Japan Energy Drink Market - Growth, Trends, COVID-19 Impact, and Forecasts (2023-2028)

The Japanese energy drink market is estimated to register a CAGR of 14.5% over the next five years.

Key Highlights

• By packaging, the canned energy drink segment is estimated to be the most preferred and highly consumed owing to its easy availability and convenience as long working schedules and hectic lifestyles become the norm. Hence, the working population, one of the major consumers of energy drinks, helped the demand for energy drinks stay afloat.
• In Japan, canned energy drinks are estimated to be the most preferred and highly consumed product owing to their easy availability and convenience. The energy drink market caters to the demand and changing consumer preferences of a large population of millennials in the country, owing to their perception that energy drinks are superior to other carbonated drinks in terms of health benefits. Therefore, factors such as these are driving the market studied.
• In addition, rising consumer lifestyle changes increased health consciousness, and awareness of health and wellness products are anticipated to drive market expansion over the coming years. Additionally, the popularity of products among teens is fueling the expansion of the industry.
• However, a caffeine overdose may result in hypertension, nausea, agitation, and other health problems that restrict the growth of the energy drink market. On the other hand, it is projected that a shift in consumer preference toward beverage consumption and a healthy lifestyle would open up the lucrative potential for market advancement throughout the projection period.
• Furthermore, increasing consumer awareness of maintaining good health reduces the frequency of gut-related disorders, like ulcers, Gastroesophageal Reflux Disease (GERD), gastroenteritis, etc., accelerating the consumption of energy drinks. Energy drink producers assert that their products increase energy.
• The popularity of energy drinks, which offer immediate energy along with mental and physical stimulation, is one of the main factors driving the market growth for energy drinks. Taurine is another important component necessary to grow skeletal muscle and the cardiovascular system. The growth of the Japanese energy drink market is primarily projected to be driven by these factors.

Japan Energy Drink Market Trends

Hectic Lifestyles Leading Toward High Demand for Energy Drinks

• In Japan, 'karoshi' is a significant social problem. This condition, which results in illnesses and mental disorders brought on by overwork, is expanding globally. According to a joint World Health Organization (WHO) and International Labor Organization (ILO) estimate from 2021, more than 745,000 people die annually due to extended workdays. According to the Japan Ministry of Health, Labour, and Welfare, the percentage of paid leave taken in Japan in 2021 was 56.6%. The culture of Japanese businesses makes it challenging to take time off. Japan has among the longest working hours in the world. According to a government survey, approximately one-fourth of Japanese companies required their employees to work more than 80 hours of overtime, and 12% of companies had employees breaking the mark of 100 hours a month.
• Therefore, due to the rise in health consciousness among consumers, most Japanese consumers are shifting toward healthier alternatives to soft drinks and carbonated beverages due to their hectic lifestyle, which, in turn, has led to a rise in demand for functional beverages, like energy drinks, especially through kiosks, vending machines, and specialist retail stores that are easily available.​
• The increasing consumption of ready-to-drink (RTD) beverages in line with the hectic schedules of consumers due to their work lifestyles has moved their preference toward canned, processed, or ready-to-eat drinks, propelling the functional drink market in Japan.
• For instance, in February 2022, ITO EN North America, the Brooklyn-based green tea company and innovators of healthy beverages, introduced a plant-based functional energy drink under their award-winning brand- matcha LOVE+. The new matcha LOVE ENERGY + line is an innovative green tea and matcha blend with functional ingredients that benefit the body and mind with soothe, immunity, and focus. Each variety contains 50 mg of natural caffeine for a gentle energy boost and is powered by green tea and matcha's unique properties.

Innovation in Packaging Accelerating the Demand for Energy Drinks

• As a product category, energy drinks are found widely in stores across the country due to their longer shelf life, range of packaging sizes, and convenience. In Japan, energy drinks are famous as pharmaceutical drugs, quasi-drug, and carbonated beverages with innovative packaging to attract new generations of consumers. However, several giant manufacturers of energy drinks are spending huge amounts on product packaging in line with safety measures.
• For instance, Red Bull employs circular packaging technology in all its products to ensure sustainability and decrease plastic usage. The Japanese population spends a significant amount on the food service sector, and the country is witnessing a decent consumption rate of energy drinks.
• For instance, in October 2021, Japanese contract packaging company Cosmo Foods is set to add carton packs to its portfolio by installing SIG’s high-speed combismile filling machine at its plant in Komono. The 50-50 joint venture DNP • SIG Combibloc Co., Ltd brings true packaging innovation and value-added filling technology to Japan with SIG’s unique on-the-go combismile carton pack. Copacker Cosmo Foods will be the first company in Japan to install a state-of-the-art, high-speed combismile filling machine from SIG. This will set the course to bring trendy beverages in modern, convenient and sustainable packaging solutions designed specifically for on-the-go consumption to busy consumers.

Japan Energy Drink Market Competitor Analysis

The Japanese energy drink market is highly competitive, and the majority of the market share is held by key players, including The Coca-Cola Company, Rockstar Inc., Red Bull GmbH, Taisho Pharmaceutical Holdings, and Otsuka Pharmaceutical Co. Ltd. Manufacturers are focusing on creating wider distribution channels to cope with the rising competition and increasing consumer demand for energy drinks in the country. In addition, key players are relying on online distribution channels for the marketing and branding of their products. Advanced distribution network and manufacturing expertise offer an upper edge to manufacturers to expand their range of products across the country.

Additional benefits of purchasing the report:

• The market estimate (ME) sheet in Excel format
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