Vending International
Vending competes for a larger share of the OOH market
Published:  01 April, 2007

Over 770 million people live in Europe and between them, they consume 190 billion cups of hot coffee, tea and chocolate-out-of-home - each year. That’s equivalent to more than 6,000 cups every second of every day.

The hot beverage profile is different in each country but overall out-of-home coffee outperforms tea by a factor of 2:1 while hot chocolate is the poor relation accounting for only about 2% of the total; a mystery and a marketing challenge for the excellent creamy hot chocolate mixes available to the vending market.

On the domestic front, Britain is now the world’s second-largest market for branded coffee chains and accounts for half of European sales. Over the past decade high street names have engendered an appreciation of flavour and aroma (and large servings) plus a perception that take-out in branded paper cups indicates a higher quality drink - a strategy vending is able to emulate thanks to packaging innovators producing chic modern designs to enhance the presentation of premium hot drinks.

The vending industry is competing against a trend for workers to pop out in search of a quality drink. The industry is responding with the development of first class bean-to-cup, pod, in-cup and singles machines, as well as improvements to traditional powders, granules and other soluble mixes. Whiteners, creamers and toppings have been formulated to enhance specific beverages and appeal to individual taste requirements as well as respond to health and weight concerns with low calorie and skimmed and semi-skimmed options.

Vending is also fighting back by offering flavoured and specialty coffees such as hazelnut, vanilla, chocolate mocha, amaretto, cinnamon - and the canny operator rings the changes to create interest and reduce menu fatigue.

Far more tea is drunk in-home than out-of-home. As a nation we get through a daily 165 million cups of tea against 70 million cups of coffee - more than 2:1 in favour of home brewed tea. Yet out-of-home the position is reversed to 2:1 in coffee’s favour. In vending the figures are even more disproportionate with only 2 million cups of tea vended compared with 8 million cups of coffee - vended coffee wins 4:1.

The industry is striving to increase the appeal of vended tea with developments like leaf tea in freshbrew machines and brew-in-the-cup teabags. The growing popularity of specialty, herb and fruit teas is broadening the market with forward thinking companies offering Green, Oolong, Jasmine, Mint, Lemon, Hibiscus, Blueberry, Rosehip, Apple etc as well as varietal teas like English Breakfast, Earl Grey and Darjeeling which will all help redress the current imbalance.

Ethically sourced coffee, tea and chocolate are all available for vending with appropriate branding for machines and peripherals. Research shows that 40% of consumers would be very likely to select an ethically traded product if offered, even if the price was a little bit higher and already 5.5% of the hot drinks sold in Foodservice are Fairtrade.

Sources: Food & Drink Fed, Allegra Strategies, The Tea Council, AVA, Aimia Foods, The Fairtrade Foundation/Mintel.






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