Through 2012, off-trade volume sales within the US other hot drinks market declined by 2% to 25,617 tonnes, whilst off-trade current value sales increase by 1% to reach US$349 million.
The US other hot drinks market is comprised of chocolate-based flavoured powder drinks and malt-based hot drinks. These flavoured powdered drinks have traditionally been positioned as an indulgent treat, enjoyed during winter months, and are often positioned towards parents seeking beverages fortified with calcium for their children. However, the high sugar and calorie content deterred consumers in an increasingly health-conscious society.
In order to appeal to an increasingly health-conscious consumer base and more discerning parents, manufacturers continued to offer better-for-you (low fat, low calorie) versions of their other hot drinks. For example, Swiss Miss and Nestlé offer diet, fat-free and sugar-free flavoured powder drinks.
Manufacturers also continued to fortify flavoured powder drinks with calcium and vitamins in an effort to position these products as sensible treats. Unfortunately, this entirely contradicts the original positioning of chocolate-based flavoured drinks as an indulgent treat, which is a deterrent to their primary consumer base.
Foodservice locations which serve other hot drinks, such as Starbucks, Ghiradelli and Hershey's, have remained popular. The justification behind purchasing chocolate-based flavoured powdered drinks in the on-trade channel is that it is an affordable luxury; consumers can treat themselves once in a while.
Consumers can better control when they have a drink, rather than fighting temptation on a daily basis if the flavoured powder drinks were in their homes.
In 2012 Nestlé USA led other hot drinks with a 33% share of off-trade value sales. The Nestlé portfolio includes popular brands such as Nestlé, Nestlé Quik and Carnation, which are all affordable, and benefit from Nestlé's wide distribution network.
The company's share declined in 2012, due to consumers choosing healthier tea options, or indulging in more premium and gourmet hot chocolate products. However, the company's performance remained flat, with sales of US$115 million.
In 2012 ConAgra Foods remained the second largest company in other hot drinks, with a 15% share and sales of US$51 million, due to its Swiss Miss brand. The continued inclusion of Swiss Miss branded hot chocolate drinks in Green Mountain Coffee Roasters's Keurig machines was a boon for both companies, as Swiss Miss provides a recognisable hot chocolate brand which is enjoyed by all ages.
With the continued focus on childhood obesity, the US other hot drinks market is not expected to fare well through to 2017, unless major changes within the industry are made.
For more information on the US other hot drinks market, see the latest research: US Other Hot Drinks Market
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