Can you tell us a little of the history of your brand?
Arctic Coffee burst onto the scene in 2016 with a bold mission: to shake up the iced coffee sector with great taste, quality ingredients, and an affordable price tag. Skip forward to today, and we’re proud to be the UK’s largest independent iced coffee brand – proof that doing things differently pays off.
Every product is crafted in the heart of Devon, blending smooth, fresh Devonshire milk with Rainforest Alliance Certified coffee beans for a rich, refreshing hit of flavour. Our dairy is one of the best in the industry, and we’re still privately owned, which means we do things our way – with passion, precision, and a personal touch. We’re not some faceless corporate giant; we care about every step of the process, from sourcing to sipping. That’s why with Arctic Coffee, you’ll always get a chilled coffee that’s big on taste.
How is Arctic Coffee performing?
Arctic Coffee continues to lead the way, outperforming the category and strengthening our position as the UK’s number one independent chilled coffee brand. This is particularly evident within the take-home sector. Arctic Coffee is capturing a dominant 70% share of the take-home coffee sector by volume and an even higher 72% share in groceryi. These numbers prove that our commitment to innovation, accessibility, and great-tasting coffee is resonating with consumers – driving both category growth and brand loyalty. Despite the wider category success, we are one of the only brands continually innovating in terms of flavour in this format – bringing new options to shelves to keep customers coming through the doors. In fact, this year, we are launching the first Vanilla 1L to market – a must-have for chilled coffee fans who love a classic.
What makes Arctic Coffee unique?
For consumers buying into the chilled coffee category, it is an interesting time. We know that consumers have brand preferences which attract them to the category (i.e. products backed up by powerhouse coffee chains), but there are two key factors that come into play – taste and price.
In previous years, taste has always beaten price within the category, but with the recent increased cost of living, price is starting to become the number one go-to. There is an increased amount of brand “switching” to find more cost-effective alternatives. Brands are acutely aware of this, hence the high frequency and depth of promotions that take place within the chilled coffee space.
The more interesting element here is that consumers do not settle for price alone – they still place taste as a key factor for purchasing, so if a product is delivering in terms of price, but does not deliver on taste, consumers will be put off and rates of sale plummet.
‘ Therefore, it is imperative that brands deliver against both – price and taste. At Arctic Coffee this is what makes us unique, we have always been focused on delivering great-tasting, high-quality chilled coffee. As an independent brand within Crediton Dairy, we are also able to offer good value in a convenient format.
How much is the chilled coffee category worth?
The chilled coffee category is now worth £277.2mi, with household penetration in the UK grocery sector at 20.8%ii – highlighting significant room for growth. When compared to Total Milk Drinks (48.6%ii), it’s clear that chilled coffee has huge untapped potential, especially in how it’s positioned in-store. Looking at the Chilled Soft Drinks sector, which boasts a 77.2% penetrationii, there’s a major opportunity to attract new shoppers and expand the category’s reach, making chilled coffee a staple for even more consumers.
What are the key consumption occasions for chilled coffee?
Chilled coffee may be a year-round favourite, but when it comes to seasonality, there’s a clear rhythm to consumer demand. Unsurprisingly, summer is when iced coffee truly shines, with sales peaking as temperatures rise. As we move through the year, demand steadily climbs, with spring acting as the warm-up and autumn holding strong after the summer rush. In fact, compared to winter sales, we see uplifts of +28% in spring, +61% in summer, and +30% in autumni – proving that while chilled coffee is enjoyed all year, the warmer months are when it really takes centre stage.
Understanding these seasonal trends is key to ensuring availability when demand is highest, keeping shelves stocked and customers coming back for their go-to chilled coffee fix.
What are the key trends influencing the chilled coffee sector?
The chilled coffee sector is driven by changing consumer preferences and shifting lifestyles. At Arctic Coffee we are constantly responding to these trends, which include:
1. Constant Innovation
Consumers always want ‘more, new and interesting’ when it comes to the chilled coffee sector. It’s a category that is known for innovation. Limited-edition flavours, functional benefits, and larger formats has helped keep shelves dynamic, ensuring shoppers keep coming back for more. At Arctic Coffee, this is the heart of what we do – from seasonal launches to brand-new product lines like Arctic Frappe, designed to bring fresh excitement (and audiences!) to the category.
