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Coffee has become much more than a morning pick-me-up, especially among young consumers who enjoy specialty coffee beverages at any time of the day.
This trend has helped drive the emergence of cold coffee as—pardon the pun—the hottest thing brewing in the foodservice coffee arena. Cold specialty coffee drinks such as cold brew, iced lattes, iced mochas and more have become a powerful force driving growth in the category overall.
According to Project Café USA, 2024, a report from World Coffee Portal, 79% of consumers under age 35 typically purchase an iced coffee beverage at least once per week. The survey of more than 5,000 coffee shop customers also found that daily consumption of cold coffee increased 8% during the previous 12 months. Iced coffee was the second-most popular order behind filter coffee in terms of order frequency.
In addition, 24% of consumers reported drinking iced coffee daily, up from 17% in 2022.
The survey also found that half of industry leaders polled identified cold coffee as the more important trend in the market.
Peter Giuliano, executive director of The Coffee Science Foundation and chief research officer at the Specialty Coffee Association, says the trend toward cold coffee mirrors the trend that occurred long ago in the tea category, when consumers switched from having an overwhelming preference for hot tea to instead favoring iced tea.
Research from the National Coffee Association, meanwhile, found that 73% of consumers have an excellent or very good view of cold coffee. The NCA also found that the popularity of cold brew, nitro, and frozen blended beverages continue to be stable, and that consumers under age 40 are driving positive intent for cold brew consumption.
Likewise, research from Mintel found that cold coffee is increasingly an entry point to the coffee category for younger consumers, The company’s 2023 U.S. Coffee Report notes that Gen Z consumers are drinking a wider variety of beverages than older generations, and that cold coffee drinks are serving as a gateway into the wider coffee market.
More than half of Gen Z consumers—57%—say they first regularly drink cold coffee beverages, as opposed to those who first regularly drink hot beverages.
As further evidence of the trend toward cold coffee, last year research firm Technomic reported that the iced Americano was the fastest-growing nonalcoholic beverage in the foodservice space, with year-over-year growth of 27.5%, vs. 4% for coffee overall, according to a report by the Specialty Food Association.
Cold beverages outpace hot, all year long
Consumers’ craving for cold coffee is playing out at the cash registers of coffee chains large and small around the world.
At Starbucks, for example, cold drinks now command the lion’s share of all beverage orders, the company says, accounting for as much as three-fourths of all sales in some recent quarters.
Brady Brewer, CEO of Starbucks International, said in a recent conference call with analysts that the company sees younger consumers increasingly making cold coffee a part of their daily rituals.
“We don’t see a tradeoff in frequency between cold beverage customers and hot beverage customers,” he said. “It’s really a shift in generational taste preferences where that highly frequent millennial/Gen Z customer is drinking cold coffee every day, just as people of different generations were drinking hot coffee to start their day every day.”
Cold beverages are ideally well-suited for customization, which makes them especially appealing, Brewer said. They allow the company to create more unique, signature drinks that help the chain differentiate itself from competitors.
A recent report from Fresh Cup, a content hub for the specialty coffee industry, describes similar trends at Big Shoulders Coffee, a coffee roaster and café chain in Chicago, which counts 60% of its sales from iced beverages, compared with 30% of sales 10 years ago.
Tim Coonan, founder of Big Shoulders Coffee, told Fresh Cup that cold coffee is a strong seller throughout the year, even during the cold Windy City winters. Although customers cut back on cold brew coffee consumption during the winter months, espresso-based cold coffee drinks remain popular year-round, he said.
SEB Professional is one company with three coffee equipment brands – WMF, Schaerer, and Curtis. Their brands offer coffee equipment that produce both hot and iced bean-to-cup and espresso-based beverages. For example, the new Schaerer Coffee Soul C guarantees a fresh cup of hot or iced coffee, while reducing labor and waste while offering automated cleaning with no user intervention for 300 days. Additionally, the WMF 5000S+ offers hot and iced espresso-based beverages, and automated cleaning. Additionally, they have equipment that can automate cold coffee production by the cup or in large batches - able to brew a gallon of cold coffee in 30 minutes.
For more information about how SEB Professional can help you drive sales of cold coffee and capitalize on the biggest trend in the beverage category, visit any of our three brand websites to find the right equipment for your operation:
WMF, Schaerer, and Curtis