Ready-to-Drink Beverages Market Size, Share & COVID-19 Impact Analysis, By Product Type (Fermented Beverages, Non-Fermented Beverages, and Alcoholic Beverages), By Distribution Channel (Supermarkets/Hypermarkets, Specialty Stores, Convenience Stores, Online Retail, On-Premise, and Others), and Regional Forecast, 2023-2030

The global ready-to-drink beverages market size was valued at USD 718.72 billion in 2022. The market is projected to grow from USD 749.17 billion in 2023 to USD 1,155.14 billion by 2030, exhibiting a CAGR of 6.38% during the forecast period.

The thirst for ready-to-drink beverages has grown fast among consumers in recent years. The rising urbanization and hectic lifestyles led to the demand for the product. Furthermore, the infusion of functional ingredients, citrus fruits, herbs, and botanicals in ready-to-drink (RTD) beverages to improve users' immunity and health positively influences the product demand. Enormous opportunities for manufacturers to develop innovative products under low-sugar, low-calorie, and low-alcoholic categories will be an upcoming driver for the industry. In addition, new product launches under different categories, such as fruit juices, energy drinks, and dairy beverages, will shape the industry in the coming years. For instance, in February 2021, Bodyarmor, a sports nutrition company, launched active hydration and sports nutrition, BODYARMOR EDGE. This product is developed from coconut water and natural caffeine.

COVID-19 IMPACT

Challenges Occurred in Different Phases of Supply Chains during Pandemic Hindered the Industry Performance

During the pandemic timeframe, industry players have experienced numerous challenges, including labor shortages, fluctuations in raw material supply, and closure of distribution channels. As a result, sales from carbonated soft drinks, fruit juices, and non-fermented dairy beverages segments decreased. However, the demand for healthy beverage products that improve gut health & immunity has increased. Therefore, sales from fermented dairy beverages, energy drinks, and functional water categories increased. Furthermore, stay-at-home and increased house parties during the pandemic influenced the sales of RTD alcoholic beverage products.

LATEST TRENDS

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Research & Development and New Product Launches to Push the RTD Beverages Demand to the Next Level

The ongoing consumer shift toward low-calorie and low-sugar beverages influences manufacturers to reduce the sugar level in their products. In 2021, PepsiCo Inc. announced that the company will reduce the average level of added sugar in its beverage products, including Pepsi-Cola, 7UP, and Lipton Ice tea by 25% by the end of 2025 and 50% by 2030 across several markets. The key manufacturers' vision of reducing sugar in ready-to-drink beverages will bring a new trend and increase product launches within the reduced-sugar or low-sugar category.

Innovative product launches to serve consumers with hybrid tastes will also influence the product demand growth. For instance, in February 2022, PepsiCo Inc. launched Nitro Pepsi. The company claims this nitrogen-infused cola is softer than normal soft drinks and offers creamy, smooth, and bubble-topped frothy foam heads in this product. In addition, industry players are emphasizing partnership activities to expand their geographical presence, which can have a positive impact on product sales. For instance, in July 2021, Nestle SA and Starbucks Corporation announced a partnership to sell RTD coffee beverages to selected markets across Southeast Asia, Oceania, and Latin America.

DRIVING FACTORS

Spotlight on Gut Health Improvement and Functional Beverages will Propel the Market Growth

Consumer's thirst for beverage products that improve their gut health has been increasing over the past couple of years. Therefore, prebiotics, postbiotics, and other gut immunity-boosting products are exhibiting high priority in the market. It creates sufficient space for manufacturers to research & develop novel products. Furthermore, companies have started to develop novel products using herbs and botanicals. It is an additional driving factor for the global market. In December 2021, Humble Warrior Drinks, a U.K.-based functional beverage brand, launched a range of soft drinks such as mango turmeric, pomegranate hibiscus, and pineapple ginger in ready-to-drink packaging. The company claims all these products have 80% less sugar than traditional carbonated soft drinks.

Premiumization and Diversified Flavors Drive the Evolution of RTD Alcohol Beverages

Nowadays, consumers are inclining toward premium products containing quality and simple ingredients derived from organic and natural sources. It creates a wide opportunity for companies to position their products on retail shelves globally. This factor supports the global ready-to-drink beverages market growth. Therefore, the introduction of products made from natural ingredients is increasing in the market space. In January 2022, Spirited Hive, an American spirit-based ready-to-drink beverages company, launched two new ready-to-drink craft cocktails. These RTD cocktails are made from high quality spirits, natural ingredients, and honey. According to the company, these new products contain 100% certified organic wildflower honey sourced from Lancaster, Pennsylvania.

