An ever-changing category ripe with opportunity
In recent years, the global market for chilled liquid foods has been in constant flux. But this change is bringing about opportunities as well as greater clarity as to what consumers want from what is typically considered a more traditional product type. Furthermore, each chilled category has been reacting to various consumer trends in a way that poses challenges for producers, but also provides opportunities for growth. Our experts discuss what lies behind these shifts, as well as the future trends and developments producers of chilled liquid foods should look out for.
A short history of chilled
Historically, the concept of chilled liquid foods brought to mind a few standard – and common – offerings: white milk, yoghurt and similar dairy products, and fruit juices. After the commercial introduction of refrigerated bottles in the early 20th century, such products became household staples in the West, particularly on the breakfast table. Generations were raised on chilled products’ specific taste profile – especially milk – and such habits became cultural touchstones; witness the ubiquity, and reach, of the famous Got Milk? advertising campaign.
And chilled products – especially white milk – enjoyed a further advantage which drove the market’s growth over the last few decades – consumers frequently perceived them as being “fresher”, healthier, and altogether more natural. “In Europe especially, this notion was a driver behind consumers’ belief that chilled products were of better quality – a notion that, in some markets, continues to today,” says Anna Larsson, Business Insights Leader at Tetra Pak.
Of course, these qualities – wholesome, nutritious, and great tasting – are no longer limited to chilled offerings; ambient products are now often indistinguishable from their refrigerated counterparts. And chilled as a category is now extremely broad, taking in cold brew teas and coffee, energy drinks, plant-based beverages, sauces, egg-based products, and soups. As such, producers have a wide scope for innovation and differentiation regarding their chilled liquid foods portfolio, but they must also ensure their offerings meet ever-increasing consumer expectations in what is now a highly competitive space.
The global market for chilled liquid foods is emerging from an extremely challenging few years – Covid, inflation, and the decline of breakfast as a family “occasion” are just a few of the drivers that have impacted consumer behaviour when it comes to the purchase of chilled products. Overall, the market has been somewhat flat, and this is forecast to continue through 2026. Yet behind this seeming stagnation is a much more nuanced picture of what is happening in both specific global markets, and in specific chilled categories.
“You have to consider each separate category in its geographical context,” says Nagi Noujeim, Global Category Expert at Tetra Pak. “Dairy, and specifically milk, is a mature category in western markets, especially the USA, UK, and Europe, whereas in China, chilled milk is now witnessing growth, particularly in megacities, where consumers are more and more drawn to the ‘fresh’ perception chilled milk provides. On top of that, we are witnessing growth in other chilled formats with coffee and other categories. So, there are still opportunities for growth in chilled, even in those markets that might seem flat, if you explore deeply enough.”
Consumer trends driving change
There are, says Noujeim, different trends currently impacting the demand for chilled liquid foods, especially milk and juice. “Some trends are impacting it positively, such as consumers' desire for naturalness and transparency, while others are more challenging, such as the decline of the breakfast occasion or changes in consumers’ diets. It’s therefore key that industry players leverage these positive trends to both increase the consumption of chilled liquid foods and explore new trends, such as offering more functional health products or on-the-go chilled products.”
“Natural” is a winning quality
So, what are the key trends set to influence the chilled foods market? As noted above, the perception of “freshness” – and, by extension, quality – continues to exert a powerful influence in many markets. “There is a trend toward prioritising minimally processed products for health reasons, and we have every reason to believe that this will continue to be a strong driver for chilled product categories,” says Larsson.
Chilled products are also assumed – not always correctly – to contain fewer additives and preservatives, further fuelling chilled products’ “natural” credentials. And this can be leveraged for premiumness, too, as demand for premium offerings gathers pace.
Functional health – a platform for growth
Being refrigerated, chilled liquid foods can safely contain several ingredients that provide unique functional benefits with regard to gut health, immunity, and various other areas. And this ties into another major trend – functional foods that come with added nutritional benefits. “Consumers are looking for foods with specific functionalities and seeking out ingredients that play an active role in their well-being,” says Larsson. “That could be for energy, health, or something calming.”
Promoting living bacteria in yoghurt and other dairy products is one growing example of functionality; adding dietary fibres and removing lactose to support digestion is another. Protein-fortified products have been growing for several years and will continue to do so, targeting consumer segments from fitness enthusiasts to the elderly seeking extra nutrition. Other interesting emerging areas related to functional health are immunity boosting and even mental health.
With modern lifestyles generally faster, less regimented, and packed with a greater variety of activities, traditional consumption patterns – particularly around mealtimes – have changed. As such, many consumers now have part, or even all, of their breakfast or other meals on-the-go.
Such change – alongside that of functional health – is behind the current growth in categories such as coffee- and tea-based drinks, flavoured milk, and rice, nut, grain, and seed-based drinks. Producers should also take note of the demand for healthy and energising liquid food snacks at work or after physical activity.
The plant-based trend
Also among the recent changes in consumer habits is a move towards consuming more plant-based products, driven by the perception of these being beneficial both for individual health and the planet. Of course, this category remains somewhat limited when compared to the much wider dairy market, but it does give producers the opportunity to offer new chilled products such as chilled plant-based or coffee-based beverages. This could also push producers to diversify their chilled milk and juice portfolio – and attract new consumers to the chilled category – by offering new flavours, added functionality, or improved health benefits.
“But as with any product, just combining two things won’t cut it,” Larsson points out. “With plant-based beverages, you need to do a lot of experimentation to achieve an appealing taste profile and mouthfeel, as it is a relatively new product category. This means there are also a lot of mixed proteins, such as peas and oats; therefore, it’s a good area to innovate in. And you must have a clear, well-thought-out idea of how to position your chilled product, and what benefits it will bring your consumer.”
Ultimately, says Noujeim, when it comes to seizing opportunities in chilled liquid foods, understanding underlying consumer trends in each specific geographical market and category, and positioning your products accordingly, is key to your success. "You need to look for specific segments and provide unique selling propositions that will resonate with ever-changing consumer demand. Evolving and developing your offering is therefore crucial to staying relevant in the minds and diets of consumers."
Segmentation is, of course, always relevant, but considering the markets where chilled liquid products are seen as a traditional staple, finding innovations that resonate is imperative – this is where research, experimentation, and reaching out to existing and new consumer segments will allow future growth.
