Global Functional Beverages Market

Global Functional Beverages Market by Type, by Distribution channels, by Ingredients, by Regions: Opportunity Analysis and Industry Forecast, 2020-2027

Report ID: GMRI0024 | Published Date: Oct 2021 | Report Format: PDF

Price : $3549

The global functional beverage market was valued at approximately USD 129.5 million in 2020 and is projected to grow to USD 208.2 billion by 2027, registering a compound annual growth rate (CAGR) of around 8.1% from 2021 to 2027.

Functional beverages refer to non-alcoholic, non-traditional drinks that offer added health benefits. These may include probiotic drinks, plant-based and vegan beverages, herbal infusions, and fortified waters, among others.

An increasing focus on fitness and wellness has led to a surge in health-conscious consumers worldwide, which is anticipated to significantly boost demand in the functional beverages market. The growing popularity of new diet trends, fitness routines, and regular gym attendance has prompted consumers to seek out convenient options that support a healthy lifestyle. As a result, there is rising interest in beverages that are not only easy to consume but also provide a strong nutritional profile.

Key factors contributing to the market’s growth include heightened consumer awareness of health and wellness, a greater willingness to invest in innovative functional beverage products, and the increasing frequency of sports and fitness events. With more people participating in and following sports activities, demand for performance-supporting and health-oriented beverages is expected to grow substantially in the near future.

New and emerging brands, along with established beverage manufacturers, are continuously innovating by incorporating ingredients that are rich in nutrients and support overall wellness. These ongoing developments are expected to significantly reshape the global functional beverage market in the years ahead.

However, certain challenges may hinder this growth. The presence of more affordable alternative products is one such limiting factor, as it may divert consumer attention away from higher-priced functional beverages. Additionally, the high cost of premium ingredients poses a barrier, particularly in developing regions where affordability plays a crucial role in consumer purchasing decisions.

Global Functional Beverage Market Overview

The global functional beverage market has been witnessing significant growth, driven by rising health consciousness, innovation in ingredients, and changing consumer lifestyles. This sector includes non-alcoholic drinks enhanced with nutritional or health-promoting ingredients such as probiotics, vitamins, plant-based extracts, and herbal additives.

Market Segmentation Insights

By Type: Energy Drinks Lead the Growth

Among the various types of functional beverages, the energy drinks segment accounted for the largest market share, contributing approximately 25% of total revenue in 2020. This segment is also expected to grow at the fastest pace due to the increasing number of athletes, fitness enthusiasts, and young consumers who seek quick energy boosts and performance-enhancing beverages.

Meanwhile, the functional fruit and vegetable juice segment is projected to grow at a CAGR of 7% during the forecast period, driven by the demand for natural, vitamin-rich alternatives that support immune health and detoxification.

By Distribution Channel: Online Sales Surge

The online distribution channel is set to grow rapidly during the forecast period, bolstered by the shift in consumer buying habits during the COVID-19 pandemic. With the convenience of online shopping and ongoing health and wellness trends, e-commerce platforms and specialized health websites have become preferred points of purchase. Continued social distancing norms and the digital transformation of retail are expected to keep online sales strong in the coming years.

By Region: Asia Pacific Dominates

In 2020, the Asia Pacific region led the functional beverage market, accounting for roughly 30% of the global share. This growth is driven by increasing disposable incomes, improved quality of life, and rising health awareness in countries like India and China. Consumers in these countries are becoming more conscious of adopting healthier diets and preventive wellness measures.

The growing prevalence of diabetes in these regions is further influencing consumer preferences toward beverages made with natural sweeteners and reduced sugar content. According to the International Diabetes Federation, India had about 78 million diabetes patients in 2019, with projections reaching 110 million by 2035. In response, global giants like PepsiCo and The Coca-Cola Company are reformulating their offerings to include less sugar and no artificial ingredients.

Market Dynamics

Drivers

Growing consumer awareness of health benefits from functional ingredients
Increasing demand for convenient, on-the-go nutrition
High rate of new product launches and innovation

Restraints

High ingredient costs, particularly in developing countries
Availability of lower-cost substitute products

Opportunities

Surge in fitness and sports-related activities
Expansion into emerging markets with health-focused demographics

Recent Developments

October 2020: Crave launched a line of natural energy drinks in flavors such as Passionfruit & Vanilla, Pineapple & Coconut, and Mint & Lime. These are formulated with organic ingredients and vitamins B & C to support immunity and energy.
2019: 7-Eleven released a sugar-free energy drink, Triton, featuring L-Theanine (from green tea), along with caffeine, taurine, ginseng, amino acids, and Vitamin B to enhance focus and stamina.

