Functional Coffee Market Size
| Study Period | 2019 - 2029 |
| Market Size (2024) | USD 4.03 Billion |
| Market Size (2029) | USD 4.45 Billion |
| CAGR (2024 - 2029) | 2.03 % |
| Fastest Growing Market | Asia-Pacific |
| Largest Market | North America |
Major Players
*Disclaimer: Major Players sorted in no particular order |
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Functional Coffee Market Analysis
The Functional Coffee Market size is estimated at USD 4.03 billion in 2024, and is expected to reach USD 4.45 billion by 2029, growing at a CAGR of 2.03% during the forecast period (2024-2029).
The functional coffee market is one of the fastest-growing areas in the beverage industry as it considers a healthy halo, offering drinks containing properties perceived as better and healthier. Subsequently, the growing health consciousness among global consumers is further propelling the functional coffee product demand. Coffee infused with cannabinoids (CBD) is becoming popular with consumers due to its health benefits, including pain and anxiety relief. Owing to this trend, the players are introducing innovative products. For instance, in August 2022, US-based Brewpoint Coffee launched cannabidiol (CBD) infused coffee, targeting consumers seeking jitter-free beverages infused with CBD's calming effects.
On the other hand, the drinks claiming to boost the immune system and contain antioxidants with powerful anti-inflammatory benefits have witnessed higher demand among consumers. Hence, manufacturers have infused turmeric, ginger, cardamom, and cinnamon into coffee grounds to aid digestion and strengthen immune function. For instance, in September 2022, Nutrocore, a premium USDA Organic and non-GMO certified grown coffee supplier, introduced cinnamon turmeric organic coffee in the market.
Global coffee producers have been adding ginseng to instant coffee for many years to offer additional benefits of improving blood circulation and memory. Manufacturers have combined the convenience and energy boost of instant coffee to increase these coffee beans' functionality. The market for functional coffee expanded to include products with weight-loss claims as well. For example, Bulletproof Coffees offer coffee combined with MCT oil (medium-chain triglycerides) and butter, which helps to support weight loss. The market is driven by multiple factors, including increasing demand for certified coffee products and consumers' acceptance of single-serve coffee brew systems.
Functional Coffee Market Trends
This section covers the major market trends shaping the Functional Coffee Market according to our research experts:
Growing Demand for Healthy Hydration
Healthy hydration refers to the ability of functional beverages like RTD coffee to provide instant refreshment and mild stimulating benefits that are not considered detrimental, which is otherwise the case with coffee or tea. Furthermore, per capita witnessed higher coffee consumption among European consumers due to increasing demand for healthy beverages and rising specialty roasters in the region. Thus, consumers are developing an affinity for functional drinks due to their ready-to-drink version that offers enhanced convenience, providing a suitable, convenient, and healthy alternative to soft drinks. The rise in obese and diabetic populations in the United States, China, India, Australia, and the United Kingdom shifted the focus from regular caffeinated drinks to functional caffeinated beverages in the recent past. Moreover, research by the International Food Information Council Foundation revealed that 47% of consumers prefer food with additional nutrients. It leads to the high potential for the functional coffee market.
The organoleptic versatility associated with functional coffee makes it easier for manufacturers to innovate with these products in line with the health trends emerging in the global market. For instance, in October 2021, Functional beverage brand REBBL launched a REBBL stacked coffee in the US Market. The product is a ready-to-drink cold brew that offers balanced energy and immune support. Additionally, the beverage is formulated with a combination of caffeine and green tea's nootropic L-Theanine to promote relaxation by reducing anxiety levels. Hence, the growing demand for functional drinks among global consumers due to the increasing diet consciousness is anticipated to fuel the growth of the functional coffee market in the forthcoming period.
North America holds the major share in the market
North America is the dominating region in the coffee market due to the growing trend of coffee consumption. Based on the National Coffee Association report, coffee consumption hit a two-decade high. Similarly, the Spring 2022 National Coffee Data Trends (NCDT) report shows that around 66% of Americans consume coffee daily. Moreover, 43% of coffee drinkers prefer specialty coffee with high-quality ingredients. The Asia-Pacific region is anticipated to be the fastest-growing region in the functional coffee market owing to the rising coffee culture associated with the increasing number of café.
