Iced coffee is hot this summer and making cold cash for cafes, chains


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Walk through the city this summer and everywhere you look you'll see pedestrians clutching plastic cups of iced coffee. You also might notice, on store windows, glossy posters showing larger-than-life confections topped with whipped cream.

Iced coffee, of course, has been available in many more cafes since the dramatic rise of Starbucks. According to the latest statistics from the National Coffee Association, Americans drink 400 million cups of hot coffee a day compared to 640 million cups of iced coffee a year. But consumption has taken off this summer and retailers are hurrying to meet the demand.

Large chains are battling for a share of the market, hoping to eat into Dunkin' Donuts' substantial majority. 7-Eleven is adding self-serve iced coffee machines to 4,500 stores. McDonald's has been airing television ads for its iced coffee drinks, part of the McCafe program that introduced specialty coffee drinks. Wendy's is airing radio spots for its new "brewed by the cup" iced coffee. And Starbucks has a new advertising campaign for its iced drinks, for which it offered discounts through June.

Independent cafes are mostly staying out of the turf war. Nick Nicholas, owner of Nicholas Coffee Co. in Market Square, Downtown, the oldest coffee roaster in Pittsburgh, is well aware of the competition. Just on the Square you'll find a Crazy Mocha, a Dunkin' Donuts and a Starbucks. McDonald's is around the corner.

Shops like Nicholas Coffee don't have the advertising power of these chains, but they're benefiting from the hoopla.

Nicholas says the store is having a banner year, partly because of an increase in iced coffee sales. "It's starting to be more popular. We've been selling more and more at our little coffee bar."

Store manager Liz Musser agreed. "Anything iced and anything frozen has really taken off over the last year. I think people are looking for something different."

Choices, choices

There is a wide variety of iced coffee drinks, some tasting more intensely of coffee or espresso, others milk-based and still others sweetened and flavored with all kinds of syrups and powders.

Almost every cafe offers plain iced coffee, but that's where the similarities end. At Nicholas Coffee, they chill full-strength regular coffee overnight, then pour it over ice to order. Some cafes prefer to use double-strength coffee, since melting ice can quickly dilute the drink.

21st Street Coffee, which has locations in the Strip District and Downtown, and Voluto Coffee in Garfield use the cold-brew method, which typically produces coffee lower in acidity and less bitter. Ground beans are brewed in cold water for 12 hours, then strained and chilled. The resulting coffee concentrate is then diluted with cold water and ice for each order. A number of chains, including Caribou Coffee and Seattle's Best, also use the cold-brew method.

The real money for cafes is in flavored, iced lattes and frozen coffee drinks, which cost pennies to make (at least at most cafes) but fetch premium prices -- usually $3 to $4 for a small and often approaching $5 for a large. That's why cafes go to such efforts to differentiate their products from the competition. Most of those frozen, flavored drinks are similar, but a catchy name goes a long way. Starbucks has frappuccinos. Caribou Coffee has Northern Light Coffee Coolers and Snowdrifts.

Cafes can charge top dollar for these drinks because people are willing to pay for them. Demand is so high that even back-to-basics cafes that focus on espresso and single-origin coffees offer some sweeter drinks. Aldo in Mt. Lebanon offers a house-made coffee frappe.

International roots

Some coffee aficionados may not even recognize sweetened, blended drinks as coffee, but there's an international tradition of such drinks. Many believe that the drink originated as Italian coffee granita, leftover sweetened coffee chilled and made into an icy dessert. Others point to Vienna, where people have been drinking Eis Caffe' Mit Schlag -- iced coffee with whipped cream -- for hundreds of years.

For more than 50 years, one of Greece's most popular summertime drinks has been the frappe, a frothy concoction of Nescafe instant coffee, cold water and sugar shaken with ice. It is said to have originated at a trade show in Thessaloniki in 1957.

As espresso has become more available in the past 10 or 15 years, new drinks have started to grow in popularity. Espresso freddo is made by pouring sweetened espresso over ice. Cappuccino freddo is simply espresso freddo topped with cold, frothed milk and sometimes a dusting of cinnamon or cocoa powder.

In Italy, people drink espresso in summer as well as in winter, but they also drink caffe freddo (iced espresso) and caffe shakerato, espresso shaken with ice and poured into a martini glass, usually sweetened with simple syrup or a little liqueur. Try a shakerato at Aldo Coffee.

Iced coffee drinks are particularly popular in Southeast Asia. Thai iced coffee is usually brewed with cardomom pods, sweetened with sugar and then topped with a few spoonfuls of cream or condensed milk, which floats in a creamy white layer on top of the reddish-brown coffee.

Vietnamese iced coffee is usually served as a homogeneous mixture made from dark roast coffee, sweetened condensed milk and ice. It's traditionally made using metal coffee brewers that brew small portions of strong coffee directly into a glass filled with a spoonful or two of the sweetened condensed milk. Ground coffee is placed in the pot, then a metal press is screwed onto it, pressing down on the coffee. Small holes in the bottom of the pot and the press-plate allow boiling water to drip slowly through the grounds into the milk. This mixture is stirred, then poured into a glass full of ice.

In Thailand and Vietnam, top quality Arabica beans make up a very small percentage of coffee crops. These drinks are triumphs of culinary ingenuity, using spices, sweeteners and dairy products to make cheap, pre-ground robusta coffee palatable.

While the proliferation of iced coffees gives consumers more options, it also has become a real money maker for cafes that can sell inferior coffee at an extreme markup.


China Millman can be reached at 412-263-1198 or cmillman@post-gazette.com . Follow China on Twitter at http://twitter.com/chinamillman . First Published July 23, 2009 4:00 AM


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