Global Ready-To-Drink (RTD) Tea Market Report and Forecast 2024-2032

Global Ready-To-Drink (RTD) Tea Market Size

The global market for ready-to-drink (RTD) tea reached approximately USD 34.1 billion in 2023. The market is estimated to grow at a CAGR of 5.8% in the forecast period of 2024-2032, reaching a value of around USD 56.6 billion by 2032.

Ready-To-Drink (RTD) Tea Market Growth

Ready-to-drink tea, variously known as RTD tea, refers to packaged tea that is sold in a prepared form and does not require any brewing. It is available in a wide range of flavours in bottles or cans and can be consumed in hot or cold form.

Increased incorporation of functional ingredients such as vitamins, minerals, antioxidants, and probiotics, among others, in RTD tea to provide specific health benefits is a crucial trend in ready-to-drink (RTD) tea market.

Ready-To-Drink (RTD) Tea Market Trends

Several manufacturers are infusing new and exotic flavours such as peach, mango, and brown sugar, among others, in RTD tea to cater to a diverse range of consumers and extend their market outreach.

With the growing focus on sustainability, there has been a surge in the adoption of recyclable packaging and eco-friendly business practices for the production of RTD tea, which further provides impetus to the growth of the ready-to-drink (RTD) tea market.

The rising health consciousness and the increasing trend of veganism are prompting market players to introduce innovative RTD teas with protein bases such as soya milk or nut milk.

Recent Developments

As per the ready-to-drink (RTD) tea market dynamics and trends, Cola India announced on Nov 2023, that it aims to enter the ready-to-drink tea segment with the launch of Honest Tea product. This product falls under the brand of Honest, which is one of the subsidiaries of Coca-Cola company.

Industry Outlook

As per the ready-to-drink (RTD) tea industry analysis, in 2018, RTD tea was the only category of tea which witnessed significant growth in the market. The RTD tea segment reached a value of around USD 10.75 billion, according to the data by Beverage Market Corp. In 2017, the sales of soft drinks and sports beverages, among others, witnessed a significant decline, whereas RTD tea witnessed a growth of 3.9% in revenue. Market players such as Coca-Cola and Honest Tea have gained significant growth in this segment.

As per the North American Tea Conference (NATC) in October 2023, RTD tea showcases better sales than packaged tea in the USA. RTD tea segment also witnessed some loss after the pandemic but this segment showed positive growth from the perspective of the health and wellness sector, which contributed to the growth of the ready-to-drink (RTD) tea industry.

Market players are readily launching new varieties of RTD teas to boost market growth. Uncle Matt’s Organic announced in June 2024 that it aims to launch 3 ready-to-drink brewed black tea products, which can contribute to the ready-to-drink (RTD) tea industry revenue. Additionally, Singha Park Chiang Rai also announced the launch of Tea Infuse, an RTD tea product, in May 2024.

The Growth of the Global RTD Tea Market Driven by Health Trends and Convenience

• Health Trends: Increasing consumer preference for healthier beverage options as an alternative to sugary sodas.

• Convenience: Growing demand for convenient, on-the-go beverage solutions aids ready-to-drink (RTD) tea demand growth.

• Diverse Flavors: Availability of a wide range of flavours and formulations catering to diverse consumer preferences.

• Natural Ingredients: Rising consumer demand for natural and organic ingredients in beverages.

• Market Penetration: Expansion of RTD tea products into emerging markets with growing urban populations.

Challenges Impacting the Growth of the Global RTD Tea Market Include High Competition and Regulatory Hurdles

• High Competition: Intense competition from other RTD beverages, including energy drinks, coffee, and soft drinks can affect ready-to-drink (RTD) tea demand forecast.

• Regulatory Hurdles: Different regions have different standards for food and beverage products.

• Price Sensitivity: Consumers' sensitivity to price fluctuations affecting purchasing decisions.

• Supply Chain Issues: Challenges in managing a consistent supply chain for raw materials and finished products.

• Shelf Life: Ensuring product stability and shelf life without compromising quality and taste.

Opportunities in the Global RTD Tea Market Driven by Innovation and Market Expansion

• Product Innovation: Opportunities for innovation in flavors, packaging, and functional benefits can increase ready-to-drink (RTD) tea market value. 

• Market Expansion: Market presence can be expanded in developing countries which witness an increase in disposable incomes.

• E-commerce Growth: Increasing online sales channels providing wider reach and convenience.

• Collaborations: Potential for collaborations with health and wellness brands to enhance product appeal can increase ready-to-drink (RTD) tea opportunities.

Setbacks Faced by the Global Ready-To-Drink (RTD) Tea Market Include Changing Consumer Preferences and Health Concerns

• Health Concerns: Growing scrutiny over sugar content and artificial additives in beverages.

• Changing Consumer Preferences: Shifts in consumer preferences towards freshly brewed tea or other beverages.

