Tea with bubbles in it? As strange as this may sound, bubble tea is an incredibly popular drink that’s growing in marketplaces across the world.
Just take a look at some of the stats:
- The global bubble tea market will reach more than US$4.5 billion by 2026
- In 2021, the bubble tea market was worth US$2.1 billion
- Sales of non-alcoholic beverages rose by 8% in 2021
- In the US, 90% of people between the age of 20- and 29 purchased bubble tea in the last 2 months
- Thailand is one of the major consumers of bubble tea. The average consumption of bubble tea is six cups per person every month
- 37% of bubble teas consumed are fruit flavoured
- The Asia-Pacific Bubble Tea market is the biggest and keeps growing
What Is Bubble Tea?
Bubble tea, also known as boba, bubble milk tea, or pearl milk tea originated in Taiwan in the late 1980s. It’s a refreshing drink combining chewy tapioca balls with other components that give the tea a taste that’s sweet and savoury at the same time. Its name comes from the fact that bubbles appear in the drink after it gets extracted from the shaking machine.
Sound familiar? Well if it doesn’t yet, based on these stats it will soon!
Competitive Players In The Bubble Tea Market
The crucial players in the global bubble tea market include:
- Chatime Group
- Bubble Tea Supply Inc.
- Gong Cha
- CoCo Fresh Tea & Juice
- Kung Fu Tea
- Tiger Sugar
- Lollicup USA Inc.
- Happy Lemon
The size of the Global Bubble Tea market was valued at US$2.1 billion in 2020 and predictions tell us that it should reach more than US$4.5 billion by 2026. The compound annual growth rate will vary from area to area but it looks to be at least slightly more than 8% between 2021 and 2026. This means that even the most conservative estimates say that it will reach almost US$2.3 billion by 2023.
Bubble Tea Analysis by Region
The Asia-Pacific region is predicted to undergo the biggest market share in the next few years in terms of the contribution of global revenue.
Countries like Taiwan and Vietnam are likely to be posting the highest figures when it comes to sales because of the enormous popularity of bubble tea in these regions. In addition, factors like new cafés and products being launched in these countries will serve to attract new consumers and ensure loyalty in those who already enjoy bubble tea.
North America will probably have the second-largest market share during the period forecast. This is because tea consumption is on the rise in this part of the world, as is the popularity of fruit beverages with a tea base overall.
The fact that people the world over are showing a growing inclination towards non- and low-alcoholic drinks will also be a factor boosting sales of bubble tea globally.
For the year ending in October 2021, the sale of non-alcoholic beverages increased by 8% and that of low-alcoholic drinks rose by 8%. This trend is likely to continue for the foreseeable future.
Bubble Tea Industry Growth Factors
Growth of the worldwide bubble tea market will be governed by factors related to the increased consumption of coffee and tea as non-alcoholic drink options among students and blue-collar workers. This will be above and beyond the focus of bubble tea’s health benefits like the fact that it has a zero fat content and is low calorie.
Furthermore, studies have indicated that consuming bubble tea regularly leads to increased brain function and improved concentration, as well as:
- An increase in bone strength due to its antioxidant content
- A boost in energy due to its high carbohydrate content
- A lowering in stress levels
- An improvement in your immune system due, in part, to the vitamin C that fruit bubble teas contain
- A reduction in free radical damage due to compounds like epigallocatechin and polyphenols in bubble tea
There is a marked predilection worldwide for tea and coffee over other forms of drinks nowadays too. Per capita consumption of soft drinks has declined at an annual rate of 0.8% since 2017 in the United States alone. This preference will also augment the growth of the bubble tea market.
Studies have indicated that over 90% of people between the ages of 20- and 29-years old have purchased bubble tea over the last three months. Although people of all ages drink bubble tea, the younger generation does so more frequently.
As the Millennial population increases its purchasing power and because hectic lifestyle trends show no signs of slowing down, the footprint of the bubble tea market is likely to increase. Other factors to consider in terms of industry growth are aggressive marketing by brands and celebrities, and the fact that this will further widen the consumer base into 2023 and beyond.
Globally, the bubble tea market can be divided into Component, Flavour, and Type.
- Component Qualities
When talking about Components, the breakdown includes Creamer, Flavour, Liquid, Sweetener, and Tapioca Pearls. In this case, the Liquid segment will occupy the biggest market share because of the combination of easy availability and the range of possibilities when it comes to the mixtures of flavours and syrups.
- Favourite Flavours
There is a large variety of different flavours and tastes in bubble tea, but the most popular has to be Classic Milk, Tiger Milk, Thai Milk, Thai Milk, and Lychee Fruit Tea.
Essentially, we can split the market into Chocolate, Classic, and Fruit. Fruit-flavoured bubble teas account for the largest percentage of bubble teas consumed at 37%. The Fruit section will also probably witness the biggest share of the market because of the inclusion of potentially lucrative flavours like Lychee, Mango, Passion Fruit, Peach, Plum, and others.
- Top Tea Types
In terms of Type, the industry can be divided into Black, Green, Oolong, and White Tea.
The Black Tea segment is likely to hold onto the largest share of the market as a result of health-conscious consumers’ preferences along with the rising trend of organic beverage and food products.
Studies indicate that consumers are increasingly becoming aware of nutritional value and this will affect their purchases in the months and years to come. 51% of Millennials, people born between 1981 and 1996, and 45% of Generation Xers, those born between 1965 and 1980, focus on healthy food options when buying groceries and eating out.
The Demand for Healthier Drinks
With bubble tea brands continuing to generate novel, unique products, the versatility in flavour this item offers combined with its health benefits and visibility on social media platforms will keep driving the market.
The American market is anticipated to see a CAGR of over 12% by 2031, China will exhibit a CAGR of 8%, Thailand’s will be near 9%, and Singapore’s will exceed 10%. The Asia-Pacific Bubble Tea market will likely flourish with many opportunities and the base ingredient, green tea, will lead market growth. Because of its lesser sugar content, products in the reduced-sugar and sugar-free categories will also gain traction going forward.
The stats don’t lie. Bubble tea is rising to the top, and everyone wants a sip!
Nathan has always been captivated by numbers and patterns. With a Master’s degree in Statistics, he’s honed his skills to decipher complex data sets and discern market trends.
Over the past decade, Nathan has worked with various firms compiling and analyzing industry spending figures to forecast market movements.