Bubble Tea Market Anticipated to Generate a Revenue of $4,553.2 Million, Growing at a CAGR of 7.4% from 2021 to 2028Download Sample Reports Overview
The global bubble tea market is estimated to be valued at $4,552.9 million by 2028, surging from $2,595.8 million in 2020 at a noteworthy CAGR of 7.4%.
Impact Analysis of COVID-19 on the Bubble Tea Market
The global market for bubble tea is estimated to experience a negative impact amid the COVID-19 pandemic. The growth is declining amidst the pandemic due to supply chain disruptions and decline in the availability of raw materials. The import-export restrictions, shortage of labor, and social distancing measures have negatively impacted the demand for bubble tea. The shortage of raw materials and travel restrictions led to the closure of manufacturing units which negatively impacted the market growth. For instance, the base ingredient used for preparation of bubble tea such as black tea and green tea is majorly exported from India, but due to import-export restrictions, the companies were unable to export tea to other countries. Furthermore, the closure of shops, cafes, hotels led to decline in sales of bubble tea. All these factors have greatly affected the revenue and demand for bubble tea across the world.
Various government initiatives and measures are helping the bubble tea manufacturers amid the pandemic. For instance, Hindustan Unilever Limited (HUL), a leading consumer goods company in India, extended the partnership with UNICEF, the United Nations Children’s Emergency Fund, to support the tea growers and workers in Assam during the COVID-19 pandemic. This partnership aims to deliver essential goods such as soaps, toilet cleaners, sanitizers, and other hygienic products to tea growers in Assam. This will also raise awareness among tea growers and local communities for taking necessary precautions during the pandemic. Such initiatives are estimated to generate investment opportunities during the forecast period.
Global Bubble Tea Market Analysis
The enormous growth of the global bubble tea market is mainly attributed to growing health-consciousness, decline in demand for carbonated drinks, and health benefits offered by the consumption of bubble tea. The consumption of bubble tea is known to strengthen the immune system as it is rich in antioxidants such as catechins that prevent oxidative stress. Furthermore, the addition of various fresh fruits, such as mango, strawberry, lychee give you substantial dose of vitamin C. Bubble tea is an excellent energy booster as it contains caffeine that provides instant energy and enhances the metabolism process. The consumption of bubble tea prevents the formation of free radicals and enhances weight loss process. In addition, decline in demand for carbonated drinks that may cause insulin resistance due to high sugar content is estimated to drive the demand for bubble tea. Also, carbonated drinks lack essential nutrients and increases the risk of type 2 diabetes, cancer, and other chronic disorders. All the factors are anticipated to generate a positive impact on the growth of bubble tea market during the analysis period.
The growth in coffee consumption can act as a substitute for tea. Coffee is another widely consumed beverage that has various health benefits such as stress reduction, strengthening the immune system, and boosting the energy levels. It totally depends on the consumer which beverage they would like to consume. This factor is estimated to hamper the market demand during the forecast period.
The low price of bubble tea and availability of various flavors are estimated to generate huge opportunities during the forecast period. The basic ingredients used for the preparation of bubble tea include tapioca balls, creamer, sweetener, flavor which is cheaper compared to the ingredients that are used in preparation of coffee such as cappuccino, latte, and others. In addition, bubble tea is rich in nutrients such as vitamin C, vitamin B12, vitamin B6, and others. Also, it contains essential minerals such as calcium, manganese, potassium that are beneficial for our health. In addition, bubble tea is available in a variety of fruity flavors such as strawberry, mango, peach, banana, coconut, grape, green apple, lychee, kiwi, lemon, and others. The introduction of less fruity flavors such as ginger, caramel, chocolate, mocha, almond, sesame, and others are estimated to drive huge growth opportunities in the global bubble tea market.
Global Bubble Tea Market, Segmentation
The global bubble tea market is segmented based on base ingredient, flavor, component, and region.
