This report looks at the following areas:
This Report looks at the following areas:
- Future market outlook and growth prospects of China’s RTD coffee market
- New RTD coffee product launches and market activities
- Trends and attitudes towards RTD coffee consumption
- Advantages and disadvantages of RTD coffee compared to other non-alcoholic drinks
- Factors for repurchasing RTD coffee
- Barriers to purchasing RTD coffee
RTD coffee has a unique advantage in outdoor occasions due to its convenience; although the market penetration is relatively high, there is still room for increasing the drinking frequency.
Marta Zhang, Senior Analyst, China Insights
Market Definitions
The report discusses ready-to-drink (RTD) coffee products including:
RTD coffee includes RTD coffee drinks, such as Starbucks Frappuccino and Bernachon (贝纳颂), sold at retail channels such as supermarkets. It is prepared to be consumed directly and does not require the addition of water or flavourings before consumption.
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Executive summary
- Key issues covered in this Report
- Definition
- What you need to know
- The market
- RTD coffee continues to grow steadily
- Market factors
- Companies and brands
- The category leader Nestlé's market performance is stable
- Marketing activities
- New product trends
- Product examples
- The consumer
- The consumer base for RTD coffee continues to expand, but the frequency remains low
- Graph 1: drinking penetration rate, 2023 vs 2024
- Milk coffee leads, with the black coffee penetration rate following closely behind
- Graph 2: RTD coffee consumption frequency, 2024
- Further enhance the premium perception through authentic coffee taste experiences
- Graph 3: category perception, 2024
- Taste, price and convenience drive consumer repurchase
- Graph 4: factors for repurchasing RTD coffee, 2024
- Concerns about the naturalness and safety of RTD coffee continue to heat up
- Graph 5: reasons for not drinking RTD coffee, 2022 vs 2024
- Caffeine content is receiving attention
- Tap into the demand for diverse caffeine choices
- Graph 6: attitudes towards RTD coffee – caffeine, 2024
- Issues and insights
- What we think
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The market
- Market size and forecast
- RTD coffee continues to grow steadily
- Market factors
- Coffee has become a solution for dealing with workplace stress
- Graph 7: average weekly working time for corporate employees (hours), March 2022-September 2024
- Declining willingness to trade up beverage consumption during economic recovery
- Graph 8: upgrading and downgrading of non-alcoholic drinks consumption, 2021-24
- The ongoing travel and outdoor activity boom benefits RTD coffee consumption
- Graph 9: interest in travel participation over the next 12 months, 2023
- Graph 10: overall participation rate in outdoor sports, 2024
- RTD coffee has a spending priority advantage, and collaboration and competition with on-premise coffee co-exist
- Graph 11: priority of beverage spending, 2024
- Graph 12: coffee spending priorities, 2024
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Companies and brands
- Market share
- The category leader Nestlé's market performance is stable
- Costa Coffee achieved impressive results
- Marketing activities
- Ride the wave of event economy
- Cross-industry collaborations integrated with travel scenarios
- Nescafé embarks on mountain hiking and wilderness exploration
- Lock on to workplace and study scenarios for industry collaboration
- Provide emotional value for wage earners
- New product trends
- Flavour innovation diversifies
- Understanding the graph
- Examples of new RTD coffee flavours
- Minus claims lead RTD coffee innovation, while natural claims gain attention
- Graph 13: RTD coffee new product launch, by 'natural' claim, 2019-24
- Graph 14: RTD coffee new product launch, by claim, 2019-24
- Examples of new products with natural claims
- Low-caffeine innovation expands drinking scenarios
- Add ingredients to boost functional innovation
- Reach more consumers through continuous package innovation
- Apart from specifications, new packaging types have emerged in the market
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The consumer
- Coffee consumption trends
- The consumer base for RTD coffee continues to expand
- Graph 15: drinking penetration rate, 2023 vs 2024
