Consumer demand for healthier food and drink options is fueling growth of the functional-coffee space, where a diverse array of products are proving that coffee and tea are overdue for a major change.
Tea and coffee are big business. Ready-to-drink products, in particular, have seen impressive growth. Market research firm Grand View Research predicts the ready-to-drink tea and coffee market will exceed $115 billion in annual revenue by 2024, with functional benefits being a significant driver of demand. (1)
Coffee and tea are becoming more advanced, and manufacturers are now using their products to address health concerns like brain support and protein intake. Here are just a few of the unique new functional coffee trends that are changing the definition of “health drink."
1.“Ready to drink tea & coffee market worth $116.13 billion by 2024: Grand View Research Inc.” Market Watch. (October 2016)
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Cashing in on Cashews: Mood-Regulating Cold Brew Coffee
Launched in 2016, Coffee So Good (Minneapolis) manufactures ready-to-drink, cold-pressed coffee that uses raw cashew milk from the nuts of the cashew tree (Anacardium occidentale) as a creamer.
Founder Rita Katona says that Coffee So Good’s flavored coffees provide several functional benefits, including mood regulation. Says Katona: “Cashew milk is rich in protein, iron, and magnesium. Magnesium has great benefits in terms of stress relief and antianxiety, and it also increases dopamine production.”
Katona says that the recent rise in ready-to-drink cold-brew coffees presents new opportunities in the cold-brew space. “Customers are buying more cold coffees, and that’s made it easier for the grab-and-go category to grow.”
Coffee So Good is the first clean-label, dairy-free alternative to the traditional latte, Katona says, and giving latte-drinkers a healthier alternative simply seemed like a natural evolution of the product.
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The New Vitamin “C”: Vitamin Coffee Targets Workout Enthusiasts
Clinical studies have shown that coffee improves speed and respiration (2), psychomotor function (3), and fat oxidation (4). Now, manufacturers are optimizing coffee formulations to improve athletic performance. AlphaMind Vitamin Coffee founder John Waldon (Greenville, SC) says that he’s aiming to create the “Gatorade” of coffee.
AlphaMind coffee contains B vitamins to promote muscle gain, potassium for maintaining electrolyte balance, sodium for regulating nerve function, and iron to stimulate red blood cell production.
Says Waldon: “We saw a gap in the market for a coffee that appeals to workout enthusiasts. Folgers and Maxwell House are for 50-year-olds who don’t care about what kind of coffee they’re drinking. We’re targeting 20-somethings who live an active lifestyle.”
Waldon says younger consumers are looking for more convenient workout supplements. “There are other functional coffees out there, like Bulletproof – but Bulletproof is a smoothie that you have to prepare. [Consumers are living] fast-paced lifestyles and just want to make a cup of coffee.”
2.Wiles JD et al. “Effect of caffeinated coffee on running speed, respiratory factors, blood lactate and perceived exertion during 1500-m treadmill running.” British Journal of Sports Medicine, vol. 26, no. 2 (June 1992): 116-120
3. Natu MV et al. “Testing of stimulant effects of coffee on the psychomotor performance: an exercise in clinical pharmacology.” The Indian Journal of Pharmacology, vol. 29, no. 1 (January-February 1997): 11-14
4. Costill DL et al. “Effects of caffeine ingestion on metabolism and exercise performance.” Medicine & Science in Sports & Exercise, vol. 10, no. 3 (Fall 1978): 155-8
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Brain-Boosting Creamers Promote Mental Acuity and Overall Nutrition
Breakfast replacements are a growing functional-coffee niche. National surveys show that 15% of Americans (including one-third of 20- to 29-year-olds) skip breakfast every day (5) despite the fact that clinical studies have shown breakfast boosts mental performance. (6)
Know Brainer founder Shari Leidich (Lafayette, CO) believes the solution is a functional creamer that can act as a breakfast substitute. Know Brainer uses butyrate and conjugated linoleic acid to regulate the metabolism and improve brain function, packaging grass-fed organic butter and MCT oil into a portion-controlled serving.
“We’re revolutionizing how people use a creamer,” Leidich says. “The creamer industry hasn’t seen innovation since the 1940s.”
Leidich expects functional coffee creamers to grow in the coming years, citing the cold-brew trend as an exciting new opportunity. “Cold brew is a great mechanism for delivering something healthy. Plus, coffee is habit-forming-so why not enhance something that people are already consuming?”
5. U.S. Department of Agriculture, Agricultural Research Service. 2014. “Breakfast: Percentages of selected nutrients contributed by food and beverages consumed at breakfast, by gender and age.” What We Eat in America, NHANES, 2011-2012
6. Mahoney C.R. et al. “Effect of breakfast composition on cognitive processes in elementary school children.” Physiology & Behavior, vol. 85, no. 5 (August 2005): 635-645
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Vegetable Extract Coffee: Detoxing with a Broccoli Brew
Ashley Koff, a dietician and member of Brassica Coffee's (Baltimore, MD) scientific advisory board, says that consumer interest and clinical research are driving demand for detox-oriented coffees rich in antioxidants. Brassica is meeting that demand by using glucoraphanin, a naturally occurring phytonutrient found in broccoli (Brassica oleracea var. italica), in its coffee and tea products.
