A lot of Indonesian consumers buy sports drinks for on-the-go consumption, which is why staying at home for extended periods in 2020, due to school and office closures amid COVID-19, has led to a decline in sales for this category. Despite more people riding bicycles in 2020, there has been little effect on demand as most cyclists tend to bring water from home, which means they can avoid entering sales channels such as convenience stores where they may risk virus transmission.
Third-ranked player Tirta Alam Segar PT is likely to be the only company in sports drinks to increase its off-trade volume sales and share since the outbreak of COVID-19. Higher product availability in traditional channels than in modern channels is proving the major factor in this achievement, as modern grocery retailers, particularly ones located within shopping centres, have faced operating restrictions during the pandemic.
Sports drinks showed an improved performance in off-trade volume and current value growth terms in 2019 (pre-pandemic). This was partly due to a more favourable economic climate in Indonesia as compared with 2018, which strengthened consumer confidence and purchasing power.
In 2021, a fall in the average retail unit price is predicted for sports drinks as producers try to help volume sales recover amid diminishing purchasing power. While sales growth is likely to return in both the on- and the off-trade in 2021, sports drinks may take a few years to recover fully, especially in the much smaller foodservice channel, as competition from other soft drinks will be much higher.
Demand for sports drinks is set to remain heavily concentrated in off-trade sales channels in the forecast period, with on-trade sales only accounting for a small share of total consumption. Nonetheless, in 2021 the on-trade should recover a sizeable amount of 2020’s lost sales thanks to the growing availability of brands such as Pocari Sweat and Isoplus in foodservice outlets, particularly food courts in shopping centres and roadside service stations.
Increasing price-competition in sports drinks has helped to strengthen the category’s appeal among low-income Indonesians in recent years, and this trend looks set to persist over the forecast period. In particular, it is expected that the Isoplus brand from Tirta Alam Segar will continue to gain popularity among this consumer group thanks to its affordable price positioning and growing availability via traditional grocery retailers, especially in the short term as consumers’ disposable incomes have fallen since the outbreak of COVID-19.
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Understand the latest market trends and future growth opportunities for the Sports Drinks industry in Indonesia with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
Key trends are clearly and succinctly summarised alongside the most current research data available. Understand and assess competitive threats and plan corporate strategy with our qualitative analysis, insight and confident growth projections.
If you're in the Sports Drinks industry in Indonesia, our research will help you to make informed, intelligent decisions; to recognise and profit from opportunity, or to offer resilience amidst market uncertainty.
This report originates from Passport, our Sports Drinks research and analysis database.
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