Soft drinks in 2024: The big picture
In 2024, soft drinks in Malaysia witnessed further strong, if slowing, growth in on-trade volume sales. The channel continued its recovery from the slump in demand caused by the restrictions imposed on foodservice, travel and consumer mobility in the wake of the Coronavirus (COVID-19) pandemic.
2024 key trends
Soft drinks players are increasingly leveraging digital marketing in response to the evolving advertising landscape. They are deepening their focus on engaging consumers through social media, influencers, road shows, and pop-ups.
Competitive landscape
The key players in soft drinks in Malaysia, including Fraser & Neave Holdings, Coca-Cola Bottlers (M) and Spritzer, maintain strong industry positions through new product development and innovation, packaging revamps, marketing and advertising and sustainability initiatives. In 2024, Fraser & Neave Holdings continued to lead soft drinks in off-trade volume and value terms, leveraging its strength in a number of categories, including juice, RTD tea, carbonates, sports drinks and Asian speciality drinks.
Retailing developments
Smaller players in soft drinks are shifting their distribution strategies, focusing more on vending, forecourt retailers and convenience stores, for example, to avoid the high listing fees charged by large modern grocery retailers like Jaya Grocer and Mercato. Higher product placement costs make it difficult for smaller players to compete with larger rivals, which have strong negotiating power and enjoy extensive product facings in retail stores.
Foodservice vs retail split
In response to the increasingly busy lifestyles of consumers, particularly in urban areas, coupled with recovering financial confidence following the COVID-19 pandemic, dining out increased in 2024. As a result, the on-trade channel significantly outpaced the off-trade channel in volume and value growth terms in soft drinks.
What next for soft drinks?
Prime Minister Datuk Seri Anwar Ibrahim has announced an 80% increase in excise duty on sugary drinks, from MYR0.50 per litre to MYR0.
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Overview:
Understand the latest market trends and future growth opportunities for the Soft Drinks industry in Malaysia with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
Key trends are clearly and succinctly summarised alongside the most current research data available. Understand and assess competitive threats and plan corporate strategy with our qualitative analysis, insight and confident growth projections.
Data and analysis in this report provides further detailed coverage dedicated to the following key categories, where applicable:
- Bottled Water
- Carbonates
- Concentrates
- Juice
- RTD Coffee
- RTD Tea
- Energy Drinks
- Sports Drinks
- Asian Speciality Drinks
If you're in the Soft Drinks industry in Malaysia, our research will help you to make informed, intelligent decisions; to recognise and profit from opportunity, or to offer resilience amidst market uncertainty.
The Soft Drinks in Malaysia report includes:
- Analysis of key supply-side and demand trends
- Detailed segmentation of international and local products
- Historic volume and value sizes, company and brand market shares
- Five year forecasts of market trends and market growth
- Robust and transparent research methodology, conducted in-country
This report answers:
- What is the market size of Soft Drinks in Malaysia?
- To what extent are health considerations impacting consumption of Soft Drinks in Malaysia?
- How are changing social attitudes and legislation (eg sugar tax) reshaping demand and consumption?
- How are changing demographics (for example, an ageing or predominantly young population) determining consumption of Soft Drinks in Malaysia?
- Which are the leading brands in Soft Drinks in Malaysia?
- What potential exists for multinational or domestic soft drinks companies to expand in Malaysia?
- How are products distributed in Soft Drinks in Malaysia?
- How is the rise of e-commerce changing the retail and competitive landscape?
- How have home seclusion and social distancing measures following COVID-19 impacted sales of Soft Drinks?
- How are sustainability issues, such as environmentally-friendly packaging, legislation on recyclability, or the amount of plastic in bottles, impacting the soft drinks industry?
- Where is future growth expected to be most dynamic?
Soft Drinks in Malaysia
Soft drinks in 2024: The big picture
2024 key trends
Competitive landscape
Retailing developments
Foodservice vs retail split
What next for soft drinks?