Some animal studies have found that broccoli sprout extract has a protective effect on the liver, enhancing the expression of genes that regulate detoxification. (7)
Says Koff: “Glucoraphanin is a water-soluble detoxifier, and it maintains its effectiveness at different temperatures, making coffee a good match.” Koff says Brassica is unique in its dosage control. The concentration of glucoraphanin in one serving of broccoli can vary significantly, she says, whereas every Brassica K-cup and tea pouch contains one 15-mg dose.
Koff expects the functional coffee space to expand in the near future and says she expects adaptogens to be a major focus.
7. Yoshida K. et al. “Broccoli sprout extract induces detoxification-related gene expression and attenuates acute liver injury.” World Journal of Gastroenterology, vol. 21, no. 35 (September 21 2015): 10091-10103
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Drink the Pounds Off: Losing Weight with Thermogenic Coffee
Coffee and green tea have been shown in prospective cohort studies and randomized clinical trials to contribute to weight loss. (8-9) Coffee manufacturers are now optimizing this effect with weight-loss coffees.
Coffee Blenders’ Lean Cup promotes weight loss by incorporating Naturex’s (Avignon, France) branded and patented Svetol green coffee extract (Coffea arabica) in its coffee. The companies say that Svetol differs from generic green coffee extract in that its chlorogenic acid (CGA) level is standardized at 45%, whereas lab studies show that wild-grown coffee and generic coffee extract can vary in their CGA levels (10) depending on the growing region and species of the coffee plant in question. (11)
Coffee Blenders sales manager Callan McCollister (San Diego, CA) says thermogenic coffees and functional cold brews are the next evolution of thermogenic drinks, but she expects consumers to lead the trend. Says McCollister: “I think people will find ways of making functional craft coffee at home. We’re already seeing homemade cold brews.”
8. Greenberg JA et al. “Coffee, tea, and diabetes: the role of weight loss and caffeine.” International Journal of Obesity, vol. 29 (May 2005): 1121-1129
9. Westerp-Plantenga, M et al. “Body weight loss and weight maintenance in relation to habitual caffeine intake and green tea supplementation.” Obesity, vol. 13, no. 7 (July 2005): 1195-1204
10. Ludwig, IA et al. “Variations in caffeine and chlorogenic acid contents of coffees: what are we drinking?” Food & Function, vol. 5, no. 8 (August 2014): 1718-1726
11. Dias, RCE et al. “Discrimination between Arabica and Robusta coffees using hydrosoluble compounds: Is the efficiency of the parameters dependent on the roast degree?” Beverages, vol. 1, no. 3 (September 2015): 127-139
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No More Jitters: Calm Energy and Stress Relief
Stress relief is another growing function coffee manufacturers want to address. According to Coffee Blenders’ McCollister, the company’s “patented Relax cup uses the L-theanine amino acid to relieve stress and create a calming effect, so you get the energy without the jitters.”
McCollister says this is a popular function, and she cites recent legal events as evidence; she recently encountered a copycat brand at a trade show. McCollister says this is proof that interest in a more “relaxed” coffee is growing.
“We’ve seen other interesting blends. People are now mixing their coffee with tea–Arabica with chamomile. There was talk at the National Coffee Association’s Annual Convention, which took place March 23-25 in Austin, TX, about how functional tea–coffee hybrids are the next big thing.”
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Instant Energy: Concentrated Coffee Shots for On-the-Go Buzz
The energy shot niche has been dominated by 5-Hour Energy (12), but the growth of the functional-coffee category may be reinvigorating a stale market. Forto Energy Shots provide the energy of two cups of coffee in a single, 2-oz shot, combining Arabica coffee with coffee extract (Coffea arabica) for an added boost.
Founder Neel Premkumar says he devised the idea for Forto shortly after becoming a father to twin girls in 2012, during which time he struggled to maintain his energy and focus. (13)
Premkumar says that sales of the Forto shot have been strong, with Forto reporting category growth of 25%. The company differs from other energy shots in its clean-label approach: the only two ingredients in the product are Arabica coffee and green coffee extract.
Forto is also capitalizing on the growth of multiple categories. Functional RTD coffee has consistently outperformed other beverage and snack categories since 2015. IRI Consulting reports that in 2016, the category grew 20% over 2015, outpacing yogurt drinks, vegetable juice, sports drinks, and energy drinks. (14)
12. Grebow, J. “Energy shot sales are slumping. Do energy shots still have a chance?” Nutritional Outlook (February 2016)
13. Premkumar N. “Our Story.” FORTO Strong Coffee. Published online.
14. Davey, K et al. “Big, small, and in-between: Who’s driving growth across the CPG industry.” The Midwinter Executive Conference. (January 28, 2017): 14
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Protein-Rich Coffee Provides Sustained Energy and Muscle Growth
Protein drinks have long been a staple of the nutritional supplement market, but now, protein coffees are making it easy for consumers to incorporate added protein into their diets. Food ingredient company Arla Foods (Aarhus, Denmark) has developed an ingredient solution for high-protein coffee drinks. Arla’s first such drink, a whey protein iced coffee, was launched in November 2016.
