Functional Beverages - US - August 2007

Abstract

This report covers the market for functional beverages in the US, and can be used to create marketing messages that resonate with key groups of consumers and to develop new products in-line with emerging trends. Topics explored in this report include the following:

• Mintel identifies the emerging trends, including natural/organic products, drinks made for women, beverages offering heart health, improved immunity and digestion benefits
• Product trends and consumer attitudes are analyzed from the perspective of product developers, marketers, and retailers
• Sales performances of the six functional beverage segments are explored, plus an in-depth look at leading manufacturers and brands, including promotional activity
• Who functional beverage consumers are and what other habits they have adopted toward their quest for healthy living
• Where consumers purchase functional beverages and which retail outlets reach target demographic groups

The total market for functional beverages is abounding with opportunities based on sales from 2002-07. It is energizing to see how manufacturers are developing exotic fruit combinations with a never-ending variety of vitamins, minerals and herbs to meet shoppers' demand for better-for-you-drinks. Mintel expects the market to continue expanding from 2007-12 with consumers' desire for healthy options to quench their thirst, boost their energy or quiet their hunger. [For the purposes of this report, the following definitions have been used to describe functional beverages:]

• Drinks enhanced with added ingredients to provide specific health/disease benefits beyond general nutrition, such as aiding digestion or joint health
• Drinks that have been modified and enhanced through the act of processing (e.g. fermentation of dairy products where the bacteria which cause the fermentation are selected for their health benefits, as in probiotic beverages)

Many functional and fortified beverages bear approved claims from the FDA. For example: “Helps lower cholesterol: 25 grams of soy protein a day, as part of a diet low in saturated fat and cholesterol, may reduce the risk of heart disease.” Others make function/structure claims such as, “Calcium builds healthy bones.” Functional beverages are divided into six segments for this report

• Juices and juice drinks
• Smoothies and yogurt drinks
• Tea
• Soy-based drinks
• Energy drinks
• Enhanced water and sports drinks

[The report excludes:]

• Sports drinks which perform a largely rehydrating function and do not contain enhanced ingredients or make any functional claims beyond rehydration (e.g. Gatorade)
• Isotonic drink mixes or powders
• Bodybuilding/bulk-building drinks and powders
• Slimming-aid drinks (Slim-Fast, Herbal Life)
• Meal-replacement products (e.g. Ensure)
• Milk-there is a legal requirement for milk to be fortified and so all milk sales potentially fall into the functional drink category

This report contains US IRI InfoScan data.