Sugar Free Beverages Market Size
The Global Sugar Free Beverages Market reached USD 7.9 billion in 2022 and is expected to reach USD 10.9 billion by 2031 and is expected to grow with a CAGR of 4.2% during the forecast period 2024-2031. The beverage industry is experiencing a significant shift in consumer preferences towards healthier options, leading to the rise of sugar-free and low-sugar drinks.
As people become more health-conscious, there is a growing demand for zero-calorie beverages that provide the satisfaction of a refreshing drink without the guilt of excessive sugar consumption. Artificial sweeteners like stevia, sucralose, and aspartame are being used as alternatives to traditional sugar in the production of these beverages which drives the sugar free beverages market size. Sugar-free drinks are not limited to just soft drinks, but also include a wide range of carbonated beverages that cater to varying tastes and preferences.
The beverage industry is continuously innovating to meet the demand for low-sugar and zero-calorie options, ensuring that consumers can enjoy their favorite drinks while making healthier choices.
Market Scope
| Metrics | Details |
| CAGR | 4.2% |
| Size Available for Years | 2022-2031 |
| Forecast Period | 2024-2031 |
| Data Availability | Value (US$) |
| Segments Covered | Type, Distribution Channel and Region |
| Regions Covered | North America, Europe, Asia-Pacific, South America and Middle East & Africa |
| Fastest Growing Region | Asia-Pacific |
| Largest Region | North America |
| Report Insights Covered | Competitive Landscape Analysis, Company Profile Analysis, Market Size, Share, Growth, Demand, Recent Developments, Mergers and Acquisitions, New Product Launches, Growth Strategies, Revenue Analysis, Porter’s Analysis, Pricing Analysis, Regulatory Analysis, Supply-Chain Analysis and Other key Insights. |
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Market Dynamics
Rising Concerns Related to Sugar-Sweetened Beverages are Driving the Market.
The rising prevalence of the obese population is becoming a global concern, which has resulted in increased demand for sugar-free beverages. According to CDC National Centre for Health Statistics estimates, during the year 2021-2022, the prevalence of obesity was 43.2%, which has increased due to covid-19 pamdemic. Thus, sugar-free beverages are being considered as an affective step towards reduction in obese population. This drink contains artificial sweeteners which are 600 times sweeter than the traditional sugar and hence used in small quantities which low-calorie content.
Since more people are inclined towards a calorie deficit diet, it boosts the market demand. A widening spectrum of beverages can be an opportunity for the market. The introduction of different flavored energy drinks, fruit and vegetable juices are likely to gain consumers’ interest. For instance, on July 21, 2022, Genki Forest China's fastest growing beverage brand launched sugar-free cola-flavored drink.
The Growing Trend of Veganism and Plant-Based Diets Drives the Sugar Free Beverages Market.
The sugar-free beverages market is experiencing significant growth, driven by the increasing trend of veganism and plant-based diets. As more individuals embrace these dietary choices, there is a rising demand for beverages that cater to their preferences. Sugar-free beverages align with vegan principles as they are free from animal-derived ingredients and provide a healthier alternative to traditional sugary drinks. This trend is fueled by a growing awareness of health and environmental concerns, as consumers seek out options that promote their well-being and reduce their ecological footprint.
Manufacturers are responding to this trend by introducing a wide range of sugar-free beverages specifically designed for vegan and plant-based consumers. These beverages often feature natural sweeteners, such as stevia and other plant-based alternatives, while maintaining delicious flavors and varieties. Carbonated drinks, flavored water, herbal teas, and fruit-infused beverages are among the popular offerings in the market. For instance, on July 28, 2022, Wild Drum is a carbonated alcoholic beverage with fruit flavourings company launched a low-cal, vegan and gluten-free seltzer.
The High Cost of Sugar Substitutes Hindering the Market Growth.
The growth of the sugar-free beverage market is being hindered by the high cost of sugar substitutes. As consumers increasingly seek healthier alternatives to traditional sugary drinks, the demand for sugar-free beverages has surged. However, the production of these beverages often requires the use of expensive sugar substitutes, such as artificial sweeteners like stevia, sucralose, and aspartame. The cost of sourcing and acquiring these substitutes adds to the overall production expenses, making sugar-free beverages more expensive compared to their sugary counterparts. This price disparity poses a challenge for manufacturers in terms of pricing their products competitively and attracting price-sensitive consumers. Additionally, the high cost of sugar substitutes can impact profit margins and limit the scalability of sugar-free beverage production.
Market Segment Analysis
The global sugar-free beverages market is segmented based on type, distribution channel and region.
In the Global Market of Sugar Free Beverages, the Alcoholic Beverages Segment Holds the Largest Market Share.
The market for sugar-free alcoholic beverages has witnessed significant growth in response to increasing consumer demand for healthier options. These beverages cater to individuals who are conscious of their sugar intake, following low-carb diets, or managing conditions such as diabetes. With the aim of providing guilt-free alternatives, manufacturers employ various techniques to create sugar-free alcoholic beverages, including the use of artificial sweeteners like stevia, sucralose, and erythritol. Additionally, natural sweeteners such as monk fruit extract and agave nectar are utilized to enhance flavor without increasing sugar content.
