Coffee has seen surge in innovation in 2016 from the rise of cold brew and nitro coffee to unique coffee cocktails in the restaurant industry.
Cold brew, which began at local coffee shops, moved into the cold vault and is now brewing in the mainstream market with Starbucks launching cold brew last summer, and Dunkin’ Donuts adding its own line this past June.
Research firm Packaged Facts pointed out that Dunkin Donuts’ cold brew is marketed as “crafted by hand … in small batches and served each day while supplies last,” which resonates with the current consumer demand for “distinctive, limited-time experiences and hand-made, artisanal products.”
Packaged Facts’ “Foodservice Coffee Market Trends in the U.S” found 10% of survey respondents drink iced coffee most often, and only half of coffee drinkers exclusively take their coffee hot. In fact, among U.S. coffee drinkers, 5% choose cold brew most often, and 14% report having ordered it at a restaurant or café.
Nitrogen-brewed coffee, is yet another trend at hipster coffee shops, but it’s also sneaking into prime time, i.e. beginning this summer in select cities it’s also available at Starbucks. C-stores with growler stations take note.
This cold coffee is infused with nitrogen, poured from a keg and appears like a stout beer with a head of foam on top.
Coffee has not been spared by the clean label trend rolling across the foodservice segment. Customers care where their coffee beans come from and what’s in their creamers.
Packaged Facts’ report “Refrigerated Coffee Creamers: U.S. Market Trends,” found “clean label” products will be essential in growing U.S. retail market sales of coffee creamers to a projected $2.9 by 2020—a 15% increase from sales of $2.5 billion recorded in 2015.
And as cold vault creamers change with the times, condiment bars must also be fully stocked to meet the demand.
With so much excitement and innovation around coffee across channels, c-store retailers need to pay extra attention to their coffee lines in order to compete.
CLEAN & PREMIUM
Broomall, Pa.-based Swiss Farms, with 13 drive-through c-stores debuted a new signature premium coffee, which rolled out this June on Father’s Day with a free coffee promotion to encourage sampling.
The three signature roasts include Swiss Signature Roast, a rainforest alliance certified roast; Swiss Sunrise Roast, a fair trade and organic certified roast; and Swiss Decaf Signature Roast a decaffeinated medium to dark roast, which uses a Swiss Water Decaffeination Process.
A 16-ounce cup of hot coffee goes for $1.49. Swiss Signature Iced Coffee is also available for $1.79 for a 16-ounce and $2.09 for a 24-ounce cup.
The clean label trend played into Swiss Farm’s decisions in selecting the new line.
“One of the things we’re seeing is definitely a demand for clean—knowing what is in products, where they are sourced, if they’re organic,” said Scott Simon, president and CEO.
“One of our varieties is an organic blend. We have a rain forest-certified variety and our decaf brew uses a chemical-free natural decaffeination process,” said Jackie Daley, director of marketing for Swiss Farms.
The Swiss Water process uses pure green coffee extract and proprietary carbon technology to remove caffeine from green coffee beans without chemicals. Swiss Farms shows the certification on its coffee menu.
During the launch, Swiss Farms gave out free coffee for an entire week. “After we went back to charging, in just the first week alone, we saw a 7% lift in coffee sales. The second and third weeks went into double digits,” Simon noted.
The line offers premium blends, including Sumatra and Ethiopian Harrar, and fits well with Swiss Farm’s offerings.
“We believe people will drive out of their way for something that’s compelling, that’s authentic, that is trustworthy,” said Simon. He added Swiss Farms’ customers want quality, consistency and freshness in their coffee —all on the go.
Previously, Swiss Farms had “a good cup of coffee,” Simon noted. But absent were the buzzwords that convey transparency and quality to customers today, such as organic, rainforest-certified and chemical-free. This new line is also a Swiss Farms-branded coffee line, where previously Swiss Farms partnered with various coffee company brands over the years.
“We wanted something that we could call our own that was a unique, drive-out-of-your-way product that people knew they could trust,” Simon said. “So for us, private label coffee was really, really important.”
As fall approaches, Swiss Farms is preparing to offer a limited time offer (LTO) pumpkin shooter of pumpkin and white chocolate sauces, with optional whipped cream on top. An iced variety will also be an option.
This winter, Swiss Farms will offer a peppermint LTO.
While Swiss Farms has yet to launch a cold-brew variety, the chain continues to look into it.
“We talk about it often and we did a taste test here with it,” said Daley. But the chain is waiting for the product to become more mainstream before it begins to offer it.
Having its own premium milk line allows Swiss Farms to also offer customers authentic add-ons like whole cream. The chain also offers combo meals of coffee and breakfast sandwiches or fresh-cut fruit to entice morning commuters.
BESTING THE COMPETITION
Rutter’s in York, Pa. is another c-store chain that knows how to do coffee right. The chain was recently recognized for having the “Best Coffee” by readers of The York Daily Record and the York Sunday News.
Chuck Moyer, food service category supervisor for Rutter’s Farm Stores, said Rutter’s coffee program resonates with customers because it offers a good, quality product at a good price.
“We offer a great variety of coffee and dispensed cappuccino flavors with a very robust condiment bar,” Moyer said. “Execution is the main factor of whether any program is successful.
Our staff in the stores do a great job of making sure the offerings are available and fresh throughout the entire day and keep a constant focus on the cleanliness and stocking of these areas.”
All of Rutter’s 66 locations feature six flavors of coffee, ranging from a Premium House blend to a 100% Colombian to a flavored Hazelnut. It also offers dispensed cappuccino products, which includes seasonal LTOs.
“By the end of this year we will have our behind-the-counter Espresso/Smoothie bar programs in 42 of our 66 locations where customers can order customizable drinks through our touchscreen kiosks. These drinks range from Americanos to lattes to frappes,” Moyer said.
While standard drip-brew coffee remains the core of c-store coffee programs, specialty coffees and espresso-based drinks continue to outgrow drip brew in sales and demand.
Customers want original blends and customizable drinks. To meet this demand, Rutter’s puts a great deal of care and thought into its extensive coffee condiment section.
“I believe our condiment bar is second to none,” Moyer said. The condiment bar features cold wells with a range of Rutter’s Dairy items from half and half to skim milk and creamers from International Delight.
All milk and creamer options are in bottle form, which Moyer noted, customers seem to really appreciate.
Customers can also select from various flavored syrups and spice shakers to maximize customization.
To meet consumer demands, Rutter’s stays on top of the trends and makes changes as necessary. For example, earlier this year the chain added Stevia to its sweetener packet options that already included raw sugar and Splenda.
In keeping on the pulse of coffee trends, Moyer sees iced coffee sales in the Northeast remaining strong year round.
“Iced lattes, frappes and smoothies are not just purchased for the purposes of energy like coffee, but are now seen as snack options by our customer base,” he said.
“These products provide great opportunity for growing this category in dayparts outside the typical morning commute-breakfast time frame.”
Erin Rigik Del Conte
