The
global flavored and functional water market is fragmented in nature.
The main focus of industry players is product differentiation through
use of different ingredients and innovative packaging. This is
because the possibility of product differentiation is low to medium,
as most players offer the same products, states a new report by
Transparency Market Research (TMR). The threat of new entrants is
expected to be low. Leading players in the market include: Nestle SA,
The Coca-Cola Company, Groupe Danone, PepsiCo, Hint Water, and New
York Spring Water.
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Key
players are partnering with other brands to combine innovation and
renovation capabilities with product expertise. Case in point: Nestle
signed an agreement with Yinlu Foods Group in China. This has helped
Nestle to integrate its innovation capability with Yinlu’s
entrepreneurship and consumer understanding, enabling the production
of affordable products for the consumers in China.
Increasing
Prevalence of Obesity Boosts Demand for Flavored and Functional Water
According
to the WHO, the number of obese children below the age of five was 42
mn across the globe in 2013 and this figure is expected to rise to 70
mn by 2025. With growing concerns over obesity and diseases
associated with obesity, the preference for low calorie drinks has
risen considerably over past few years. As such, flavored and
functional water provide a healthier option for the health conscious
people.
Changes
in lifestyle and urbanization of people have resulted in the
population becoming more health conscious, thus propelling the demand
for flavored and functional water. Manufacturers are also taking a
conscious effort by aligning themselves with the demands of
customers, and developing healthier beverages. Moreover, it has been
found that the demand for flavored and functional water is
particularly high among the geriatric population. All these factors
are boosting the demand for these beverages across the globe.
Companies
Need to Worry about Campaigns against Plastic for Packaging
Various
public campaigns against use of plastics in packaging are causing
problems for the flavored
and functional water market. Environmental groups feel threatened
by the growth in the bottled water industry as it leads to high
amount of PET bottle waste. Moreover, a growing segment of the urban
society that possesses increased awareness regarding environmental
conservation has started avoiding plastic bottles. This is expected
to hamper the growth of the market.
The
demand for flavored and functional water is threatened by the
availability of low cost carbonated drinks. Additionally, the
presence of high amount of sugar in some of the flavored and
functional water products is negating the very purpose of consuming
these products. Thus, the high sugar content is hampering the growth
of the flavored and functional water market.
Emerging
Markets Offer Opportunity for Manufacturers
Emerging
economies in Asia Pacific, the Middle East, and Latin America are
witnessing rapid urbanization and increasing disposable income. This
is working in favor for the global flavored and functional water
market. Urbanization and the rising disposable income have led to a
heightened awareness among consumers regarding benefits of consuming
products intended for their well-being. Thus, market players can
focus on these emerging economies and grow in the market.
Healthy
living has become one of the important objectives of a consumer, as
there is a heightened consciousness regarding fitness and appearance.
Banking on this, manufacturers are developing flavored and functional
water products that are developed targeting the wellbeing market.
These products include appetite suppressants and anti-aging
beverages.
By
geography, Asia Pacific is expected to lead and account for 44% of
the global flavored and functional water market by 2019. By product,
flavored water is expected to grow at a significant pace in the
coming years. According to the report, the global flavored and
functional water market was worth US$23.8 bn in 2015 and is expected
to be worth US$36.7 bn by 2019.
This
information is based on the findings of a report published by
Transparency Market Research titled “Flavored and Functional Water
Market - Global Industry Analysis, Size, Share, Growth, Trends, and
Forecast 2013 - 2019.”
The
global flavored and functional water market is segmented as follows:
Geography
- Europe
- North America
- Asia-Pacific
- Rest of the World
Product
- Flavored Water
- Functional Water
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