Press release: Allegra World Coffee Portal Project Iced2016 UK Report; www.worldcoffeeportal.com
For Immediate Release: 11 February 2016
UK iced beverage market continues to grow despite a disappointing British
summer in 2015
Estimated at £265 million, the UK iced beverage market continues to grow, accounting for a 3.3%
share of the total UK coffee shop market turnover (£7.9 billion). This is according to Project Iced2016
UK, the latest report from Allegra World Coffee Portal.
With 8% sales growth year on year, the iced beverage category is an important sales driver for the
coffee shop market. However, keeping the same rate of growth proves increasingly difficult with
seasonal volatility. Despite the 30%+ growth seen in 2014, poor weather1 in 2015 led to single digit
decline for a few operators, impacting the strong growth seen in previous years. Nevertheless, the
introduction of iced beverages by food-focused and non-specialist coffee shops, together with a wider
menu range, has contributed to the measured growth observed.
Market Trends
The main consumption period for iced beverages is summer, with the majority of consumers
purchasing iced beverages from May to September. However, after the disappointing summer of
2015, 69% of consumers have agreed that they only purchase an ice blended beverage during hotter
temperatures, up from 64% in 2014.
63% of consumers have tried an iced beverage out of home and the most popular is ice blended coffee.
Healthy living remains a key trend in the UK and people now expect healthier options in coffee shops.
In fact, there is a higher incidence of requests for milk alternatives, such as coconut and almond milk,
with iced beverages than hot beverages.
1 The summer of 2015 was both cooler and wetter than either of the two previous summers, with mean temperatures
below average for June, July and August. http://www.metoffice.gov.uk/climate/uk/summaries/2015/summer
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Although iced beverages are still seen by many as an indulgence or a treat, the need for stores to offer
sugar-free and low-sugar options is becoming more important, with over one third of people stating
they would purchase a low-calorie beverage.
The most successful stores offer handmade iced beverages using fresh ingredients rather than preprepared off-the-shelf options. This growth of sales in branded coffee-focused chains is now
influencing food-focused operators and non-specialists, including JD Wetherspoon, to introduce iced
beverages into their menus for the first time.
Challenges and Opportunities
Although the unpredictable nature of the weather is the most difficult challenge for the industry, cold
beverages are becoming central to the coffee shop menu, with many chains offering iced beverages
all year round.
The key industry operational challenge is space, especially for smaller outlets. Ice machines take up a
lot of room and as the popularity of iced beverages increases, larger machines are required to meet
consumer demand.
Speed of service is also an issue, as iced beverages take a long time to prepare, especially when using
fresh ingredients from scratch. Stores need to ensure that staff are well-trained and beverages are
simple to prepare to avoid lengthy wait times for consumers in peak consumption periods.
The Future Marketplace
Innovation within the iced beverage market is slow to develop and there has been nothing groundbreaking in the industry since Starbucks introduced the Frappuccino™ in 1995. Allegra predicts that
the next key industry development will be the widespread integration of cold brew into the branded
chains, and increasing availability of nitro coffee in artisan independents.
Other future trends will be an increased use of fresh fruit and vegetables, milk alternatives and sugarfree options in iced blended beverages to respond to the demands of the health and wellness focused
consumer and their desire for beverage customisation.
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This market shows no sign of slowing, with 78% of consumers indicating that their iced beverage
consumption will remain the same over the next 12 months and 17% stating that their consumption
will increase. With other channels closely following the branded chains’ lead, Allegra predicts that
there will be continued measured growth of 14% CAGR in the iced beverage market over the next five
years.
The Project Iced2016 UK report is now available to purchase from Allegra Strategies World Coffee
Portal Limited.
***Ends***
Editor’s Notes
Sources
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In-depth interviews with industry leaders, including CEOs and Managing Directors of the
major coffee chains, key suppliers, industry associations and other industry participants
1,237 online surveys with UK consumers regarding iced and iced blended beverages
Allegra World Coffee Portal
Allegra World Coffee Portal is the global information platform delivering on the global coffee, café
and related food-to-go sectors. World Coffee Portal provides data, reports, research and
consultancy to help businesses make informed decisions and is the only specialist information
platform for senior decision makers in the coffee industry. World Coffee Portal builds upon Allegra
Strategies’ nearly two decades of experience in global coffee market analysis.
www.worldcoffeeportal.com
Contacts
Michaela Clement-Hayes
Anya Marco
Content Marketing Manager
Director of Research and Insight
World Coffee Portal
World Coffee Portal
mclement-hayes@allegra.co.uk
amarco@allegra.co.uk
+44 (0)20 7691 8824
+44 (0)20 7691 8800
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Allegra Strategies
Allegra Strategies is a London-based strategic research consultancy recognised as a global leader in
the foodservice and coffee shop sector. Allegra is best known for its definitive reports on the
European and UK coffee markets. Allegra has accurately predicted trends in the UK branded coffee
shop market since 1999. The report is considered by the industry as ‘the bible’ of the coffee sector.
Allegra Strategies Limited registered address:
Walkden House, 10 Melton Street, NW1 2EB
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