January 6, 2025 – The beverage category hot drinks encompasses a number of different beverages, including coffee, tea and malt and other hot beverages. Hot coffee includes coffee pods, coffee concentrates, coffee beans, coffee powder, flavored hot coffee, ready-to-drink hot coffee, and coffee substitutes such as chicory. Tea drinks that are served hot include fruit teas, tea infusions, tea substitutes, chai mixes, tea concentrates and ready-to-drink hot tea. Other types of hot drinks include hot malted drinks, hot chocolate, cocoa, and milk-based hot drinks.
Considerations Regarding Hot Drinks Market Trends
Reports that look at hot drink trends consider several different factors. These include macro trends that are global, the size of the market and trends in market size, sales of hot drinks subcategories, including hot coffee, hot tea, and hot cocoa, leading companies and their share of the market, and new hot drinks product launch trends. Packaging claims, including emergent claims, also are a consideration. Consumer trends and insights about the hot drinks market include perceptions of drivers of hot drinks and differences in consumption frequency.
Hot Drinks Market Sales are Growing
North America’s hot drinks market is worth billions of dollars and is growing in both volume and dollar sales. Hot coffee sales are solid. Roasted coffee beans and ground coffee beans make up nearly all of hot coffee sales, and pods with ground coffee comprise nearly half of roasted coffee sales. Hot tea and hot chocolate are growing and are projected to grow but at a slower rate than hot coffee.
Per Capita Consumption of Hot Drinks
Per capita, consumption of hot coffee is the highest. Hot tea per capita consumption is one-tenth of hot coffee consumption. Per capita consumption of hot chocolate is relatively low. About half of US consumers drink hot drinks. Hot coffee is the most popular, followed by hot tea and then hot cocoa. US consumers also drink hot coffee most often – nearly half report drinking hot coffee every day. About one in six US consumers consume hot tea every day. Older generations in the US are most likely to consume hot coffee. Hot tea is popular among Millennials and Gen Z in the US, while hot chocolate is consumed more by Millennials than by other generations.
Retail Outlets for Hot Beverages
US consumers purchase hot drinks most often from supermarkets and convenience stores. Some consumers buy hot drinks at specialty stores. Restaurants are a strong outlet for sales of coffee.
Various Factors Drive US Hot Drinks Consumption
Taste is a key driver of hot coffee and hot tea consumption. US consumers also drink coffee for energy and tea for relaxation. When shopping for hot beverages, US consumers are influenced by real ingredients and premium quality. US tea consumers also look for tea without artificial colors or additives.
US consumers tend to prefer ground coffee but some also prefer capsules or pods, while others drink instant coffee. The most popular types of hot coffee drinks are coffee with milk, black coffee, cappuccino, and mocha.
In the US, herbal tea, green tea, and black tea are popular hot teas. Favorite hot tea flavors are chamomile, lemon, and honey.
Claims Grow in Hot Drinks Market
US consumers are interested in indulgent health so functional hot drinks markets are evolving to meet consumer desire. Gluten-free and GMO-free claims have increased slightly in hot coffee drinks. In hot tea in the US, natural and no additives or preservatives claims are growing. Low-sugar, no-sugar, and plant-based are emerging. Ethical claims have grown in US hot beverages over the past five years.
Coffee Launches are Growing
Although innovation in hot drinks in the US has slowed in recent years, coffee launches have gained share of total launches in the hot drinks market. Tea launches have a smaller share and so do malt beverages and hot chocolate.
Hot Beverage Flavors Evolve
In coffee, the use of Arabica coffee beans is up. Caramel flavor is growing, while seasonal and premium flavors show opportunity. Green tea and black tea stand out for hot tea launches. Berry flavors are on the rise, and exotic flavors could attract hot tea drinkers. Milk chocolate hot chocolate is gaining, and white chocolate is emerging.
Less Sugar, More Functional Ingredients
US consumers are looking to consume less sugar, and hot drinks with less sugar are trending. At the same time, a growing number of hot coffee and hot tea launches include nutraceutical and functional ingredients.
What’s Next in Hot Drinks Market Trends in the US?
Several hot drinks trends are expected to continue in hot beverages in the US. Watch for less sugar and more alternative sweeteners and functional ingredients. Fairtrade and environmental protection are increasingly important considerations. Innovation is likely in new packaging formats, indulgent flavors and textures, and the fusion of health and indulgence.
This article is based on Innova’s Now & Next in Hot Drinks in the US report. This report is available to purchase or with an Innova Reports subscription. Reach out to find out more
