ResearchAndMarkets.com has released the "Ready to Drink Tea and Coffee Market, Size, Global Forecast 2024-2030, Industry Trends, Share, Growth, Insight, Impact of Inflation, Company Analysis" report.
The report finds that the ready-to-drink (RTD) tea and coffee market will reach US$172.28 billion by 2030, and the market was valued at US$107.18 billion in 2023. It is forecast to grow with a CAGR of 7.02% during the forecast period from 2023 to 2030.
Trends in RTD Tea & Coffee Market
Natural Ingredients. Brands are placing more emphasis on natural ingredients and honing in on trends and flavors that resonate locally, which has led to an explosion in flavors and combinations.
The RTD tea and coffee market is shifting in quality to keep pace with increased interest in healthier ingredients and authentic experiences. As consumers become savvier, brands respond by bringing tea leaves directly into the plant as part of their brewing process and moving away from tea and coffee made from liquid extracts and powders.
Doing so allows brands to enter the "premium" space, which affects price and how manufacturers connect and communicate with consumers. The category is awash with trends, one being cold-brewed, followed by cold-brewed coffee. It is made with Tea & coffee leaves steeped in cold water for up to 24 hours. This brewing style requires more leaves to ensure that enough flavors are extracted. Although still considered a niche product, its devotees, particularly in Asia and Europe, claim it produces a more full-flavored and less bitter tea & coffee.
On-the-go Appeal. The increasing prevalence of on-the-go consumption, particularly among the urban and younger demographics, has significantly contributed to its market growth. Consumers are attracted to the vast array of flavors and varieties available in the RTD tea and coffee segment, catering to their diverse preferences. Moreover, the shift towards healthier and more convenient beverage options has been a key driver in market growth.
Health & wellness. As health and wellness trends gain momentum, including functional ingredients, natural and clean label formulations, specific health claims, specialty varieties, and reduced sugar content in RTD tea and coffee products have gained prominence. RTD tea and coffee are a subgroup of soft drinks, although they differ in their function with proven health benefits.
The altering lifestyles, which encourage on-the-go eating, and a growing trend of replacing meals with smaller nutritional snacks and drinks have resulted in the adoption of RTD tea and coffee. Growing consumer awareness regarding the health concerns caused by carbonated drinks is leading to a shift towards RTD tea and coffee. Another factor attributing to the market's growth is the health-conscious population who prefer the antioxidant properties of RTD tea.
Positioning RTD tea and coffee as recreational products has significantly benefited in attracting millennials, further augmenting the product demand. Over the last two decades, rapid socio-economic development has led to a rise in several chronic health conditions such as cancer, heart disease, and diabetes.
Health advantages coupled with RTD tea and coffee consumption drive consumers' attention, particularly the aging population, further boosting consumer inclination towards RTD tea and coffee. Various RTD tea and coffee products are being launched to cater to the broad consumer base across geographies.
RTD Tea Category Primarily Led the Global Market for Ready-to-Drink Beverages
The global ready-to-drink tea market is growing due to increased awareness of its health benefits, including weight loss, pain relief, and reduced cholesterol levels. These health focus, rising disposable income, convenient packaging, and expanding cafes and retail outlets are set to drive market growth.
Premium brands use social media to engage tech-savvy consumers and tap into a growing online audience, presenting significant growth potential in the forecast period. RTD tea is a rapidly growing segment in the beverage industry, offering tea lovers a convenient on-the-go experience. It includes various tea types like black, green, white, oolong, and herbal, pre-brewed and packaged for instant consumption, eliminating the need for steeping. The global RTD tea market has grown significantly, gaining popularity for its convenience, portability, and perceived health benefits.
Glass Segment is Expected to Lead
By packaging type, the RTD Tea and Coffee Market is divided into: glass, PET, cans, and others. The glass segment is poised for a prominent role, and its ascent can be attributed to its inherent convenience for both consumption and storage. Glass containers have gained favor among consumers and industry experts alike for their numerous advantages.
They offer a premium drinking experience, ensuring that the taste and quality of beverages are preserved. Furthermore, glass is a sustainable choice, eco-friendly and easily recyclable. Its transparency allows consumers to see the contents, enhancing the visual appeal. As a result, the glass segment is set to flourish, meeting the evolving demands of convenience and environmental consciousness.
Online Sector is Expected to Achieve a Higher CAGR
By distribution channel, the market is classified into: supermarkets/hypermarkets, convenience stores, online, and others. The online sector is poised for robust growth during the projected period in the drink tea and coffee industry. As consumer preferences evolve and technology advances, the convenience of online platforms has become increasingly appealing.
E-commerce channels offer a vast array of RTD tea and coffee options, catering to a broader audience. This accessibility and ease of online ordering and delivery drive the online sector towards higher growth. With the ongoing digital transformation and shifting consumer habits, the online segment is anticipated to play a pivotal role in shaping the future of this market.
China Popularity of RTD Tea Reflects the Nation's Tea Culture and its Openness to Beverage Industry Innovation
The market includes: China, India, Turkey, Japan, the United Kingdom, Germany, the United States, Indonesia, Egypt, Australia, and others. Tea has held a central place in Chinese culture for centuries, and the RTD tea segment has recently gained immense popularity, especially among busy Chinese consumers, notably the younger generation. A heightened focus on health primarily fuels the growth of RTD tea in China. This trend has led to competition between sugar-free, carbonated, and alcohol-infused variants and traditional soft drinks, attracting specialty tea shops despite intense market rivalry.
Essential flavors in this market include oolong, black, green, and jasmine tea. Brands like Chi Forest have entered the tea market, offering sugar-free and fruity sparkling water with erythritol sweeteners to enhance taste without compromising health-conscious appeal. Additionally, Master Kong, a prominent player, introduced reduced-sugar jasmine tea, diversifying its product range and poised for significant off-trade volume growth.
United States Market for RTD Coffee Made Most Significant Contribution to the Global Tea & Coffee Market
The RTD coffee market includes the United States, Brazil, France, Germany, Spain, Canada, Netherlands, Sweden, Finland, Denmark and others. In the United States, the demand for healthy beverages, including various types of RTD coffee, has evolved beyond a trend and is now an integral part of consumers' lifestyles. The focus on health has increased awareness of functional drinks, particularly in the hot RTD coffee segment. Companies are responding by infusing RTD coffee products with nutrients like vitamins, minerals, probiotics, antioxidants, and energy boosters to meet consumer demands.
For instance, REBBL introduced REBBL Stacked Coffee, a line of cold-brew coffees designed to provide balanced energy and immunity support through the inclusion of ingredients such as green tea's L-Theanine, oat milk, reishi mushrooms, Lion's Mane mushrooms, and MCTs. This approach addresses consumer preferences for taste and health benefits. RTD coffee appeals to a broad demographic, with a focus on younger consumers, and functional RTD coffee with health claims offers brands an opportunity to differentiate them.
Consumers seek various functional benefits in their coffee, including antioxidants, anti-inflammatory properties, low sugar, added protein, probiotics, and varying caffeine levels. The market is also witnessing the launch of dairy-free and vegan coffee options to cater to the convenience and health-conscious on-the-go beverage categories.
Plan to Attend or Participate in World Tea Expo, March 18-20, 2024
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