Click to read the original article for details The winter solstice has passed, and temperatures in China are dropping day by day, but one area is heating up: the (ready-to-drink) hot beverage market. Of particular note is the emergence of "self-heating beverages." From coffee and milk to milk tea and red wine, all kinds of drinks can now be self-heated. In this winter-limited trend, how are self-heating beverages performing so far? And who is buying into them?

-01- Coffee, Milk, Red Wine: This Winter, Everything Can Be Self-Heated First, since the beginning of winter in 2020, New Consumption Daily has observed that three different brands have successively launched self-heating beverages in three different categories, covering milk, coffee, and red wine.

1. Nongfu Spring: Self-Heating Coffee At the end of November, Nongfu Spring's Tanbing coffee launched a self-heating set, equipped with a self-heating cup and a self-heating bag. The self-heating principle of this coffee is similar to that of self-heating hot pot. Users insert the self-heating bag into the self-heating cup, pour in a certain amount of water, then place the beverage inside, close the lid, and wait 6-8 minutes to complete the "self-heating" process.

2. Jindian: Self-Heating Milk On December 7, high-end dairy brand Jindian announced that it would launch a self-heating milk gift box. It is understood that the product's self-heating method is a "wireless thermal charging" mode, which heats the milk to 55 degrees Celsius in 15 minutes and maintains a constant temperature for 3 hours. However, as of the time of writing, this product has not yet been sold in its official flagship store.

3. Drunk Goose Lady: Self-Heating Red Wine At the beginning of the month, the founder of the wine brand Drunk Goose Lady posted on her official Weibo, saying that Drunk Goose Lady had launched the "world's first" self-heating canned red wine. Simply press the button at the bottom, shake the bottle, and you get a cup of hot mulled wine at the right temperature.

In addition to the self-heating beverages launched in the winter of 2020, in 2019, a lesser-known self-heating milk tea called Lujiaojian also appeared on the market. It is reported that this self-heating milk tea still uses a self-heating pack for heating, providing consumers with essential items such as a self-heating pack, purified water, tea powder pack, and straw.

-02- What Gives Brands the Courage to Make Self-Heating Beverages? Compared to the self-heating beverages that have emerged in the past month, "self-heating" is not a new term. However, when most of us mention "self-heating," it is usually followed by foods like "hot pot" or "rice." Looking back at the soon-to-end 2020, "self-heating" has clearly led the trend in the food market. The outbreak of the epidemic at the beginning of the year made self-heating hot pot, self-heating rice, and other self-heating foods popular in households. This was an unexpected boon for the self-heating market. After the boom, capital also poured in: in May 2020 alone, two food brands primarily focused on self-heating hot pot, Shirenzu and Moxiaoxian, completed Series A financing of tens of millions of yuan, and Zihaiguo completed a Series B financing of over 100 million yuan in May.

Although compared to the booming self-heating food market, beverages have been lackluster in the self-heating space, to some extent, "self-heating beverages" sit at the intersection of the "self-heating market" and the ready-to-drink "hot beverage market." The emergence and popularity of self-heating foods have made consumers more familiar with the concept of "self-heating," and now self-heating beverages are meeting the burgeoning Chinese hot beverage market. Public data shows that the scale of China's hot beverage market has exceeded 100 billion yuan, with categories including soy milk, fruit juice, plain tea drinks, milk tea, coffee, almond milk, and walnut milk. Meanwhile, the 2018 Consumer Beverage Temperature Preference Index shows that in winter, 54.7% of consumers choose hot beverages.

Although for most beverages, the cold winter is often the off-season for consumption, consumers, especially Chinese consumers, clearly have a demand for hot beverages. Brands have also noticed this and begun to meet consumer needs. According to New Consumption Daily's observations, both emerging beverage brands and traditional beverage companies have made varying degrees of layout for the (ready-to-drink) hot beverage market:

  • Yuanqi Senlin launched a new mini version of Yuanqi Senlin milk tea, with thickened packaging and multiple reinforcing ribs, greatly improving the bottle's heat resistance and stability to meet the needs of beverage heating.
  • Since October 2020, Coca-Cola has successively launched multiple winter hot drinks, including Coca-Cola Ginger+, Costa English Breakfast Tea Latte Milk Tea, and Minute Maid Osmanthus Warm Pear Fruit Drink.
  • Suntory Beverage also launched an upgraded winter warm drink series, including Osmanthus-flavored Lichi Milk Tea, Honey Fruit Tea, Classic Unsweetened Oolong Tea, and Lichi Latte.

It can be seen that although the beverage market has entered a stage of intense competition, ready-to-drink hot beverages still have a broad market. After all, in the current development of the ready-to-drink hot beverage category, no single product or brand has grown strong enough to successfully seize the big cake hidden under the so-called "winter beverage off-season." As long as demand remains unmet, there is unlimited market potential. Coca-Cola, Nongfu Spring, Yuanqi Senlin, and others have all recognized this. And the market for "self-heating beverages," based on its current development, can be described as "a blank slate."

After discussing the market, let's look at the audience. To some extent, consumers' "higher-order needs" have also given self-heating beverages room to emerge and develop. First, as the Beverage Temperature Preference Index shows, Chinese consumers have always preferred warm or room-temperature food and beverages, as they are considered less irritating to the digestive system and beneficial to health. Second, self-heating beverages allow consumers to achieve "hot beverage freedom" to some extent. This is especially true compared to traditional instant products like Xiangpiaopiao and Youlemei, which require finding water and brewing to get a hot drink. When you're walking on a street without convenience stores and pull out a self-heating milk from your bag, or at midnight during overtime, take out a self-heating coffee, to a certain extent, this expands and provides consumers with more convenient scenarios for hot beverages.

