Ready to Drink (RTD) Tea and Coffee Market Size, Share & Trends Report

Ready to Drink (RTD) Tea and Coffee Market Size, Share & Trends Analysis Report By Product (RTD Tea, RTD Coffee), By Packaging (Canned, PET Bottle), By Distribution Channel, By Price, And Segment Forecasts, 2018 - 2024

  • Published Date: Apr, 2018
  • Base Year for Estimate: 2016
  • Report ID: GVR-1-68038-192-4
  • Format: Electronic (PDF)
  • Historical Data: 2014-2016
  • Number of Pages: 104

Industry Outlook

The global ready to drink tea and coffee market size was valued at USD 75.25 billion in 2016. It is expected to attain a CAGR of nearly 5.6% from 2016 to 2024. Spiraling demand for energy drinks that have familiar taste as daily consumption beverages is estimated to fuel the demand for the product over the forecast period.

North America RTD tea and coffee market

Rapid socio-economic development that has taken place over the decades is resulting in the rise in cases of several chronic diseases such as heart disease, cancer, and diabetes. Growing health consciousness is boosting consumer inclination towards RTD tea and coffee. Changing lifestyles that encourage on the go eating and growing trend to replace meals with smaller nutritional snacks are stirring up the adoption of the product.

The trend of being proactive to chronic health problems is creating a staggering volume of demand for ready to drink tea and coffee as they contain antioxidants and other essential ingredients. Global trends are moving towards personalized nutrition.

Growing concerns among aging population regarding heart health and obesity can bolster the demand for the product among this population. Rising healthcare expenditure cost due to improper food consumption is poised to drive the demand for RTD tea and coffee. Fast paced lifestyles coupled with growing health awareness are projected to trigger the growth of the market.

Rising healthcare cost is making people aware of the increasing costs associated with proper medical facilities. High cost associated with healthcare has led people to inculcate self-nutrition and preventive healthcare behavior. Such behavior can lead to increase in the demand for RTD tea and coffee, which offer several health benefits.

Product Insights

On the basis of product, the market can be segmented into RTD tea and RTD coffee. RTD tea dominated the market with 74.0% share in the overall market in 2015. However, RTD coffee is likely to make inroads in the shares of RTD tea, owing to its rising consumption.

Rising demand for cold coffee concentrates is anticipated to contribute to the growth of the RTD coffee segment. External factors such as rising number of consumers and changing lifestyles are also supplementing the growth of the segment.

RTD coffee is a cold brewed coffee, which has relatively high sweetness and high amounts of caffeine. The segment has marked the presence of key beverage manufacturers. Protean coffee bean prices have been a major challenge for manufacturers for a long time.

The El Niño effect, which caused a lot of problems in the coffee plantations, has eased down; thereby, helping the market to revive. Introduction of new flavors in these products is expected to promote the growth of the segment.

RTD tea belongs to the category of non-alcoholic soft drinks. The drinks are available in both dairy and non-dairy forms. Manufacturers are making process improvements to bring out the best tea flavors with added nutritional benefits to escalate the demand for these products.

Rising preference for carbonated RTD tea among consumers is supporting the growth of the RTD tea segment. Global soda consumption is on a decline owing to health hazards and this is a good opportunity for the product manufacturers to capitalize on the market and gain shares in the global arena.

Packaging Type Insights

Canned, glass bottle, PET bottles, and others are the four packaging type used in the RTD tea and coffee market. The PET bottle packaging segment dominated the market, representing 31.5% of the overall revenue in 2015.

Packaging familiarity and consumer attributes towards plastic packaging are supporting the growth of the segment. However, demand for other types of packaging such as cartons and pouches is estimated to decrease on account on growing awareness about plastic pollution.

Global RTD tea and coffee market

The type of packaging directly influences the purchase decision of consumers. Canned and glass bottle type of packaging also hold prominent positions in the market. They represent 28.0% and 24.0% of the overall market in 2015.

