Hot drinks sales in Asia Pacific were stagnating in real value terms in 2020, impacted by the decline seen in China in this year due to the COVID-19 lockdowns. However, sales have been increasing since then, in spite of further Chinese lockdowns in 2022, with continued growth expected over the forecast period. Health and wellness will be increasingly important in the coming years, with the functional benefits of tea emphasised by industry players and sugar levels being cut in other hot drinks.
This report comes in PPT.
Fruit/herbal tea is performing strongly in China, with local consumers perceiving it as nutritious and healthy. Players in fruit/herbal tea are tending to place more emphasis on the traditional functions and health benefits of Chinese herbal teas rather than identifying the flavours of these teas.
Most major companies in India adhere to a localisation strategy concerning products and packaging, recognising the country’s vast diversity. These companies understand that catering to such a diverse market requires a tailored approach rather than a one-size-fits-all offering.
Retail e-commerce continued to gain share in Japan in 2023, helped by the large number of people continuing to work from home, which makes it easy for them to receive deliveries during the daytime. While Japan’s online sales share topped 12% in 2023, it stood at 10% in Asia Pacific as a whole, reaching a regional high of 30% in South Korea.
As the region moves beyond the post-pandemic period of rising prices, positive growth is expected for hot drinks in Asia Pacific, with tea and coffee continuing to be the main drivers of the overall performance. India will add the most new sales over the forecast period, while value sales in Japan and South Korea are expected to record declining CAGRs in 2023-2028.
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