RESTRAINING FACTORS 

High Taxes and Strict Regulations of Some RTD Products to Hamper the Global Market Growth

RTD canned or bottled beverages have a wider acceptance due to the convenience of usage and availability of the product in several flavors. However, they contain high-added sugars, which may lead to numerous health-associated diseases. Therefore, some government authorities impose high taxes on sugar or artificial sweeteners-added food & beverage products. Taxes may highly affect the consumption and affordability of sugar-sweetened ready-to-drink beverages, which can negatively influence the ready-to-drink beverages sales in the coming years.

There are several legal complexities surrounding RTD alcoholic beverages. Regulators implied high taxes based on alcohol by volume (ABV) and highly regulating the marketing and promotional activities to control the product exposure to minors. In several countries, governments restrict the sale of products containing high ABV. This factor is also negatively influencing the global market growth.

SEGMENTATION

By Product Type Analysis

Wider Popularity of Carbonated Soft Drinks among Youth to Propel the Non-fermented Beverages Segmental Growth 

Based on product type, the market is categorized into fermented beverages, non-fermented beverages, and alcoholic beverages. In 2022, the non-fermented beverages segment held the larger proportion in the global market due to easy availability of a variety of products and multiple options such as carbonated soft drinks, energy drinks, and fruit juices, which are the positive factors leading the segment's growth. Users' preferences are rapidly shifting toward healthy options in the global beverage market. As a result, companies are experiencing a gradual shift within healthy product options. According to the Coca-Cola Company, the Coca-Cola Zero sugar products sales increased by 11% in its 3^rd quarter of 2022. Increasing manufacturers' focus on developing novel products with functional ingredients, botanicals, and herbs that improve users' immunity and overall health will pose an opportunity for the industry.

The alcoholic beverages segment is anticipated to grow at a higher CAGR over the study period. Increasing house parties and social gatherings are some of the primary factors that surge the demand for RTD cocktails and hard seltzers. With increasing demand for spirit-based RTD drinks among individuals, manufacturers are developing innovative product options with special claims such as low sugar and low calories. New product launches and expansion of the product portfolio with innovative flavors will drive the sales of the products. In January 2022, Mandatory Spirit Co, an Australian beverage company, launched a range of alcoholic, premixed cocktails in single-serve tetra-pack carton packaging. The newly launched product, "boxtail" is available in three different flavors, strawberry daiquiri, passionfruit martini, and orange & pineapple mai tai.

By Distribution Channel Analysis

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Flexibility and Easy Shopping Factors of Online Retail Channels to Experience Vibrant Growth

Based on distribution channel, the market is categorized into supermarkets/hypermarkets, specialty stores, convenience stores, online retail, on-premise, and others. Supermarkets/hypermarkets segment is anticipated to exhibit a prominent share in the global market due to increasing popularity of supermarkets and hypermarkets among users, paired with the availability of a wider range of products offered by numerous brands, which will shape the sales contribution from the segment. Furthermore, the continuous expansion of supermarkets in different geographies is likely to propel the segment growth. For instance, in July 2022, Grocery Outlet Holding Corp., an American discount supermarket chain, opened multiple stores across Pennsylvania, U.S. 

Convenience stores segment is another prominent segment contributing to considerable revenue share to the global market. The easy accessibility to users and the adoption of digital payment methods to offer hustle-free shopping are the key driving factors for the segment's growth.

The online retail segment is anticipated to grow at a higher CAGR during the forecast period. Flexibility in shopping and home delivery are factors influencing shoppers for online retail purchasing. Furthermore, companies reinforcing their e-commerce presence will be an additional factor in driving the segment growth. In December 2022, 8th Wonder Tea, a U.S.-based RTD tea manufacturing company, launched its organic sparkling teas, Sparking Green Tea, Sparking Chai, Sparking Oolong Tea, and Sparkling Rooibos Tea. The newly launched products are available countrywide through Amazon.com, an online retail store.

REGIONAL INSIGHTS

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The market is analyzed across North America, Europe, Asia Pacific, South America, and the Middle East & Africa.

Asia Pacific holds the leading proportion in the global market space due to growing consumer earning capacity and increasing number of working women across Asian countries, including China, India, Indonesia, and Japan, which will push the market growth. The consumer's shift toward healthy lifestyles coupled with adults' preferences to try out new beverage products positively drives ready-to-drink beverages sales in the region.

In North America, ready-to-drink beverages demand is exhibiting a higher CAGR during the forecast period, owing to consumers' greater acceptance toward products. After COVID-19, individuals are becoming more conscious about their immunity and overall well-being. Thus, they are inclined toward fortified and gut-health-improving beverages such as kombucha, energy drinks, and functional water. Therefore, manufacturers are launching novel products under these categories. For instance, in August 2022, Reed's, Inc., an American company, launched Reed's Zero Sugar Stormy Mule in the nation. This product is manufactured from ginger roots and rum with no added sugars.

