RTD Coffee in Asia Pacific

July 2021

Asia Pacific is the key region for RTD coffee globally, accounting for nearly 80% of global sales. Much of this is due to Japan, with sales of USD11 billion. However, home seclusion due to COVID-19 hit the Japanese market hard, which accelerated the struggles already seen prior to the pandemic. However, the regional presence of RTD coffee is growing in China, South Korea and Southeast Asia. Affordability and diversified variants will be the key growth drivers in the forecast period.

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Key Findings

Asia Pacific is the largest market for RTD coffee, yet growth potential remains

Asia Pacific is by far the largest market for RTD coffee in the world, accounting for nearly 80% of global sales. This is because the region includes the world’s top market, Japan, which accounts for more than half of total off-trade global volume sales. In terms of per capita consumption, however, Asia Pacific only ranks third globally. This is attributed to the low penetration of RTD coffee outside of Japan, which offers further growth potential.

Mixed impact of COVID-19

Home seclusion and store closures due to the pandemic resulted in lost drinking occasions for RTD coffee, which caused declines or slowdowns in category growth in most countries in 2020. The exception was South Korea, where RTD coffee benefited from channel shift, as chained coffee shops were not allowed to operate eat-in.

RTD coffee faces strong competition due to working from home in Japan

Japan’s highest global consumption of RTD coffee has been supported by its positioning as a quick energy shot in the workplace, available from vending machines. The mature category was already seeing slow growth prior to COVID-19, but further struggles are expected in the forecast period, as many consumers continue to work from home, which will place RTD coffee in strong competition with other types of coffee prepared at home.

Emphasis outside of Japan is expected to grow

Most of the big RTD coffee players in the region are heavily reliant on sales in Japan. However, market maturity, the declining population, and competition from other drinks will limit the future growth prospects in Japan. RTD coffee players are therefore expected to shift their emphasis to other Asian markets, as seen by the launch of a new product in the Chinese market by Coca-Cola.


Key findings

Regional Overview

Asia Pacific dominates RTD coffee globally, with further growth potential
RTD coffee negatively hit by COVID-19 due to home seclusion
Japan’s dominance slowly declining in the region
Yet, still huge gap between Japan and other countries
Increasing demand for on-the-go options in Indonesia and the Philippines
Volumes increase in most countries, except for Japan and Taiwan
Mixed performance for RTD coffee from 2015 to 2020
Small format retail is important to the category
Convenience stores is a key channel in the leading markets

Leading Companies and Brands

High consolidation observed across Asia Pacific
Coca-Cola and Suntory fiercely compete in the region
Japan is the main market for most companies
Moderate changes in brand share rankings
Coca-Cola and Suntory expand their ranges to tackle stagnation in Japan

Forecast Projections

Volume growth expected outside Taiwan and Singapore
Struggle expected in Japan, while growth expected in most other markets
Drivers of growth largely vary across the key markets

Country Snapshots

Japan: Market Context
Japan: Competitive and Retail Landscape
China: Market Context
China: Competitive and Retail Landscape
South Korea: Market Context
South Korea: Competitive and Retail Landscape
Indonesia: Market Context
Indonesia: Competitive and Retail Landscape
Thailand: Market Context
Thailand: Competitive and Retail Landscape
Philippines: Market Context
Philippines: Competitive and Retail Landscape


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