The Beverage Guide: overview

    Double-digit growth of the beverage category at 12.7% for the MAT ending 3/1/21 is reassuring.

    By IRI Lead Consultant Justin Nel.

    After the tumultuous year that was, we should expect to see exciting NPD via flavour, pack architecture and functionality, given that innovation is, after all, one of the foundations of the beverage category.

    Emerging trends and current threats

    Trend: functional beverages

    The growth of functional drinks is driven by busy consumers, primarily younger adults and parents, seeking shortcuts to enhanced health. This has been significantly accelerated by the pandemic. A niche but growing group of consumers consider food as medicine, consuming products they perceive as offering a distinctive health benefit. Given the nature of the coronavirus, we can expect greater consumer adoption of functional beverages and more innovation in this exciting space.

    While brands should stay on the pulse of the needs of this audience, opportunities remain to reach older adults with products that support the healthy ageing process. The pandemic presents brands with new opportunities and threats. Products that provide immunity support and stress relief will thrive. Functional products appear in all categories from water to dairy through to drinking vinegars.

    Threat: sugar

    The war on sugar continues and will still plague the beverage category, especially when we establish a new normal and our health and wellness aspirations are no linger on pandemic pause. Many adults are avoiding excess sugar in their foods and beverages. Many consumers are trying to consume less sugar as it continues to garner negative media attention. Additionally, this continued avoidance of sugar is leading to growth in popularity of functional waters, and brands with higher sugar and calorie content may need to adapt their formulations to compete.

    Trend: adaptogens

    While only a niche audience is currently seeking adaptogens and nootropics in its functional drinks, this is very likely to change as more consumers become familiar with these terms and the potential benefits offered. Adaptogens are generally referred to as botanical substances that can help the body restore balance and cope with physical or mental stress. Within this niche group of products, leading adaptogenic ingredients include holy basil, ashwagandha, maca, ginseng and certain medicinal mushrooms, such as chaga.

    Read the full overview on beverages from IRI in the May/June issue of Convenience World.

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