Online Hot Drinks Market in France: Beverage Sector Could Reach US$1 Billion by 2027

Online Hot Drinks Market in France: Key Insights

• Market Definition: The global Hot Drinks market, a subcategory of Non-Alcoholic Beverages within the Grocery Market, is predicted to reach US$23 billion by 2024 with a CAGR of 9.6% from 2024-2028.

• Pandemic Impact: The French Hot Drinks market surged from US$425 million in 2019 to US$649 million in 2020 due to the COVID-19 pandemic, but growth slowed to 1.8% by 2023, partly due to inflation.

• Coffee vs. Tea: Coffee consistently leads the French Hot Drinks eCommerce sector and holds at least 53.4% of the market share.

• Looking ahead: Despite recent slowdowns, the French Hot Drinks market is forecast to exceed US$1 billion by 2027, supported by declining inflation and a growing trend towards online grocery shopping.

The online market for hot drinks has seen a significant boost in many countries thanks to the closures along the Corona pandemic. The case of France, the ninth largest eCommerce market in the world, is especially noteworthy.

After peaking in 2019, year-over-year growth has slowed. What's behind this development? Where will the market go from here?  

What Is the Hot Drinks Market?

ECDB defines the Hot Drinks market as a subcategory of the Non-Alcoholic Beverages market, together with Juices, Water and Other Non-Alcoholic Beverages. Its super-category is the Grocery Market.

The global Hot Drinks market is predicted to reach US$23 billion in revenue by 2024, while the expected compound annual growth rate for the next four years (CAGR 2024-2028) is expected to be 9.6%.

What Are Hot Drinks?

The Hot Drinks sector consists of in total two additional subcategories, Coffee and Teas & Other Hot Drinks. In total, the category includes:

• Coffee beans, including whole beans and ground coffee,

• Single-serve coffee containers, such as coffee capsules and instant coffee,

• Tea, in the form of loose-leaf tea, tea bags or instant tea,

• Cocoa.

Excluded from the Hot Drinks category are:

• Coffee flavorings and additives, such as flavorings, sweeteners, creamers, and milk alternatives,

• Health teas, like bladder tea and kidney tea,

• Tea accessories, including tea infusers, teapots and kettles, teacups and mugs,

• Tea sweeteners and additives, such as sugar, milk or cream.

How Big Is the Hot Drinks Market?

With a strong, pandemic-driven boost in 2020, the market's revenue had risen sharply from US$425 million in 2019 to US$649 million in 2020. Thereafter, the Hot Drinks segment in France has slowed down in terms of growth.

While the market was still expanding by 9.2% year-over-year in 2021, it only grew by 1.8% in 2023, reaching US$754 million in revenue. One of the causes of the slowdown in growth could be inflation, which has reached a century-high of 5.9%.

For the coming years, the market is projected to grow more significantly and is predicted to cross the US$1 billion mark by 2027. Besides declining inflation, the trend toward online grocery shopping may account for growing revenues. More and more grocery stores are offering the option to buy food and beverages online, making it increasingly convenient.

Coffee vs. Tea: Who Leads the Hot Drinks Market?

As mentioned above, the Hot Drinks eCommerce sector is divided into the sub-categories of Coffee and Tea & Other Hot Drinks. In the French market, Coffee has always held the highest market share of at least 53.4% and a maximum of 56.9%, as shown in the chart above. In 2023, 54.9% of net eCommerce sales were generated by the Coffee industry and 45.1% by Teas and Other Hot Drinks. Coffee therefore takes the lead in this case.

The fact that coffee consistently holds a majority share of the Hot Drinks eCommerce sector in France could be explained by several factors, like cultural preferences, consumer habits and marketing.

The Pandemic Boom of the French
Hot Drinks Market

In recent years, special circumstances such as the pandemic have led to remarkable changes in the eCommerce industry, including the hot beverage industry. As part of Beverages, the sector has seen stronger changes than the super-category itself, either in terms of increase or decrease.

• Before the pandemic: The years 2018 and 2019 are characterized by a downward trend. In particular, in 2019 the Beverages (-1%) and Hot Drinks (-8%) markets experienced some, albeit small, declines.

• In the COVID-19 pandemic: The first year of the pandemic was for both the Hot Drinks and Beverages markets a great success. The first year of the pandemic was a great success for both markets. These eCommerce industries were among the winners of the pandemic, with the Beverages sector recording 42% year-on-year growth and the Hot Beverages segment reaching 53%. The growth rate then slowed to 9% in both segments by 2021.

• Post-Corona: After the two Corona years in France, the market expansion trend continued to slow down. While the Beverages category remained at a 5% increase between 2022 and 2023, the Hot Drinks sector experienced a decline from 5% in 2022 to 2% in 2023.

• Forecast: Going forward, revenue growth is forecast to improve slightly from previous years. In 2024, the Beverages market is expected to reach 9% and the Hot Drinks sector 8%. For the following years, both are forecast to remain between 7% and 11%.

In summary, the two categories have similar year-over-year growth trends, which makes sense since the French Hot Drinks market is a subset of the Beverages market. Nevertheless, the differences between them show how a market can develop differently when faced with opportunities such as the pandemic and challenges like rising inflation.

Online Hot Drinks Market in France:
Closing Thoughts

The COVID-19 pandemic was a catalyst for significant change in many industries, but its impact on eCommerce was deep. In particular, the French online hot beverage market has experienced a significant upsurge, largely due to changing work environments and the closure of physical coffee shops. French consumers have had to turn to digital alternatives to satisfy their hot beverage and caffeine needs.

Once the dust settled and everything was back to normal in France, it almost looked like the market had reached saturation. But the forecast has other plans, with an expected compound annual growth rate over the next four years (CAGR 2024-2028) of 9.8%. This may be due to a wider range of options for buying hot beverages online. In general, online grocery shopping has gained popularity because it is convenient and easy.

Sources: ECDB, secondary sources in the referenced articles.