• Market Saturation: Potential saturation in mature markets leading to slower growth rates can decrease ready-to-drink (RTD) tea market revenue.

The North American, a major RTD market, has grown significantly due to:

• Diverse Flavor Profiles: The diverse cultural backgrounds in North America drive demand for a variety of flavor profiles in RTD beverages.

• Premiumization: Consumers are paying more for high-quality and artisanal RTD options such as small-batch and organic products.

• Shift from Sugary Beverages: Health concerns over sugar consumption and rising obesity rates have led consumers to choose RTD beverages over sugary sodas and juices which aids ready-to-drink (RTD) tea demand.

Global Ready-To-Drink (RTD) Tea is An Intensely Competitive Market

Shift Towards E-commerce Sales Channel: Distribution networks play a pivotal role, with companies leveraging both traditional retail channels and e-commerce platforms to ensure widespread availability. The rise of e-commerce has revolutionized beverage purchasing, with many RTD tea brands establishing an online presence or partnering with online retailers to reach consumers who prefer online shopping or those in areas with limited physical retail access.

Leveraging Social Media: Competitors emphasize marketing strategies like social media engagement, celebrity endorsements, and health-focused campaigns to differentiate brands and attract a wider audience which can aid the demand of ready-to-drink (RTD) tea market.

Focus on Product Innovation: Key players often focus on product innovation and diversification, introducing new flavours, formulations, and packaging to cater to evolving consumer preferences. This ensures the product portfolio remains fresh and appealing.

Ready-To-Drink (RTD) Tea Industry Segmentations

Based on category, the market is bifurcated into organic and conventional. The ready-to-drink (RTD) tea market segmentation, on the basis of type, includes herbal, green tea, and black tea, among others.

On the basis of distribution channel, the market is classified into supermarkets and hypermarkets, speciality stores, and online stores, among others. The major regional markets of ready-to-drink (RTD) tea are North America, Europe, the Asia Pacific, Latin America, and the Middle East and Africa.

The comprehensive EMR report provides an in-depth assessment of the market based on the Porter's five forces model along with giving a SWOT analysis. The report gives a detailed analysis of the following key players in the ready-to-drink (RTD) tea market, covering their competitive landscape and latest developments like mergers, acquisitions, investments, and expansion plans.

• Danone S.A.

• Nestle S.A. 

• Starbucks Corporation  

• PepsiCo, Inc.  

• Keurig Dr Pepper Inc  

• The Coca-Cola Company  

• Harney & Sons Fine Teas  

• Snapple Beverage Corp  

• Unilever PLC  

• The Republic of Tea   

• Others

Ready-To-Drink (RTD) Tea Market Share by Type

Black tea occupies a significant portion of the ready-to-drink (RTD) tea market share owing to its high popularity as a staple flavour among tea consumers across the world. Black tea is loaded with antioxidants and polyphenols, which makes it widely popular among health-conscious consumers.

It also contains a decent amount of caffeine, which makes black RTD a go-to drink for morning or mid-afternoon. Additionally, green tea is expected to gain a sizeable share of the market in the forecast period as it provides multiple health benefits and aids in weight loss.

Competitive Landscape

Danone S.A. is a multinational food company, founded in 1919, with its headquarters in Hoofddorp, the Netherlands. The company operates under the brand names Alpro, Activia, Danette, Delight, and Silk, among others.

Nestle S.A., incorporated in 1866, is a global food and drink processing company, based in Vaud, Switzerland. Some of its major products include cereals, coffee, bottled water, and confectionery, among others.

Starbucks Corporation, established in 1971 and headquartered in Washington, the United States, is a multinational coffeehouse chain. The company aims to promote sustainability by utilising ethically sourced tea and coffee.

Other ready-to-drink (RTD) tea industry players include PepsiCo, Inc., Keurig Dr Pepper Inc., The Coca-Cola Company, Harney & Sons Fine Teas, Snapple Beverage Corp, Unilever PLC, and The Republic of Tea, among others.

Ready-To-Drink (RTD) Tea Market Regional Analysis

The Asia Pacific accounts for a substantial share of the global market due to the increased number of tea plantations in the region. The growing presence of market players who are implementing strategic measures such as developing unique flavours to stay ahead of their competitors also drives market growth in the region.

Meanwhile, North America is expected to gain healthy growth in the ready-to-drink (RTD) tea industry due to the shift in consumer preference from carbonated and caffeinated beverages to healthy beverages such as black and green tea.

Key Highlights of the Report

Ready-To-Drink (RTD) Tea Market Report Snapshots

Ready-To-Drink (RTD) Tea Market Size

Ready-To-Drink (RTD) Tea Market Growth

Ready-To-Drink (RTD) Tea Market Trends

Ready-To-Drink (RTD) Tea Market Share

Ready-To-Drink (RTD) Tea Companies

Ready-To-Drink (RTD) Tea Market Regional Analysis