New CEO Tim Cofer hailed the strength of the US coffee and soft beverages group’s K-Cup proposition which includes new brand partnerships with Lavazza, Kicking Horse Coffee and Black Rifle Coffee Company
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KDP has announced Black Rifle Coffee Company as its latest coffee pod partner | Photo credit: Zach Xavier
New Keurig Dr Pepper (KDP) CEO Tim Cofer has said new brand additions to its coffee pod portfolio will be a key to reversing the business’ falling coffee sales this year.
The US coffee and soft beverages group achieved 3.4% total sales growth in the three months ending 31 March 2024 to $3.5bn. However, US Coffee segment revenues fell 2.1% to $911m amid a 1.8% reduction in overall product price and lower year-on-year volumes.
Cofer, who became CEO on 26 April 2024 following a six-month transition period, said the coffee segment continued to achieve top-line recovery with higher coffee pod shipments and greater US market share for its owned and licensed coffee pod brands.
Speaking to investors on an earnings call, Cofer highlighted the strength of KDP’s K-Cup partnership proposition. In the second quarter, Lavazza will transition from a KDP partner to a licensed brand – a move which will see KDP assume retail and e-commerce sales and distribution responsibilities for the Italian coffee roaster across the US and Canada.
KDP has also announced Black Rifle Coffee Company as its latest coffee pod partner, adding to a broad portfolio of coffee brands including Caribou Coffee, Dunkin’, Intelligentsia Coffee, Kicking Horse Coffee, Krispy Kreme, La Colombe, Starbucks and Tim Hortons.
“The Keurig partnership proposition remains very strong, as evidenced by multiple recent brand additions to our ecosystem. Our La Colombe ready-to-drink (RTD) coffee partnership is yet another proof point and is just now beginning to scale. In total, these exciting partnerships will begin to contribute to U.S. Coffee segment volume growth, later in 2024,” Cofer said.
Cofer also told investors KDP will reinforce its focus on affordability in the second quarter with ‘sharper, value-based’ marketing.
Texas-based KDP is part of JAB Holding Company’s extensive coffee portfolio which also includes JDE Peet’s, Pret A Manger, Espresso House and Panera Brands. In April 2024, Luxembourg-based JAB announced plans to lower its stake in KDP in a bid to raise approximately $2.5bn.