India boasts a significant demographic, with a youthful population comprising 327 million millennials and 377 million Generation Z individuals. This demographic, combined with widespread and affordable internet access and rapid urbanisation, has cultivated an informed and aspirational consumer base, positioning India as a market of immense potential.
By the end of 2023, companies were incorporating additional product weight, slashing prices, and allocating resources to marketing efforts to stimulate volume growth and enhance their market presence. As the year concluded, major hot drinks industry players began adjusting prices or augmenting the weight of their offerings significantly as commodity prices stabilised.
In the concluding quarter of 2023, Hindustan Unilever initiated a strategic overhaul of its margin model. The traditional fixed margin holds diminished significance in this revamped structure, as the newly introduced target-linked variable margin takes precedence.
Prominent corporations actively pursue an omnichannel strategy to broaden their reach across India. In 2022, Hindustan Unilever Ltd achieved a significant milestone by becoming the inaugural fmcg company to join the central government's Open Network for Digital Commerce (ONDC) network through its D2C platform, UShop.
Specialist tea and coffee shops continue to fuel the growth of foodservice volumes in India, with brands expressing confidence in the country's potential due to its youthful demographic. Notably, developments in the specialist coffee shop sector are prominent, driven by the demand for unique café experiences, particularly from millennials and Generation Z, who value customisation options.
Favourable macroeconomic factors will be instrumental in driving the volume growth of hot drinks in India. While inflation in tea and milk has stabilised, coffee continues to experience high inflation, impacting volume growth.
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Understand the latest market trends and future growth opportunities for the Hot Drinks industry in India with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
Key trends are clearly and succinctly summarised alongside the most current research data available. Understand and assess competitive threats and plan corporate strategy with our qualitative analysis, insight and confident growth projections.
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Hot Drinks
This report originates from Passport, our Hot Drinks research and analysis database.
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