With dynamism returning into consumers’ lives, the hot drinks industry has experienced significant changes. According to the EuroMonitor International December 2022 report, inflation will turn stagflation in 2023 without returning to pre-pandemic levels and even though lockdowns and quarantines have ended, people are still spending much more time at home than they did before the pandemic.
In the following article we will explain the six main trends that will shape 2023. Some of them have been developing for a few years and others have recently emerged creating new opportunities.
1. Relief Spending
The boom of premium products is here to stay. Changes in lifestyle during the pandemic and increases in coffee prices1 in cafés have pushed consumers to consume at home and choose products that offer smaller quantities without losing the premium aspect (primarily with high-quality, convenience products).
This feeling of splurging has given consumers a brief sense of joy, including a feeling of victory. As a result, making high-quality coffee at home has become a ritual. In short, the industry must continue developing a premium portfolio for 2023.
2. Health Deciphered and Detailed Labels
It’s no secret that the evolution of product and nutritional value labels are becoming more important in day-to-day life. The use of nutritional indicators has become an important tool that allows consumers to stay aware of the nutritional profile of all the products they consume as part of their diets.
Consumers are more and more demanding and conscientious in their search for products that are healthy for them. This is the starting point for any strategy to improve public health based on the great quantity of ultra-processed food in the market, making coffee a great choice in the hot drinks industry.
In some cases, this also addresses other concerns thanks to a strong tendency for products labeled “plant-based,” “low in sugar,” “organic,” and “fair trade,” among others. As with most hot drinks, coffee fits perfectly in this trend thanks to its versatility and antioxidant properties.
3. Positively Imperfect
The new manner of relating to clients has forced companies to become more transparent with their stakeholders. A few years ago businesses referenced the good decisions they made for environmentally friendly processes and societies. However, today that’s not enough. Companies have started to show their mistakes and failures as a strategy to bring their clients closer by showing their imperfections.
The most communicated data by companies that have decided to adopt this practice is related to water and energy consumption, and CO2 emissions. The hot drinks industry is not unaffiliated to this new reality, new relationship manners and transparency will lead the market.
4. Persistent Inflationary Pressures
Inflation has affected consumers as much as producers. With price increases, organizations have had to look for innovative processes that allow them to remain open and also remain profitable. Likewise, consumers have shown that they have budgetary restrictions, which, adding to the habits developed during the pandemic, have made them move strongly towards the consumption of premium products that can be quickly prepared at home.
That ‘s why instant and ready to be consumed products will be the norm for the next few years.
5. The Path to Tomorrow – Sustainability
Companies in food sectors are looking to be in equilibrium with the environment and their production processes, product development, selection of raw material or the creation of packaging. Businesses are increasingly adopting environmental policies to reduce their carbon footprint and are committed to causes. Additionally consumers are expecting companies to commit to those causes, according to EuroMonitor 2022, in a survey more than 60% of consumers affirmed to be concerned about the impact their daily activities and habits have on the environment.
In terms of development and product, businesses increasingly invest more money in the creation of biodegradable or compostable packaging for their clients to be assured that the products they’re consuming are environmentally friendly (click here to see our environmentally friendly packaging). It is undeniable that many of these clients are willing to pay more for these products knowing that they are investing in responsible manufacturing.
6. The Glory of the Intestines – Functional Products
Intestinal microorganisms have the potential to be the change factor for how consumers manage their lives. Intestinal health is key to achieving integral wellbeing. The future will be centered on understanding the potential of the ingredients to intestinal health.
According to InnovaMarkets 2022, since 2017 new plant-based products launches grew 42% annually evidencing the priority consumers give to the nutritional source of products. This is an additional indicator that, from pre-cooked foods to gourmet gastronomy, people are looking for benefits that plant-based products can offer. This type of diet has grown in popularity around the world and its market is increasingly large.
Previously, functional products were spoken of in very general terms. Today we see articles where this functionality is focused on the digestive system where plant-based products have become key, in addition to products that have prebiotic, probiotic, etc. Opportunity is made for hot drinks, mixes of coffee and functional ingredients are suitable for consumers taking care of their health.
In conclusion, these latest trends are an engine behind consumption and amplification that, thanks to digital media, are being replicated beyond specialized sectors, permeating the day-to-day lives of consumers. And hot coffee is one of the favorite products around the world that fits into these trends.
Source of data: December 2022 EuroMonitor International Report “World Market for Hot Drinks”
1 An average increase of 11% from 2021 to 2022 (Euromonitor International, 2022)