Fountain sales in Malaysia
DISCLAIMER
Bottled Water in Malaysia
KEY DATA FINDINGS
Flavoured bottled water gains popularity amid the health and wellness trend as new players enter the fray
New products and distribution developments support the high per capita consumption of bottled water in Malaysia
Strong tourism rebound promises growth opportunities for bottled water
Water supply disruption ramps-up the demand for bottled water and pressure for eco-friendly packaging solutions to mitigate sustainability issues
Population growth, a rising number of households, improving consumer purchasing power and tourists to push the consumption of bottled water
Foodservice operators to reduce the offer of complimentary drinking water to stimulate bottled water consumption and profit margins
Carbonates in Malaysia
KEY DATA FINDINGS
On-trade and fountain sales see strong volume growth, while off-trade volume sales drop
Constant new product development is key to success as a shift towards functional offerings is observed
Sustainability gains traction in carbonates
Hike in excise duty for sugary drinks may hinder carbonates, especially in the off-trade channel
Tourism and Karaoke bode well for carbonates consumption
Growing appreciation for health-orientated carbonates in Malaysia
Concentrates in Malaysia
KEY DATA FINDINGS
The rise of alternatives undermines powder concentrates while liquid concentrates maintains momentum
Low shelf visibility, low demand and weak new product development limit growth potential in 2024
Brands with strong positioning consolidate their leadership
Brand collaboration is an effective marketing strategy to broaden audience reach
Slowing off-trade (RTD) volume growth is set to prompt a refocus of distribution strategies
Reduced sugar or sugar-free options may see increased visibility and demand in light of the sugar tax
Concentrates Conversions
Juice in Malaysia
KEY DATA FINDINGS
Marginal volume growth in the off-trade channel amid consumer price-sensitivity and substitution threats
Prize contests gain momentum in juice
Key players engage in distribution strategies to expand their reach and engender brand loyalty
The increase in excise duty on sugary drinks is poised to hike prices of juice
Reconstituted 100% juice is set to continue to struggle in off-trade volume terms
The outlook for coconut and other plant waters is optimistic
RTD Coffee in Malaysia
KEY DATA FINDINGS
Greater appreciation of quality and taste in coffee limits RTD coffee’s volume growth potential
Packaging refreshes, product reformulation and unique marketing campaigns keep consumers engaged
Digital marketing is key to consumer engagement and audience reach
New entrants may add dynamism yet saturate the competitive landscape of RTD coffee
New product developments to continue to spark excitement among consumers
Etika Beverages at the forefront of a focus on convenience distribution and marketing
RTD Tea in Malaysia
KEY DATA FINDINGS
RTD tea enjoys strong volume growth in the on-trade channel amid foodservice and tourism flow recoveries
Fresh, limited edition packages and rebranding offer brand refreshes and revitalise consumer interest
Innovative collaborations to expand market reach
Reduced sugar to outpace regular in off- and on-trade volume growth terms in still RTD tea
Players to engage in collaborations to boost brand visibility and push purchases
Digital marketing and new product development offer essential competitive tools
Energy Drinks in Malaysia
KEY DATA FINDINGS
New product development and innovation are key competitive tools for energy drinks
Strong partnerships reinforce brand positioning and visibility
Halal certification to ease doubts among the Muslim-majority population
Urbanisation effects to foster a demand for energy-boosting products
Interactive marketing campaigns to create customer engagement and propel demand
Players to shift distribution to improve competitiveness
Sports Drinks in Malaysia
KEY DATA FINDINGS
The expanding number of cafés and restaurants attached to fitness centres spur on-trade volume sales
Repositioning aims to broaden the use and appeal of 100 Plus
“Spend-and-Win” contests and sponsorships remain key strategies
Malaysia’s route to becoming a “Sporting Nation” by 2025 offers growth opportunities for sports drinks
Collaboration with brand ambassadors increases brand visibility, credibility and engagement
Players look to strengthen footholds through distribution strategies
Asian Speciality Drinks in Malaysia
KEY DATA FINDINGS
Off-trade volume sales stagnate but greater penetration boosts on-trade volume sales
Price promotions prove an effective strategy to stimulate interest and large purchases
Marketing efforts and product innovation are key ways to gain a competitive edge
Players may redirect their focus to other soft drinks or the on-trade channel
Strong collaboration with retailers to secure strategic product placement and higher visibility
Growing interest in healthier beverages presents growth opportunities for Asian speciality drinks
The following categories and subcategories are included:
Soft Drinks
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- Carbonated Natural Mineral Bottled Water
- Carbonated Spring Bottled Water
- Carbonated Purified Bottled Water
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- Still Flavoured Bottled Water
- Sparkling Flavoured Bottled Water
- Functional Bottled Water
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- Still Natural Mineral Bottled Water
- Still Spring Bottled Water
- Still Purified Bottled Water
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- Regular Carbonates
- Reduced Sugar Carbonates
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- Regular Cola Carbonates
- Reduced Sugar Cola Carbonates
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- Regular Non-Cola Carbonates
- Reduced Sugar Non-Cola Carbonates
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- Regular Lemonade/Lime
- Reduced Sugar Lemonade/Lime
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- Regular Tonic Water/Mixers/Other Bitters
- Reduced Sugar Tonic Water/Mixers/Other Bitters
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- Regular Orange Carbonates
- Reduced Sugar Orange Carbonates
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- Regular Other Non-Cola Carbonates
- Reduced Sugar Other Non-Cola Carbonates
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- Liquid Concentrates
- Powder Concentrates
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- Not from Concentrate 100% Juice
- Reconstituted 100% Juice
- Coconut and Other Plant Waters
- Juice Drinks (up to 24% Juice)
- Nectars
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- RTD Coffee
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- Carbonated RTD Tea and Kombucha
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- Regular Still RTD Tea
- Reduced Sugar Still RTD Tea
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- Regular Energy Drinks
- Reduced Sugar Energy Drinks
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- Regular Sports Drinks
- Reduced Sugar Sports Drinks
- Asian Speciality Drinks
Soft Drinks
This is the aggregation of the following categories; Carbonates, Fruit/vegetable juice, Bottled water, Functional drinks, Concentrates, RTD tea, RTD coffee and Asian speciality drinks.
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This report originates from Passport, our Soft Drinks research and analysis database.
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