Tonic Water Market Size

Market Size Snapshot

Note – Market size depicts the revenue generated over the financial year

The growth of tonic water is a consequence of the increasing preference of consumers for premium mixers and the increasing popularity of tonic water as a beverage of versatility, especially in the cocktail segment. Moreover, as the health consciousness of consumers increases, the demand for low-calorie and naturally flavored tonic water is growing, which also contributes to the growth of the market. Also, the development of the craft cocktail culture is driving the demand for premium mixers. The appearance of artisanal tonic water has attracted the attention of consumers looking for new tastes. The leading players in the market, such as Fever-Tree, Q Mixers and Schweppes, are actively investing in product development and strategic alliances to expand their market presence. For example, Fever-Tree has expanded its product line to include different flavors and has established strategic alliances with premium spirits, thereby strengthening its leadership in the tonic water market. These strategic moves indicate that the market is developing rapidly and will continue to grow in the future.

Regional Market Size

Regional Deep Dive

The Tonic Water market is experiencing significant growth across several regions, driven by a growing interest in premium mixers and the rise of craft cocktails. In North America, the trend is towards artisanal and flavoured tonic waters, while in Europe, a move towards low-sugar, natural and low-sugar drinks is seen. In Asia-Pacific, the popularity of tonic water as a mixer for alcoholic drinks, and particularly gin, is growing as a result of changing drinking habits. The Middle East and Africa are seeing a gradual acceptance of tonic water, with the growing expatriate population and changing preferences for alcoholic beverages. Latin America, with its vibrant cocktail culture, is also seeing a growth in the tonic water market, especially in urban areas where premium products are popular.

Europe

• The European market is seeing a shift towards low-sugar and organic tonic waters, with brands such as Fentimans and Thomas Henry leading the way in offering healthier alternatives.
• Regulatory changes in the EU regarding sugar content in beverages are pushing manufacturers to innovate and reformulate their products to meet consumer demand for healthier options.

Asia Pacific

• The growing popularity of gin in countries like Japan and Australia is driving the tonic water market, with local brands like East Imperial capitalizing on this trend by offering premium mixers.
• Innovations in flavor profiles, such as the introduction of exotic botanicals and spices in tonic waters, are attracting a younger demographic looking for unique drinking experiences.

Latin America

• In Brazil, the growing trend of mixology is leading to an increased demand for premium tonic waters, with local brands emerging to compete with international players.
• The rise of health-conscious consumers is prompting companies to introduce tonic waters with natural ingredients and lower sugar content, aligning with regional dietary preferences.

North America

• The rise of craft cocktail culture has led to an increased demand for premium tonic waters, with brands like Fever-Tree and Q Mixers gaining popularity among consumers seeking high-quality mixers.
• Health trends are influencing product development, with companies like Spindrift introducing low-calorie and naturally flavored tonic waters to cater to health-conscious consumers.

Middle East And Africa

• The expatriate population in the UAE is influencing the tonic water market, with brands like Schweppes and Fever-Tree expanding their distribution to cater to diverse consumer preferences.
• Cultural shifts towards social drinking and cocktail culture are encouraging local bars and restaurants to include tonic water in their beverage offerings, enhancing market visibility.

Did You Know?

“Tonic water contains quinine, a compound originally used to treat malaria, which gives it its distinct bitter flavor and has led to its use as a mixer in cocktails.” — National Institutes of Health

Segmental Market Size

The tonic water market is an important part of the beverage market, which is currently growing at a steady rate. This is mainly due to the growing popularity of premium mixers and the so-called “craft cocktail” movement. The growing demand for healthy drinks, in which tonic water is often considered a low-calorie option, is also a key driver. Home mixology is becoming increasingly popular, with consumers seeking high-quality cocktail ingredients. Also, the rise of well-being brands that contain natural ingredients and herbs is making tonic water more appealing. Brands like Fever-Tree and Q-Mixers are currently dominating the market, especially in North America and Europe. Tonic water is primarily used as a mixer in gin & tonics and as a refreshing, low-calorie drink. The growing focus on sustainability and the demand for organic products are driving growth, as companies focus on sustainable packaging and sourcing. Tonic water is a high-growth beverage market with a long tradition. It is a reassuring beverage in a very competitive market.

Future Outlook

During the period 2023 to 2030, the tonic water market is expected to grow from $ 2,014,800,000 to $3,954,600,000, a robust compound annual growth rate (CAGR) of 11.9 per cent. The growth of the premium tonic water market is mainly driven by the increasing popularity of millennials and generation Z, who are looking for artisanal, quality beverages. And the market will be driven by the demand for low-calorie, natural colas, which are expected to reach a penetration of 30 per cent in the premium segment in 2030, compared to the current penetration of 15 per cent. The development of the production process, i.e. the use of natural sweeteners and new infusions, will improve the product and appeal to a wider audience. And the trend towards home mixology, accelerated by the COVID-19 pandemic, will also help to keep tonic water in demand. Strategic alliances between tonic water producers and the artisanal spirits industry will also increase the visibility and availability of the product, thereby boosting growth. The market will also be driven by the increased focus on sustainable and transparent sourcing. Brands that are able to take advantage of this will be well placed in this fast-changing market.