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4 Trends That Are Shaking Up Functional Beverages

A Coke and a smile used to be all a beverage company needed to power profits. But a funny thing happened on the way to shareholder value: consumers have recently decided that carbonated sugar water doesn’t please their palates like it once did. Why? Because drinks are no longer just about tasting good or merely satiating thirst. Consumers want more from their beverages, and they’re looking at functional beverages as a way to reach their proactive health and wellness goals.

Beverage Innovation Stats

Source: GlobalData, “TrendSights Analysis: Wellbeing,” December 2016

Winners in the rapidly shifting beverage landscape today are finding success in functional beverages. Functional health benefits are a major driver of beverage innovations.

Here are just four of the specific consumer niches and benefit-driven trends manufacturers are capitalizing on to create value-driven and successful functional beverages.

1. Seniors represent a consumer segment in need of beverages that support health and wellness.

The market opportunity for senior nutrition is large and yet quite underserved. For example, according the UN’s World Population Aging Report, the global population over the age of 60 is expected to grow by 56% by 2030, but if you look at supplemental nutritional drinks—just one segment of the beverage market for older adults—you can see a clear white space. In 2014, sales of supplemental nutrition drinks primarily targeting older adults in Western Europe and North America were $1.4 billion, yet the baby food market in the same regions was $14.2 billion, reported Euromonitor International. With underserved markets and a consumer focus on health and wellness, functional beverages with immune system health benefits have a prime opportunity.

2. Immune health is an emerging trend in the sports and performance beverage category.

Athletes at all levels can face harsh environmental factors, such as increased exposure to crowds and travel exhaustion, as well as physical and psychological stress. These pressures can negatively impact the immune system and overall physical health, leading to missed training days or workouts, and adverse effects on performance goals. This concern among athletes presents a clear opportunity for beverage innovators to achieve marketplace differentiation with sports nutrition drinks that offer proven immune health benefits.

Source: Mintel, “Nutrition and Performance Drinks—US,” March 2018

3. Stress affects us all and is quickly becoming a growing market for nutritional beverages.

One of the most detrimental effects of stress is the suppression of the immune system and, therefore, a greater risk of illnesses such as upper respiratory tract infections. Science-backed ingredients that are clinically demonstrated to support the immune system during times of stress can be incorporated into innovative beverage solutions to provide a compelling offer that addresses this concern.

4. On-the-go functional beverages for parents with young children.

Keeping children well is a top concern for parents, because it’s not just the children’s health at stake, it’s that of the entire family. As a result, a growing number of parents are looking to proactively support their children’s health through functional beverages they can take with them, such as fruity waters, juices, smoothies, and dairy beverages.

Overall, these trends are shaking up the growing functional beverage market. Brands that take advantage of them to create products that offer targeted benefits consumers can enjoy and feel good about will be better positioned to capture market share.

For a deeper dive into these trends and market drivers that are influencing the functional beverage space, download our whitepaper: Capitalizing on Today’s Beverage Trends: Functional with Targeted Benefits



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