Premium coffee maker La Colombe Coffee Roasters today announced an exclusive partnership with Molson Coors Beverage Company to expand distribution of its specialty ready-to-drink coffee products La Colombe’s Draft Latte and Brazilian Cold Brew in convenience and drug stores nationwide. The 10-year-deal will start in 2021 and - over time - a full transition of the distribution for all channels of La Colombe’s RTD products to the Molson Coors network is planned. As part of the deal, Molson Coors will have access to new and innovative products La Colombe develops.
The partnership with Molson Coors will allow La Colombe to increase its retail footprint by more than 400% within 18 months in convenience stores which rank as the top channel for ready-to-drink coffee, accounting for some 41% of total retail sales, per Nielsen data.
The deal is the latest in a string of moves Molson Coors has made to expand its business beyond the beer aisle since redefining itself as Molson Coors Beverage Company in late 2019 (inside.beer, 30.10.2019).
“This is one more way we’re innovating beyond our traditional product lines to deliver what consumers want,” said Pete Marino, President of Emerging Growth at Molson Coors. “It’s a mutually beneficial partnership for all; La Colombe will enhance its reach through our established distribution network, our distributors will benefit from access to another fast-growing, high-demand product they can offer their retailer customers, and Molson Coors adds an above-premium offering to the top of our non-alcohol roster of brands.”
Consumer demand for RTD coffee products is growing. The U.S. market is estimated to be worth $4.6 billion today, and it is expected to grow by more than 60% over the next five years, according to an analysis of third-party data.
And La Colombe ranks among the fastest growing in the U.S. ready-to-drink coffee category in the total U.S. food channel, IRI data show. Over the 52-week period ended Sept. 6, La Colombe posted 59% growth, more than double that of the industry rate of 22%, per IRI.
“The customer base is telling us what they like to drink,” says Todd Carmichael, La Colombe’s CEO and co-founder. “The numbers are solid across all brick-and-mortar retail.”
It’s not the first time Molson Coors and La Colombe have joined forces. In 2019, they paired up to test La Colombe Hard Cold Brew coffee, a ready-to-drink cold brew with 4.2% alcohol-by-volume. After the test concluded, the two companies found their goals for the future aligned, Marino says.
“When we strategically stepped back and said, ‘What are the categories that are interesting to us?’, we said RTD coffee, energy and enhanced water,” he says.The potential for success is evident in La Colombe’s sales in grocery stores.
“Our retail partners have never seen anything like it,” Carmichael says. “The velocities are just outstanding. Our early adopters are moving over 200 cans a week, which is setting new standards.”
Founded in 1994 and known for its ethically sourced ingredients and high-quality roasting technique, La Colombe is credited as being a pioneer in the third-wave coffee revolution, which focused on the culinary aspect of coffee and helped redefine it as a sophisticated product.
The Philadelphia-based coffee roaster’s ready-to-drink coffee beverages are available in thousands of grocery and big-box stores nationally, in addition to its 30 cafes in six states.
“The RTD coffee opportunity in drug and C-stores is a huge opportunity, and with La Colombe, we believe we have partnered with the best company in the RTD coffee space when you look across their brand strength, their quality and their innovation pipeline,” Marino says
“We’re two companies who appreciate innovation,” Carmichael says. “Combining our forces and getting Draft Lattes in more stores all around the country will bring great things to both of our futures.”
Both companies came out winners in the distribution deal, Marino says: “It’s a great opportunity for the Molson Coors beverage company, and it’s a great opportunity for La Colombe to continue to sell these great products to coffee enthusiasts across the country.”