by The functional beverage market consists of beverages containing functional ingredients that provide health benefits beyond their basic nutritional value. Some of the common functional beverages include energy drinks, functional sports drinks, nutraceutical drinks, tea-based drinks, dairy-based drinks, and plant-based drinks. Nutraceutical drinks containing ingredients like vitamins, minerals, herbs, botanicals, amino acids, and dietary supplements are gaining popularity among consumers for their various health benefits. The increasing global prevalence of non-communicable diseases coupled with rising health consciousness among people has boosted the demand for functional beverages.
The Global functional beverage market is estimated to be valued at US$ 220.66 Mn in 2024 and is expected to exhibit a CAGR of 6.6% over the forecast period 2024 To 2031.
Key Takeaways
Key players operating in the functional beverage market are Teva Pharmaceutical Industries Ltd, Novo Nordisk A/S, OPKO Health Inc., Lilly, Hanmi Pharm.Co., Sanofi, Circle Pharma, Pfizer Inc., Novartis AG, PeptiDream Inc., Amgen Inc., AstraZeneca, Bachem Holding AG, CordenPharma International, Ipsen Pharma, Merck KGaA, PolyPeptide Group, Bayer AG. The key players are focusing on new product launches, mergers, acquisitions, and collaborations to gain a competitive advantage in the market.
The Functional Beverage Market offers various opportunities such as untapped emerging markets, new product development, and rising demand for plant-based beverages. Emerging economies with growing working population present significant growth prospects. Technological advancements in encapsulation and delivery methods help enhance the stability, bioavailability, and efficacy of functional ingredients in beverages.
Market drivers: Growing health consciousness coupled with the increasing prevalence of lifestyle diseases such as diabetes, obesity, cardiovascular disorders are the major factors driving the growth of the functional beverage market. Rising disposable income and growing spending on healthy beverages supplement this growth. Expanding retail landscape with availability of various product offerings aids the market expansion. Moreover, changing consumer preferences towards nutrition-rich drinks and popularity of herbal supplements as alternatives to conventional medicines further augment the market rise.
Current Challenges in the Functional Beverage Market
The functional beverage market faces several challenges currently. Consumers lack awareness about the potential health benefits of functional beverages and perceive them to be highly processed and artificial. This acts as a restraint on the growth of the market. Another challenge is the premium pricing of functional beverages compared to regular beverages which limit their mass appeal. Strict regulatory framework and approval process delays the launch of new and innovative products. The presence of substitute beverages such as fortified juices and energy drinks also pose competition to the functional beverage market.
SWOT Analysis
Strength: Growing health consciousness among consumers is leading to increased demand for beverages with functional ingredients.
Weakness: High product development and marketing costs involved in functional beverages limits new market entrants.
Opportunity: Untapped growth opportunities in developing regions offer scope for market expansion.
Threats: Introduction of taxes on sugar and other ingredients used in functional beverages can adversely impact the industry.
The functional beverage market in the United States accounted for the largest share in terms of value in 2024. This was attributed to factors such as rising obesity rates and increasing popularity of healthy beverages. The market in China is expected to grow at the fastest CAGR during the forecast period. Rising disposable incomes, growing health awareness and changing lifestyles in China are driving the demand for functional beverages.
Europe is another major regional market for functional beverages. Countries like Germany, United Kingdom, France have high per capita consumption of beverages containing functional ingredients. Availability of resources to manufacture herbal extracts and natural ingredients provide opportunities for European companies in the functional beverage market.
About Author:
Money Singh is a seasoned content writer with over four years of experience in the market research sector. Her expertise spans various industries, including food and beverages, biotechnology, chemical and materials, defense and aerospace, consumer goods, etc. (https://www.linkedin.com/in/money-singh-590844163)
*Note:
1.Source: Coherent Market Insights, Public sources, Desk research
2.We have leveraged AI tools to mine information and compile it
