Often overlooked, Malaysian consumers’ disposable incomes are higher than those in China, particularly when cost of living is factored in. The market is making the transition from low-cost offerings by large local and global brands to seeking out lesser-known brands and flavor profiles. Quality and health are increasingly valued, particularly in wealthy urban areas.
Soft Drinks & Juice
The soft drinks and juice market alone in Malaysia is worth US$ 2.1 billion and is set to grow by over 5% a year through 2025. Big brands, such as Pepsi and Coca Cola, still dominate the soft drinks sector in the country but space is opening up—particularly among the well-heeled and urban consumers—for new and healthier options.
Low-cost juices indigenous to Asia (e.g. tropical fruits) account for most sales in this product category; however, interest in and willingness to pay for less common imported juices—such as those made from berries—is growing, particularly among Malaysia’s young consumers and people in larger urban areas generally.
Malaysia alcohol sector will achieve a 7.87% CAGR through 2025 on top of existing revenues of US$ 1.78 billion. Rising incomes are pushing a shift away from basic beer options towards mid-market and premium options as well as higher ABV and stronger flavor offerings. Like much of Asia, cognac is the most popular spirit, but tipplers are taking up whiskey and much else in addition to increased interest in grape wines. This trend will accelerate as incomes continue to grow.
Far larger, Malaysia’s food market is expected to grow to nearly US$ 44 billion in sales by the end of 2021 and, according to Statista, enjoy a 5.19% CAGR through 2025. Malaysian consumers are relatively young and, as incomes rise, seeking food products and brands that match their socio-economic aspirations. This means higher quality, more novel products, and imported brands.
Overall, local consumers are a mix of those looking for value-for-money and those focused on quality over price. Increased variety, and more organic and healthier options will account for the majority of growth in these sectors. Food and beverage brands that can tap into either of these trends will do well in Malaysia.