Europe is one of the prominent markets for RTD beverages due to concern of environmental sustainability coupled with plant-based diet practices, which is likely to propel the demand for RTD beverages in the region. Thus, industry players are embarking on strengthening their presence in the plant-based RTD beverages segment. In May 2021, Britvic PLC., a British soft drink manufacturing company, acquired Plenish, a U.K.-based dairy alternative drinks manufacturing company. This acquisition helps the company to expand its presence in the RTD plant-based milk, cold-pressed juices, and functional shots.

South America contributes a sizable revenue to the global market, owing to the growing demand for energy and sports drinks among adults. Furthermore, regional players are collaborating with industry stakeholders to develop a new products, which will push the product demand in the region. In May 2020, Brazilian roastery Isso é Café, a cafe chain in Brazil, collaborated with TCHÁ Kombucha, an RTD drinks manufacturing company, to develop a new product, "Tchá Flor de Café". This new product is a coffee-flower kombucha drink available across coffee shops in Brazil and the international market.

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The Middle East & Africa market is one of the emerging markets in the global space. Functional beverages and RTD coffee & tea are becoming popular among the youth. As coffee and tea consumption gradually increases, companies focus on expanding their production capacities. For instance, in November 2022, Nestle S.A., a global beverage company, announced to invest USD 1.9 billion to expand its operations in Saudi Arabia. Initially, the company invested USD 100 million to develop & produce Nestle RTD coffee products. This factory is expected to be functional in 2025.

KEY INDUSTRY PLAYERS

The Coca-Cola Company Led the Market with Strong Portfolio of RTD Beverages in 2022 

The global market has started to intensify in recent years due to escalated demand for unique flavors, convenience in usage, and diversified product types in retail shelves. Furthermore, leading companies, such as PepsiCo Inc., Coca-Cola, Bacardi Limited, Diageo PLC, and Nestle S.A., are embarking on expanding their product portfolio with novel flavors. The beverage producers focus on R&D and innovation activities to develop new products using functional ingredients such as botanicals and herbs. In addition, alcoholic RTD beverage manufacturers are introducing RTD cocktails with low-sugar and low-calorie claims. It creates ample opportunities for the industry, and drives the market to the next heights.

Since the local players have started to strengthen their grip on the regional market, international players are eyeing them to improve their business footprint. Thus, they are adopting collaboration and merger & acquisition strategies, which is likely to push the market to be more consolidated. For instance, in March 2022, Nestle S.A., a global beverage company, acquired a majority share of Orgain Inc., a California-based plant-based protein powder, ready-to-drink beverages, and protein bar manufacturing company.  

List of Key Companies Profiled:

• Abbott Laboratories Inc. (U.S.)


• Bacardi Limited (U.S.)


• Danone S.A (France)


• Del Monte Foods, Inc. (U.S.)


• Diageo PLC. (U.K.)


• Keurig Dr. Pepper, Inc. (U.S.)


• Molson Coors Brewing Company (U.S.)


• Nestle S.A. (Switzerland)


• PepsiCo., Inc. (U.S.)


• Pernod Ricard (France)


• Rauch Fruchtsäfte GmbH & Co OG (Austria)


• Suntory Holdings Limited (Japan)


• The Coca-Cola Company (U.S.)


• Yakult Honsha Co. Ltd. (Japan)

KEY INDUSTRY DEVELOPMENTS:

• November 2022: Pernod Ricard, a French multinational company, invested nearly USD 22 million to build an RTD canning plant at Arkansas, U.S. to produce a canning line for Jameson Ginger & Lime RTDs.


• November 2022: Tata Consumer Products, an Indian FMCG company, launched the ready-to-drink juice & jelly combination beverage product "Tata Fruski" under its NourishCo brand across the India market.


• September 2022: Hochstadter's, an American spirits-based beverages manufacturing company, launched two new products, Whiskey Sunshine and Whiskey Buck. Newly launched RTD alcoholic beverages contain 10% ABV per 200ml can.


• September 2022: Kokonut Pacific Solomon Islands Limited (KOSI), a company that manufactures coconut-based products, launched three products, Coconut Kefir, Coconut Yoghurt, and Coconut Niubiks in Australia. Coconut kefir is made from coconut water and probiotic bacteria.


• May 2022: We are the Uncommon Ltd., a U.K.-based wine company, introduced a range of canned English White and Rosé Wine spritzers in the U.K. These two products were developed with white & red rose wine with sparkling water and different botanical extracts.

REPORT COVERAGE

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This research report includes quantitative and qualitative insights into the market. This market intelligence report also offers a detailed regional analysis of the global ready-to-drink beverages market share, size, and growth rate for all possible market segments. This market analysis report provides various key insights on market, an overview of related markets, the competitive landscape, recent industry developments such as mergers & acquisitions, the regulatory scenario in critical countries, and key industry trends.

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