Beyond cream & sugar: savvy Retailers recognize the value of flavored coffee.

Increasing consumer sophistication is fuelling innovation in the beverage industry. Trendaware retailers have caught on to the sensibility of selling flavored coffee--whether American newscaster Andy Rooney agrees or not. The CBS commentator ranted on the topic with the following declaration:

"Everything's got something else in it. Cherry Vanilla Dream with Pecans and Cashews. How about a Cherry Vanilla Nightmare? Orange cappuccino. Hazelnut-flavored coffee. What's wrong with coffe-flavored coffee?" Wry humor aside, Rooney's sentiment is hot the norm for the typical coffee-driven consumer who is clamoring for creativity, according to the Specialty Coffee Association of America (SCAA). Flavored coffees will continue to increase in total market share, claim industry pundits. But there's also a telling fact backed up by Danisco, the Copenhagen-based supplier of flavorings. The firm reports that studies show flavored coffee drinkers don't necessarily like the flavor of coffee.

The specialty coffee industry has developed in direct response to growing consumer demand for quality experiences, according to the SCAA. The industry as a whole will continue to grow, and is not expected to peak until the year 2015. At a time when ready-to-drink tea and coffee beverages have surpassed canned juices, if is of interest to note that flavored coffees account for up to 35% of a typical roaster's/retailer's annual sales*. Plenty of retailers nationwide are receptive to the flavored coffee category. For instance, Southern California-based Black Mountain Gold Coffee currently has distribution in more than 29 states and 4 provinces in over 6000 retail outlets for its flavored coffees--including mainstream venues such as Walgreen's and Longs Drugs.

Further evidence of the power of the category is the fact that the Motley Fool stock exchange report even comments on the flavored coffee niche with a perspective on 7-Eleven--it has finally woken up and smelled the specialty coffee. Just 5% of 7-Eleven's sales come from its coffee products. Late to the game but still looking to play, the leading convenience store chain is finally giving coffee the Slurpee treatment with Cherry Creme and Vanilla Nut.

Promote with Panache

Philadelphia-based Anthony's Italian Coffee House is a retailer who gets it. This family-owned business knows how to throw a promotion that runs the gamut from salami to coffee. With a clever cross-merchandising methodology--flavored coffee options incorporate flavored syrups in the traditional Italian way. The retailer's current 'Postcards from Italy' promotional campaign invites customers to experience the flavors and culture of Italy. "My goal with Anthony's Italian Coffee House has always been to bring the romance, character, culture and comfort of an authentic Italian cafe to the Italian Market. With 'Postcards from Italy, our customers can experience the authentic culture and flavors of Italy right here in their own backyards, "comments owner Anthony Anastasio, whose family hailed from Sicily to Philadelphia nearly 100 years ago.

Kicked off in January 2004, Anthony's customers experienced the flavors and festivities of Genoa for the entire month and highlighted products of Italy's Liguria region. Genoese featured menu items included hazelnut and almond flavored coffee and lattes and a "Taste of Genoa" sampler featuring minestrone soup, served with herb focaccia and a side of pesto, among other selections. The "Postcards from Italy" promotion introduces regional delicacies on a monthly basis and also incorporates flavored coffee. "Since many of out customers are coffee purists, this promotion encourages them to try something they might not have otherwise considered," says Anastasio.

Retailers Roaters and Consumer Awareness

The coffee consuming public is staged for more innovative offerings. As the Seattle Times reports, even Rory, the savvy teen protagonist on The WB's "Gilmore Girls," has a coffee addiction as a regular plot line. The TV college freshman is not alone--the vanilla latte is said to be the hands-down favorite among teen girls, who comprise a facet of a demographic buying category that could exceed $17 billion in 2006.

Significant large and small brick/mortar retailers and cyberspace retailers have rallied behind flavored coffee. Proof of interest lies in the response to Amazon.com selling beans online. Black Mountain Gold Coffee (BMG) offered its flavored coffee sampler on the site. Its proprietary flavors--including its number one seller Cinnamon Crumb Cake-flavored coffee--garnered terrific testimonials and repeat purchases. Albertson's in Texas has responded to consumer demand and is now offering its shoppers BMG flavored coffee in 1-pound sizes in addition to the convenience packs; pre-ground and measured to brew one perfect pot (8-10 cups).

With the motto "Flavors that Really Reach the Cup!" [c], Black Mountain Gold Coffee has spent 12 years perfecting the flavor profiles of top-selling Tiramisu and Cinnamon Crumbcake, says Priscilla Broward, Vice-President of Sales & Marketing. "Our customers call us direct because they are amazed that the flavor is maintained throughout an entire pot. We don't use stock flavorings; each one is proprietary to the firm. There is a higher percentage of flavoring in Black Mountain Gold coffee." There's another cog in the flavor profile wheel--the wherewithal of Scott K. Plail, BMG Founder and CEO of the Orange County, Calif.--based firm. "His culinary background is pivotal in developing the long-lasting flavors," notes Broward. BMG flavored coffees are fat free, carbohydrate-free and kosher certified. Other flavors include Hazelnut Creme and French Vanilla. Two new items are anticipated for introduction from BMG in the summer.

On the Flavoured Coffee Bandwagon

Consumers have developed a passion for fun and flavorful drinks. Sell them and you'll see for yourselves. Wolfgang Puck did. Wolfgang Puck Beverage Partners now markets a four-flavor (Dulce de Leche, Espresso, French Vanilla, and Mocha) line of Wolfgang Puck Gourmet Latte products, reports Packaged Facts. The goal: to make a product that tasted like the chilled lattes consumers were enjoying in specialty coffee houses everyday.

Ideas to Further Boost Flavored Coffee Sales

Communicate with customers: conduct a flavor survey. Offer coupons for a free flavored coffee drink if they fill it out. Share the surveys with your coffee roasters and syrup vendors,

Go seasonal with a "Limited Time Only" flavored coffee promotion, Market flavors that appeal to consumers at certain times of the year,

Winemakers often tell their tale et the retail or restaurant level, so why hot bring in a coffee authority you can tout as the "Flavor Genius"? Let your vendor's coffee company spokesperson engage your staff about flavored coffee. Make it a two-for-one deal by announcing the visit (in-store signage, on your website, etc.) and let your customer meet the "Flavor Genius" too!

Ask your customers what they think. Give them comment cards to fill out. Have your staffer be the "Flavor Beat" reporter who asks customers for a quick comment or two about the flavored coffee. Use that comment on P.O.P. or shelf talkers as well as your website.

Promote that your flavored coffee is carbohydrate-free. If you are up to date with what's making the news in food/beverages then you know that carbohydrate-free "anything" is flying off the shelves

Teach your staffers to listen to the customer's order If they say one shot or syrup--be sure it's one shot. Your customer always knows best!

* according to the site espresso 101.com