The beverage giant, Coca-Cola China, launched two functional soda water drinks featuring zero-sugar and zero-fat for a price of 4 RMB (US$0.62) per bottle.
The new soda drinks of Coca-Cola are packaged in fresh blue-green and added vitamins and minerals. One of the soda drinks is specifically fortified with niacin, an essential B vitamin in energy metabolism. The drink also has added zinc which helps appetite, making it the first functional soda drink on the market.
This is an important move for Coca-Cola to adapt to the needs of consumers and transform the whole category. It is also optimistic about the development prospect of China’s soda water market. Chinese young consumers become more health-conscious. Soda water is more favorable by consumers, and zero-sugar, zero-fat and zero-calorie beverages have become a trend in sparkling water, soda water, and even tea. The annual growth rate YoY of soda water has reached more than 20%.
In order to change the impact of the continuous decline of carbonated beverage sales and comply with the health trend, Coca-Cola began to produce soda water products in 2013. In 2019, Coca-Cola launched coffee-flavored soda water under its sub-brand Schweppes (Chinese name: Yiquan) on Tmall flagship store, further expanding the market of Coca-Cola soda water in China.
The growing demand for natural and healthy beverages is a driving force for soda water’s rapid growth. However, carbonated drinks, which were once popular all over the world, have suffered from declining market performance because of the change in consumption habits.
According to data from Nielsen, China’s soda market size was 7.9 billion RMB (US$1.22 billion) in 2016. From 2017 to 2018, soda market sales increased by 36%, much higher than the 3.1% of the total beverage industry. It is estimated that the market size of soda water in China has reached 20 billion RMB (US$3.1 billion) by 2020, and the overall market size of soda water is expected to reach 40-50 billion RMB (US$6.18 billion to US$7.73 billion) in the next 10 years.