Japan Alcoholic Beverages Market to Grow Due to Innovation and Product Diversity

Japan alcoholic beverages market is experiencing unprecedented growth, fueled by the global recognition received by the country, innovative and diversified product offerings, country’s cultural significance of drinking, and a shift towards online platforms.

According to the Markets and Data Research report, “Japan Alcoholic Beverages Market Assessment, By Region, Opportunities and Forecast, FY2017-FY2031F”, Japan alcoholic beverages market was estimated at USD 81.62 billion in FY2023 and is anticipated to reach USD 98.83 billion by FY2031, growing at a CAGR of 2.42% during the forecast period, owing to numerous dynamic factors. Innovation and product diversification stand as the key driver as breweries in Japan are continuously introducing new flavors, styles, and packaging formats that align with the changing taste requirements of consumers. The trend has mainly been observed in craft beer segments in urban areas such as Tokyo and Osaka.

Moreover, the tourism sector in Japan is on the rise, playing a significant role in driving Japan’s alcoholic beverages market growth. With more people visiting Japan, the demand for alcoholic beverages, especially beer, is surging. Furthermore, growth in e-commerce platforms has laid additional paths for breweries to broaden their market reach by selling their products directly to consumers without using the traditional means of distribution, making the market more open than before​.

Consumers increasingly demand low-alcohol beverages due to ongoing health and wellness trends. The preference for low-alcohol content drinks is partly driven by health-conscious consumers and those seeking a lighter and more casual drinking experience. The increasing demand for low-alcohol beverages in Japan reflects a broader global trend towards mindful drinking, where consumers prioritize moderation and health without foregoing social drinking occasions. In response to the change, breweries are coming up with more health-conscious alternatives, which are tastier​.

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The market, although, comes with challenges in the form of regulatory constraints on advertising and branding due to health hazards emanating from overconsumption. However, amid these challenges, competition has stayed afloat with key players such as Asahi Group Holdings Limited, Kirin Holdings Company, Limited and Takara Holdings Inc. controlling the industry.

Spread through 103 pages, "Japan Alcoholic Beverages Market" report includes an in-depth TOC, over 27 market data figures, latest market developments, key drivers and opportunities, and a thorough study of major company profiles. Moreover, the report offers strategic recommendations, pricing analysis, market share analysis, and value chain analysis in detail.

Key Takeaways:

• The introduction of new flavors, styles, and packaging formats is driving the market growth for breweries in Japan, especially in the craft beer category, which is serving the changing consumer preferences.
• The increased number of tourists and the rise of online trading platforms have significantly increased the market demand hence enabling breweries to reach a broader audience and consequently improve accessibility.
• One of the main reasons for stable and firm market growth is increasing demand for low-alcohol drinks and recovering on-trade distribution channels post-pandemic.
• Maintaining a high level of competitiveness, the market is controlled by big domestic names such as Asahi Group Holdings Limited, Kirin Holdings Company, Limited and Sapporo Holdings Limited, and international brands such as Heineken NV and Carlsberg A/S, intending to preserve good reputation and quality as well as adopting innovative marketing strategies​.

Japan Alcoholic Beverages Market is Segmented in the following Categories:

By Type: Beer, Wine, Spirits, Ciders and Flavored Alcoholic Beverages (FABs), and Others

By Alcohol Content: High, Medium, Low

By Packaging: Aluminium Cans/Tins, Pouch Packaging, Glass Bottles, Plastic Bottles, and Others

By Category: Mass and Premium

By Distribution Channel: Convenience Stores, On-Premises, Liquor Stores, Grocery Shops, Internet Retailing, Supermarkets, and Others

By Region: North, East, West and Central, and South

Based on type, beer has asserted significant dominance in Japan alcoholic beverages market, driven by cultural significance and innovations in craft and low-alcohol options, appealing to a broad consumer base. Craft beer is taking over the market as more customers are looking for special and top-quality products. Cities such as Tokyo or Osaka have seen an expansion of small regional breweries as people appreciate different styles of beer. Moreover, the growing number of tourists affects the market significantly, as much as beer is concerned. Additionally, the proliferation of online shopping sites has facilitated the availability of a broad spectrum of beer products, which increases consumer convenience and choice​.

Based on alcohol content, Japan alcoholic beverages market is led by low-alcohol beverages, reflecting a significant consumer shift towards healthier lifestyles and moderation. Products such as low-alcohol beers and Chu hai (shochu highballs) cater to the trend, appealing to younger and health-conscious consumers seeking lighter drinking options. Low-alcohol beers are notably attractive as they resemble typical beers in terms of flavor and societal experiences but have low alcohol content. Alternatively, Chu hai is an alcoholic beverage combination that has less alcohol and is more revitalizing than other spirits. These are sometimes advertised in relation to their low calories and appropriateness for casual consumption.

Based on packaging, the market is dominated by glass bottles due to their premium appeal and association with high-quality products such as wine, sake, and whisky. Consumer preferences for traditional packaging and premiumization trends in spirits and wines support this segment. Aluminum cans and tins show a slight increase in market share, driven by the rising popularity of ready-to-drink (RTD) beverages and craft beers, which benefit from the convenience and portability of cans. Plastic bottles, while experiencing a minor decline, remain popular for specific product categories such as large-volume beverages and convenience-focused segments.

Based on category, Japan's alcoholic beverages market is dominated by the mass segment. The premium segment shows a slight growth, reflecting a rising consumer preference for high-quality, artisanal products, especially in whisky, sake, and craft beer. Increased disposable incomes and exposure to global trends drive the shift, with Japanese whisky gaining international acclaim. The mass-market segment remains dominant due to the high-volume consumption of mainstream beers, RTDs, and traditional beverages such as shochu, catering to affordability and familiarity. The significant market share of the mass segment shows its importance in providing steady revenue and broader consumer reach.

Major companies operating in Japan alcoholic beverages market include:

·         Suntory Holdings Limited

·         Kirin Holdings Company, Limited

·         Asahi Group Holdings Limited

·         Takara Holdings Inc.

·         Sapporo Holdings Limited

·         OENON Holdings, Inc.

·         Gekkeikan Sake Co., Ltd.

·         Choya Umeshu Co., Ltd.

·         Ozeki Corporation

·         Sanwa Shurui Co., Ltd.

Companies in Japan alcoholic beverages market are actively involved in research and development (R&D) initiatives to promote innovation, improve current technologies, and create new solutions.

In the year 2023, Ozeki Corporation launched a product called the Platinum Limited Edition, the first Junmai Daiginjo brewed in 2023 sake brewing season and made of California-grown rice polished to 50%. Sake is different from the regular Platinum offering, as it is bottled within a week after filtration with almost no storage time. It is a draft (nama-chozo), which undergoes heat treatment only one time instead of the regular two, creating a more fresh and fragrant sake.

“Japan Alcoholic Beverages Market Assessment, FY2017-FY2031F”, evaluates the future growth potential of Japan alcoholic beverages market and provides statistics and information on market size, structure, and future market growth. The report intends to provide innovative market intelligence and help decision-makers to take investment decisions for their organizations more strategically. Moreover, the report identifies and examines the emerging trends along with key drivers, challenges, and opportunities in Japan alcoholic beverages market.

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