TCP Group, the manufacturer and distributor of Kratingdaeng energy drink, Mansome vitamin water and Sponsor, has allocated 450 million baht for its marketing budget to drive sales of functional drinks this year as it expects this segment to resume growth.
According to Prapaipak Weigl, the company's global marketing director for F&B, TCP Group expects the overall functional drink market in 2022 to grow by 5.6% to 7.67 billion baht. The functional drink market contracted by 13.3% to 7.26 billion baht in 2021 from 8.38 billion baht in 2020, attributed to the country's strict restrictions to curb the spread of Covid-19.
"The market was in a slow move in the first quarter of this year due to persistent Covid-19 outbreaks, the country's economic slowdown, and people's cautious spending. However, demand for functional drinks is found to have improved in the second quarter of this year and continued to grow after the state's virus containment measures were gradually eased," she said.
According to Mrs Prapaipak, of the total 450 million baht, 30% had already been spent in the first half of this year and the remaining 70% would be used in the second half to build its brand awareness, new product promotion and other marketing activities.
"The functional drink business unit is expected to play a key role in driving our growth in Thailand this year. Covid-19 has put immune health in the spotlight and has elevated concerns about immunity to a high level," said Anurak Teeralabhnanon, the company's associate marketing department director.
TCP Group aims to increase sales of its functional drink products to reach 1.01 billion baht this year from 700 million baht in 2021.
Apart from functional drinks, Mrs Prapaipak said demand in the vitamin water market in 2022 is expected to grow by 4.7% to 2.49 billion. The company plans to launch two new Mansome vitamin water products with premium ingredients for specific consumer targets this year.
It also plans to join GQ, a men's apparel brand, in joint marketing activities in the fourth quarter of this year. Within its plans, the company aims to have Mansome vitamin water as one of the top three leading brands in this segment this year, up from being among the top five largest brands last year.
According to Mrs Prapaipak, the firm is also scheduled to launch two formulas of Hi! X DHC -- premium vitamin C shot drink in September.
It aims to roll out five brands of health and wellness products and launch 11 energy drink products on the market over the next three years. The group expects to double its revenue in 2024 to 90 billion baht. Of the total, 70% will be from overseas operations.
TCP Group said in April this year that its plans to invest 12 billion baht in its three-year business plan (2022-24) to expand business at home and abroad.
Of the 12-billion-baht budget, over 50% will be used to set up the firm's own energy drink factory in Sichuan, China, with a total capacity of 1.4 billion cans per year.
Some 20% of the budget will be used to upgrade its factory in Prachin Buri to become more automated, using artificial intelligence and data analytics, with the rest of the budget slated for improving its offices and transport process.