2. Indulgence is in Demand
The rise of indulgent, coffee-shop-inspired drinks is shaping the market, with creamy, rich, and flavour-packed options gaining traction. That’s exactly why we’re launching Arctic Frappe, a range that delivers the indulgent, café-style experience in a convenient, ready-to-drink format.
3. Growth of Take-Home Formats
While single serve remains popular, there’s a clear shift towards larger take-home formats as more consumers enjoy chilled coffee from the comfort of home. Arctic Coffee was one of the first brands to introduce take-home formats to the market, and we continue to lead the way with new flavour innovations, including the UK’s first Vanilla 1L launching this year.
4. Gen Z is Driving the Category
Younger consumers, particularly Gen Z, are shaping the future of chilled coffee. With over half (53%) of Gen Z shoppers enjoying RTD chilled coffee at least once a weekiii – and 43% indulging twice weeklyiii – it is an audience brands need to respond to. They’re adventurous with flavours, engaged with brands, and keen on convenience.
What does the future hold in store for the chilled coffee sector?
Within the chilled coffee market, there are three front-runners when it comes to what will happen in the category in 2025:
1) Products that deliver on indulgence and taste innovation will start to win out and bring new shoppers in store. At Arctic Coffee, we continually innovate and rise to the challenge of this new space – kicking off with our newly launched Arctic Frappe sub-brand which directly responds to Gen Z consumers, the driving force behind the category, who crave indulgent and innovative coffee experiences.
2) Innovation has always played a major role in keeping the category exciting – whether that is by flavour, functional benefit or format. This means that in the next few years, we will continue to see experimentation across the board – from our new indulgent range (with Caramelised Biscuit being first to market) to more exotic offerings such as matcha.
3) The demand for take-home formats will continue to rise, as it offers coffee lovers the convenience of enjoying their favourite chilled coffees at home – perfect for busy mornings, remote workdays, or simply stocking up on their go-to brew.
Do you have any NPD coming up?
Absolutely! Arctic Coffee is kicking off 2025 with the launch of Arctic Frappe, our brand-new sub-brand landing in Tesco and Morrisons on March 3rd. Designed for coffee lovers who crave a thick, creamy, and indulgent experience, this range introduces two bold new flavours: Caramelised Biscuit – a first for the chilled coffee category – and the rich, fudgy Chocolate Fudge. With Gen Z leading the charge in iced coffee consumption, Arctic Frappe is all about delivering big flavour, big texture, and big indulgence, while staying accessible and affordable. March will also see the launch of the much-loved Vanilla Latte which goes big – bringing the first 1L Vanilla take-home format to market.
What marketing plans do you have to support your brand?
We’ve got big plans to keep Arctic Coffee front and centre in 2025. Our multi-channel media campaign will drive awareness across digital and social, while in-store activations ensure strong visibility at the point of purchase. But the real showstopper? Our major UK-wide sampling tour this summer, bringing Arctic Coffee directly to consumers in key cities, giving them the chance to experience our latest innovations first-hand. It’s all about getting our products into hands, driving trial, and making Arctic Coffee the go-to choice for chilled coffee lovers everywhere.
How can retailers maximise chilled coffee sales?
By implementing the below strategies, retailers best promote chilled coffee, sustaining interest and demand throughout the year:
1) Offer Variety: Ensure a diverse range of offerings, including category leaders like Starbucks alongside independent brands like Arctic Coffee. Providing a range of options caters to different consumer preferences and price points. Arctic Coffee also has the highest repeat purchase rate, so it is a great way for retailers to get shoppers into stores more frequently.
2) Prominent Positioning: keep the visibility up by prominently displaying chilled coffee to attract customers’ attention and encourage impulse purchases. Ensuring visibility can significantly impact sales.
3) Secondary Displays: Utilise secondary sitings / in-store location to further drive penetration and differentiate products. These displays can highlight new product developments (NPD) or seasonal promotions, drawing in both existing and new consumers. For example, the upcoming Arctic Frappe sub-brand taps into the growing indulgence trend, offering a differentiated product that appeals to a younger consumer.
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