In this issue, we’re looking at some of the most immediate trends in the beverage business, from the growth of cold brewed coffee concentrates as an alternative to ready-to-drink bottles, to the evolution of what some call “mix-to-drink” products made with powders and liquids, to the expanding use of the “growler” bottle as a way of bringing home craft beer for immediate consumption.
These topics might seem a bit premature for a magazine like this one, which has always kept its eye on the realities of mass distribution plays while addressing the needs of the entrepreneurial side of the beverage business equation. But we don’t think so. The past two years have brought on tremendous change in the beverage industry, and products and systems of going to market that may once have been considered on the fringe will be have great influence over the future of the entire business.
Consider the growler as a nexus of the influence of coffee and craft beer. These jugs are emblematic of consumer movements toward local and fresh, of the idea that the products that are in the consumer’s own fridge are of gourmet, on-premise quality, of the notion that they are somehow on a face-to-face (or face-to-tap) basis with the producer or distributor. This is local, small-build, concentric circles that grow in a largely hub-and-spoke manner, and it’s similar to the juicing craze as well (and we’re getting to that in issues to come, don’t you worry) in that there are similar emphases put on both in-store – or in juice bar – and at-home consumption. The products are expensive but there’s innovation in terms of freshness, in terms of functionality (more enzymes and vitamins, more alcohol, more caffeine), in terms of taste.
And many of the problems accompanying the growth of those categories are similar as well – on an execution basis, how do you keep the coffee, the juice, the beer fresh as it moves from region to region; from a marketing standpoint, how do you move into new territory when there are strong independent regional brands in which consumers feel ownership stakes? At a cost level, how do you afford all that cold-channel distribution? There are better minds than mine working on these problems, but I bet they’re also up more nights worrying about them, as well.
Meanwhile, think about the mix-it-yourself nature of the powder and add cold brew to that as well. Again, there’s a larger trend here, that of customization and at-home production. Just as people want to know their producer, a lot of times, they want to be that producer, even when it comes to their otherwise pre-made drinks. The customizability of a coffee syrup into a cold drink, a hot drink, a sweet or milky one, the act of creation when a tube of powder is shaken into a bottle of water, the triple-strength Mio blast, they’re all the consumer declaring mastery over the product. This isn’t even taking into account the growth of at-home production of CSDs that we’re seeing through the Sodastream, or even the longer-term revival of homebrewing.
Finally, think about the overall time it takes for a trend to build into a product. What seems like something that happens overnight – Greek Yogurt, Energy Drinks – is a commercial manifestation of a long-term movement. So health and wellness, satiety, and protein eventually wrought the opportunity for greek yogurt, while an increasing awareness of the power of caffeine via Starbucks, the growth of action sports, and our longer, never-ending work weeks helped make the time right for energy drinks.
The movements manifesting into the products we’re talking about this issue are aligned with forces like foodie-ism, tracking food from farm-to-table, the craft movement and the Etsy economy, the push for local products and the ability to identify them anywhere you are, because of the international availability of local, crowd-sourced knowledge. These ideas are bigger that any one product. But the products that come out of them are proving to be very interesting, indeed.
Are these the final form of the CPG offerings we’ll see based on these trends? We can’t answer that, but we can help put the picture together. Look at coffee, where the next wave is coming from so many independent stores, gradually improving the top level of offerings to one that is better than – but complementary to – Starbucks itself. It’s not a storm, yet, but you can see the color of the sky starting to change.