Ready to Drink (RTD) Coffee Market Analysis North America, Europe, APAC, South America, Middle East and Africa - US, Japan, China, Germany, UK - Size and Forecast 2023-2027

Ready to Drink Coffee Market Forecast 2023 -2027

The Ready to Drink Coffee (RTD) market size market size is projected to reach a value of USD 11.78 billion, at a CAGR of 7.73% between 2022 and 2027. The global demand for ready-to-drink (RTD) coffee is on the rise, fueled by a growing preference for convenient refreshments and an increasing number of coffee consumers. This trend is particularly prominent in urban areas, where busy lifestyles and longer work hours drive the need for quick and accessible coffee options. As a result, the RTD Coffee Market is experiencing significant growth. This market analysis and report provide a comprehensive examination of the primary market drivers, trends, and challenges anticipated for the forecasted period.

Market Size and Growth Analysis

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Market Segmentation

The offline segment forecasts to account for a significant share of market growth. Several factors such as convenience, huge SKUs, and wide brand variants are increasing the consumer preference for buying products from retail chains and retailers such as hypermarkets, supermarkets, convenience stores, and clubhouse stores. Also, these retail stores and retailers offer a variety of brands and stock-keeping units (SKUs) at competitive prices. Some of the key vendors that offer coffee products include Walmart Inc. (Walmart) and Target Corp. Due to busy lifestyles and hectic work schedules, There is a growing consumer preference for these products. Companies like Coca-Cola and Nestlé have been at the forefront, offering a wide array of options, not only in terms of flavors but also in considering the evolving demands in the packaging type segment. Hence, such factors are expected to drive the growth of this segment in the market during the forecast period.

Market Segmentation by Packaging

The market share growth forecasts for the glass bottled segment will be significant. One of the key segments is preferred by consumers is the glass-bottled segment due to its several packaging advantages. Some of the key advantages include the transparent nature of glass allows consumers to visually appreciate the product inside, creating a perception of high quality and freshness. This premium image appeals to consumers who value a luxurious and authentic drinking experience.

The glass-bottled segment was valued at USD 8.91 billion in 2017 and continued to grow until 2021

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There is a growing popularity for glass bottles due to their highly regarded for their ability to preserve flavor, aroma, and quality. Factor such as it provides excellent protection against external factors that can degrade the product due to the impermeability of glass to light, oxygen, and moisture ensuring freshness and taste for a longer shelf life, enhancing the overall consumer experience. One of the key advantages of glass-bottled RTD coffee is that it is suitable for on-the-go consumption as glass has high resistance to heat, ensuring that the beverage remains at an optimal temperature preserving its quality. Hence, such factors are expected to drive the growth of this segment which in turn will drive the growth of the market during the forecast period.

Regional Analysis of Market

North America is estimated to contribute 58% to the growth of the global market during the forecast period

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Factors such as changing consumer preferences and increasing demand for convenience products are some of the major reasons driving the market globally, especially in Australia, the US, Italy, Spain, South Africa, France, Brazil, Russia, Latin America, Argentina Canada, and India. This includes both the incorporation of local tastes and the experimentation with global inspirations, such as those found in Italian or Latin American. In regions like New Zealand and the Asia-Pacific, where the market is witnessing substantial growth rates, the increasing population of enthusiasts is contributing to the expanding market share.

Market Dynamics and Customer Landscape

The Ready-to-Drink (RTD) Coffee Market is being propelled by several significant drivers and emerging trends, reflecting its dynamic nature and ability to adapt to evolving consumer preferences. One primary driver is the increasing awareness of health and wellness among consumers. This awareness has led to a growing demand for antioxidant-enriched health drinks, including RTD coffees, as consumers seek beverages that offer both instant energy and potential long-term health benefits associated with antioxidants.

Convenience and portability are also driving forces in the RTD coffee market. Modern lifestyles often require on-the-go solutions, making bottled RTD coffee in formats such as cold coffee cans or bottles highly appealing. These offerings provide consumers with the convenience they desire, allowing them to enjoy their favorite coffee beverages anytime, anywhere.

Furthermore, flavor innovation and customization play a crucial role in attracting and retaining consumers in the market. Brands are continuously introducing new and enticing flavors like hazelnut latte and caramel, catering to diverse taste preferences and ensuring a wide appeal to consumers.