The market offers a diverse range of options, including sugar-free versions of popular cocktails, wines, sparkling wines, and low-carb beers. Craft breweries and distilleries are also exploring innovative techniques to produce sugar-free craft beers, vodka, rum, and other spirits. The growth of the sugar-free alcoholic beverages market aligns with the broader health and wellness trends observed in the industry, as consumers increasingly prioritize healthier drinking choices. However, moderation is essential when consuming any alcoholic beverages, including sugar-free options, to maintain a balanced and responsible approach to alcohol consumption.
Market Geographical Share
North America Region Held the Largest Share in Sugar Free Beverages Market.
North America has evolved as the largest market for sugar free beverages accounting for nearly 48.6% of the global sales revenue in 2022. The rising prevalence of obesity and diabetic population in the country has resulted in people shifting towards sugar free lifestyle. Moreover, the steps taken by the United States and Canadian government towards increasing taxation on sugary beverages, have further helped the growth of the sugar free beverages market. The United States has imposed soft drink taxes in four cities of California, keeping track of overconsumption of soft drinks in these cities., which has encouraged manufacturers to reformulate their product lineups in favor of sugar free drinks.
The rise of sugar-free alcoholic beverages aligns with the broader health and wellness trends observed in the beverage industry. Consumers are increasingly seeking products that allow them to enjoy their favorite alcoholic beverages without compromising their dietary goals or overall well-being. As a result, the market for sugar-free alcoholic beverages is expected to continue growing as more individuals prioritize healthier drinking choices. For instance, on January 9, 2023, Monster Energy launched energy zero sugar beverage in the North American region.
Market Companies
The major global players in the market include Coca-Cola Company, PepsiCo, Inc., Monster Beverage Corporation, Nestle Inc., Rockstar Inc., Suntory Holdings Limited, The Gatorade Company, The Kraft Heinz Company, The Hershey Company and Pernod Ricard.
COVID-19 Impact on Market
Global Recession/Ukraine-Russia War/COVID-19, and Artificial Intelligence Impact Analysis:
Covid-19 Impact:
The COVID-19 pandemic has had a profound impact on society, leading to significant disruptions in various industries. The sugar-free beverage market is no exception. With the loss of livelihoods and concerns about immunity, people have become more conscious of their health and have embraced social distancing measures. This has resulted in a decline in sales revenue for the sugar-free beverage market as manufacturing units faced closures during lockdowns.
Furthermore, the supply chain network was severely affected, causing a decrease in the profit margin of the industry. However, it is anticipated that the sugar-free beverage market will gradually recover from the pandemic's adverse effects by the end of the third quarter of the upcoming year. This recovery will be driven by the increasing health consciousness among individuals, as they prioritize boosting their immunity.
To capitalize on the market's recovery, companies operating in the sugar-free beverage sector are developing strategic plans that align with the evolving needs of the market. By adapting to changing consumer preferences and focusing on health-oriented offerings, businesses can position themselves for positive growth in the market.
By Type
- Energy Drinks
- Ready-to-Go drinks
- Carbonated Soft Drinks
- Fruit and Vegetable Juices
- Alcoholic Beverages
- Others
By Distribution Channel
- Supermarkets/Hypermarkets
- Online Sales
- Convenience Stores
- Others
By Region
- North America
- The U.S.
- Canada
- Mexico
- Europe
- Germany
- The U.K.
- France
- Italy
- Spain
- Rest of Europe
- South America
- Brazil
- Argentina
- Rest of South America
- Asia-Pacific
- China
- India
- Japan
- Australia
- Rest of Asia-Pacific
- Middle East and Africa
Key Developments
- On July 27, 2022, Coca-Cola India launched low, zero-sugar variants of its sparkling brands. The Bottling partners invested US$1 billion for production expansion in India.
- On January 13, 2022, ZOA The US-based beverage company launched new energy drinks in two new flavors new flavors, White Peach and Tropical Punch, to its range of beverages.
- In May 2021, Drink Me Chai, a British company, introduced a dairy-free and sugar-free chai latte to meet the increasing global demand for sugar-free beverages. This product launch caters to consumers seeking alternatives that align with their dietary preferences and health goals.
Why Purchase the Report?
- To visualize the global sugar-free beverages market segmentation based on type, distribution channel and region, as well as understand key commercial assets and players.
- Identify commercial opportunities in the market by analyzing trends and co-development.
- Excel data sheet with numerous data points of sugar free beverages market-level with all segments.
- The PDF report consists of cogently put-together market analysis after exhaustive qualitative interviews and in-depth market study.
- Product mapping is available as Excel consists of key products of all the major market players.
The global Sugar-Free Beverages market report would provide approximately 93 tables, 109 figures and 190 Pages.
Target Audience 2024
- Manufacturers/ Buyers
- Industry Investors/Investment Bankers
- Research Professionals
- Emerging Companies
