What Is RTD Coffee? A Clear and Neutral Explanation

Ready-to-drink (RTD) coffee has been rapidly growing in popularity in recent years, thanks to its convenience and accessibility. RTD coffee refers to chilled coffee that comes pre-made in a can or bottle, making it easy to grab and go. This type of coffee has become increasingly popular due to the wider cold coffee trends and a focus on health and wellbeing. According to research by Mintel, 46% of surveyed Generation Z consumers said they drink RTD coffee.

One type of RTD coffee that has gained attention in recent years is cold brew. Cold brew is made by steeping coffee grounds in cold water for an extended period of time, resulting in a smooth and less acidic coffee. RTD cold brew is often sold in bottles and cans, making it a convenient option for those on the go. Another popular type of RTD coffee is iced coffee, which is brewed hot and then chilled over ice. Canned lattes are also becoming increasingly popular in the RTD space.

Specialty roasters have also started to offer RTD coffee as a way to expand their product offerings and reach a wider audience. Starbucks was one of the first companies to introduce RTD coffee with their popular Frappuccino, which is still sold in stores today. As the RTD coffee market continues to grow, more and more companies are introducing new products to meet consumer demand, including plant-based options and even hard coffees.

Understanding RTD Coffee

Ready-to-drink (RTD) coffee is a popular beverage that has been gaining popularity in recent years. It is a type of coffee that is pre-made and ready to drink, usually sold in a can or bottle. RTD coffee is a convenient and quick option for coffee lovers who want to enjoy their favorite drink on the go.

RTD coffee comes in a variety of flavors and styles, from cold brew to iced coffee to lattes. It is made using a variety of coffee beans and grounds, and the taste and quality of the coffee can vary depending on the brand and brewing method.

One of the benefits of RTD coffee is that it is a quick and easy way to get a caffeine boost. Most RTD coffee products contain caffeine, which can help increase energy levels and improve focus. However, it is important to note that different RTD coffee products may contain varying amounts of caffeine, so it is important to check the label before consuming.

Another factor that can affect the taste and quality of RTD coffee is the texture and mouthfeel. Some RTD coffee products may be smooth and creamy, while others may have a more watery consistency. The texture and mouthfeel of RTD coffee can be influenced by factors such as the brewing method and the type of coffee beans used.

Overall, RTD coffee is a convenient and delicious option for coffee lovers who want to enjoy their favorite drink on the go. With a variety of flavors and styles available, there is an RTD coffee product to suit every taste and preference.

Health Aspects of RTD Coffee

RTD coffee has gained popularity due to its convenience and health benefits. Consumers are looking for healthier options with less sugar and low-fat milk.

Studies have shown that coffee consumption can have positive effects on health, including reducing the risk of type 2 diabetes, liver disease, and some cancers. However, it is important to note that excessive consumption of caffeine can have negative effects on the body, including increased heart rate and blood pressure.

When it comes to sugar content, some RTD coffee brands contain high amounts of added sugars, which can contribute to obesity and other health problems. Consumers should look for options with less sugar or natural sweeteners like stevia or honey.

In terms of health and wellness, some RTD coffee brands are incorporating functional ingredients like antioxidants, probiotics, and adaptogens into their products. These ingredients can provide additional health benefits beyond the caffeine in coffee.

Overall, RTD coffee can be a healthy and convenient option for busy consumers, but it is important to choose options with low sugar content and be mindful of caffeine intake.

Market Overview

The global market for ready-to-drink (RTD) coffee has been experiencing steady growth in recent years. According to a report by Statista, the RTD coffee market in the United States is projected to grow by 5.95% between 2023 and 2027, resulting in a market volume of US$14.09bn in 2027. The global RTD coffee market size was valued at USD 22.44 billion in 2019 and is projected to reach USD 42.36 billion by 2027, exhibiting a CAGR of 8.31% during the forecast period.

The popularity of "café culture" has brought ready-to-drink coffee to the center stage of the global marketplace. The convenience of RTD coffee has made it a popular choice among consumers who are always on the go. The market is segmented by packaging type, product type, distribution channel, and geography.

Supermarket/hypermarkets, specialist stores, online retail, and other distribution channels are the main distribution channels for RTD coffee. Emerging brands are also making their presence felt in the market, challenging the dominance of key players like Starbucks, Nestle, and Coca-Cola.

According to a report by Statista, in the 52 weeks ended May 15, 2022, Starbucks was the leading ready-to-drink (RTD) coffee brand in the U.S., with a market share of 37.5%. Other leading brands in the U.S. include Dunkin' Donuts, International Delight, and Chameleon Cold-Brew.

Overall, the global RTD coffee market is expected to continue its growth trajectory in the coming years, driven by changing consumer preferences and the convenience factor.

