Craft Soda Market Report

Craft Soda Market Analysis By Product Type (Natural, Organic), By Target Consumer (Teenagers, Young Adults, Middle-Aged Adults), By Distribution Channel, And Segment Forecasts, 2018 - 2025

  • Published Date: Nov, 2017
  • Base Year for Estimate: 2016
  • Report ID: GVR-2-68038-238-9
  • Format: Electronic (PDF)
  • Historical Data: 2014 - 2016
  • Number of Pages: 135

Industry Insights

The global craft soda market size was valued at USD 537.9 million in 2016. Rising population in developing countries along with the increasing consumer disposable income is expected to have a positive effect on the product industry in the coming years. Moreover, the growing health concerns and rising awareness regarding the use of organic products are likely to further boost this growth.

The shifting consumer preference from sugar-laden drinks to low-sugar or mid-calorie beverages as well as choosing craft soda as an operative substitute for alcoholic drinks is expected to foster industry growth during the forecast period. 

U.S. craft soda market

Furthermore, growing concern toward obesity and shifting consumer preferences toward natural and organic drinks are reshaping the global craft soda industry. The demand for craft soda containing natural sweeteners such stevia, agave nectar, and honey is increasing owing to their low-calorie contents. The market is anticipated to be growing on account of rising urbanization, hectic schedules, and growing popularity of the drink among the youngsters, who have a go-and-grab mentality. 

Rapid urbanization coupled with increasing consumption of takeaway products due to busy lifestyle is leading to expansion of the market. North America, followed by Europe, is expected to record the fastest growth over the forecast period owing to various untapped markets, and growing disposable income. 

Large amount of electricity and water are consumed in the production of such beverages. Rising social awareness coupled with strict government initiatives toward environment and energy conservation can be considered as one of the restraining factors for the growth of this industry. The acts such as the Clean Air Act and the Resource Conservation, and Recovery Act are some inclusive regulatory frameworks in food and beverage market that are envisioned toward energy and environment conservation. 

Product Type Insights 

Organic craft soda emerged as the fastest-growing product type segment over the forecast period owing to the increase in smart consumers who are more value-oriented and concerned toward their health. The product manufacturers, these days, are involved in manufacturing organic craft sodas owing to the increasing demand by consumers. Many craft soda manufacturers have also started the development of their healthier soda line by shifting from nutritive sweeteners to organic non-nutritive sweeteners. This is projected to foster the growth of organic sodas over the forecast period.

Natural craft soda was the largest product segment in 2016. The change in consumer’s preference on account of increasing awareness toward green and healthy products is shifting the industry toward developing products that are beneficial to health. Manufacturers are concentrating on developing beverages produced from natural ingredients such as herbs, spices, and sweeteners to meet the customers’ demand.

Target Consumer Insights 

Young adults accounted for 64.22% of the market share and emerged as the most significant target consumer segment in 2016. The segment is also expected to ascend at the fastest CAGR of 3.9% over the forecast period. Some of the factors responsible for driving demand in this age group are the perception of craft soda as a healthy substitute to diet and regular drinks and their willingness to pay for flavorful and authentic beverages.

Middle-aged adults emerged as the second-largest target consumer segment in 2016, generating a revenue of USD 133.8 million. Increasing awareness about ill effects of sugary drinks as well as obesity concerns is one of the significant factor expected to affect the growth of craft sodas within this age group. The product is not only considered as a healthy alternative to carbonated drinks but also consumed as an alternative to alcoholic beverages, which is a key factor for increasing consumption of the drink in middle-aged adults. The inclusion of real or natural ingredients in such beverages is projected to aid the potential of craft sodas to create mass appeal.

Distribution Channel Insights

Craft soda sales mainly rely on the skill of the industry player to bring various beverage products to the marketplace and distribute them through large-scale retailers or supermarkets such as Walmart, Carrefour, and Safeway, because these supermarkets are vital distribution channels for crafted beverage products to reach the end customers. The most important factor contributing to product growth has been the progress in distribution channels.

Global craft soda market

Craft soda is sold through various distribution channels such as specialty stores, supermarkets, hypermarkets, convenience stores, and online stores, thus witnessing a strong presence of crafted beverage products across many regions. Restaurants, food service providers, and hotels are anticipated to be significant channels for driving the growth of food and beverages globally. Supermarkets/hypermarkets emerged as the largest distribution channel for craft soda products in 2016 and is expected to progress at high CAGR over the forecast period. 