Arla’s head of science and sales development Peter Schouw says that protein coffee has positive impacts on muscle growth, bone health, and brain function. Schouw says that Arla’s protein coffee also uses milk minerals to promote neurotransmission.
Schouw notes that creating a ready-to-drink protein coffee has been a challenge until now due to the restrictions of the RTD format and taste concerns. “Most iced coffee beverages are UHT products with a long shelf life,” Schouw says. “In the past, it hasn’t been easy to formulate with whey protein for UHT applications. Our development team overcame this obstacle, creating an iced coffee ingredient solution that tastes great and delivers health benefits.”
Schouw says he expects high-protein iced coffee to become a major niche in RTD functional beverages in the future.
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Mediterranean-Style Coffees: Coffee with Mediterranean Diet Benefits
Creating coffee with functional benefits has never been easier thanks to ingredient supplier Frutarom Health’s (Haifa, Israel) NutraT line of powdered drink boosters inspired by the Mediterranean Diet. Coffee brand Mongibello chose to use several NutraT ingredients in its new line of functional coffees, which are designed to be dispensed using ETNA coffee machines.
The NutraT ingredients used in the Mongibello coffees are based on staples of the Mediterranean diet such as olive, artichoke, and ginseng. The line includes four coffees: Detox, which contains NutraT’s CynaxT artichoke extract; Cardio, with OliveT olive extract; Relax with RosT, a lemon balm extract; and Mental, with Ginseng EFLA 913, Frutarom’s own unique ginseng (Panax ginseng) extract produced using the company’s proprietary HyperPure technology.
NutraT ingredients are a noteworthy addition to the functional-coffee market because they are formulated to dissolve quickly and easily in beverages (including water, soft drinks, and dairy products). Frutarom says that beverages using NutraT remain clear, without turbidity. Yannick Cappelle, product manager for Frutarom Health, said in a press release: “With NutraT, drink manufacturers can fortify their products with exceptional natural extracts from Mediterranean origin that typically are not water soluble. We are excited about these functional coffees from Mongibello. This demonstrates that the possibilities for natural and soluble functional ingredients can go beyond the standard cold beverages. The NutraT line helps developers of new functional drinks combine fresh flavors with extracts delivering the essence of the Mediterranean diet.”
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Eat Your Coffee: Energy Bars Packed with Caffeine and Micronutrients
For those looking for a more-portable way to consume their coffee, new Kickstarter hopeful Eat Your Coffee has created the concept of a food bar packed with the same dose of caffeine as a full cup of coffee. According to Eat Your Coffee’s founders, the Eat Your Coffee Bars contain natural, not synthetic, caffeine. According to the company, it’s as “if your favorite energy bar and coffee had a baby.”
Eat Your Coffee Bars co-founders Ali Kothari and Johnny Fayad (Boston, MA) say they often found themselves running behind for their early-morning classes at Northeastern University. Unable to grab breakfast-let alone coffee-they sought to create a product that would meet both needs. First developed in their dorm room, Eat Your Coffee energy bars are formulated with gluten-free, vegan, and organic ingredients.
The company’s Kickstarter campaign was activated on June 13, 2017. The brand’s first bar flavored will be Peanut Butter Mocha.
Photo from Eat Your Coffee
What Kind of Coffee Do Consumers Want?
This June, flavors supplier Comax Flavors (Melville, NY) released the results of its first consumer-research survey on coffee examining coffee-buying habits and consumer attitudes, with a particular focus on the specialty coffee and RTD coffee segments. The company collected feedback from 500 U.S. adult respondents of all ages and found that flavor is the single biggest driver of coffee purchases across all ages, with nearly three-quarters (73%) of respondents citing it as the most important quality. Of that 73%, Generations Y (Millennials) and X said they preferred flavored coffee most, at 49% and 44%, respectively.
Catherine Armstrong, vice president of corporate communications, Comax, said in a press release: “Coffee is a universal staple engrained in many cultures. With so much market activity, especially in flavored coffees and ready-to-drink (RTD) products, Comax wanted to better understand coffee consumption habits and usage among the general population.”
Other notable findings from the survey included that RTD coffee is most popular among the younger generations. A total of 32% of respondents said they drink RTD coffee regularly. The company says it was also surprised to find that instant coffee was most popular with Millennials (65%). The research reflected significant consumer interest in coffee-flavored foods and other applications, and widespread use of flavored creamers, seasonal flavors (43%), and indulgent coffees (such as mochas, frappuccinos, and the like) in place of traditional desserts.
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Functional Coffee: A Growing Market for Manufacturers
Consumers’ search for a healthier coffee is driving expansion of the functional coffee space in a variety of ways, with an ever-diversifying array of products entering the market to address the health concerns of various niches.
Both ready-to-drink and ground coffee are seeing more functional ingredients added to their formulations, and functional tea is also gaining ground. Coffee and tea brands’ next evolution will be finding a niche within the functional space, which will involve pinpointing consumers’ most pertinent health and wellness concerns and then formulating appropriate products.
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