Brewers Large and Small are Betting Big on Hard Coffee

Hard coffee can with glass
Photo by Tom Arena

It was bound to happen. As the popularity of flavored malt beverages (FMBs) grows, traditional non-alcoholic drinks like lemonade, iced tea and seltzer have gotten an adult kick of booze. Now, some companies are betting big on hard coffees.

This includes brewing giants like Pabst and MillerCoors, as well as startups like Newground Hard Dutch Lattes, based in Asheville, North Carolina. All seek to stake their claim in what is still a relatively small alcohol category.

Behind the Meteoric Rise of Hard Seltzer

That hard coffees exist at all is thanks to the ready-to-drink (RTD) coffee segment that has exploded over the last several years.  Starbucks, Dunkin’ and other brands offer pre-packaged, cold-brew coffees in both bottles and cans.

A Kenneth Research report states that the non-alcoholic RTD coffee market could reach $116 billion by 2022, up from $71.4 billion just three years ago. A similar growth in non-alcoholic seltzers, also a billion-dollar industry, has helped fuel the growth of spiked versions like White Claw, Truly and others.

“We’re reading the tea leaves and specifically, beer overall is flat to declining,” says John Newhouse, brand manager at Pabst Blue Ribbon. “It ebbs and flows, and from our consumer’s perception, beer is losing favor. So, companywide, we’re starting to shift from declining categories to emerging categories. Coffee is a way to stand out in that category and not do something that others are doing.”

Pabst Blue Ribbon Hard Coffee
Pabst Hard Coffee is made with Arabica and Robusta beans / Photo by Edgar Garcia

The trend is steeping into the liquor space as well.  Jägermeister and Jameson each recently announced a cold brewed coffee flavored spirit. The 66-proof Jägermeister Cold Brew Coffee blends the botanicals the brand is known for with Arabica coffee and cacao, and is designed to be taken as a chilled shot.

Jameson Cold Brew, a 60-proof limited edition spirit, launches this month. “When we started researching our next innovation, we didn’t need to go far, as it had been under our nose all along,” said Matt Foley, Jameson Brand Director at Pernod Ricard USA in a media release.

The alcohol makers are largely taking a cue from the non-alcoholic space. Most of the packaged hard coffees are flavored with milk (pasteurized or retort-processed to remain shelf-stable) and other adjunct ingredients like chocolate or chai. Coffee chain La Colombe partnered with MillerCoors to create two versions of hard cold brew, vanilla and black.

The combination of coffee and alcohol is nothing new. The Irish coffee, a cocktail of java and Bailey’s or Jameson (or both), is known throughout the world. A shot of espresso and a small glass of grappa or sambuca is another classic pairing.

On the chilled side, there are coffee-flavored vodkas, rums and liqueurs. Brewers have added whole beans, cold-brewed extract or regular coffee to everything from stouts to cream ales for years.

La Colombe Hard Coffee
Coffee chain La Colombe partnered with MillerCoors to create two types of hard cold brew / Photo by La Colombe

The new generation of hard coffees can have either a malt base, like beer, or a dextrose base to create the alcohol content. Many producers keep their products between 4% to 5% alcohol by volume (abv) and use blends of beans familiar to many coffee drinkers.

Pabst Hard Coffee features Arabica and Robusta beans.

“We wanted the coffee profile to be general and approachable,” says Newhouse. “It’s not too far into acidity or bitterness, and the final product is pretty sweet and creamy. We’re not homing in on specific beans. That’s not the focus.”

Newground uses espresso concentrate, while Brown Bomber, made by Twelve 5 Beverages, touts the Colombian coffee in its hard lattes. Another, Bad Larry’s Cold Hard Coffee, uses cold-pressed coffee from a Minnesota roaster in its 6% abv offering.

While most have started off simple, all are eyeing national distribution and look to the RTD coffee space for inspiration. Expect to see seasonal flavored offerings like gingerbread, pumpkin and coconut. And nitro versions that provide an extra-creamy mouthfeel are offered by Bad Larry’s and Newground.

“This is not designed to be the next big trend,” says Phil Rooney, CEO of Newground. “It has its place at limited times. It can be used as a mixer, after dinner, brunches or on vacations. They really aren’t designed to be consumed in mass. I’d be delusional if I was to sit here and say customers should have six of them in a row. We don’t want them to.”

Newground Hard Coffee
Newground Hard Dutch Latte are made in Asheville. / Photo by Lew Robertson Photography

Accurate sales figures are not yet available, but the initial buzz on social media ranges from bemusement to excitement. Even if hard coffee stays a niche drink with a small, loyal clientele, expect to see more varieties join the fray. Given the success of hard seltzer, producers eager to grow their profit margins are looking to the non-alcoholic space for inspiration.

Let’s just hope it’s a while before boozy milk hits shelves.

Published on January 31, 2020
Topics: Drinks


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