Major RTD Coffee Brands

RTD coffee has become increasingly popular in recent years, and there are several major brands that dominate the market. Here are some of the most well-known RTD coffee brands:

Starbucks

Starbucks is the leading brand of RTD coffee in the United States, with sales amounting to over 377 million U.S. dollars in the 52 weeks ended May 15, 2022. The company offers a wide variety of RTD coffee products, including bottled Frappuccinos, Doubleshot Espresso, and Nitro Cold Brew.

Costa Coffee

Costa Coffee is a British coffee chain that was acquired by Coca-Cola in 2019. The company has potential for expansion into RTD coffee across many markets globally. Costa Coffee offers a range of RTD coffee products, including iced lattes and cold brews.

La Colombe

La Colombe is a specialty coffee roaster that offers a range of RTD coffee products, including Draft Latte and Triple Shot. The company prides itself on using high-quality ingredients and ethical sourcing practices.

PepsiCo

PepsiCo is a multinational food and beverage corporation that offers a range of RTD coffee products under its Starbucks partnership. The company's RTD coffee products include bottled Frappuccinos, Doubleshot Espresso, and Nitro Cold Brew.

Blue Bottle

Blue Bottle is a specialty coffee roaster that offers a range of RTD coffee products, including New Orleans Iced Coffee and Cold Brew. The company is known for its commitment to sustainability and ethical sourcing practices.

Overall, these major RTD coffee brands offer a wide variety of products to meet the needs of different consumers. Whether you prefer a bottled Frappuccino or a cold brew from a specialty coffee roaster, there is an RTD coffee product out there for you.

Packaging and Convenience

Packaging and convenience are two of the main reasons why ready-to-drink (RTD) coffee is becoming increasingly popular. RTD coffee is typically packaged in cans or bottles, which are easy to transport and store.

Cans are often preferred for single-serve RTD coffee due to their portability and convenience. They are also more environmentally friendly than plastic bottles and can be easily recycled. On the other hand, bottles are more commonly used for multi-serve RTDs because they can be resealed for future consumption.

In addition to the type of packaging used, the convenience factor plays a significant role in the popularity of RTD coffee. Consumers are always looking for ways to save time and make their lives easier, and RTD coffee offers just that. With RTD coffee, there is no need to wait in line at a coffee shop or spend time brewing coffee at home.

RTD coffee is also convenient for those who are always on the go. It can be easily stored in a bag or purse and consumed at any time, making it a great option for people who have busy lifestyles.

Overall, the packaging and convenience of RTD coffee make it a popular choice for consumers who are looking for a quick and easy way to enjoy their coffee.

Consumer Trends

RTD coffee has seen a significant increase in popularity among younger generations, particularly Millennials and Generation Z. This demographic is more likely to choose RTD coffee over traditional hot coffee. As a result, the category is expanding and developing in response to their preferences.

One of the biggest trends in RTD coffee is cold coffee. This trend has been fueled by consumers looking for convenience and a refreshing drink during hot weather. Cold coffee has also been associated with the emergence of new coffee flavors and blends, as well as new brewing methods.

Another trend in the RTD coffee market is the emergence of plant-based options. This trend has been driven by consumers looking for healthier alternatives to traditional coffee. Plant-based RTD coffee drinks have been gaining popularity due to their perceived health benefits, as well as their unique flavors and ingredients.

Finally, there has been an increase in the popularity of "hard coffee," which is RTD coffee beverages made with alcohol. This trend has been driven by consumers looking for a unique and flavorful alcoholic beverage that combines the taste of coffee with the kick of alcohol. Hard coffee has become a niche category within the RTD market segment.

Overall, the RTD coffee market is expected to continue to grow in popularity in the coming years, driven by consumer demand for convenience, unique flavors, and healthier options.

Innovations in RTD Coffee

RTD coffee is a rapidly growing beverage category with new innovations emerging regularly. One of the most popular innovations in RTD coffee is cold brew. Cold brew coffee is made by steeping coffee grounds in cold water for an extended period, resulting in a smoother and less bitter taste. RTD cold brew has become increasingly popular in recent years, with many brands offering a variety of flavors and blends. Nitro cold brew is another innovation in this category, which is infused with nitrogen to create a creamy, velvety texture.

Carbonated coffee is another trend in RTD coffee. This innovation adds a fizzy texture to coffee, making it a refreshing beverage option. Hard coffee is another innovation that is gaining popularity. Similar to hard seltzer, hard coffee is coffee infused with alcohol, making it a great option for those who enjoy a boozy beverage.

Flavor profiles have also become a focus in RTD coffee innovation. Pumpkin spice is a popular flavor during the fall season, while fruity and tropical flavors are popular during the summer months. Bitterness is another flavor profile that is becoming more popular, with many coffee drinkers enjoying the bitter taste of coffee.

