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The coffee substitute market share is expected to increase to USD 1.84 billion from 2021 to 2026, and the market's growth momentum will accelerate at a CAGR of 9.46%.
This coffee substitute market research report provides valuable insights on the post COVID-19 impact on the market, which will help companies evaluate their business approaches. Furthermore, this report extensively covers coffee substitute market segmentation by distribution channel (offline and online) and geography (North America, Europe, APAC, South America, and Middle East and Africa). The coffee substitute market report also offers information on several market vendors, including Anthonys Goods, Dandy Blend, drink nuJo, Flying Embers, Hand Family Companies, Mondelez International Inc., Mud Wtr Inc., PepsiCo Inc., Postum, Remedy Organics, Rishi Tea and Botanicals, Slate Craft Goods LLC, So Good Brand Inc., Tattvas Herbs LLC, Teeccino Caffe Inc., The Hain Celestial Group Inc., World Finer Foods LLC, and World Matcha Inc. among others.
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The growing demand for green tea is notably driving the coffee substitute market growth, although factors such as the rising popularity of coffee among millennials may impede the market growth. Our research analysts have studied the historical data and deduced the key market drivers and the COVID-19 pandemic impact on the coffee substitute industry. The holistic analysis of the drivers will help in deducing end goals and refining marketing strategies to gain a competitive edge.
Key Coffee Substitute Market Driver
One of the key factors driving growth in the coffee substitute market is the growing demand for green tea. The consumption of green tea has been growing at a rapid pace across the globe, which is attributable to the increasing awareness among consumers about the health-promoting benefits of consuming green tea. Besides, it has been found that adults who drink about two cups of green tea daily reduce the risk of death associated with cardiovascular diseases by 22%-23%. The consumption of green tea, helps in lowering the cholesterol content in the body and fights arthritis, helps to retain healthy micro-organisms, helps prevent prostate cancer in men, boosts the immune system to make it more resilient against cold and flu, helps in maintaining the cardiovascular health and helps prevent age-related neurodegenerative disorders such as Parkinson and Alzheimer disease. Thus, owing to convenience, health benefits, sustainability, availability, and continued innovation, the discovery of unique and flavorful green tea will fuel the demand for coffee substitutes and, in turn, drive the market in focus.
Key Coffee Substitute Market Trend
The growing demand for energy drinks is a coffee substitute market trend that is expected to have a positive impact in the coming years. Energy drinks are witnessing a surge in demand globally, with the consumer lifestyles changing and advancing toward an aging phase. Millennials have specific health and wellness needs that include stress management, energy retention, and the ability to fight fatigue. They look forward to beverages with strong nutritional profiles that can help them meet their specific needs. Millennials perceive energy drinks as containing higher nutritional value over other beverages as these drinks can be readily associated with sports and physical activities. Millennials, especially women, are the top consumers of energy drinks as they enter parenthood. This group is more concerned about their health as well as the safety of the products they consume. Thus, the increasing consumption of energy drinks by millennials and children has been identified as the key driver of the global coffee substitute market.
Key Coffee Substitute Market Challenge
The rising popularity of coffee among millennials will be a major challenge for the coffee substitute market during the forecast period. The culture of socializing at cafes has become popular among millennials. The increased influx of people to urban areas and substantial increase in the number of employees in service industries have necessitated an increase in the number of cafes and food service outlets, which increased the demand for coffee products. Leading cafe chains such as Starbucks, Costa Coffee, and Barista are opening their outlets in emerging economies. The growing popularity of malls and shopping centers has also led many new players to invest substantially in the distribution of coffee through these centers. With the growth in the number of coffee-themed restaurants, coffee manufacturers are receiving several branding opportunities. Thus, the growing demand for coffee among millennials, especially in countries, such as India, will hamper the global coffee substitute market.
This coffee substitute market analysis report also provides detailed information on other upcoming trends and challenges that will have a far-reaching effect on the market growth. The actionable insights on the trends and challenges will help companies evaluate and develop growth strategies for 2022-2026.
Technavio categorizes the global coffee substitute market as a part of the global packaged foods and meats market under the global food products segment of the global food, beverage, and tobacco market. Our research report has extensively covered external factors influencing the parent market growth potential in the coming years, which will determine the levels of growth of the coffee substitute market during the forecast period.