- High RTD coffee consumption penetration rate but low consumption frequency
- Graph 16: consumption frequency, 2024
- Graph 17: consumption frequency – RTD coffee, 2021-24
- Interest in RTD coffee is rising among younger people
- Graph 18: penetration rate of consumption – RTD coffee, by age, 2023 vs 2024
- Studying/working remains the main consumption occasion
- Amplify the advantages of RTD coffee in outdoor settings
- Graph 19: drinking occasions, 2024
- Graph 20: drinking occasions, by consumption frequency, 2024
- Consumption of RTD coffee categories
- Milk coffee leads, with the black coffee penetration rate following closely behind
- Graph 21: RTD coffee consumption frequency, 2024
- Fruit-flavoured coffee needs further market exposure
- Graph 22: share of milk coffee* and black coffee** in new RTD coffee products, 2019-24
- Graph 23: share of fruit-flavoured coffee*** in new RTD coffee products, 2019-24
- The popularity of cold brew black coffee is rising
- Graph 24: RTD coffee category penetration rate ranking, 2022 vs 2024
- Highlight milk ingredients to achieve differentiation in milk coffee
- Graph 25: frequency of RTD coffee consumption – weekly and above, by monthly personal income, 2024
- Category perception
- Enhance the perception of 'classy' through the drinking experience of authentic coffee
- Graph 26: category perception, 2024
- The relaxing properties of RTD coffee are favoured by female consumers
- Graph 27: category perception – relaxing, by gender, 2024
- RTD coffee is perceived as more accessible among high-income groups
- Graph 28: category perception – RTD coffee, by monthly personal income, 2024
- Repurchase factor for RTD coffee
- Taste, price and convenience drive consumer repurchase
- Graph 29: factors for repurchasing RTD coffee, 2024
- Reasonable pricing is valued, especially among high-income groups
- Graph 30: factors for repurchasing RTD coffee – reasonable price, by monthly personal income, 2024
- Differentiate through packaging
- Packaging and functionality help to further attract frequent drinkers
- Graph 31: factors for repurchasing RTD coffee, by consumption frequency, 2024
- Examples of functional claim products
- Reasons for not drinking RTD coffee
- Natural claims become a game changer for RTD coffee
- Graph 32: reasons for not drinking RTD coffee, 2022 vs 2024
- Alleviate younger consumers' concerns about calorie intake and the impact on sleep health
- Graph 33: reasons for not drinking RTD coffee, by age, 2024
- Enhance the category recognition of RTD coffee among on-premise coffee consumers
- Graph 34: reasons for not drinking RTD coffee, compared to consumers who only drink on-premise coffee, 2024
- Collaborate with coffee shops to endorse RTD coffee
- Attitudes towards RTD coffee
- Prioritise the demand for low-caffeine products
- Graph 35: attitudes towards RTD coffee – caffeine, 2024
- Iced drinks have the opportunity to be a focus of communication
- Graph 36: attitudes towards RTD coffee – iced coffee, by consumption frequency, 2024
- Capitalise on the popularity of social media endorsements and the enthusiasm for outdoor sports
- Graph 37: attitudes towards RTD coffee – social media, by monthly personal income, 2024
- Graph 38: attitudes towards RTD coffee – consumption occasions, by monthly personal income, 2024
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Issues and insights
- Expand the selection of caffeine levels
- Differentiate caffeine combinations to cultivate drinking habits
- Prioritise the product portfolio that offers varying caffeine levels
- Display 'nutrition choice' grading labels and provide selection guidance
- Return to the natural taste of coffee
- Emphasise the natural and authentic attributes of the product to increase the acceptance of RTD coffee
- The authentic flavour of coffee beans
- The aroma enhances the original taste of coffee
- Position iced coffee as an important innovation direction
- Innovation in cold beverages becomes the key to competitiveness
- Emphasise optimised drinking experiences through extraction methods
- Focus on younger consumers' enthusiasm for iced coffee
- Riding the influence of convenience store chilled drinks
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Appendix – market size and forecast, research methodology and abbreviations
- Market size and forecast
- Methodology
- Abbreviations
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