Competitive Landscape

The global functional beverage market is highly competitive, with both established players and new entrants focusing on innovation, strategic partnerships, and mergers to expand their market share.

Key Companies:

Danone
The Coca-Cola Company
PepsiCo Inc.
Monster Beverage
Nestlé
Red Bull GmbH
Clif Bar & Company
Cloud 9
Rockstar Inc.
Arla Foods
Universal Nutrition
Red Devil NV
Shenzhen Eastroc Beverage Industrial Co., Ltd
The Kraft Heinz Company
WNWM Ustronianka

A notable example includes The Coca-Cola Company’s acquisition of Ades from Unilever, aimed at bolstering its plant-based beverage offerings.

Unique Insights from the Report

Value Chain Analysis
Opportunity Mapping & Sector Snapshot
Key Player Positioning Matrix
Regulatory Overview & Strategy Benchmarking Heat Map
Market Trends & COVID-19 Impact Analysis
Comparative Product Study (Pre & Post COVID Effects)
Detailed Competitive Landscape

AI and Machine Learning Integration, American Marketing Association (AMA), Associate Consultant, Associate Partner (Consulting), Brand Awareness/Perception Studies, Branding Research, Case Studies, Competitor Analysis, Competitor Research, Comprehensive Approach, Consultant, Consulting/Consultancy, Consistency and Brand Alignment, Cost-Effectiveness, Council of American Survey Research (CASRO), Customer Journey Maps (CJM), Customer Research, Customer Understanding, Data Analysis, Data Collection, Digital Transformation Consulting, Director of Market Research, Economic Consulting, Efficiency, Enhanced Decision-Making, ESG (Environmental, Social, Governance) Consulting, ESOMAR, Exploratory Research, Financial Advisory, Flexible Models and Specialization (Consulting), Human Element (Consulting), Human Resources (HR) Consulting, Implementation Consulting, In-house Market Research Capabilities, Insights Analyst, Insights Generation, Integrated Services, Intern (Consulting), IT/Technology Consulting, Manager (Consulting), Market Research, Market Research Analysts, Market Research Reports, Market Segmentation Reports, Marketing Data Analyst, Marketing Research Association (MRA), Observational Research, Optimized Resource Allocation, Partner (Consulting), Personalized Solutions (Consulting), Primary Research, Problem Solving, Product Research, Product Research Analyst, Qualitative Research, Qualitative Research Assistant, Qualitative Research Consultants Association (QRCA), Quantitative Research, Real-Time Data Analytics, Remote Work (Consulting), Risk Consulting, Risk Reduction, Secondary Research, Senior Associate Consultant, Senior Manager (Consulting), Social Media Listening, Specific Research, Strategic Plans, Strategy Consulting, Sustainability Consulting, SWOT Analysis, Target Market/Audience.

Section 1: Introduction
1. Engagement Objective
2. Scope of the Study: Segmentation
3. Timeframe, Currency and Limitations
Section 2: Research Methodology
1. 3P Research Approach
2. Market Sizing Approach
3. Data Sources
4. Primary Research Coverage
Section 3: Executive Summary
1. Global Functional Beverages Market Summary
2. Market Snapshot
3. Regional Snapshot
Section 4: Market Overview of Functional Beverages
1. Drivers
2. Restraints
3. Opportunities
4. Market Trends
Section 5: Premium Insights
1. Industry Prospects
2. Major Market Segments
3. Key Trends
4. Competitive Benchmarking
5. Product Benchmarking
6. SWOT Analysis
7. Strategies Adopted-Benchmarking Heat Map
8. Recent News and Developments
9. Value Chain Analysis
10. Pain-Point Analysis
11. Porter’s Five Forces Analysis
Section 6: Market Overview of Functional Beverages
1. By Product Type
  1. Energy Drinks
  2. Sports Drinks
  3. Fortified Juice
  4. Dairy and Dairy Alternative Beverage
  5. Others
2. By distribution channel
  1. Online Channel
  2. Offline Channel
  3. Supermarket/Hypermarket
  4. Pharmacies/Health Stores
  5. Departmental Stores
3. By Ingredients
  1. Antioxidants
  2. Minerals
  3. Amino acids
  4. Prebiotics
  5. Probiotics
  6. Vitamins
  7. Others
Section 7: Future Forecast & Impact of COVID-19
1. Covid 19 - Prevalence Analysis
2. Key Trends Analysis
3. 2020 Market Forecast (Pre & Post Covid-19)
4. Key Factor Analysis
5. Ecosystem Impact & Opportunity Analysis
Section 8: Regional Market Analysis (US Millions)
1. North America
2. Market Overview
3. Market Outlook
4. Key Countries & Market Estimates
  1. United States
  2. Canada
5. Europe
  1. Market Overview
  2. Market Outlook
  3. Key Countries & Market Estimates
  4. Germany
  5. France
  6. United Kingdom
  7. Rest of Europe
6. Asia Pacific
  1. Market Overview
  2. Market Outlook
  3. Key Countries & Market Estimates
  4. China
  5. Japan
  6. India
  7. South Korea
  8. Rest of APAC
7. Latin America
  1. Market Overview
  2. Market Outlook
  3. Key Countries & Market Estimates
  4. Brazil
  5. Mexico
  6. Argentina
  7. Rest of Latin America
8. Middle East & Africa
  1. Market Overview
  2. Market Outlook
  3. Key Countries & Market Estimates
  4. GCC
  5. Rest of MEA
Section 9: Competitive Scenario
1. Competitive Landscape
2. Investment Scenario by key Players
3. Key Player Overview
4. Top 5 Player Comparison
5. Player Wise Geographic Presence
6. Player Wise Target Applications
7. Competitive positioning and strategies of market players
Section 10: Company Profiles
1. Danone
2. The Coca Cola Company
3. Monster Beverage
4. Nestle
5. Cloud 9
6. Clif Bar & Company
7. Arla Foods
8. Universal Nutrition
9. PepsiCo Inc.
10. Red Bull GmbH
11. Red Devil NV
12. Rockstar Inc
13. Shenzhen Eastroc Beverage Industrial Co., Ltd
14. The Kraft Heinz Company
15. WNWM Ustronianka