Food services and drinking places channel, which comprises full-service restaurants, takeaway, fast-food outlets, and bars, is another leading distribution channel in this market. The demand from this channel is expected to rise over the forecast period, and the segment is expected to grow with the third-fastest growth rate.

Advancements in beverage manufacturing technology and recycling coupled with the increase in disposable income and improvement in standard of living are projected to foster the development of this industry. The rise in demand with the contemplation of large population in developing regions, such as India, China and Australia, is expected to create a favorable market with a high growth potential.

Regional Insights

North America emerged as the largest market in 2016 and is also expected to be the fastest growing regional segment over the forecast period owing to an increase in the number of mainstream retailers, rising disposable income, increasing health concerns, and shifting preferences toward healthy drinks. Increasing demand for a variety of craft sodas from these regions is anticipated to drive the global market.

Growing production of craft sodas and investments in packaging & labeling technology are expected to heighten the demand for several types of crafted beverage products across the world. Innovation coupled with technological advancement in microbreweries is projected to upsurge the preference for such beverages.

Europe accounted for approximately 24.82% of the market in 2016 owing to the early acceptance of soda products and the emergence of developed economies. Imposition of sugar taxes is expected to act as a restraint for this product in the region. Increasing demand for artisanal drinks owing to consumer inclination toward alternatives for alcohol is one of the vital factors that are anticipated to drive market growth. 

Competitive Insights

Product diversity is an essential factor that is driving innovation and research activities in this industry. Demanding customers coupled with changing technology creates the need for new product development and product augmentation. Product portfolio expansion is one of the significant factors that are expected to influence the market positively. 

Promotion is one of the vital strategies for supporting brand recognition. Companies functioning in this industry are designing websites for endorsement and initiating advertisement campaigns, which comprise many promotional activities, to have a competitive edge over others.

Some of the companies engaged in the expansion of this market include Jones Soda Co., Reed’s Inc., Appalachian Brewing Co., Boylan Bottling Co., Wild Poppy Company, PepsiCo, Inc., The Coca-Cola Company, SIPP eco beverage co. Inc., Crooked Beverage Co., and The Original Craft Soda Company.

Many significant players such as The Coca-Cola Company and PepsiCo are endorsing the e-commerce channel owing to the adoption of smartphones and development in technology. Many craft soda manufacturers are executing retail expansion, which is intended to boost distribution channels regionally.

Report Scope 

Attribute

Details

Base year for estimation

2016

Actual estimates/Historical data

2014 - 2016

Forecast period

2017 - 2025

Market representation                                                 

Volume in Million Liters, revenue in USD Million, and CAGR from 2017 to 2025

Regional scope

North America, Europe, Asia Pacific, Central & South America, Middle East & Africa

Country scope

U.S., Germany, UK, France, China, Japan, Oceania  

Report coverage             

Revenue forecast, company share, competitive landscape, growth factors and trends

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Segments covered in the report

This report forecasts revenue growth at global, regional & country levels and provides an analysis on the industry trends in each of the sub-segments from 2014 to 2025. For the purpose of this study, Grand View Research has segmented the craft soda market on the basis of product type, target consumer, distribution channel, and region:

  • Product Type Outlook (Volume, Million Liters; Revenue, USD Million; 2014 - 2025)

    • Natural

    • Organic 

  • Target Consumer Outlook (Volume, Million Liters; Revenue, USD Million; 2014 - 2025)

    • Teenagers

    • Young Adults

    • Middle-Aged Adults

  • Distribution Channel Outlook (Volume, Million Liters; Revenue, USD Million; 2014 - 2025)

    • Supermarkets & Hypermarkets

    • Food Service & Drinking Places

    • Convenience & Specialty Stores

    • Online Stores

    • Other

  • Regional Outlook (Volume, Million Liters; Revenue, USD Million; 2014 - 2025)

    • North America

      • U.S.

    • Europe

      • Germany

      • UK

      • France

    • Asia Pacific

      • China

      • Oceania

      • Japan

    • Central & South America

    • Middle East & Africa 

Key questions answered by the report
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