U.S. Non-Alcoholic Beverages Market Size, Share & COVID-19 Impact Analysis, By Type (Fruits & Vegetable Juices, RTD Coffee, RTD Tea, Functional Drinks, Flavored Water, Coffee, Tea, Smoothies, and Others), By Distribution Channel [Food Service and Retail (Supermarkets/Hypermarkets, Convenience Stores, Specialty Stores, Online Retail Stores, and Others)], and Forecast, 2023-2030

The U.S. non-alcoholic beverages market size was valued at USD 149.62 billion in 2022 and is projected to grow from USD 161.31 billion in 2023 to USD 225.62 billion by 2030, exhibiting a CAGR of 4.91% during the forecast period.

The growing consumer shift toward healthy drinks over alcoholic spirits, such as wine and beer, rising popularity of refreshment drinks, and growing innovations in non-alcoholic beverages are expected to propel the U.S. non-alcoholic beverages market growth. Beverage manufacturers in the country are investing in marketing and branding strategies to promote non-alcoholic drinks to a wide range of consumers. Such initiatives will also play a vital role in boosting the product sales.

COVID-19 IMPACT

Shift in Consumption Pattern and Supply Chain Bottlenecks Hindered Market Growth amid COVID-19

In the U.S., the supply chain of various non-alcoholic beverages was disrupted during the pandemic as it faced significant delays due to bottlenecks in sourcing raw materials and ingredients. Manufacturers halted the production of several beverages during the initial phase of the pandemic, owing to lack of raw materials and production facility closures, which acted as a massive restraint for the industry. Implementing lockdowns and social distancing measures led to reduced outings and social gatherings. This led to a significant decline in the consumption of non-alcoholic type of beverages, which are typically consumed in restaurants, bars, and cafes, thereby hindering the market growth.

LATEST TRENDS

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Growing Demand for Low/Zero Calorie and Sugar-free Carbonated Drinks to Boost Market Growth

Carbonated beverages have been a popular and lucrative drink among consumers in the U.S. owing to their taste and non-alcoholic nature. Carbonated beverages or soft drinks come in various flavors and types including cola, lemon, orange, and others, and are popular among all age groups. In recent years, a growing consumer focus on health and wellness has led to increased demand for low or zero-calorie and sugarfree beverages. Therefore, to adapt to changing consumer preferences, the companies have expanded their product portfolios and launched new products. For instance, in April 2022, The Coca-Cola Company, a carbonated soft drink manufacturer, launched a limited-edition beverage named Coca‑Cola Zero Sugar Byte.

DRIVING FACTORS

Rising Demand for Nutritious and Functional Drinks to Drive Market Growth

This market in the country witnessed significant growth as consumers, especially the young population, are becoming increasingly concerned about maintaining their physical fitness. They are also gaining awareness regarding the health benefits of functional beverages. Functional beverages are infused with various nutritious ingredients, such as vitamins, minerals, amino acids, and others, which aid immune health, heart health, weight management, and offer other benefits. Furthermore, new product launches by key players will also promote the product sales and drive the market growth. For instance, in April 2023, Hangobi, an all-natural functional beverage company, launched a functional beverage containing essential multivitamins in a can. The company launched the new product in Texas at Central Market, C&S Wholesale, with over 150 locations nationally.

Growing Investments in Ready-to-Drink (RTD) Beverages to Propel Market Growth

Non-alcoholic RTD beverages are growing in popularity among U.S. consumers owing to their hectic lifestyle and a wide range of options with respect to convenient beverages. Consumers in the country are seeking healthier and on-the-go food and beverage options, thereby driving the demand for RTD beverages. Furthermore, leading players, such as Nestle S.A., The Coca-Cola Company, Danon, and others, are expanding their product portfolio and business through investment strategies. For instance, in January 2023, Nestle S.A., a Swiss multinational company, invested USD 43 million in its U.S. plant. The investment would increase the capacity of its Boost and Carnation breakfast essentials RTD products and help meet the growing demand for RTD beverages.

RESTRAINING FACTORS 

Presence of High Sugar Content in Energy Drinks, Fruit Juices, and Other Non-Alcoholic Beverages may Hinder Market Growth

Although there is a rising demand for non-alcoholic beverages, they may contain high sugar. Concentrated sugar and high calories in carbonated drinks, fruit juices, and energy drinks can lead to obesity and inappropriate weight gain. According to the U.S. Department of Agriculture (USDA), carbonated drinks contain 11g of sugar per 100 grams. Moreover, the American Diabetes Association also recommends people with diabetes to avoid high-sugar beverages to keep their blood sugar level down, which may impede the U.S. non-alcoholic beverages market growth.

SEGMENTATION

By Type Analysis

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Constant Innovation by Top Players in Coffee and RTD Coffee Products to Boost their Demand

Based on type, the market is classified into fruit & vegetable juices, RTD coffee, RTD tea, functional drinks, flavored water, coffee, tea, smoothies, and others.

