The global packaged coconut water market is driven by the growing preference for beverages, which are natural, healthy, and convenient. Coconut water is at the cusp of rapid growth on account of its versatile characteristics. This product has exerted a universal consumer appeal for being natural, unadulterated, virtually unprocessed, pure, and organic by virtue. These add-on benefits have naturally paved the way for its rapid growth in the past decade. These qualities have further radically shaped the beverage market wherein either focused vendors dealing with these products are flourishing, or the existing players gradually are diversifying their portfolios to include healthier alternatives to stay competitive in the market.
The onset of COVID-19 in early 2020 has greatly affected the coconut water market across the globe, especially in the US and EU countries, where the demand is well established. The landscape of high demand with a shortage of coconuts sold at a higher price has gone for a toss during the pandemic period. Further, the demand for packaged and unpackaged coconut water is more prominent during the summer season that lasts from April to July in most Southeast Asian countries. This peak season has drastically been affected by the pandemic owing to distribution and supply shortages.
- The paperboards distribution segment is expected to grow during the forecast period as over two billion liters of coconut water will be consumed via paperboards by 2025.
- The APAC region is estimated to be the fastest-growing region in terms of volume consumption at an estimated CAGR of over 34% during the forecast period.
- Organic and calorie-conscious consumers are driving the growth of the Europe packaged coconut water market.
- Over 80% of flavored coconut water offerings include watermelon, pineapple, raspberry, lemon, coffee, and tea flavors.
PACKAGED COCONUT WATER MARKET SEGMENTATION
This market research report includes a detailed segmentation by variant, type, category, packaging, distributor, and geography.
COCONUT WATER MARKET BY VARIANT
Packaged plain coconut water is finding high demand, especially for medical formulations and cosmetics. Coconut water is observing consumption due to the unaltered nature and the versatility of usage for several potential end-users. Since people need low-calorie and no preservative drinks, unflavored coconut drinks are the preferred option as they have low calories than flavored ones. Flavored coconut water, which is sweetened with appropriate flavors, can be easily pitched as a healthy substitute, improving adoption opportunities among this segment. Flavored health drinks are likely to be at the consumption front as the shift in consumer preference in developed countries is for cola and caffeine products. Another major factor driving the segment growth is that sweetened drinks offer vendors the scope to derive better cost savings by optimizing the input ingredient composition.
INSIGHTS BY TYPE
The millennial segment is driving the demand for sweetened variants; they are increasingly showing a preference for lifestyle drinks, which come with a blend of taste, flavor, and health. The growing demand for packaged sweetened coconut water alone is set to witness high growth during the forecast period with the entry of new players and high demand for innovative drinks from the consumer segment. However, sweetened beverages contain 2X times sugar than the unsweetened that can hinder the growth in the calorie-conscious population.
The emergence of the health-conscious consumer segment, which avoids the intake of sugar and sweetened products, constitutes an ideal target consumer segment for unsweetened variants. It is the foremost preference of the diabetic population that requires to consume healthy alternatives to sugary drinks. Moreover, ‘No Added Sugar’ labeling is a key factor driving instant purchase in most of the health-conscious markets.
INSIGHTS BY CATEGORY
The non-sparkling packaged coconut water market is expected to grow at the highest CAGR of over 25% during the period 2019–2025. Non-sparkling coconut water is widely available in the unflavored form, which is of low calories. Hence, the growing preference for low-calorie drinks is likely to boost the non-sparkling segment during the forecast period. The segment is the preferred option for both millennials and baby boomers, which is the reason for the significant market size. Further, consumers are more concerned with the potential side-effects of consuming carbonated coconut waters. The addition of flavor enhancers such as sodium and other additives could be harmful.
The demand for fizzy drinks has recently increased the demand for packaged sparkling coconut water. Americans drink more than 170 million gallons of sparkling water each year. Sparkling waters are the hottest choice among the millennials across geographies. The introduction of the most successful fizzy concept in coconut water can be a vital enhancer for the market growth on account of the consistent demand for new beverages.
INSIGHTS BY PACKAGING
Ecofriendly paperboards such as Tetra Pak are more dominant in the market. They tend to remain as the foremost choice for market leaders such as Vita Coco, O.N.E owing to their sustainable nature and on-the-go convenience. More than 65% of coconut water producers prefer paperboards and carton packs for their package and distribution. Paperboards are the most preferred mode of packaging in countries such as China, Russia, Brazil, and India, where tetra packs drive the beverage packaging market. With coconut water brands are investing in innovating new flavors and forms, considerable cost-cutting can be done through packaging in paperboards.
Plastic bottle packaging facilitates the easy creation of large lots and unit sizes. The volumetric size of juice coconut containers vary as much as 250 ml to 2 liters, and the creation of unit sizes in metal and paperboard can be difficult. Hence, plastic remains a preferred material for packaging as it facilitates a better scope for branding. Further, plastic packaging offers significant scope for innovative product design in terms of dispensation, sealability, and quality retention, which otherwise may prove difficult in other modes of packaging. Plastic was the second most preferred packaging technique in 2019, which contributed to over 37% of the total revenue generation.
INSIGHTS BY DISTRIBUTION
Since the shelf lives of packaged coconut drinks are less than one-year, efficient distribution and logistics sourcing is required. Retailers constitute as much as 80% of the sale in this segment. Supermarkets and hypermarkets are the ideal channels for the sale of large volumes for commercial consumption. Supermarkets have the largest share in the North American region due to the abundant availability of retail chains. Hypermarkets are also growing in numbers in developing economies such as India.
Coconut water is also extensively distributed through online e-commerce websites. The channel has gained momentum due to the rapid growth and penetration level of e-shopping among millennials and Gen Z. With countries such as China whose online grocery market is about to reach $196 billion by 2023, online stores remain as one of the preferred media of sales in the country along with South Korea and Australia.
INSIGHTS BY GEOGRAPHY
The consumption of packaged coconut water in North America is driven by rapidly shifting consumer preferences for healthier alternatives, increased awareness of the harmful effects of sugar-based drinks. The well-developed retail landscape that facilitates innovations and product launches and the presence of multinational food and beverage manufacturers that have recognized the product potential and have committed significant investments to drive the product availability and reach.
INSIGHTS BY VENDORS
The coconut water has emerged as one of the highly competitive markets since 2019. The entry of players such as Vita Coco in 2004, followed by the venture of FMCG giants such as PepsiCo and Coca-Cola through O.N.E and Zico brands, has breathed a new life in the market. With more than 200 recognized players in the industry today, it is highly fragmented where the intensity of the competition is high. Along with coconut water brands, vendors are trying to gain an edge over substitutes such as plant-based waters, sports drinks, and conventional fruit juices as they determine the significance of market share and success significantly.
The packaged coconut water market report includes in-depth coverage of the industry analysis with revenue and forecast insights for the following segments:
Segmentation by Variant
Segmentation by Type
Segmentation by Category
Segmentation by Packaging
Segmentation by Distribution
- Supermarkets and Hypermarkets
- Convenience Stores
- Specialty Stores
- Online Channels
Segmentation by Geography
- North America
- South Korea
- Latin America
- Middle East & Africa
- South Africa
- Saudi Arabia