Better-for-you drinks are bubbling to
the surface of healthy category sales.
By Kathleen Furore
Increase in sales of shelf-stable
functional beverages from last
year, while sales of shelf-stable
water increased by 740%.
here’s a lot of talk about functional beverages these days as more and more consumers
embrace a healthier lifestyle.
Naturally functional beverages are
expected to significantly impact the beverage industry
in the coming year, according to Evergreen Packaging, a
company that worked with EcoFocus Worldwide on the
annual EcoFocus Trend Study.
“Consumers are increasingly looking to beverages to
play new roles in their diets and health routines,” finds
EcoFocus Worldwide, whose research mirrors a five-year
decline of carbonated soft drink category sales. Meanwhile, consumers’ cravings for healthier options continue
to swell, with natural beverages driving nearly half of category dollar growth.
The numbers from SPINS have been equally impressive. Sales of shelf-stable functional beverages were up
140.5% from last year, and sales of shelf-stable water
increased by 740%.
Increasing Interest Fuels Product Development
A functional beverage is typically intended to offer a health
benefit—think sports and performance drinks, energy
drinks, ready-to-drink (RTD) teas, enhanced fruit drinks,
soy beverages and enhanced waters. And in today’s
health-conscious marketplace, there is no shortage of
consumer interest in these beverages, nor of options
for retailers looking to add or expand the category.
“More and more, category managers in conventional grocery stores are looking for better
alternatives to sodas and other high-sugar beverages,” says Henry Chen, founder and president of
Alo Drink, makers of aloe vera-infused beverages
including Alo Exposed, Alo Allure (a mango and
mangosteen blend), Alo Comfort (watermelon and
peach flavor) and Alo Crisp (fuji apple and pear flavor),
Consumer demand prompted Celsius to rebrand its
portfolio in January 2017, and to introduce new lines with
the “fitness drink” position: Celsius Heat and Celsius Naturals (which includes sparkling grapefruit and cucumber
line), says EVP of Sales and Marketing Vanessa Walker.
“We believe counting calories and fad diets are no longer
the mindset of the public. People are opting instead to live
healthier lifestyles and are moving away from unhealthy
food groups, while also detoxing; they want brands that
support these philosophies, as opposed to strict calorie-counting regimens,” Walker says.
This trend toward functional beverages kicked off with
coconut water about a decade ago, says Mitch Compton,
co-founder of Coconut Beach, a manufacturer of shelf-stable products including 100% Coconut Water, Coconut
Water with Pulp, and Aloe Vera Water with Coconut.
“The market for coconut water, which started about
2007, was probably a precursor to health and wellness as
a category,” Compton says. “For two-thirds of the world,
coconut water is an everyday beverage, and now the U.S.
has turned on to it. … It is a response to people not wanting to
drink highly processed, high-sugar beverages.”
WTRMLN WTR is another example of a simple fruit water finding favor with consumers.
Launched in 2013, WTRMLN WTR—made
from watermelons that must be discarded
because of blemishes—met two of the company’s goals. It helped farmers turn loss into profit,
and it introduced water derived from those
melons to the functional beverage world. In
2017, four new flavors joined WTRMLN W TR’s
lineup, which now features original (for hydration), ginger (for hydration and immune system
support), tart cherry (for hydration and mus-