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RTD Coffee in Russia

Russia RTD coffee market: Nescafé Xpress the leading brand during 2012

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2014-04-18 02:40:03 - RTD Coffee in Russia - a new market research report on

After the leading brand in RTD coffee in Russia, Nescafé Xpress from Nestlé, was withdrawn from Russia as a result of very low volume sales, enabling Lotte Chilsung to take the category lead. South Korean company Lotte Chilsung is the main importer of RTD coffee in Russia. Lotte Chilsung has been supplying RTD coffee under the Let´s Be brand to Russia´s eastern regions for eight years and is currently attempting to generate a culture of RTD coffee consumption in Moscow. The company plans to maintain its leading position in RTD coffee by selling more than one million litres in the country annually.

In 2012, for the first time in four years, the Russian RTD coffee category began to show some positive



development. Since the onset of economic instability in 2009, the category has been declining at a steady pace in both value and volume terms. The decline was mainly attributed to the low popularity of this novel drink among Russian consumers. When first launched, RTD coffee was positioned as a higher-end product, therefore since the economic instability, sales of more expensive products declined notably. As a result, the leading brand at that time, Nescafé Xpress from Nestlé, was withdrawn. Although there were only two major companies offering RTD coffee in Russia at the end of the review period, their performance started to show some positive results, leading to a 9% increase in volume terms in 2012.

RTD coffee is a novel category and, therefore, can be regarded as a niche with potential for future development. The coffee culture is likely to continue developing over the forecast period which will mean there could be potential demand for products, such as RTD coffee. However, the high average unit price and unhealthy image of this category will remain the key constraints for its development over the forecast period. It is predicted that RTD coffee will register a 4% CAGR in off-trade constant value terms to reach RUB21 million by 2017.

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