Market Trends of United Arab Emirates Bottled Water Industry
This section covers the major market trends shaping the UAE Bottled Water Market according to our research experts:
Surge in the Demand for Functional/Fortified and Flavored Water
The widening portfolio of functional water, which is infused with micronutrients, the addition of appealing flavors, and packaging level modifications to create its aesthetic appeal are driving the market for fortified, functional, and flavored water in the United Arab Emirates. Moreover, the rise in obese and diabetic populations across the country has shifted the focus of consumers from carbonated soft drinks to functional or fortified bottled water in the recent past. Functional water is set to receive a major boost, owing to strong category sales across various distribution channels and sales platforms. Consumers are gravitating towards the consumption of flavored water as they are able to avoid sugar consumption and calories that are often present in other juices and carbonated drinks, thereby making it more interesting than plain water and an alternative to other soft drinks.
Furthermore, companies have started offering innovative solutions that spur growth momentum. Additionally, functional waters are relatively inexpensive when compared to other (ready-to-drink) RTD drinks, and different packaging options, including containers and single-serve bottles, are increasing consumer popularity, fueling the expansion of the functional water industry. The incorporation of vital components like amino acids, vitamins, and minerals in different functional waters is responsible for the spike in demand for functional water. For instance, Agthia Group PJSC (Al Ain) offers different types of water, like vitamin D-fortified bottled water, low sodium bottled water, and zero bromate bottled water, as per the needs of the consumer.
Growth in the Tourism Industry Owing to Favorable Government Initiatives Increasing the Sales of Bottled Water
The United Arab Emirates has long been recognized as a premier tourism and leisure destination. According to the World Bank data, the United Arab Emirates' population reached around 9.99 million in 2021, out of an expat population of 8.84 million. With the rise in the expat population over the past decade, these sectors have experienced rapid and sustained growth, becoming a key component of the country's economic diversification strategy, which in turn has driven the growth of the food sector, including bottled water. For instance, the Ajman Strategic Plan (2015-2021), which focuses on the development and sustainability of its tourism sector, is one of the country's tourism initiatives, according to the United Arab Emirates Travel and Tourism organization. This plan, along with other strategies, is expected to drive the market for bottled water over the forecast period. Also, owing to increasing tourism in the United Arab Emirates, food service channels such as cafes, pubs, hotels, and restaurants are rising across the country, which is expected to increase the sales of bottled water. Additionally, in experiencing the opulent dine-in lifestyle, the United Arab Emirates is seeing growth in its upscale, refined eating scenario. Thus, companies manufacturing bottled water in the United Arab Emirates are developing various sizes of bottled water that tourists can easily carry as per their needs and requirements.
