Japan’s Cider Market Snapshot: A Booming Niche Market

While Japan’s cider market is still a niche compared to adjacent categories such as ‘ready-to-drink’ (or ‘RTD’) and wine, cider is having a major moment with Japanese consumers developing a growing appetite for this drink with a rich tradition and heritage.

Enjoying soaring success worldwide, the cider market is expected to grow in Asia and notably in Japan. In 2019 leading research companies estimated that Japan’s cider market represented a value of 1.2 to 3 billion Japanese yen ($11 to $29 million) with 1.7 million liters and volume growth of 2%. An estimation that GourmetPro experts found to be significantly below the actual volume, estimated above 6 million liters with 8+ million.

In Japan, cider gained visibility next to RTDs as a healthy, easy-to-drink, low alcohol beverage.

The worldwide renaissance of cider goes along with the resurgence of the RTD category, booming across widening demographics. Since cider shares characteristics with RTD’s - low-alcohol, sweet and fruity, and Japan being the world’s largest RTD market, this beverage naturally fits Japanese consumers’ ever more health-focused lifestyles. To consumers seeking out products that seem to offer moderation, cider offers approachable flavors and stands as a good alternative to beer, traditional spirits, and mixers.

Cider’s success in Japan, notably with consumers in their 30s-50s, hinges how this category's functional benefits perfectly fit their preferences: easy to drink, low alcohol, healthy (high polyphenols, almost purine-free), and photogenic. Particularly attractive for women in their 20s-40s, cider is perfect for joshikai (“girls’ night out”) and, generally speaking, social gatherings.

Long associated with regional food, French galette bistro, and the likes, this segment now benefits from national visibility in convenient stores and supermarkets, promoted by leading manufacturers, importers, and retailers.

Japan’s cider market is divided into three major segments

Domestic brands dominate Japan’s cider market with more than 80% share in volume. The domestic production is divided into apple-producing regions’ well-established local cider makers and Japanese beverage industry-leading players.

Japanese Local cideries

Japan has a long history of growing high-quality apples. Aomori Prefecture notably produces more than half of Japan's annual harvest with over 50 million tons of apples. However, its cider culture is relatively recent.

Aomori and Nagano prefectures’ local governments are actively supporting local brands educating the public through events. They provide subsidies and programs to establish new breweries. Japanese cider makers (TENTO, VinVie, Ringo School Cidery, Kamoshika Cider...) also partnered up to proactively promote cider through a cidery tour and online campaign.

Japanese consumers tend to purchase local brands directly from cider makers - through agro-tourism or in recent years, through e-commerce. But high-end supermarkets and department stores, which offer upper-market goods in a curated setting, also distribute craft ciders.

Mainstream cider brands

The market distribution by volume showed that Japan’s top 3 brands are all domestic. Nikka (Asahi Holdings), Hard Cidre (Kirin), and Additive-free Wine Cidre (Mercian/Kirin) account for 79% of the volume in 2019. What’s more, Mercian’s Additive-free Wine Cidre, barely launched in 2019, reached the top within 9 months. Mercian’s success story could better engage the trade with the cider category.

Both by volume and value, analysis shows that off-trade channel sales mainly drive Japan’s cider market, respectively 65% and 62%. Asahi’s Nikka and Kirin’s Hard Cider’s presence in convenience stores and supermarkets contributed to raising cider awareness and usage among RTD drinkers

Market leaders Kirin (48% of the market share) and Asahi (37%) drive the on-trade channel sales with a wide distribution in Japan’s French bistros.

Imported cider brands

France is the largest cider import country with 42% of imported cider market share in volumes and 58% in value. The bigger market share in value than volume is explained by the higher price and ratio of on-trade sales. Next in line, Belgium stands as the second-largest import country with its popular brand Strongbow, largely distributed in bars, pubs, and entertainment channels. Quite interestingly, imports from the United Kingdom, the United States, and Ireland are still minimal despite internationally renowned brands.

If only a minority of foreign brands are imported to Japan today, they hold a higher market share in value due to overall higher prices per liter and more on-trade sales.

Promising, Japan’s cider market entry isn't without obstacles

The cider segment is showing signs of growth, and the time is right to enter the market. However, foreign operators looking into expanding their business in Japan’s cider need to pay attention to key barriers, starting with cider’s positioning.

Cider still needs to “cross the chasm” in Japanese consumers’ minds

Cider clearly gained national visibility, particularly in stores. But its positioning in terms of consumption, occasion, and taste isn't clear yet in Japanese consumer's minds. Borrowing the sophistication of sparkling wines while sharing the complex, distinctive taste of craft beers, cider is neither. This unclarity definitely represents a key barrier the industry needs to overcome.

Not mainstream enough for the industry to push cider development

Side effect of the lack of a clear positioning, early cider consumers community did not yet reach a critical size enough to influence the trade. Thus the beverage industry manufacturers have low incentive to allocate resources on cider development while adjacent categories - beer, wine, and RTD’s, heavily impact their businesses.

Pricing competition from the sparkling wine segment

With Japan-EU Economic Partnership Agreement entered into force in 2019, imported sparkling wines are booming with low prices, notably Spanish Cava. As a result, imported cider, French brands, in particular, became less competitive. Breaking into Japan’s cider market requires serious price strategy and analysis.

Are you a leading producer looking to expand on Japan’s cider market? We can help your company strategize your market entry today.

GourmetPro is a market consulting company based in Japan committed to helping the food and beverage companies grow by offering end-to-end customizable market-entry solutions in value chain assessment, competition analysis, conducting store checks carrying out negotiations supported by tailor-made sales presentations in Japanese.

We also assist F&B companies by identifying prospects and placing them in strategic positions through; recognizing potential areas, screening distributors, matching them with the appropriate businesses, setting up supply chains, and a lot more.