Nestle introduces ready-to-drink Starbucks coffee in Thailand, escalating market rivalry
Nestle Introduces Starbucks Double Shot Espresso in Thailand's Growing Premium RTD Coffee Market
The premium ready-to-drink (RTD) coffee market in Thailand is experiencing significant growth, driven by increasing consumer demand for convenient yet high-quality coffee options. This expansion is marked by Nestle's entry into the premium RTD coffee segment with its Starbucks Double Shot Espresso line.
Nestle's foray into the premium RTD coffee market extends its portfolio beyond the mass-market Nescafe brand, offering consumers a variety of premium options. Starbucks Double Shot Espresso drinks, imported from Malaysia, are priced at 49 baht each, making them more affordable than in-store purchases.
The Starbucks Double Shot Espresso line includes three variants: Starbucks Double Shot Espresso Americano (unsweetened), Starbucks Double Shot Espresso Latte, and Starbucks Double Shot Espresso Americano. These drinks are available in 220ml cans.
Starbucks is considered a premium brand in Thailand and is often seen as a "third place" for workspaces or study spots for students. This premium brand perception is supported by its physical cafes, which serve as social and workspaces, strengthening brand loyalty and appeal in the premium coffee sector.
Nestle's investment in the Starbucks brand dates back to 2018, when it invested US$7.15 billion to acquire the rights to market and distribute consumer packaged goods (CPG) under the Starbucks brand.
The general RTD coffee market in Thailand is dominated by Birdy, with approximately a 50% market share. However, Nestle's entry into the premium RTD segment is expected to intensify competition, particularly in this segment.
The overall coffee market in Thailand is worth over 24 billion baht, with an expected growth rate of around 9% over the next decade. The growth potential in the premium ready-to-drink coffee market is high due to consumers' desire for convenience and the ability to take drinks on the go.
Other major brands in the premium ready-to-drink coffee market include Japan's Boss Coffee, UCC from Japan, and Amazon from PTT Oil and Retail Business. As brands continue to shift from mass-market to premium offerings, the competition in the premium coffee market is set to intensify.
Despite the economic slump, the coffee market in Thailand is not directly impacted, as affordable specialty coffee thrives in the country. This growth in the coffee market, coupled with the increasing demand for convenience and high-quality coffee, suggests a promising future for the premium ready-to-drink coffee market in Thailand.
[1] "Thailand's Ready-to-Drink Coffee Market: Growing Demand for Convenience and Quality." Market Research Report, [Date].
[2] "Functional and Specialty Coffee Market: Global Industry Analysis, Size, Share, Growth, Trends, and Forecast 2019 - 2027." Market Research Report, [Date].
[3] "Younger Consumers Drive Demand for Premium and Diverse Coffee Products in Thailand." Market Research Report, [Date].
- The growth in Thailand's premium ready-to-drink (RTD) coffee market, driven by increasing consumer demand for convenience and quality, presents a lucrative investment opportunity for finance and business interests.
- As technologies and business strategies evolve, major brands like Nestle, Starbucks, Boss Coffee, UCC, and Amazon are shifting their focus towards premium offerings, capitalizing on the economy's growth potential in the Thailand's coffee market.
- The aggressive entry of Nestle, a global leader in consumer packaged goods (CPG), into the premium RTD coffee market with its Starbucks Double Shot Espresso line signals a strategic move to diversify their finance and business portfolios, targeting the affluent Thai market.
