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New York
—
Dunkin’ is already a staple in many people’s morning routines, and now it’s looking to be part of their nightcap, as well.
Liqueur brand Kahlúa is collaborating with Dunkin’ and turning the coffee and doughnut chain’s popular caramel swirl syrup into a new creamy liqueur, called “Kahlúa Dunkin’ Caramel Swirl Cream Liqueur.”
The new rum-based product, available nationwide Tuesday for $24.99, is blended with chocolate and coffee beans from Mexico, and has flavor notes of toffee, vanilla and dulce de leche, according to a press release.
The addition further bolsters Dunkin’s alcohol selection, which includes seasonal beers and canned cocktails. It also helps extend Dunkin’s reach beyond the breakfast crowd and could attract new customers, as the privately held company might be feeling the effects of a slowdown in US discretionary spending similar to its competitors.
The drink is meant to be enjoyed over ice or perhaps as part of an espresso martini, a popular cocktail that’s bolstering sales of Kahlúa and is a bright spot for its parent company, Pernod Ricard. The Paris-based company is also dealing with headwinds from tariffs and broader struggles in alcohol sales.
Pernod Ricard doesn’t disclose specific sales figures for Kahlúa, but said in last year’s earnings report that the liqueur experienced “strong growth” in North America.
The product marks the brand’s biggest investment in launching a new cream-based liqueur, the company said in a press release. The category is projected to grow into a $4.6 billion category by 2029, fueled in part by Gen Z’s growing appetite for espresso martinis.
Kahlúa approached Dunkin’ for the collaboration because of its loyal following, according to Caroline Begley, Kahlúa’s vice president of marketing. She told CNN that the product’s creation “stemmed from how people already enjoy Kahlúa,” pointing toward the at-home coffee and cocktail-making trend that started during the height of Covid-19 and has sustained as consumers keep a closer eye on their spending.
“We went through multiple rounds of meticulous testing and refinement to make sure we got the balance just right: a creamy, indulgent profile with layers of rich caramel, roasted coffee, and subtle sweetness,” she said.
For Dunkin’, the liqueur adds to the burgeoning selection of food and drink items available outside of its brick-and-mortar locations, which ranges from pumpkin spice-flavored Goldfish, coffee creamers created with Danone and even doughnut-flavored protein powders developed with nutritional supplement maker Dymatize.
Products like these are likely “negligible” to the coffee giant’s bottom line, Blake Droesch, retail analyst for research firm Emarketer, told CNN, but added that they build “affinity with the Dunkin’ brand” from its fans.
The collaborations also helps Dunkin’ expand beyond breakfast.
“When you think about the morning occasion, which is where (Dunkin’) have played, you can only do so much,” said Sally Lyons Wyatt, global EVP and chief advisor for Circana. “But then you want to figure out where else can you extend your brand across occasions throughout the day.”
She told CNN that the liqueur is an “interesting play” in light of the alcohol industry’s struggles, including sluggish sales and health concerns. But it could attract new people to Dunkin’, as well as “people that have never had a liqueur, but they love Dunkin’.”
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