The base ingredient segment is further classified into black tea, green tea, oolong tea, and white tea. Among these, the black tea sub-segment is anticipated to acquire the market share and surpass $1,864.8 million by 2028, with an increase from $1,082.9 million in 2020. This is majorly owing to various health benefits associated with the consumption of black tea. Black tea contains antioxidants called flavonoids that boost the heart health. It reduces the level of bad cholesterol, improves gut health, reduces blood pressure, and reduces the risk of stroke and cancers as it contains polyphenols. In addition, black tea is rich in caffeine and amino acid called L-theanine that boosts the brain health by increasing the focus and alertness. All these factors are anticipated to create a positive impact on the black tea sub-segment of the bubble tea market throughout the forecast period.
The flavor segment is further divided into original flavor, coffee flavor, fruit flavor, chocolate flavor, and others. The fruit flavor sub-segment is anticipated to have a dominating share in the global market and register a revenue of $2,820.3 million during the forecast period. The fruit flavor enhances the taste of bubble tea, and they are available in various flavors such as apple, pomegranate, mango, lychee, raspberry, strawberry, jackfruit, lemon, and others. Hence, consumers have various options to choose from while selecting the fruit flavor of the bubble tea. All these factors are anticipated to generate lucrative revenue throughout the forecast period for the fruit flavor sub-segment.
The component segment is further classified into flavor, creamer, sweetener, liquid, tapioca pearls, and others. Among these, the liquid sub-segment is anticipated to have the dominant market share and surpass $1,703.4 million by 2028, with an increase from $930.2 million in 2020. The liquid component of the bubble tea can be easily mixed with variety of tea flavors such as black tea, green tea, and other as well as fruit syrups and fruit powders which is anticipated to drive the growth of liquid sub-segment during the forecast period.
The bubble tea market for the Asia-Pacific region is projected for the rapid growth. This region generated a revenue of $701.0 million in 2020 and is further projected to reach up to $1,267.2 million by 2028. This growth is majorly attributed to the presence of largest tea producing and tea consuming countries such as China, Japan, India, and others. Furthermore, health benefits offered by tea consumption and decline in popularity of carbonated drinks that increases the risk of chronic illness such as type 2 diabetes and heart disorders is estimated to drive the demand for bubble tea market in this region. Also, availability of distinct bubble tea flavors such as chocolate, caramel, lavender, barley, taro, mocha, sesame, and others is anticipated to boost the demand for Asia-Pacific bubble tea market during the forecast period.
Key Players in the Global Bubble Tea Market
- Kung Fu Tea
- Bobabox Limited
- Bubble Tea House Company
- Gong Cha
- Sumo's (M) Sdn Bhd
- ViVi Bubble Tea
- Ten Ren's Tea Time
- The Bubble Tea Company
Along with the company profiles of the key players in the market, the report includes the Porter’s five forces model that gives deep insights into the competitive environment of the market.
Porter’s Five Forces Analysis for the Global Bubble Tea Market
- Bargaining Power of Suppliers: The suppliers in bubble tea market usually supply tea leaves as a base ingredient necessary for the production and making of bubble tea. The base ingredient differentiation is less but there are small number of domestic and international raw material suppliers that supply tea leaves.
Thus, the bargaining power of the suppliers is high.
- Bargaining Power of Buyers: The buyers in the bubble tea market are high in number which are mostly home users or commercial users Buyers have low bargaining power, as the buyers are high in number which are usually home users or commercial users such as café owners and others.
Hence, the bargaining power of buyers is low.
- Threat of New Entrants: Startups entering this market has less legal barriers and government norms as bubble tea production has less environmental impact. Also, the demand is high due to various benefits associated with the consumption of bubble tea.
As a result, the threat of the new entrants is moderate.
- Threat of Substitutes: The availability of substitute product such as coffee which is another widely consumed beverage that also offers various health benefits increase the threat from substitution.
Therefore, the threat of substitutes is moderate.
- Competitive Rivalry in the Market: The ventures operating in the global bubble tea market are focusing on enhancing the product base by launching new bubble tea flavors and expanding their geographical presence.
Therefore, competitive rivalry in the market is high.