Glass Bottle as packaging material for milk-based products is the oldest form of packaging. Several major brands still use glass bottles as it improves the product image and also forms an important part of the brand identity of these products. The recyclability and reusability of glass makes it an important form of packaging material for the product.

Distribution Channel Insights

Supermarkets/hypermarkets commanded the dominant share of 35.5% in terms of revenue in 2015. Presence of a large number of supermarket chains and changing retail landscape across the globe is poised to boost the sales of ready to drink tea and coffee through supermarket distribution channel. However, rising café culture around the world is projected to propel the consumption of the product through food service distribution channel.

Food service is likely to be the fastest-growing distribution channel with a CAGR of over 6.0% during the forecast period. Rising number of millennials following the café culture is anticipated to contribute to the growth of the segment.

Price Segment Insights

The premium price segment led the market in terms of revenue in 2015. The demand is expected to grow as manufacturers are looking to introduce new flavors and trying to capitalize on premium products comprising these flavors.

The other three price segments reviewed in the report are regular, fountain, and others. Regular pricing is majorly preferred by the supermarket distribution channel to augment the demand for RTD tea and coffee.

Regional Insights

Asia Pacific dominated the global market with a share of over 40%, in terms of revenue in 2015. The demand for the product in this region is driven by countries such as Japan and China, which have a high number of tea and coffee plantations. The market is estimated to experience healthy in the coming years, especially in countries such as Thailand, Indonesia, and India.

The Middle East & Africa is poised to post a CAGR of 7.0% from 2016 to 2024. High consumption of tea coupled with changing retail landscape is projected to provide an upthrust to the consumption of ready to drink products in this region. Flourishing foodservice segment in this region can further encourage the demand for RTD tea and coffee.

Ready to Drink Tea and Coffee Market Share Insights

Distribution channels play an important role in the value chain of the market. Generally, companies operating in the market are involved in mass production. Demand for the product mostly remains high, due to which easy access to the product becomes the major differentiating factor for manufacturers.

Manufacturers have established alliances with retailers for the sale of their products. Retailers are also gaining importance due to growing demand for soft drinks. Major retailers who have RTD tea and coffee in their product portfolio are Walmart Stores Inc.; Costco Wholesale Corporation; Carrefour S.A.; and Tesco PLC.

The market is highly competitive in nature and is, therefore, likely to witness new product development as one of the most commonly adopted strategies. Key players of this market include Suntory Holdings Ltd.; Nestlé S.A.; The Coca-Cola Company; Tsing Hsin International Group; PepsiCo Inc.; Starbucks Corporation; Monster Beverage Company; Uni-President Enterprises; and Danone.

Segments Covered in the Report

This report forecasts revenue growth at global, regional, & country levels and provides an analysis of the industry trends in each of the sub-segments from 2013 to 2024. For the purpose of this study, Grand View Research has segmented the global RTD tea and coffee market report on the basis of product, packaging type, distribution channel, price segment, and region:

  • Product Outlook (Revenue, USD Million, 2013 - 2024)

    • RTD Tea

    • RTD Coffee

  • Distribution Channel Outlook (Revenue, USD Million, 2013 - 2024)

    • Supermarket/Hypermarket

    • Convenience Stores

    • Food Service

    • Others

  • Packaging Type Outlook (Revenue, USD Million, 2013 - 2024)

    • Canned

    • Glass Bottle

    • PET Bottle

    • Others

  • Price Segment Outlook (Revenue, USD Million, 2013 - 2024)

    • Premium

    • Regular

    • Fountain

    • Others

  • Regional Outlook (Volume, Kilotons; Revenue, USD Million, 2013 - 2024)

    • North America

      • U.S.

      • Canada

    • Europe

      • Germany

      • U.K.

      • Italy

    • Asia Pacific

      • China

      • Japan

      • India

    • Latin America

      • Brazil

    • Middle East & Africa

      • U.A.E

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