Tonic Water Market - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

Tonic Water Market - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

The tonic water market is projected to increase at a CAGR of 7.1% during the forecast period, 2022-2027.

The COVID-19 pandemic considerably impacted the tonic water industry. The on-trade segment has been especially impacted since bars, restaurants, pubs, and breweries have been shut due to the lockdown, and customer visits are restricted. Comparatively, the impact was less likely felt on the off-trade sales channel since consumers stock-piled beverages in the initial stages of the lockdown.

Tonic water is a carbonated soft drink in which quinine is dissolved. Originally Tonic water was used as a medicine against malaria, but now it has significantly lower quinine content and is consumed for its distinctive bitter flavor. It is often used in alcoholic drinks, particularly in gin and tonic. The rising disposable income drives the market due to modernization, promotion of tonic water as a mixer with alcohol, increasing popularity of tonic water, and surging popularity.

Consumers have developed a strong preference for premium spirits and are willing to spend money on innovative products with a distinct character. As a result, there is a growing preference for premium-priced mixers, including tonic water. The resurgence of the cocktail trend in emerging economies has boosted growth for the super-premium tonic water category. In addition, diet tonic water is gaining increasing acceptance among consumers owing to its lesser sugar content than regular diet variants that possess fewer calories or carbohydrates. Companies are also bringing in new naturally flavored water in this product segment, intending to cater to the consumers’ specific needs for diet consciousness and taste factors. For instance, Sodastream offers naturally flavored diet tonics with zero calories.

North America accounted for a significant global tonic water market share. The popularity and surging demand for gin are expected to boost the acceptance of tonic mix in the next few years. The mixing of tonic water in alcoholic beverages is prominent in developed countries. The market is still nascent in developing economies due to less awareness about the product and a relatively lower preference for gin. Compared to North America and Europe, Asian countries with high gin consumption, such as the Philippines, do not use alcoholic mixers frequently.

Some major key global players in the tonic water market include Coca-Cola, El Guapo Bitters, Fentimans Ltd., Fever-Tree, Keurig Dr. Pepper Inc., White Rock, and London Essence Company, Q Mixers, Hansen Beverage, SodaStream Inc., and Franklin & Sons Ltd. In recent years, Fever-Tree has expanded its offering to include mixers for other spirits alongside tonic water. Its product line-up now includes Sicilian lemonade, Madagascan cola, ginger beer, and ginger ale. As with the company’s tonic water, many drinks come in various flavors.

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