If you’re in the business of making functional drinks and not thinking about China, you’re already behind. Iain Langridge, Managing Director of In2Asia (shown left) and an expert in cracking the Asia-China market, says the time for Australian and New Zealand brands to move is now.
The demand for high-quality, health-focused drinks is exploding, and the window for getting in before the market fully matures is narrowing fast. “This space is still relatively immature,” Iain Langridge points out. “There’s a real chance for international brands to get in early, build recognition, and dominate categories that haven’t yet been saturated.” Kombucha, better-for-you sodas, and health tonics? China’s just getting started.
Source: © Martinmark | Dreamstime.com - Young Chinese Woman with Health Drink
The numbers don’t lie. China’s ready-to-drink functional beverage market was worth $16.8 billion USD in 2023 and is projected to hit $24.4 billion USD by 2028. Between 2022 and 2023, China’s new product launch index skyrocketed 58.5% which is a clear signal both consumers and brands are piling in. And while the global functional beverage market is chugging along at a respectable 7% annual growth, China is moving nearly four times faster at 26%. That’s wild growth.
Meanwhile, energy drinks are hoarding 71% of the category, but there’s plenty of space for products pushing beyond the standard caffeine-and-sugar formula.
So why China, and why now? Simple. Health is the new wealth. Urban consumers want drinks supporting their bodies, their energy, their gut health and whatever gives them an edge in their fast-paced lives. They’re not just buying into wellness trends, they’re demanding functional, science-backed products that actually deliver.
And here’s what also makes China different - rewards quality. Consumers are willing to pay for premium, international brands bringing innovation and credibility to the table.
The window of opportunity won’t stay open forever. Iain Langridge’s message to Australian and New Zealand brands? Get moving. “China rewards brands that come in strong with high-quality, innovative products. The functional beverage space is only going to get more competitive, so don’t wait until it’s fully developed. If you’ve got what it takes, now is the time to make your mark.”
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