Expansion into new markets, particularly emerging regions like China, presents another significant opportunity for growth in the market. As urbanization continues and consumer preferences evolve, there's a rising demand for convenient at-home coffee options in these markets. Established international players like Italian coffee giant Lavazza and competitors like Costa are seizing these opportunities by expanding their presence and offerings in these regions.

Lastly, the growing emphasis on health and wellness trends, coupled with concerns about health deterioration and insufficient exercise, drives consumers toward healthier beverage options. RTD coffees that are dairy-free, non-GMO, and enriched with minerals cater to these health-conscious preferences, attracting consumers seeking alternatives to traditional sugary drinks.

In summary, the market's growth is fueled by a combination of health and wellness awareness, convenience, flavor innovation, expansion into new markets, and alignment with evolving consumer preferences for healthier beverage options.

Market Trends and Analysis

The market is forecasted for significant growth in the future, driven by evolving consumer preferences and emerging market opportunities. As coffee consumption continues to rise globally, market trends indicate a shift towards convenient and healthy options, with a majority showing an inclination toward products. Health benefits is considered as a key driver. These products are often fortified with protein, antioxidants, and vitamins, addressing the problem of excessive sugar content in traditional options. This health-conscious approach and the convenience of on-the-go consumption position RTD coffee as a prominent player in the future market landscape, carving a significant place among consumers seeking both taste and well-being.

The market is experiencing a significant boost driven by the increasing demand for convenience foods worldwide. Consumers are moving towards convenience options at various stages, prompting a response from the industry. With products lining the shelves globally, the market seizes growth opportunities, especially in response to Mintel's insights. This surge is reshaping preferences, making a preferred choice over traditional ground coffee, and positioning it as a burgeoning trend in diverse international markets.

Consumer Trends and Preferences

A key factor shaping the market growth is the growing number of product innovations. The rise in the number of product innovations is a significant trend gaining popularity in the global market as many major vendors operating in the global market are prioritizing developing new products to gain a competitive advantage in the market. The introduction of Danone's Cold Brew product caters to consumers seeking elevated experiences without compromising on taste or convenience. Consequently, forecasts of such innovations aligning with consumer preferences in topics are anticipated to propel growth in the market.

The market growth and forecasting report showcases an assortment of variants designed to entice diverse consumer preferences and needs. These variants encompass an array of flavors, strengths, and packaging options, including the convenience of pet bottles and alternative innovative packaging choices.

Significant Market Challenge

Regulatory compliance associated with products is one of the key challenges hindering market growth. The industry has to comply with various regulations and standards related to food safety, labeling, ingredient specifications, and manufacturing practices. Therefore, manufacturers must adhere to strict hygiene practices, implement Hazard Analysis and Critical Control Points (HACCP) systems, and ensure proper sanitation and cleanliness throughout the production processes, as compliance with these regulations is crucial to ensure product safety, protect consumer health, and maintain the integrity of the market. Hence, these regulations and standards may limit manufacturers from innovating new products, which can significantly hinder the market.

These beverages comprise diverse ingredients and come in various packaging types, meeting the demands of a broad consumer base. With increasing competition in this field, companies like Nestlé, Coca-Cola, and others are continuously innovating, introducing new flavors, and leveraging different packaging types to stay ahead in the market.

Key Players in the Market

Companies are implementing various market research and growth strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.

• Asahi Group Holdings Ltd.: The company offers RTD coffee, such as Wonda Morning Shot.
• Caribou Coffee Operating Co. Inc.: The company offers ready-to-drink coffee such as vanilla-crafted cold brew, milk, wish-to-blend light roast, and Amys blend light roast.
• Starbucks Corp.- The company offers flavored RTD coffee varieties such as Vanilla Flavored RTD Coffee varieties and caramel flavored varieties, the most popular among the business segment.

The market analysis and report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including:

• Arla Foods amba
• Asahi Group Holdings Ltd.
• Bulletproof 360 Inc.
• Califia Farms LLC
• Campbell Soup Co.
• Caribou Coffee Operating Co. Inc.
• Danone SA
• Heartland Food Products Group LLC
• Illycaffe Spa
• Inspire Brands Inc.
• Keurig Dr Pepper Inc.
• Lotte Chilsung Beverage Co. Ltd.
• McDonald Corp.
• Nestle SA
• PepsiCo Inc.
• Restaurant Brands International Inc.
• Starbucks Corp.
• Suntory Holdings Ltd.
• The Coca Cola Co.
• The J.M Smucker Co.