The report analyzes the market's competitive landscape and offers information on several market vendors, including:
This statistical study of the coffee substitute market encompasses successful business strategies deployed by the key vendors. The coffee substitute market is fragmented and the vendors are deploying growth strategies such as focusing on the quality of the products to compete in the market.
To make the most of the opportunities and recover from post COVID-19 impact, market vendors should focus more on the growth prospects in the fast-growing segments, while maintaining their positions in the slow-growing segments.
The coffee substitute market forecast report offers in-depth insights into key vendor profiles. The profiles include information on the production, sustainability, and prospects of the leading companies.
Our report provides extensive information on the value chain analysis for the coffee substitute market, which vendors can leverage to gain a competitive advantage during the forecast period. The end-to-end understanding of the value chain is essential in profit margin optimization and evaluation of business strategies. The data available in our value chain analysis segment can help vendors drive costs and enhance customer services during the forecast period.
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35% of the market's growth will originate from APAC during the forecast period. China and Japan are the key markets for coffee substitutes in APAC. Market growth in this region will be faster than the growth of the market in other regions.
North America is another region showing major market growth. The increasing awareness about the health benefits of green tea is rapidly rising the consumption of green tea among consumer. This will facilitate the coffee substitute market growth in APAC over the forecast period. This market research report entails detailed information on the competitive intelligence, marketing gaps, and regional opportunities in store for vendors, which will assist in creating efficient business plans.
COVID Impact and Recovery Analysis
In 2020, the outbreak of COVID-19 affected the market focus in countries such as the US and Canada. The pandemic affected the supply chain of the regional tea market, especially in the US. However, the strong presence of alternatives, such as soft drinks and organic tea, positively impacted the regional coffee substitute market. For instance, the sales of green and black teas were higher in 2021 as compared to 2020 by 3% and 6%, respectively. Also, the market growth will be stabilized during the latter part of the forecast period, as vaccination drives and economic recovery are likely to promote the growth of the market, fueling more demand from various end-users such as residential consumers, restaurants, cafes, etc.
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The coffee substitute market share growth by the offline segment will be significant during the forecast period. Vendors are focusing on strengthening their organized distribution networks to increase sales and revenues. Supermarkets, hypermarkets, and convenience stores aim to attract customers by offering discounts and shopping packages. Vendors that operate in the global coffee substitute market focus on promotional and marketing strategies to increase customer footfall. Some of these promotional and marketing strategies include branding through signages, the distribution of samples, and the provision of discounts on product kits.
This report provides an accurate prediction of the contribution of all the segments to the growth of the coffee substitute market size and actionable market insights on post COVID-19 impact on each segment.
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Coffee Substitute Market Scope |
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Report Coverage |
Details |
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Page number |
120 |
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Base year |
2021 |
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Forecast period |
2022-2026 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 9.46% |
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Market growth 2022-2026 |
$ 1.84 billion |
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Market structure |
Fragmented |
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YoY growth (%) |
8.71 |
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Regional analysis |
North America, Europe, APAC, South America, and Middle East and Africa |
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Performing market contribution |
APAC at 35% |
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Key consumer countries |
US, China, Japan, Germany, and UK |
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Competitive landscape |
Leading companies, Competitive strategies, Consumer engagement scope |
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Key companies profiled |
Anthonys Goods, Dandy Blend, drink nuJo, Flying Embers, Hand Family Companies, Mondelez International Inc., Mud Wtr Inc., PepsiCo Inc., Postum, Remedy Organics, Rishi Tea and Botanicals, Slate Craft Goods LLC, So Good Brand Inc., Tattvas Herbs LLC, Teeccino Caffe Inc., The Hain Celestial Group Inc., World Finer Foods LLC, and World Matcha Inc. |
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Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for the forecast period |
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Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Five Forces Analysis
5 Market Segmentation by Distribution Channel
6 Customer Landscape
7 Geographic Landscape
8 Drivers, Challenges, and Trends
9 Vendor Landscape
10 Vendor Analysis
11 Appendix
Research Framework
Technavio presents a detailed picture of the market by way of study, synthesis, and summation of data from multiple sources. The analysts have presented the various facets of the market with a particular focus on identifying the key industry influencers. The data thus presented is comprehensive, reliable, and the result of extensive research, both primary and secondary.
INFORMATION SOURCES
Primary sources
Secondary sources
DATA ANALYSIS
Data Synthesis
Data Validation
REPORT WRITING
Qualitative
Quantitative
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