Meanwhile, the COVID-19 impact shifted consumer coffee preference, increasing the inclination toward fortified coffee products. Thus, the key players are focused on producing functional coffee products. The growing trend of coffee consumption coupled with increasing health concerns is anticipated to raise the demand for functional coffee products in the market.
Functional Coffee Industry Overview
The global functional coffee market is competitive, with the top international players holding a significant share of the worldwide market. Key market players are focusing on expansion through merger and acquisition strategies. Key global players in the functional coffee market include Nestle SA, Starbucks Corporation, Tata Coffee Limited, Bulletproof 360 Inc., and Strauss. These companies are actively investing in online distribution channels, targeting consumers who seek convenience. Thus, key players are forming strategic partnerships with online portals, as one of their key strategies is to achieve consolidation and cater to the consumers' demand across various demographics.
Functional Coffee Market Leaders
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Nestle S.A.
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Bulletproof 360, Inc
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Tata Coffee
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Starbucks Corporation
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Strauss
*Disclaimer: Major Players sorted in no particular order
Functional Coffee Market News
- August 2022: Herbalife Nutrition launched its first functional coffee mix, High Protein Premix Coffee, in the Malaysian market. According to the company statement, the high-protein premix coffee was designed for consumers who want to reduce calories, fat, and sugar.
- June 2022: Cecors, Inc. (PsyKey) introduced a premium functional mushroom-infused coffee line in the US Market. PsyKey formulated four functional mushroom-infused coffee, curated by combining 100% fairtrade organic Arabic coffee beans.
- June 2021: Laird Superfood announced the expansion of its functional coffee range's launch of Soothe Coffee, created with botanicals like marshmallow root, cardamon, and blueberries. Laird Superfood also launched a variety of functional coffee blends, including Boost coffee, a whole-food functional coffee offering 15% of an individual's daily amount of vitamin D per 12oz serving.
Functional Coffee Market Report - Table of Contents
1. INTRODUCTION
- 1.1 Study Assumptions and Market Definition
- 1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET DYNAMICS
- 4.1 Market Drivers
- 4.2 Market Restraints
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4.3 Porter's Five Forces Analysis
- 4.3.1 Bargaining Power of Suppliers
- 4.3.2 Bargaining Power of Buyers/Consumers
- 4.3.3 Threat of New Entrants
- 4.3.4 Threat of Substitute Products
- 4.3.5 Intensity of Competitive Rivalry
5. MARKET SEGMENTATION
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5.1 Product Type
- 5.1.1 Whole Bean
- 5.1.2 Ground Coffee
- 5.1.3 RTD Coffee
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5.2 Distribution Channel
- 5.2.1 Supermarket/Hypermarket
- 5.2.2 Cafes and Foodservice
- 5.2.3 Convenience Stores
- 5.2.4 Online Stores
- 5.2.5 Other Distribution Channels
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5.3 Geography
- 5.3.1 North America
- 5.3.1.1 United States
- 5.3.1.2 Canada
- 5.3.1.3 Mexico
- 5.3.1.4 Rest of North America
- 5.3.2 Europe
- 5.3.2.1 United Kingdom
- 5.3.2.2 Germany
- 5.3.2.3 France
- 5.3.2.4 Russia
- 5.3.2.5 Italy
- 5.3.2.6 Spain
- 5.3.2.7 Rest of Europe
- 5.3.3 Asia-Pacific
- 5.3.3.1 India
- 5.3.3.2 China
- 5.3.3.3 Japan
- 5.3.3.4 Australia
- 5.3.3.5 Rest of Asia-Pacific
- 5.3.4 South America
- 5.3.4.1 Brazil
- 5.3.4.2 Argentina
- 5.3.4.3 Rest of South America
- 5.3.5 Middle-East and Africa
- 5.3.5.1 South Africa
- 5.3.5.2 Saudi Arabia
- 5.3.5.3 Rest of Middle-East and Africa
6. COMPETITIVE LANDSCAPE
- 6.1 Most Adopted Strategies
- 6.2 Market Share Analysis
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6.3 Company Profiles
- 6.3.1 Nestle SA
- 6.3.2 Starbucks Corporation
- 6.3.3 Ingenuity Beverages
- 6.3.4 Tata Coffee
- 6.3.5 Bulletproof 360 Inc.
