The cola giant is getting ready to launch its new prebiotic soft drink brand Simply Pop in a bid to try and grab some share of the fast-growing prebiotic sodas market which is health-centric.
The gesture pits the giant drink company against entrenched players like Olipop, SunSip, and Poppi, who managed to establish pockets in the market for prebiotic sodas.
Soda consumption in the US has declined significantly over the past two decades, driven by increasing health awareness and the rise of alt-beverages, like cold brews, energy drinks, and flavored waters.
But the prebiotic soda segment has been gaining traction, with sales expected to increase from $197 million in 2020 to around $440 million in 2024, based on Euromonitor International figures. Prebiotic sodas remain a niche part of the larger soda market, which is worth billions.
Available starting later this month to consumers in the West Coast and Southeast regions of the US, Simply Pop will offer the following fruity flavors: pineapple mango, lime, strawberry, fruit punch, and citrus punch, similar to Coca-Cola's current Simply juice brand.
The new drinks are marketed as having no added sugar and 25% to 30% actual fruit juice, plus added vitamin C and zinc. There is also 6g of prebiotic fiber per serving, which is more than Poppi's but less than Olipop's 9g.
Prebiotics, known to be beneficial for gut health, have also caught on with consumers, especially younger groups such as millennials and Gen Z.
Coca-Cola's foray into the prebiotic soda space arrives at a time when others are diversifying their offerings. Olipop just raised $50 million and boosted its valuation to $1.85 billion, while Poppi made headlines with its top-tier Super Bowl ad. Each brand has had success positioning products as healthier substitutes for standard sodas and catering to a consumer base focused on health.
Yet the health claim that has trailed prebiotic drinks has been controversial. Poppi is right now in mediation talks over one lawsuit that says its products aren't as beneficial to health as it claims. This suggests regulation could be something of an issue for the overall category.
CMI Research: Key Functional Beverage Industry Insights
According to Coherent Market Insights, the functional beverage industry is expected to grow at a CAGR of 8.6% between 2023 and 2030 due to an increasing need for health-supporting products. It was estimated at US$ 176.37 Bn in 2022 and is expected to exhibit a significant rate of growth in the last part of year 2031.
Analyst Opinion: Strategic Role in Functional Beverage Industry Growth
The functional beverage market worldwide is extremely competitive. This is due to constant introduction of new technologies owing to constant R&D and value chain players' efforts states senior management consultant Yash Doshi.
Conclusion: Business Takeaways
The functional beverage market is growing, with demand for health-oriented beverages such as prebiotics and probiotics increasing. Coca-Cola's move into the market with Simply Pop demonstrates the growing significance of wellness-oriented products. Brands need to innovate to remain competitive, providing functional benefits that attract health-oriented consumers.
