The ready-to-drink (RTD) segment, which features products such as bottled or canned ice tea, coffee, fruit or vegetable smoothies, energy drinks, yogurt drinks and ready-made alcohol cocktails, is a sector that has seen significant growth.

Innovation and new products are driving the sector forward as consumers seek convenient alternatives that they can slot into their busy schedules, and consequently the quality of RTD products is improving. We look at how the market has changed and what the most popular RTD sectors are.

Product categories: launching new offerings

As the sector grows in popularity, new product offerings have launched. One such launch is that of JF Rabbit, which offers a range of vegetarian flavoured waters using only fresh juice and water. Felix Tanzer, co-founder of JF Rabbit, said: “Many consumers are confused about what is truly healthy to drink. The high sugar content of juice drinks and smoothies has been highlighted in the past few years and in response, consumers have opted for natural, simple products they can trust. As such, the water category is booming. In the next five years functional and flavoured water is set to grow 37% and plain bottled water at 42.5%.”

He continues: “JF Rabbit caters to the consumer demand for innovative, naturally healthy drinks. With new research reporting that eight portions of veg a day can make you feel happier, everybody knows that veg is healthy. JF Rabbit offers a range of veg infused waters that are more interesting than plain water but have none of the sugar of other juices drinks. We have just unveiled brand-new packaging designs and a new flavour – Carrot Water with Orange Blossom – that will join the popular Ginger Water with Lime and refreshing Cucumber Water. All three JF Rabbit waters are gluten-free, contain nothing artificial, no added sugar and provide 100 per cent of the daily-recommended Vitamin C and Zinc. All are under 10kcal per 330ml bottle – exactly what today’s ‘wellnistas’ are looking for.”

Adapting existing products with new flavours is something RTD brand Little Miracles have done to maintain consumer interest. Frederik Senger, CEO and Founder of Little Miracles said: “Off-trade value growth in the category remained positive during 2016, and this was mainly due to the ongoing increases being seen in the average unit price of RTD tea. This trend is being driven mainly by successful premium product launches, with the introduction of the Little Miracles brand in 2013 warranting specific mention. The success of Little Miracles lies within the positioning of the brand’s products and the consumer perception of them as being a healthier alternative to other soft drinks categories such as carbonates as well as to other cheaper RTD tea brands with higher sugar content. The Little Miracles product range is based on high-quality organic green, black or white tea sweetened with agave syrup and fruit concentrates and containing attractive functional ingredients such as ginseng and acai. Moreover, all Little Miracles products are available only in small pack sizes of 330ml and thus they also tap into the on-the-go consumption trend, which is increasingly popular in the UK.”

Addressing needs: consumer dietary requirements

It is not only the water category that is experiencing growth. RTD tea and coffee is also pushing itself forward by catering to consumer needs, creating new flavours and utilising different ingredients.

Addressing the dietary requirements of consumers is an imperative factor. Jim Cregan, founder of Jimmy’s Iced Coffee, said: “We’ve just launched our new dairy free flavour. People were contacting me all the time on social asking for a dairy free version so we had to make them one. It’s really rad that the people who are dairy intolerant now have the opportunity to come and join our party. We’re now selling one carton every nine seconds and our gross sales were over £3m in 2016/17 with YOY growth of over 45%.”

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Inventive flavours are also another way of engaging consumer interest. James Shillcock, founder of Vivid Matcha, said: “In 2016, we launched a range of 100% unsweetened green tea matcha drinks following the success of the original unsweetened SKU, which quickly became the bestseller in the range, and even outperformed the longer standing juice range. We took the decision there and then to not only remove sugar but all sweeteners too because we believe a backlash against sweeteners is inevitable and we want to provide genuine choice for consumers. As it stands, there is very little choice for consumers who don’t want sweetness in their drinks, particularly in the energy drinks space.”

He continues: “We are seeing the sales of blueberry booming in the UK and we plan to tap into this trend by launching a ready-to-drink Blueberry & Blackberry SKU with no added sugar and one gram of ceremonial matcha per carton. Each carton contains less naturally occurring sugars than coconut water.”