Costa Coffee is expanding its matcha latte range to all stores nationwide as it looks to win over Gen Z shoppers and turn around its struggling financial performance.
Following a trial in selected stores late last year, the coffee chain is now launching the range in all 2,800 stores on 8 January. It features a Hot Matcha Latte and an Iced Matcha Latte, both of which are fully customisable with milk alternatives and syrups, alongside a Strawberry Coconut Iced Matcha Latte.
“Costa Coffee’s matcha is designed to be a feel-good ritual, whether you’re discovering matcha for the first time or already love its smooth flavour,” said Costa Coffee global food and beverage innovation director Nishant Bhatia.
It comes as Costa saw financial losses more than double to £13.5m in 2024 as the chain grappled with slow footfall and cheaper competition, while rivals have also been much quicker to jump on viral trends, including matcha.
During Coca-Cola’s second-quarter earnings call in July, CEO James Quincey admitted Costa had “not quite delivered” and was “not where we wanted it to be from an investment hypothesis point of view”.
A month later, it was revealed Coca-Cola was exploring the potential sale of Costa just five years after acquiring it from Premier Inn owner Whitbread in a £3.9bn deal.
However, Costa is looking to shake up its menu further with a new Spanish Caramel Latte and the returning Spanish Latte, available hot or iced.
Costa is also launching new Instant Barista Creations Iced Latte sachets for customers to use at home. The limited-edition range includes a classic Iced Latte and an Iced Hazelnut Crème available in Tesco from 19 January and in Iceland stores from February, for a limited time.
In stores, Costa is also updating its food menu with a new Onion Bhaji Wrap, a Tomato & Basil Soup, and a Tomato & Mature Cheddar Croissant. Two new healthy snacks will also be available, including the Fruit & Nut Mix, and new Dried Mango.
“January is about finding small moments of comfort and enjoyment, and that was front of mind when creating this menu,” said Bhatia.
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