Dairy alternatives are also a focus in RTD coffee innovation. Many brands are offering dairy-free options, such as almond milk and oat milk, to cater to those with dietary restrictions or preferences.

In conclusion, RTD coffee is a rapidly evolving category with new innovations emerging regularly. From cold brew to carbonated coffee, there are many options available for coffee drinkers. With a focus on flavor profiles and dairy alternatives, RTD coffee is becoming more inclusive and accessible to a wider audience.

Impact of Covid-19

The Covid-19 pandemic has had a significant impact on the global market for ready-to-drink (RTD) coffee. Despite the challenges posed by the pandemic, the RTD coffee market has continued to grow, driven by changing consumer preferences and increased demand for convenient and healthy beverages.

According to a report by Mintel, the increased incidence of consumers working at home as a result of the Covid-19 pandemic spells opportunity for the RTD coffee space. This trend has led to an increase in demand for RTD coffee, as consumers look for convenient and healthy beverages to consume while working from home.

In addition, government initiatives in various countries are increasing demand for RTD beverages. The impact of Covid-19 has been positive for the RTD beverages across the world, compared to other beverage segments, and hence the growth is increasing.

The pandemic has also led to changes in the coffee supply chain, as transport and logistics have been affected. However, traders, shipping companies, and roasters have pivoted to meet consumer demand and ensure the supply of coffee beans.

Overall, while the Covid-19 pandemic has posed challenges for the RTD coffee market, it has also created opportunities for growth and innovation. As consumers continue to prioritize convenience and health, the demand for RTD coffee is expected to continue to grow in the coming years.

Environmental Impact

The production and consumption of RTD coffee have a significant impact on the environment. The process of coffee cultivation requires a considerable amount of water, pesticides, and fertilizers, which can have adverse effects on the environment. Additionally, the production and packaging of RTD coffee require energy and resources, which contribute to greenhouse gas emissions and waste.

One of the main environmental concerns associated with RTD coffee is the use of single-use plastic bottles and packaging. These products are not biodegradable and contribute to the growing problem of plastic waste in landfills and oceans. To address this issue, some companies have started using eco-friendly packaging materials, such as biodegradable plastics, paper, and aluminum cans.

Another way RTD coffee can have a positive environmental impact is through sustainable sourcing practices. Some companies are committed to sourcing their coffee beans from farmers who use sustainable farming practices, such as organic farming, shade-grown coffee, and fair trade. These practices can help reduce the use of pesticides and fertilizers, protect biodiversity, and improve the livelihoods of coffee farmers.

Additionally, some RTD coffee companies are exploring alternative energy sources to reduce their carbon footprint. For example, some companies are using solar panels to power their factories and warehouses, while others are investing in renewable energy credits to offset their carbon emissions.

Overall, RTD coffee has both positive and negative environmental impacts. While the production and consumption of RTD coffee can contribute to environmental degradation, companies can take steps to reduce their environmental footprint and promote sustainable practices.

Future of RTD Coffee

The future of RTD coffee looks promising as the category continues to expand and develop. Brands are responding to the growing demand for convenience and on-the-go lifestyles, especially among the younger generation. As a result, RTD coffee is projected to reach $42.4 billion by 2027, according to a report by Allied Market Research.

One trend that is likely to continue is the rise of plant-based options. Research from Mordor Intelligence shows that the segment is projected to grow by 7.69% annually between 2021 and 2026. This growth has been fueled by consumers looking for healthier alternatives and a focus on sustainability. Brands are responding with a variety of plant-based options, including oat milk and collagen-infused coffee.

Another trend to watch is the incorporation of functional ingredients such as protein, electrolytes, and adaptogens. These ingredients are aimed at providing consumers with added benefits beyond just caffeine. For example, some RTD coffee brands are adding protein to their products to appeal to fitness enthusiasts. Electrolytes are also being added to help consumers stay hydrated, while adaptogens are being touted for their stress-reducing properties.

Differentiation will be key for brands looking to stand out in a crowded market. This can be achieved through unique flavors, packaging, and marketing strategies. Some brands are already experimenting with unusual flavors such as lavender and honey, while others are using eye-catching packaging to grab consumers' attention.

Finally, indulgence will continue to be a factor driving RTD coffee sales. While many consumers are looking for healthier options, there will always be a market for indulgent treats. Brands are responding with products that offer a balance of taste and nutrition, such as low-sugar options and smaller serving sizes.

Overall, the future of RTD coffee looks bright as brands continue to innovate and respond to changing consumer preferences. With the right combination of convenience, functionality, and indulgence, RTD coffee is poised to become a staple in the lives of coffee drinkers everywhere.