Sparkling Tea Market Size (2024 – 2030)

The Global Sparkling Tea Market was valued at USD 459.66 Million in 2023 and is projected to reach a market size of USD 704.97 Million by the end of 2030. Over the forecast period of 2024-2030, the market is projected to grow at a CAGR of 6.3%.   

Sparkling tea, an effervescent fusion of traditional tea and carbonation, has been bubbling up in popularity across the global beverage landscape. This innovative drink category marries the health benefits of tea with the refreshing fizz consumers crave, creating a unique niche in the competitive beverage market. In 2023, the sparkling tea market showcased remarkable vitality, driven by health-conscious consumers seeking alternatives to sugary sodas and alcoholic beverages. The market's growth reflected a broader shift towards functional beverages that offer both refreshment and perceived wellness benefits. Sparkling tea manufacturers have been quick to capitalize on this trend, offering a diverse array of flavors and formulations to cater to evolving consumer preferences. From classic green and black tea bases to exotic herbal blends, the market has seen an explosion of creativity in product development. One of the key factors propelling the sparkling tea market forward is its appeal to millennials and Gen Z consumers, who are increasingly drawn to beverages that align with their values of health, sustainability, and experiential consumption. These demographics appreciate the craft and artisanal qualities often associated with sparkling tea brands, as well as the Instagram-worthy aesthetics of many product offerings. The market has also benefited from the growing interest in low and no-alcohol alternatives, with sparkling tea positioning itself as a sophisticated option for those looking to reduce their alcohol intake or abstain altogether. This has led to an increased presence in bars, restaurants, and social settings where alcoholic beverages traditionally dominate.

Key Market Insights:

The most popular flavors of sparkling tea in 2023 were lemon, peach, and berry.

Over 60% of sparkling tea consumers are between the ages of 18 and 34.

Women make up a larger percentage of sparkling tea consumers compared to men.

Millennials and Gen Z are the primary drivers of growth in the sparkling tea market.

Sparkling tea is often marketed as a healthier alternative to sugary soft drinks.

Over 70% of sparkling tea consumers cite health benefits as a primary reason for purchasing the product.

The demand for sparkling tea with natural sweeteners, such as stevia and monk fruit, has been increasing.

The popularity of sparkling tea has been fueled by the growing trend of wellness and clean eating.

Grocery stores and supermarkets are the primary distribution channels for sparkling tea.

Convenience stores and gas stations are also significant channels, especially for on-the-go consumption.

Online retailers, such as Amazon and Walmart, have played a growing role in the distribution of sparkling tea.

The food service industry, including restaurants and cafes, is also a significant market for sparkling tea.

Sparkling Tea Market Drivers:

The sparkling tea market has found a powerful ally in the global shift towards healthier lifestyles and more mindful consumption habits.

The fundamental driving force behind this trend is growing knowledge of the detrimental effects excessive sugar intake has on one's health. Long a mainstay of the beverage business, traditional carbonated soft drinks have drawn criticism for their excessive sugar content and poor nutritional value. Equipped with greater knowledge than ever before about nutrition and health, consumers are actively looking for substitutes that may satiate their want for a cool, fizzy drink without the guilt or health risks associated with sugar-filled sodas. Within this paradigm shift, sparkling tea has positioned itself wonderfully. It presents a strong choice for customers who are concerned about their health by combining the well-known fizz of carbonated drinks with the health advantages of tea.

The second major driver propelling the sparkling tea market forward is the ongoing trend of premiumization coupled with the rising demand for experiential consumption.

In recent years, there has been an increasing tendency in the beverage sector toward premiumization, as customers have demonstrated a willingness to spend more for goods that provide greater quality, creative tastes, or distinctive features. Sparkling tea has benefited from this trend by establishing itself as a high-end substitute for traditional carbonated drinks. Premium tea bases, which are frequently obtained from well-known tea-growing locations, enable businesses to create captivating stories about provenance and handcrafted production techniques. Small-batch manufacturing methods have been adopted by several sparkling tea producers, who highlight the skill and attention to detail that go into each bottle. This strategy appeals to customers who are prepared to pay more for goods that feel unique or exclusive and who are becoming more curious about the backstory of the things they buy.

Sparkling Tea Market Restraints and Challenges:

One of the primary challenges facing the sparkling tea market is the intense competition within the broader beverage industry. Sparkling tea must contend not only with traditional carbonated soft drinks but also with a plethora of other innovative and health-focused beverage categories. Kombucha, flavored sparkling water, plant-based drinks, and functional beverages all vie for the same health-conscious consumer base. This crowded marketplace makes it difficult for sparkling tea brands to differentiate themselves and capture consumer attention, potentially limiting market penetration and growth rates. Another significant restraint is the complexity and cost associated with production and distribution. Unlike simple carbonated beverages, sparkling tea requires a delicate balance of brewing, flavoring, and carbonation processes to achieve the desired taste and quality. This complexity often necessitates specialized equipment and expertise, which can be a barrier to entry for new players and a challenge for scaling operations. Additionally, the use of natural ingredients and the need for careful handling to maintain product quality can lead to higher production costs, potentially squeezing profit margins or resulting in higher retail prices that may deter some consumers.

