Ready-to-Drink (RTD) Coffee - South Africa

The Ready-to-Drink (RTD) Coffee market in South Africa has been experiencing significant growth in recent years.

Customer preferences: South African consumers have shown a growing preference for convenience and on-the-go products, which has contributed to the rise in popularity of RTD coffee. With the fast-paced lifestyle of urban areas, consumers are seeking convenient and portable options that can be consumed easily while commuting or at work. Additionally, the younger generation, in particular, is more open to trying new and innovative beverages, and RTD coffee offers a convenient and trendy alternative to traditional hot coffee or energy drinks.

Trends in the market: One of the key trends in the RTD coffee market in South Africa is the increasing demand for healthier and natural options. Consumers are becoming more health-conscious and are looking for beverages that are low in sugar and artificial additives. As a result, companies are introducing RTD coffee products that are made with natural ingredients and offer functional benefits, such as added vitamins or antioxidants. This trend aligns with the global shift towards healthier lifestyles and the growing demand for functional beverages. Another trend in the market is the introduction of premium and specialty RTD coffee products. South African consumers are increasingly willing to pay a premium for high-quality and unique coffee experiences. This has led to the launch of RTD coffee products that use premium coffee beans and offer distinct flavors or brewing methods. These specialty products cater to the growing demand for premium coffee experiences and provide consumers with a wider range of options to choose from.

Local special circumstances: South Africa has a strong coffee culture, with a significant portion of the population being coffee drinkers. However, traditionally, the market has been dominated by hot coffee consumed at home or in coffee shops. The introduction of RTD coffee has provided consumers with a convenient and portable alternative, allowing them to enjoy their favorite beverage on-the-go. This has been particularly appealing to busy professionals and students who are looking for quick and convenient caffeine fixes.

Underlying macroeconomic factors: The growing economy and increasing disposable income in South Africa have also played a role in the development of the RTD coffee market. As consumers have more purchasing power, they are willing to spend more on premium and convenience products. Additionally, the rise of e-commerce and online grocery shopping platforms has made it easier for consumers to access and purchase RTD coffee products, further driving market growth. In conclusion, the Ready-to-Drink (RTD) Coffee market in South Africa is experiencing growth due to changing customer preferences towards convenience and healthier options, as well as the introduction of premium and specialty products. The local coffee culture and the country's growing economy have also contributed to the development of the market. With these factors in play, the RTD coffee market in South Africa is expected to continue growing in the coming years.

Data coverage:

The data encompasses B2C enterprises. The at-home market covers retail sales via super- and hypermarkets, eCommerce, convenience stores, or similar sales channels. The out-of-home data encompasses all sales to hotels, restaurants, catering, cafés, bars, and similar hospitality service establishments. Combined numbers encompass both the at-home market and the out-of-home market. Both the at-home and the out-of-home market are valued at retail selling prices including all sales and consumption taxes.

Modeling approach:

Market sizes are determined through a Top-Down approach, building on specific predefined factors for each market segment. As a basis for evaluating markets, we use resources from the Statista platform as well as in-house market research, national statistical offices, international institutions, trade associations, companies, the trade press, and the experience of our analysts. In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, consumer spending (e.g. consumer spending on Non-Alcoholic Drinks, consumer spending at Hotels, Restaurants etc.), and price level index. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the exponential trend smoothing is well suited for forecasting the Non-Alcoholic Drinks market with a projected steady growth. The main drivers are GDP per capita and consumer spending per capita.

Additional notes:

The data is modeled using current exchange rates. The impact of the COVID-19 pandemic and the Russia-Ukraine war are considered at a country-specific level. The market is updated twice a year.