- 6.3.6 Eight O' Clock Coffee Company
- 6.3.7 Luigi Lavazza SpA
- 6.3.8 Gloria Jean's Coffees
- 6.3.9 Dutch Bros Coffee
- 6.3.10 Strauss Group Limited
- 6.3.11 Kruger GmbH & Co. KG
- *List Not Exhaustive
7. MARKET OPPORTUNITIES AND FUTURE TRENDS
** Subject To AvailablityFunctional Coffee Industry Segmentation
Coffee is a brewed drink prepared from roasted coffee beans, the seeds of berries from certain coffee species. Functional coffee is made by blending coffee with other ingredients, such as botanicals and proteins, through which consumers can get more than caffeine. The global functional coffee market is segmented by product type, distribution channel, and geography. Based on product type, the market is segmented into the whole bean, ground coffee, and RTD coffee. Based on distribution channels, the market is segmented into supermarkets/hypermarkets, cafes and foodservice, convenience stores, online store, and other distribution channels. Based on geography, the study analyzes the functional coffee market in emerging and established markets across the globe, including North America, Europe, Asia-Pacific, South America, the Middle East, and Africa. For each segment, the market sizing and forecasts have been done based on value (in USD million).
| Product Type | Whole Bean | |
| Ground Coffee | ||
| RTD Coffee | ||
| Distribution Channel | Supermarket/Hypermarket | |
| Cafes and Foodservice | ||
| Convenience Stores | ||
| Online Stores | ||
| Other Distribution Channels | ||
| Geography | North America | United States |
| Canada | ||
| Mexico | ||
| Rest of North America | ||
| Geography | Europe | United Kingdom |
| Germany | ||
| France | ||
| Russia | ||
| Italy | ||
| Spain | ||
| Rest of Europe | ||
| Geography | Asia-Pacific | India |
| China | ||
| Japan | ||
| Australia | ||
| Rest of Asia-Pacific | ||
| Geography | South America | Brazil |
| Argentina | ||
| Rest of South America | ||
| Geography | Middle-East and Africa | South Africa |
| Saudi Arabia | ||
| Rest of Middle-East and Africa |
Functional Coffee Market Research FAQs
How big is the Functional Coffee Market?
The Functional Coffee Market size is expected to reach USD 4.03 billion in 2024 and grow at a CAGR of 2.03% to reach USD 4.45 billion by 2029.
What is the current Functional Coffee Market size?
In 2024, the Functional Coffee Market size is expected to reach USD 4.03 billion.
Who are the key players in Functional Coffee Market?
Nestle S.A., Bulletproof 360, Inc, Tata Coffee, Starbucks Corporation and Strauss are the major companies operating in the Functional Coffee Market.
Which is the fastest growing region in Functional Coffee Market?
Asia-Pacific is estimated to grow at the highest CAGR over the forecast period (2024-2029).
Which region has the biggest share in Functional Coffee Market?
In 2024, the North America accounts for the largest market share in Functional Coffee Market.
What years does this Functional Coffee Market cover, and what was the market size in 2023?
In 2023, the Functional Coffee Market size was estimated at USD 3.95 billion. The report covers the Functional Coffee Market historical market size for years: 2019, 2020, 2021, 2022 and 2023. The report also forecasts the Functional Coffee Market size for years: 2024, 2025, 2026, 2027, 2028 and 2029.
Functional Coffee Industry Report
Statistics for the 2024 Functional Coffee market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. Functional Coffee analysis includes a market forecast outlook to 2029 and historical overview. Get a sample of this industry analysis as a free report PDF download.