Market Analyst Overview

The market represents a dynamic landscape characterized by diverse flavors and an expanding global presence. The convenience and diverse flavors offered by these beverages align with evolving consumer lifestyles, contributing to increased market traction. One of the distinguishing aspects of this market is the infusion of innovative coffee beans and diverse flavors. The infusion of caffeine in these beverages remains a key point of interest for consumers seeking an energy boost.  The non-alcoholic beverage segment holds the largest market share in the industry. Millennials and Generation Z consumers represent a significant target audience for RTD products.

Also, the region in the US  has a strong coffee culture, with a large consumer base that appreciates the convenience and versatility.  Some of the wide range of options that the market offers include cold brew coffee, iced coffee, canned coffee, coffee energy drinks, and other coffee-based beverages available in the US. The participation of major industry leaders such as Starbucks Corporation, PepsiCo Inc., Nestle S.A., and Keurig Dr Pepper Inc., alongside the mentioned factors, is anticipated to drive the expansion of consumer preferences in the market within this region throughout the forecast period. Notably, the influence of products like Starbucks bottled ready-to-drink coffee from these significant players further bolsters the market's growth trajectory, capitalizing on the popularity and trust associated with established brand offerings in this segment resulting in market growth analysis.

The Ready-to-Drink (RTD) Coffee Market is experiencing significant growth worldwide, driven by evolving consumer preferences and lifestyle trends. With an increasing emphasis on health and physical fitness awareness, there's a rising demand for functional and antioxidant-enriched health drinks. Consumers, particularly the health-conscious and calorie-conscious segments, are gravitating towards RTD coffee options that offer balanced energy without compromising on taste.

The market is flooded with a variety of options, ranging from classic flavors like café mocha and hazelnut latte to innovative offerings like cold-brew coffees and energy boosters. Brands like Dunkin' Donuts, Costa, Lavazza, and Sleepy Owl are competing vigorously in this space, offering bottled formats in grab-and-go sizes with sleek and fashionable packaging.

Moreover, there's a growing trend towards dairy-free, gluten-free, soy-free, and organic options to cater to diverse dietary preferences and health concerns. Additionally, the inclusion of probiotics, minerals, and nutrients is gaining traction among consumers seeking immunity support and overall health benefits.

The RTD Coffee Market is also witnessing a surge in demand from the fitness fad and gymming culture, with consumers looking for quick energy supplements and instant energy fixes. This trend is particularly resonant among youngsters and sports enthusiasts. Furthermore, economical formats and small pack sizes are making RTD coffees accessible to a broader consumer base, including those on the go and those with busy lifestyles. Overall, the market's future looks promising, driven by a combination of convenience, health consciousness, and flavor innovation.

Ready To Drink Coffee Market Scope
Report Coverage	Details
Page number	160
Base year	2022
Historic period	2017-2021
Forecast period	2023-2027
Growth momentum & CAGR	Accelerate at a CAGR of 7.73%
Market growth 2023-2027	USD 11.78 billion
Market structure	Fragmented
YoY growth 2022-2023(%)	7.23
Regional analysis	North America, Europe, APAC, South America, and Middle East and Africa
Performing market contribution	North America at 58%
Key countries	US, Japan, China, Germany, and UK
Competitive landscape	Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks
Key companies profiled	Arla Foods amba, Asahi Group Holdings Ltd., Bulletproof 360 Inc., Califia Farms LLC, Campbell Soup Co., Caribou Coffee Operating Co. Inc., Danone SA, Heartland Food Products Group LLC, Illycaffe Spa, Inspire Brands Inc., Keurig Dr Pepper Inc., Lotte Chilsung Beverage Co. Ltd., McDonald Corp., Nestle SA, PepsiCo Inc., Restaurant Brands International Inc., Starbucks Corp., Suntory Holdings Ltd., The Coca Cola Co., and The J.M Smucker Co.
Market dynamics	Parent market analysis, market growth and trends, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID 19 pandemic impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period
Customization purview	If our market 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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What are the Key Data Covered in this Market Forecast Report?

• CAGR of the market during the forecast period.
• Detailed information on factors that will drive the growth of the market between 2023 and 2027
• Precise estimation of the size of the  market size and its contribution of the market in focus to the parent market
• Accurate predictions about upcoming trends and changes in consumer behavior
• Market forecasting across North America, Europe, APAC, South America, and Middle East and Africa
• What are the current trends in the industry?
• What are the different flavors available in this segment?
• Are there any health or sustainability considerations in the market?

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