Sparkling Tea Market Opportunities:

One of the most significant opportunities lies in product innovation and diversification. The versatility of tea as a base ingredient opens up a vast playground for flavor experimentation and functional enhancements. Brands can explore unique tea varietals, novel flavor combinations, and the incorporation of trending ingredients such as adaptogens, nootropics, or CBD (where legally permitted). This continuous innovation not only keeps the category exciting for consumers but also allows brands to target specific need states or consumption occasions, potentially expanding the market's reach. The growing interest in personalized nutrition presents another exciting opportunity. Sparkling tea brands could leverage data and technology to offer customized products tailored to individual health goals, flavor preferences, or lifestyle needs. This could manifest as personalized subscription services, allowing consumers to create their own unique blends, or as product lines targeting specific health concerns or demographic groups. The burgeoning low and no-alcohol movement represents a golden opportunity for sparkling tea. As more consumers seek sophisticated, adult-oriented beverages without alcohol, sparkling tea can position itself as a premium alternative in bars, restaurants, and social settings. Collaborations with mixologists to create complex, non-alcoholic cocktails featuring sparkling tea could further elevate its status and expand its presence in the nightlife and hospitality sectors

SPARKLING TEA MARKET REPORT COVERAGE:

Sparkling Tea Market Segmentation: By Types

• Green Tea

• Black Tea

• White Tea

• Oolong Tea

• Herbal Tea

• Other Types

At the moment, the market for sparkling tea is dominated by green tea. Customers choose it highly because of its well-known health advantages, which include its high antioxidant content, ability to help with weight control, and general appeal as a nutritious beverage. Green tea is a common basis for sparkling tea products due to its mild and pleasant flavor that goes well with carbonation.

Because herbal tea is linked to a number of health advantages, this market is expanding the quickest. The health benefits of herbal teas—like better digestion, lower stress levels, and increased immunity—are luring more and more customers in. Its quick development is also attributed to its adaptability in flavor profiles and capacity to combine various herbs.

Sparkling Tea Market Segmentation: By Distribution Channel

• Supermarkets/Hypermarkets

• Online Channels

• Specialty Stores

• Convenience Stores

• Others

Supermarkets and hypermarkets continue to be the primary outlets for the distribution of sparkling tea, even with the rise in online sales. With the benefits of in-store exposure and impulse buying offered by these retail locations, customers can find new goods while performing their usual food shopping. Sparkling tea is widely accessible to a wide range of customers because of its availability in these establishments. 

With the rapid growth of e-commerce and the convenience it offers, online channels are the fastest-growing distribution channel for sparkling tea. Consumers increasingly prefer to shop online, where they can explore a wider variety of products, read reviews, and have their purchases delivered to their doorstep. The ability of brands to offer direct-to-consumer services, subscription models, and targeted marketing also drives the growth of this channel.

Sparkling Tea Market Segmentation: Regional Analysis

• North America

• Europe

• Asia-Pacific

• South America

• Middle East and Africa

North America is the most dominant region in the sparkling tea market, accounting for 35% of the global market share. The region’s dominance is driven by a strong health and wellness trend, a well-established market for premium beverages, and high consumer awareness of the benefits of sparkling tea. The U.S. and Canada, in particular, have seen significant growth in demand, with consumers seeking low-calorie, naturally flavored beverages.

The fastest-growing sparkling tea market is in the Asia-Pacific area, where demand is rapidly increasing due to factors including urbanization, increased disposable incomes, and a trend towards healthier living. Sparkling tea is becoming more and more popular as a contemporary and healthier substitute for sugary soft drinks in tea-drinking nations like China, Japan, and South Korea. The younger demographic in the area is especially drawn to creative and fashionable beverage alternatives, which is driving up market expansion.

COVID-19 Impact Analysis on the Sparkling Tea Market:

The interruption of supply chains, which impacted the availability of raw materials and packaging components, was one of the initial issues. Production slowed down and stock shortages resulted from delays in the shipment of commodities caused by lockdowns and other restrictions on mobility. Furthermore, a decrease in consumption outside of the house was caused by the closing of cafés, restaurants, and other food service establishments, which are important sales channels for high-end drinks like sparkling tea. Changes in consumer buying habits were also brought about by the economic uncertainties resulting from the epidemic. Many customers cut back on their spending on upscale or unnecessary products, such as sparkling tea, in favor of necessities. The market's expansion was momentarily delayed by this change in priorities and the fact that many people had less disposable cash. During the pandemic, customers' attention was drawn to beverages that had practical advantages, such as enhancing immunity or lowering stress levels. Sparkling tea has gained popularity among health-conscious customers seeking to enhance their general well-being due to its natural components and health-promoting qualities. Additionally, the epidemic hastened the transition in consumer behavior toward online buying, with more and more people using e-commerce sites to buy drinks. Sparkling tea companies were able to take advantage of this change to increase their internet visibility, attract new clients, and provide direct-to-consumer services. During the pandemic, brands that swiftly adjusted to this new reality by improving their online platforms, providing home delivery, and interacting with customers through digital marketing experienced notable growth.

Latest Trends/ Developments:

Adding useful additives to sparkling tea is a big trend right now. More and more customers are drawn to drinks that provide more than just refreshments. Sparkling teas are now infused with adaptogens, probiotics, and CBD to offer extra health advantages including lowered stress levels, better digestion, and sharper concentration. In the sparkling tea business, premiumization is becoming more and more popular. When purchasing items with premium ingredients, distinctive tastes, and greater quality, consumers are willing to spend a higher price. As a result of this trend, artisanal sparkling tea companies have emerged, emphasizing elegant packaging, small-batch manufacturing, and organic ingredients. The emergence of the "sober curious" movement has raised consumer demand for socially acceptable alcohol-free substitutes. Sparkling tea is being marketed to customers as a sophisticated, health-conscious substitute for alcohol for those who want to cut back on their use. Companies are taking advantage of this trend by selling sparkling teas in sophisticated packaging that resembles alcoholic drinks.

Key Players:

1. LaCroix

2. Sparkling Ice

3. PepsiCo's Bubly

4. Keurig Dr Pepper's Zico

5. National Beverage Corporation's LaCroix

6. Nestlé Waters' Pure Life Sparkling

7. Danone's Mizu

8. Unilever's IZZE

9. Coca-Cola's AHA

10. Sparkling Water Co.