-03- How Much of a Splash Have Self-Heating Beverages Made? Now, let's briefly understand the "long" and "simple" history of self-heating beverages. It is called "long" because self-heating beverages have actually been on the market for nearly 20 years. In 2001, the old coffee giant Nestlé developed a "self-heating" coffee drink called "Nescafe Hot When You Want." The principle was to place water and quicklime separately in the interlayer of the can, generating heat through a chemical reaction. After pressing the button at the bottom, consumers could drink 60-degree hot coffee within three minutes. However, after market testing, this self-heating can failed to meet demand in cold weather; moreover, the device took up a large volume of the container, with only 7 ounces of coffee in an 11-ounce container, disappointing consumers. Eventually, just one year later, Nestlé abandoned the product.

With the rapid development of the "self-heating" market in recent years, more and more beverage companies have begun to explore new directions for self-heating beverages, and more self-heating black technologies have appeared in the beverage market. For example, in 2017, self-heating technology developer HeatGenie developed a self-heating canned beverage. Its self-heating device uses safer and more efficient aluminum and silica as the reaction heat source, and the heating material of the new self-heating technology only accounts for one-tenth of the can. HeatGenie self-heating coffee can In 2018, the company received $6 million in financing. In 2019, it was renamed HeatGen, upgrading its appearance and heating method, from the previous rotating bottle cap to a rotating bottom cap to start heating. Once the appropriate temperature is reached, pulling the tab stops the heating.

Bringing the timeline back to the present, 20 years have passed. Now that the technical issues of self-heating beverages are no longer a problem, how is their market performance? Drunk Goose Lady's self-heating red wine was sold in limited quantities. Although it attracted attention at launch, a month later, this convenient self-heating red wine did not cause a "sensation" in the market. Nongfu Spring's self-heating coffee received some positive reviews for the self-heating cup, but some consumers also commented: "The coffee tastes average after heating, with a bland sourness and bitterness. The self-heating cup is too simple." And "It's okay, I guess. It's just an added heating feature, but you lose a bottle." As for Jindian, the milk gift box using black technologies such as intelligent recognition and wireless thermal charging, as of the time of writing, this Versailles-style milk has not yet been officially sold since its promotion on December 7.

Finally, the self-heating milk tea that appeared in 2019—if you search for "self-heating milk tea" on Taobao now, it hasn't completely disappeared, but it clearly has little presence in the market. The reasons are not hard to find. It is called "self-heating milk tea," but to some extent, it is still old wine in a new bottle. After all, when you want a cup of hot milk tea, you need to: take out the milk tea, open the packaging, tear open the self-heating pack and the bagged water, and then complete the brewing. The above series of operations is clearly too complicated, and it can hardly be called "self-heating" milk tea. It would be more time-saving and labor-saving to just brew a cup of Xiangpiaopiao. Lujiaojian self-heating milk tea and its corresponding Taobao reviews. Screenshot date: December 22.

This is also why the history of "self-heating beverages" is "simple": whether it was Nestlé's self-heating coffee that appeared and ended hastily in 2001, or the "lukewarm" Lujiaojian self-heating milk tea in the past two years, or the current mediocre market performance of milk and red wine products. Even though ready-to-drink hot beverages may be a new trend, the "self-heating" function has not made much of a splash in the market.

-04- Self-Heating Beverages: Tasteless to Eat, a Pity to Discard? "If all the world used the same old methods to create wealth, then what is created is not wealth, but disaster." In the book "Zero to One," PayPal founder Peter Thiel said this. It is undeniable that the innovation and emergence of self-heating beverages have met the needs of some segmented consumers, expanded the ready-to-drink hot beverage scenarios to a certain extent, and filled a gap in the self-heating beverage market. But judging from the performance of self-heating beverages over the past 20 years, it is not hard to understand why such a product catering to a niche has not become a "hit": self-heating beverages can only meet the needs of a limited group of people within a limited time and through limited methods. At the same time, even simple ready-to-drink hot beverages require sufficient investment in materials, channels, and configuration, let alone "self-heating beverages" that require higher technical thresholds. It is precisely because of this "limitation" and "high threshold" that for many big brands, self-heating beverages may just be a way to get closer to consumers, using the "self-heating" gimmick for marketing and increasing market voice. But in the end, it is: tasteless to eat, and not a pity to discard. For some young brands, self-heating beverages cannot become their main source of revenue, and "limited edition" hunger marketing may be the best choice. "The demand for hot beverages is mainly concentrated in winter and spring. Depending on geographical location, there are regional differences in the peak sales period. In the north, the peak sales period for hot beverages can last about 6 months, while south of the Yangtze River it is basically about 3 months. Whether it is the offline warm cabinet display, channel execution, or the product's own selling power, (hot beverages) place higher demands on us." This is Coca-Cola's consideration for laying out "hot beverages." If winter warm drinks are what everyone expects and the warm drink market still has potential, then after the noise subsides, beverages that can be "self-heated" are ultimately just a false proposition.

Source: New Consumption Daily, Author: Sober Zhang

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