“The packaging is one of the things that’s really innovative—when you open it, it releases air into the can and it froths the milk, so you’re getting this frothy latte that you would’ve only experienced in a third-wave coffee shop,” she told FoodNavigator-USA.
The product has been well received by retailers and the public. “Sales are great, velocity increases week-over-week,” Jon Spear, senior brand manager for La Colombe’s RTD arm, told FoodNavigator-USA.
It launched earlier in 2016 in cafés, and then expanded to retail and grocery in the last three months, shipping out to big chains like Wegman’s, Target, Meijer, and different Whole Foods regions across the country. He added that despite being off season for cold beverages, growth for La Colombe’s Draft Latte product has been steadily going up. Spear also sees the 'texturized beverage' such as La Colombe's product to pick up as a major trend. "It can be stretched into other categories," he said.
Technical wow-factors aside, Dembitzer also mentioned Califia Farms’ eye-catching, curved bottles as an example of how potent package innovation can be to benefit beverage brands. “They came up with this really premium packaging, and it really differentiates their non-dairy plant milks in the retail stores—I mean, how many almond milks are there now in stores?” Dembitzer said.
As a marketing director at Imbibe, a ‘drink tank’ based near Chicago that has a 40,000-square-foot facility dedicated to formulating and commercializing beverages for clients big and small, Dembitzer has an up close look at what it means to innovate in the beverage space.
Here are some of her highlights:
Despite rise of unsweetened drinks, sweetener innovation still relevant
“One of the biggest areas of innovation right now in the beverage industry is with sweeteners,” Dembitzer said, especially with FDA’s new ‘added sugar’ labeling requirement on the Nutrition Facts panel, and sugar taxes that have passed in various cities.
“What you’re going to see on packaging more than ever is people talking about sweeteners, and talking about how much sugar is in the product,” Dembitzer said
Though there may still be some confusion on how the Nutrition Facts changes work for beverages naturally containing sugar like fruit juices, the FDA is addressing this with a recently released guidance.
Dembitzer also said that FDA’s changes are pushing many manufacturers and ingredient suppliers to innovate with sugar alternative sweeteners, a topic still relevant despite drops in sugary fizzy drinks and the rise of water sales.
“I don’t think the American consumer is looking to get away from drinking sweet beverages,” Dembitzer said. “There’s probably an increased threshold of people with the awareness that sugar isn’t good for you, so people are looking for alternatives, trying to reduce their caloric intake without finding a [sweet] alternative—but we’re still ways away from American consumers changing their palates completely.”
More agility from smaller brands
In terms of the source of innovation in the beverage space, Dembitzer argued that a lot of it is coming from smaller, independent brands, which she describes as more agile and not as risk-averse as the bigger companies.
“You’re going to continue to see the most novel innovation coming from smaller brands,” she said. “They’re usually a lot closer to the consumer—the [small] brand owner that wants to start a company, they’re usually going around at a coffee shop, or at the local Whole Foods and speaking to the consumer.”
The trade-off is that though smaller companies may be nimbler, the reach and resources they have compared to big established CPG companies is miniscule. A common trend is for a bigger company to collaborate with, gobble up, or invest in, a smaller one, like Kellog Company’s VC fund investing in moringa shot Kuli-Kuli earlier this month.