Naturally Healthy Beverages in South Korea

PROSPECTS

NH bottled water enjoys double-digit value growth

Naturally healthy beverages enjoyed moderate retail value growth over the review period, and it increased considerably in 2018. NH hot drinks experienced a negative value CAGR but NH soft drinks witnessed a positive value CAGR between 2013 and 2018.

Bottled water and RTD tea continue to gain in popularity

NH bottled water experienced both positive and negative growth in various categories over the review period. NH spring bottled water experienced double-digit retail value growth for three consecutive years, boosted growth of NH beverages overall in 2018.

Double-digit growth anticipated for NH bottled water, with convenience stores and internet retailing contributing the most sales growth

NH bottled water is expected to see double-digit retail value growth over the forecast period in line with high popularity in NH spring bottled water. Many single households will shift from using a water purifier at home to bottled water by means of convenient home delivery and saving money.

COMPETITIVE LANDSCAPE

Kwang Dong Pharm remains the strongest player, whilst beverage giants Lotte Chilsung and Coca-Cola are far behind

Strong performance in still bottled water and RTD tea helped Kwang Dong Pharm remain an unrivalled player in NH beverages over the review period. Two beverage giants, Lotte Chilsung Beverage and Coca-Cola Korea, struggle in NH beverages; they remained at a far distant second and third place owing to weak performance in still bottled water and RTD tea, despite their strength in NH fruit/vegetable juice, sales of which were trending downwards over the review period.

End of consignment contract in 2021 could threaten Kwang Dong’s prominence in future

Kwang Dong Pharm will manage its established RTD tea brands with strong brand power over the forecast period; however, its consignment contract with Samdasoo will end by 2021, after which still bottled water sales are going to be absent from Kwang Dong Pharm’s offering. Moreover, growing competition from other players and low-budget brands will threaten the company increasingly in the future.

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