Data from analyst NIQ (formerly Nielsen) released earlier this year shows that tea and coffee sales in ‘impulse’ stores reached almost £110m, with coffee accounting for about 70% of the category value. Both segments are experiencing year-on-year growth, with tea showing stronger sales growth.
Standard black tea still dominates the convenience store tea category, with Tetley, Yorkshire Tea, and PG Tips being the top-selling brands. The current economic environment has made value a crucial deciding factor for consumers. Dan Adams, senior category development manager for Tata Consumer Products, emphasizes the importance of demonstrating good value to shoppers. Price promotions, especially for top-selling tea brands, can be a valuable tool to showcase this.
Tata recommends retailers stock a mix of pack sizes of original black tea and decaf to cater to different shopper missions. While black tea continues to dominate, premium varieties like Twinings and Ahmad Tea are gaining momentum. Bold-flavored teas, such as Good Earth’s Ginger Turmeric & Lemon and Moroccan Mint, are attracting younger consumers, offering new flavor experiences.
In the coffee category, about 24 million households in the UK purchase coffee, making it a staple household product. The demand for a diverse range of coffee products in convenience stores is increasing. Consumers are looking to recreate coffee shop experiences at home, with 65% seeking coffee shop quality drinks. Speciality coffees, including flavored coffees like vanilla and caramel, are growing in popularity. These products are also attracting younger shoppers.
While consumers seek quality and indulgence, value for money is becoming increasingly important due to rising prices. Many consumers are opting to enjoy delicious coffee at home to save money. Instant coffee remains popular, with 81% of in-home coffee cups being made using soluble products. Douwe Egberts is a trusted brand for many consumers, with 80% of convenience shoppers stating brand as the most important factor when choosing coffee.
Sustainability is a significant consideration for shoppers when purchasing hot beverages. Brands like Tetley and L’Or have introduced more sustainable packaging options, such as biodegradable tea bags and recyclable packaging. Cafédirect has also implemented new, recyclable packaging and launched a campaign to showcase the positive impact of choosing their products.
In summary, the hot beverages sector continues to experience growth in convenience stores. Offering a range of well-known tea and coffee brands, catering to different shopper missions, and providing sustainable options are key to attracting and satisfying customers.
