Younger consumers, particularly Generation Z, are increasingly favoring cold, highly customizable drinks over traditional hot coffee, a trend that is reshaping the beverage market and pushing major coffee chains to innovate. This shift is evident in consumer preferences, where factors like personalization, visual appeal, and perceived value are driving choices.
Starbucks, a company founded over 50 years ago with a focus on hot coffee, now sees three out of every four drinks sold being cold. These include iced fruity beverages, protein shakes, and customized "dirty sodas." According to a 21-year-old consumer, Elaine Ling, traditional coffee from chains like Starbucks can be perceived as "too sweet," leading her to opt for cold "refreshers" instead. This sentiment is echoed by many in Gen Z, who were born between 1997 and 2012.
Experts suggest this preference is linked to a desire for control and self-expression. Tristan Höver, global insight manager for hot drinks at Euromonitor International, explains that younger consumers view drinks as customizable tools to meet specific needs. Customization offers a sense of control, and while Gen Z can be price-sensitive, they are willing to pay more for drinks that feel special, larger, or offer functional benefits. The visual appeal of layered or vibrantly colored cold drinks can also help justify a higher price point.
Jerry Sheldon, an analyst at IHL Group, categorizes this trend as a broader cultural shift where cold beverages serve as a form of self-expression, similar to fashion choices. Professor of Marketing at Vanderbilt University, Kelly Goldsmith, likens Starbucks to an accessible luxury brand, suggesting consumers are paying for the experience and brand image as much as the product itself. This brand perception has long allowed Starbucks to maintain premium pricing.
Social media platforms, particularly TikTok, play a significant role in popularizing these drinks. Starbucks' limited-time Unicorn Frappuccino, for instance, generated substantial buzz and drove a 44% increase in foot traffic during its brief availability, according to data analytics firm Placer.ai. This demonstrates the power of viral marketing for visually striking and novel beverages.
In response, other chains are actively pursuing this demographic. Dunkin' is experimenting with protein-enhanced and customizable cold drink options. Their recent collaborations with celebrities, such as Kylie Jenner for limited-time offerings, aim to capture the attention of younger audiences. TikTok food and drink creator Natalie Ludwig notes that such celebrity partnerships are a strategic move by chains like Dunkin' to engage with and retain a younger consumer base, with the hope that successful promotions will lead to lasting customer loyalty.