The coffee segment is expected to hold a dominant U.S. non-alcoholic beverages market share in the future. In the U.S., coffee is among the most widely consumed beverages as it is a popular choice of many Americans. Coffee is a staple beverage in the U.S., with a significant portion of the population enjoying it daily. According to the National Coffee Association, the U.S. ranked 25^th in coffee consumption per capita. Furthermore, the growing acceptance of coffee in the country is attributed to the presence of premium food service stores, such as Starbucks Corporation, Dunkin', Peet's Coffee, and others. Key players in the country are providing consumers with healthy, fresh, innovative, and premium coffee items. For instance, in October 2022, Starbucks Coffee Company opened a new Starbucks Reserve store in New York City, U.S. The new store offers exclusive, interactive coffee workshops, coffee-inspired cocktails, and premium food to consumers. Such innovations will surge the demand for non-alcoholic beverages in the country.

The fruit & vegetable juice segment is expected to record a considerable CAGR during the forecast period, owing to increased consumer awareness about the benefits of these products and the growing popularity of organic and fortified fruit and vegetable juices.

The smoothies segment is expected to record a high CAGR due to increased consumer focus on maintaining physical fitness and incorporating more fruits and vegetables into the diet. Therefore, consumers in the country are infusing smoothies into their daily routines to improve their health, which will propel the market growth.

The functional drinks segment is expected to perform commendably during the forecast period due to rising consumer inclination toward non-alcoholic and healthy drinks.

By Distribution Channel Analysis

Retail Channel to Dominate Market Owing to Availability of Wide Variety of Brands

Based on distribution channel, the market is classified into food service and retail.

The retail segment is expected to hold a major U.S. non-alcoholic beverages market share. Retail channels include supermarkets, hypermarkets, convenience stores, specialty stores, and others. The supermarket/hypermarket segment holds the largest market share as these retail stores provide dedicated sections for beverages including the non-alcoholic ones. Consumers can find various brands under one roof with special discounts and offers. Convenience stores are smaller retail stores offering a range of non-alcoholic type of beverages for consumers on the go. New entrants in the market are collaborating with e-commerce platforms, such as Walmart, Amazon, and others, to increase their online presence and boost their market position.

The food service segment is expected to register a high CAGR during the forecast period owing to the growing number of full-service restaurants and innovative dine-out experiences. Key market players are launching innovative products to boost the food service industry. For instance, in May 2023, Javo Beverage, a U.S.-based food and beverage products company, launched new lemonade-based energy drinks and premium flavored iced teas, aiming to replace alcoholic beverages. The new products were made available for food service outlets.

KEY INDUSTRY PLAYERS

Increased Focus on Merger and Acquisition Strategies to Further Accelerate Market Players’ Business

Non-alcoholic beverages are a rapidly growing category in the beverage space. This market has witnessed a major surge in innovation, with players introducing a wide range of new products including mocktails, spirit alternatives, functional beverages, and others. Therefore, major players in the market are focusing on expanding their business in the non-alcoholic drinks category to meet the evolving beverage needs of consumers. For instance, in June 2022, Keurig Dr. Pepper Inc., an American multinational soft drink company, acquired the global rights of Atypique, a non-alcoholic, ready-to-drink cocktail brand of Station Agro-Biotech. The brand offers fast-growing non-alcoholic cocktails, which will increase the sales and distribution network of Keurig.

LIST OF KEY COMPANIES PROFILED: 

• Nestlé S.A. (Switzerland)


• PepsiCo, Inc. (U.S.)


• Keurig Dr. Pepper Inc. (U.S.)


• The Coca-Cola Company (U.S.)


• The Kraft Heinz Company (U.S.)


• Starbucks Corporation (U.S.)


• General Mills (U.S.)


• Arizona Beverages USA (U.S.)


• Danone S.A. (U.S.)


• National Beverage Corp. (U.S.)

KEY INDUSTRY DEVELOPMENTS: 

• April 2023: Chamberlain Coffee, one of the leading coffee lifestyle brands, announced the launch of its new line of ready-to-drink plant-based cold brew lattes. The new product is available in mocha latte, cinnamon bun latte, vanilla latte, and traditional cold brew latte flavors. The company collaborated with Walmart to offer its products across the nation.


• January 2023: Milo's Tea Company, an Alabama-based national beverage company invested USD 130 million to build a new manufacturing and distribution facility in Spartanburg County, South Carolina.


• March 2022: Red Bull, a brand created and owned by Austrian company Red Bull GmbH which offers sports drinks, launched limited-edition strawberry & apricot-flavored energy drinks in the U.S. The new product was made available in single cans, in 8.4oz (25cl), and 12oz (35cl) formats.


• April 2022: Flow Beverage Corp, a health and wellness-focused beverage company, launched the Flow Vitamin-Infused Water line of products. The new bottled water products were made available in three flavors including cherry, citrus, and elderberry, and were sold directly to U.S. consumers through its official website.


• January 2022: Starbucks Corporation, an American multinational chain of coffeehouses and roastery reserves, entered the energy drinks segment with the launch of Starbucks BAYA Energy, a Ready-to-Drink (RTD) beverage.

REPORT COVERAGE

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The research report provides qualitative and quantitative insights into the U.S. market and a detailed analysis of the market share, size, and growth rate for all possible segments. The report also provides an elaborative industry analysis on different country markets. It offers various key insights, overview of related markets, market dynamics, SWOT analysis, recent industry developments, such as mergers & acquisitions, regulatory scenario in key countries, key market trends, and competitive landscape.

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