Frozen dispensed beverages, those cold and sweet nostalgic treats, have helped make convenience stores a destination for more than fuel and convenience. But beverage company insiders believe the category has even greater opportunities for growth.

“Over the next three to five years, frozen beverages will become more premium, more innovative and more experience-driven,” said Rebecca Johnson, director of dispensed innovation at The Coca-Cola Company.

“Consumers are looking for customization, bold flavors and recognizable brands, and operators are looking for products that drive traffic, increase profitability and differentiate their business,” she said. “The future belongs to operators who treat frozen beverages as a destination category rather than simply another drink option.”

The frozen dispensed beverage category includes three subcategories: frozen non-carbonated (70.1% of sales), frozen carbonated (15.7%) and other frozen dispensed beverages (14.2%). Last year, according to the NACS State of the Industry Report® of 2025 Data, sales of frozen dispensed beverages averaged $4,048 per store, per month— an increase of 1.5% from 2024’s $3,990. The category generated an average gross margin of 65.45%, slightly higher than the 64.44% of the previous year.

The highest sales for frozen dispensed beverages occur between 3 and 4 p.m. on Fridays.

Frozen Function

Across all beverages, consumers are becoming more intentional about what they drink and are seeking beverages with functional benefits.

“While frozen beverages have traditionally been viewed as an indulgent treat, we believe there’s room for the category to evolve,” said Johnson. “Functional ingredients like energy, hydration, vitamins and other wellness-focused benefits represent an exciting area of exploration. The challenge is delivering those benefits while maintaining the taste, texture and refreshing experience consumers expect from a frozen beverage.”

Several slush producers now offer energy-enhanced beverages, including Frazil, which produces an energy-boosting slush in assorted flavors and sugar-free versions.

Sunny Sky Products debuted its OSC Energy Frozen at the 2025 NACS Show. “It was a hit,” said Isabel Atherton, vice president of marketing for Sunny Sky. “And consumers have fun adding flavor shots to this frozen base.”

Next year, f’real, the self-serve milkshake blender, will introduce two protein-enhanced smoothies: Tropical Mango Protein Smoothie and Reese’s Peanut Butter Banana Protein Smoothie.

“Both are made with real fruit and deliver 20 grams of protein from milk protein isolate, all in under 250 calories, with no artificial colors, flavors or sweeteners,” said Ashley Abeel, director of beverage and equipment at f’real.

“What sets them apart is our blend-it-yourself process,” she said. “It keeps the texture so smooth and creamy that the added protein is virtually undetectable.”

Love Those LTOs

Beverage LTOs allow operators to create buzz, encourage trial and keep the frozen-beverage experience feeling fresh throughout the year.

“We’ve found the greatest success comes from pairing trusted brands with new flavors, seasonal moments or cultural relevance,” said Johnson. “Whether it’s a unique flavor twist or a seasonal offering, such as our relaunch of Fanta Cherry Limeade, the goal is to generate excitement while maintaining the quality and consistency consumers expect.”

Traditionally, frozen beverages are considered warm-weather refreshments. But Canada has one of the highest rates of frozen beverage consumption per capita, and Winnipeg has held the title of Slurpee Capital of the World for more than 20 years, according to 7-Eleven Canada.

“We sell frozen beverages year-round, even during the Canadian winter,” said Loïc Tomei, general manager of Jones Soda Co. Canada. “For us, what matters most is distribution and having the product available where consumers are looking for it. Frozen beverages don’t necessarily have to be treated strictly as a summer product.”

“A flavor like Caramel Apple, for example, can create a completely different reason to visit the machine during the fall,” said Tomei. “The possibility of a new flavor gives customers another reason to check the frozen beverage section when they visit the store, regardless of the season.”

Partners and Promos

Tying a product to a well-known brand or popular franchise is a proven way to boost consumer interest.

“At Coca-Cola, we see opportunities to connect frozen beverages with entertainment, movies, sports, gaming and seasonal occasions,” said Johnson. “While we can’t share specific future plans, consumers can expect more collaborations that blend recognizable brands with memorable beverage experiences.”

Management at Jones recognizes the strong connection between fun, frozen drinks, younger consumers and pop culture. The company recently collaborated with Circle K on a beverage platform associated with the popular streaming series “Fallout.”

“When you connect a unique flavor with an entertainment property that consumers already care about, the frozen beverage becomes more than just a drink, it becomes part of the experience,” said Tomei.

Sunny Sky Products works closely with major food companies, such as Ferrara, Ferrero, Hershey and Mondelēz, to produce beverages with brands that customers know.

“We have amazing relationships with these companies and continue to innovate based on their candy product launches,” said Atherton. “We recently introduced two new frozen beverage flavors in tandem with the Ferrara Candy Company’s iconic Trolli gummy brand: Trolli Very Berry Punch Slush and Trolli Grape-Strawberry Slush.”

“These flavors deliver the bold candy taste consumers expect from Trolli,” Atherton said, “while providing operators with a high-impact, easy-to-execute frozen program that drives traffic and profitable beverage occasions across dayparts.”

According to Atherton, stores can sell even more products by linking a frozen LTO with a center-store confection. “The beverage has more visibility when it’s tied to a famous candy or foodservice item, like a cookie or brownie,” she said. “These programs usually help increase the basket size and drive traffic to new areas of the store.”