Tea and coffee: Two of 2015’s biggest grocery growers

By Hal Conick contact

- Last updated on GMT

Will packaged tea and coffee continue to grow in US grocery stores?
Will packaged tea and coffee continue to grow in US grocery stores?
Liquid coffee and liquid tea were two of the biggest dollar value growers in grocery stores in 2015, according to Nielsen.

The company said the dollar growth of liquid tea was up 17.3% and liquid coffee was up 16.6% in US grocery stores​. Additionally, refrigerated liquid tea was up 13.5% for the year.

In the fresh department of the store, tea was up 17.8% on the year, according to Nielsen. While liquid tea refers to shelf-stable products with an extended life, teas from the fresh department likely have fewer preservatives and a shorter shelf life.

“Having similar products in various areas of the store allows both retailers and manufacturers increased opportunity to merchandise items,”​ Carman Allison, VP of consumer insights at Nielsen, told BeverageDaily.

Out of home, but healthy, consumption rising

Out of home consumption saw an increase across the board in 2015, Allison said, something she expects to continue well into this year.

“Consumers have become more sophisticated over the past number of years with a growing tea and coffee culture,”​ Allison said. “Retailers are paying attention and are expanding their offering to win over the beverage occasion as well as consumer needs for more variety and formats.”

Consumption of sugary beverages, such as soda, has slid way down. Consumers are now more focused than ever on health and wellness; with coffee and tea, Allison said consumers are able to get their caffeine fix without having to consume added sugar.

“In addition the growth and influence of Asian consumers and cultures will continue to fuel new formats of tea,”​ she said. “The rise in consumption for one beverage, as with all products, comes at the expense of another beverage.”

What will 2016 bring?

While Allison said there will always be niche players in the beverage industry that serve a role with a specific group of consumers, the rise of unique products like kombucha will be dependent on their distribution, availability and demand.

“Retailers are always looking to differentiate and unique products [are] a great place to focus,”​ she said.

Both dairy and grocery products are slated to grow in 2016, Allison said. Dairy is slated to grow 3.2% on the year and non-food grocery is forecasted to grow 1.4%, data from Nielsen shows.

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