Published in Beverages
Hot drinks infused with natural ingredients will thrive in Asia-Pacific

Rising disposable incomes, busy life styles and growing health awareness levels among a sizeable proportion of millennial consumers across emerging countries in the Asia-Pacific (APAC) region, are driving the demand for hot drinks infused with natural ingredients. As a result, manufacturers must capitalize on this trend to stay ahead of their competitors, says GlobalData, a leading data and analytics company.

The company’s report, ‘Opportunities in the Asia-Pacific Hot Drinks Sector: Analysis of Opportunities Offered by High Growth Economies’, forecasts the market to register a compound annual growth rate (CAGR) of 6.3% from US$159.3bn in 2017 to US$215.9bn in 2022.

Syed Khaleelulla, Consumer Analyst at GlobalData, says: “Time-pressed millennials, who are open to experimenting with new flavors, are increasingly looking for hot drinks infused with natural ingredients such as ginger, tulsi (holy basil), cardamom and mint, which are known to be natural anti-oxidants, and black sesame powder, which is perceived to offer anti-aging benefits.”

This is supported by the company’s 2018 Q3 consumer survey, where 63% of Asian consumers stated that non-alcoholic beverages which impact their health and wellbeing always/often influence their product choice.

In terms of categories, hot tea held the largest share, accounting for 57.4% of total value sales, followed by hot coffee (36.8%) in 2017. The share of hot tea is expected to increase to 60.7% by 2022. During the same period, hot coffee’s share is forecast to decline to 33.8% while the share of ‘other hot drinks’ is expected to marginally drop to 5.5%.

The hot tea category is expected to register the fastest CAGR of 10.4% in terms of value during the review period, followed by ‘other hot drinks’ (8%) and hot coffee (7%). 

Khaleelulla concludes: “APAC consumers, who are frequently on-the-move, are driving the demand for hot drinks with packaging solutions that facilitate on the go consumption. Therefore, manufacturers must focus on launching drinks made with natural ingredients in convenient and efficient packaging solutions.”

More in this category: Five beverage trends in 2018 »

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