Following the outbreak of the Coronavirus (COVID-19) pandemic and related measures to stem the spread of the virus, such as lockdown, work-from-home, distance learning, limited occasions for socialising and the closure of foodservice, there was a strong shift in demand from foodservice to retail sales. While foodservice outlets offered takeaway and delivery services for extended periods, the economic shock of the pandemic increased price-sensitivity among local consumers and fostered a shift by many towards lower-priced brands in hot drinks.
The health and wellness trend, which was accelerated, rather than started, by the pandemic experience, continued to have a significant effect on the demand for hot drinks at the end of the review period. While black tea dominated retail volume sales of tea in Malaysia, followed by instant tea, green tea made gains due to its reputation as a source of antioxidants.
In addition to new product development, players looked to marketing to stimulate interest and offset the demand dampening effects of rising unit prices. In tea, Boh Plantations Sdn Bhd used online contests and social media posts with recipes for cookies or desserts featuring its Boh tea products, while Unilever (M) Holdings Sdn Bhd ran marketing campaigns like “Teh Tarik Day” in September 2022 and offered free branded mug giveaways via the “Shopee Live Show” in April 2022.
The COVID-19 public health crisis accelerated the nascent shift to e-commerce, although the channel remained a small one in hot drinks at the end of the review period. Nonetheless, the pandemic experience encouraged a growing number of local consumers, particularly younger, more tech-savvy ones, to do their grocery shopping online.
Foodservice in Malaysia was severely hit by the outbreak of the COVID-19 pandemic. One of the most visible manifestations of the measures introduced to stem the tide of the virus was closed foodservice establishments.
The government is expected to impose a sugar tax on beverages with high sugar content. This is likely to incorporate options like instant coffee mixes, instant tea and flavoured powder drinks.
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Understand the latest market trends and future growth opportunities for the Hot Drinks industry in Malaysia with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
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Data and analysis in this report provides further detailed coverage dedicated to the following key categories, where applicable:
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This is the aggregation of Coffee, Tea, and Other Hot Drinks.See All of Our Definitions
This report originates from Passport, our Hot Drinks research and analysis database.
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