There is a considerable demand for plant-based and lactose-free products as a result of the growing vegan community and the rising incidence of lactose intolerance. This is accelerating the market growth for functional beverages. A premium energy drink made in Germany that is free of taurine, gluten, and lactose was introduced by 28 Black in January 2020. There are four flavours of this energy drink: Acai Berry, Classic, Sour Mango Kiwi, and Sour Cherry. For instance, Vital Proteins, a producer of collagen bars, beverages, capsules, and powders, sold a majority of its stock to Nestle SA in June 2020.
The market for Functional Beverages was estimated at US$ 176.37 billion in 2022, and from 2023 to 2030, it is projected to increase at a compound annual growth rate (CAGR) of 8.6%.
Prominent Companies in the Functional Beverage Industry:
1. PepsiCo Inc.: Created in 1919. United States headquarters. With well-known household brands including Pepsi, Mountain Dew, Gatorade, Lay's, Cheetos, and Doritos among others, PepsiCo is a global leader in snacks and beverages. With diverse exposure to carbonated soft drinks, or CSD, as well as water, sports, and energy offerings, the firm ranks as the second-largest beverage provider in the world (after Coca-Cola) and controls the market for savoury snacks globally. 55% of its overall revenue comes from convenience meals, with the remaining 47% coming from beverages. The majority of Pepsi's manufacturing and distribution capacity is owned, both domestically and abroad. 40% of overall revenues and a third of operating earnings come from international markets. Recent acquisitions include Pioneer Foods (July 2019), BFY Brands (Dec 2019), and Rockstar Energy Drink (Mar 2020).
2. Red Bull GmbH: Established in 1984. Headquarters in Austria. Energy drinks are produced and sold by companies with the goal of reviving the body and the intellect. The business sells sugar-free functional drinks with components like caffeine, taurine, alpine water, vitamins, and other additives that help athletes, students, and others with demanding jobs stay alert and energised no matter how tired they are. Rauch Fruchtsäfte GmbH and Red Bull GmbH each purchased a 47.5% non-controlling stake in Cawingredients Limited in the United Kingdom.
3. The Coca-Cola Company: Incorporated in September 1919 under the statutes of the State of Delaware, Coca-Cola Co. The Company is a maker of beverages. More than 500 nonalcoholic beverage brands, mostly sparkling but also include still drinks including waters, enhanced waters, juices and juice drinks, ready-to-drink teas and coffees, as well as energy and sports drinks, are owned by the company or marketed under licence. Coca-Cola, Diet Coke, Fanta, and Sprite are four of the top five nonalcoholic effervescent beverage brands owned and marketed by the company. Since 1886, finished beverage products with its trademarks have been sold in the United States. Today, they are available in more than 200 nations. Fairlife (Jan 2020), Organic & Raw Trading (Sep 2018), and MOJO Beverages (Sep 2018) are the most recent acquisitions.
4. Danone SA: Established in 1919. Headquarters in France, in Paris. After acquiring WhiteWave, Danone reorganised the company into three major divisions: specialised nutrition; bottled water; and key dairy and plant-based goods, which account for little over half of group revenue. Well-known brands like Danone/Dannon dairy products, Nutrilon and Cow & Gate newborn nourishment, as well as Evian and Volvic bottled water, are all part of the company's portfolio. About 60% of Danone's yearly sales come from outside of Western Europe, up from just about one third in 2001. ProMedica (march 2023), Dumex (may 2022) and Follow Your Heart (feb 2021) are the most recent acquisitions.
5. Monster Beverage Corporation: Built in 1935. Head office in the United States. With two thirds of its revenue coming from the United States and Canada, Monster Beverage is a market leader in the nonalcoholic beverage market's energy drink area. Brands including Monster Energy, Monster Ultra, Java Monster, and Juice Monster fall under the well-known Monster trademark. In addition, the company controls the energy drink brands Reign, NOS, Burn, and Mother. After purchasing a craft brewer in 2022, it also produces and sells beers and flavoured malt beverages. Manufacturers of energy drinks Monster Beverage Corp (MNST.O) and Constellation Brands Inc (STZ.N) are in merger talks, a source familiar with the situation told Reuters on Sunday.
6. JAB Holdings Company: Headquarters are in Luxembourg. JAB Holding Company is a private equity company based in Luxembourg that was established in 2012. Investments are sought by the company in the consumer goods, services, and technology sectors. Crum & Forster (Jun 2022), AGILA Haustierversicherung (Jul 2022), and Petplan (Jul 2022) are the most recent acquisitions.
7. General Nutrition Centers Inc.: Established in 1935. Head office in the United States. GNC Holdings Inc. is a specialised retailer of health, wellness, and performance items, which include protein, performance supplements, weight-management supplements, vitamins, herbs, and greens, wellness supplements, as well as food, drink, general merchandise, and health and beauty products. Company-owned retail locations, domestic and international franchise business, third-party contract manufacturing, e-commerce, and joint ventures for wholesale distribution are how it is run. Three segments make up the company's revenue stream: the United States, which is its main source of income, the Canada sector, the international segment, and the manufacturing or wholesale segment. An agreement authorised on Thursday in Delaware bankruptcy court saw GNC Holdings Inc., a global health and wellness chain established in Pittsburgh, sold for $770 million to a Chinese pharmaceutical company.
*Definition: Functional beverages are a class of beverages that are designed to promote specific health benefits. These drinks can help with hydration, energy, digestion, stress management, and other functions.
