“What’s fun about it is everyone is taking their own approach,” Ricci said. “The quality is not being rubber-stamped, either.There’s an artisan quality to every one of those products that makes them unique and different.”The growler brands point out that they fit with the trend of consumers wanting to “have it their way” by customizing their products. From a base of concentrate, they can add water, milk, sugar, flavorings, while reconstituting a well-made cup of coffee. Meanwhile, the single-serve oriented brands have shown the ability to extend the footprint of brick-and-mortar stores, some of which have strong brands of their own.
The offerings of both Stumptown and Blue Bottle were highly anticipated by the gourmet press and foodie community, but they have taken divergent paths. Blue Bottle has largely scuttled RTD for now, with spokesman Byard Duncan calling it a pilot program; meanwhile, with Ricci, who has worked for both Columbia distributing and for Jones Soda, it’s obvious that Stumptown has ongoing RTD plans.
Still, while there’s cultural momentum and growing interest, there are many obstacles to a the next wave of RTD being a tidal one: because the products need to be kept cold, distribution remains an expensive question, particularly for a category whose multi-serve bottles don’t lend themselves to the same fast turns in the store that single-serves do. Shelf lives for the products are strong – ranging between 90 and 180 days for many of the products – but usage occasions are bound to stationary settings rather than on-the-go. There is also the shelf-set problem: in order to get extra shelf space and to really turn, sales veterans say, these companies will need more traditional, single-serve SKU’s.
“Increasing our geographic reach is one of our biggest challenges,” Buckley said. “Right now we are primarily in the Northeast, but we would obviously like to be everywhere. We compete with coffee shops and individuals who brew coffee fresh every morning, so our cold brew has to taste freshly brewed straight off the shelf (and for the entire shelf-life).”
Additionally, even the juggernauts are aware that iced coffee has a growing profile overall, and they aren’t going to concede the turf simply because they’re happy with what the Frappuccino has wrought. Earlier this year, Starbucks launched single-serve coffees (not cold-brewed – but they’re Starbucks, and what it loses in craft it more than makes up for in distribution). Meanwhile, other brands like Marley Beverages’ One Drop, Coke-affiliated Illy Issimo and fast-growing newcomer Real Beanz continue to try to grab their own piece of the single-serve business, while hybrid drink Coco Cafe has been accepted into many new channels, as well.
And just as craft beer met with an early boom-and-bust cycle, it’s not like cold brew hasn’t been tried before: Adina, a product backed by beverage veterans John Bello and Greg Steltenpohl, sold a high-quality cold brew – although it failed to emphasize that process at the time. There’s also an active line of Wolfgang Puck cold-brewed iced coffees that has claimed some shelf space. Still, to date, there hasn’t been a product to set the world on fire, although entrepreneurs in the space think the time is right.
That’s because cold brew itself is on the rise, in stores and at home. Those same independent stores have turned “cold brewed” into a catchphrase for stronger, cleaner-tasting takeout coffee. That’s been enough to get Steltenpohl himself back into the cold brew business as part of his new venture, Califia Farms, which recently introduced carafes of a high-quality non-dairy cold brew made with the “milk” of California almonds.
There’s challenge, but there’s promise, and there’s also a sense that the time has come. The popularity of cold brew as a takeout product is emblematic of that sense, according to Ric Rhinehart, the executive director of the Specialty Coffee Association,
Rhinehart notes the millennial consumer is going to make the shift more pronounced, as its members have grown up in a coffee culture, one that may be just as likely to enjoy iced coffee in hot weather as it is hot coffee when it’s cold.
“Coffee has been around for some 600 years, but people only figured out some 15-20 years ago that it can quench thirst, and only in the last 5 with cold brewing,” added Grady’s Kyle Buckley. “It’s amazing to me how many places don’t serve iced coffee because of its association with its hot brethren. Why don’t you see iced coffee at movie theaters, ballparks, concerts? I think you will now.”
Still, he concedes, location helps. If you’re relying on trends, you can’t beat being based in New York, “where people are obviously obsessed with their coffee and have been drinking it cold for a long time,” Buckley said. “It’s a little different when I bring it back home to Missouri, but it’s only a matter of time.”