Report Research Methodology

At our global market research firm, we use advanced analytical tools and methodologies to deliver precise, data-driven insights. Our experienced analysts provide comprehensive research reports equipped with actionable strategies that can generate measurable business outcomes. We use a combination of top-down and bottom-up approaches to examine the market from multiple perspectives.

This dual approach allows for thorough segmentation and enables a deep-dive analysis of each individual market segment.

We also adopt data triangulation methods to cross-validate data from various sources. This ensures our clients receive well-rounded, accurate market insights. The key elements of our research methodology include:

Exploratory Data Mining

We begin with an extensive data collection process, gathering raw information that is rigorously filtered to retain only what is relevant. This filtered data is verified for authenticity before being used further. In addition to new data, we also integrate validated insights from our internal database of previous reports and research studies.

Our extensive in-house data repository, along with access to reliable paid databases, forms the foundation for robust research outputs.

Market Landscape Understanding

To gain a holistic view of the market, we analyze both historical data and current trends. Our sources include industry stakeholders such as distributors and suppliers, in addition to credible government portals and official reports.

We also utilize qualitative inputs such as journal publications, survey responses, and customized questionnaires. Emphasis is placed on analyzing key industry dynamics like drivers, restraints, and economic factors. All collected data undergoes stringent validation and is refined using best-in-class cross-verification techniques.

Data Collection Matrix

Research Tools & Models

We use simulation-based models and business intelligence (BI) dashboards to deliver real-time statistics and predictive insights. Clients also benefit from our online reporting tools, which offer access to KPIs, brand performance data, and embedded analytics.

Our research models are tailored based on each client's unique needs. The datasets include market dynamics, technological developments, pricing trends, and application landscapes, all of which feed into forecasting models.

We provide both short-term econometric analysis and long-term technology market forecasts, helping clients seize emerging opportunities. By comparing variables like technological advancement, product innovation, and capital flow, we can assess their impact over the forecast period.

Our analysts apply correlation, regression, and time-series analysis to provide reliable business forecasts. They also account for external factors such as regulatory landscapes, technological shifts, and economic indicators.

We analyze demographic data regionally and then consolidate it to provide a “glo-cal” (global + local) perspective. Every report is curated to deliver actionable insights with precision and speed. Our team closely collaborates with clients throughout the research process—from market exploration to strategy execution.

Forecasting Parameters

We assign different weightages to forecasting factors to quantify their influence on market dynamics. This ensures a transparent and measurable projection of market trends. Parameters include:

Key market drivers and restraints, including their current and projected impact
Raw material availability and pricing trends
Regulatory frameworks and expected policy changes
Current and future production capacity through 2027

Primary Validation

The final stage of the research process involves market forecasting and expert validation. In-depth interviews are conducted with senior decision-makers and industry veterans to verify the research assumptions and findings.

We perform face-to-face and telephonic interviews with professionals across the value chain—suppliers, distributors, vendors, and end-users—to ensure unbiased and well-rounded insights. With a multilingual team, we conduct global interviews seamlessly.

These expert interactions enrich our reports with real-world context, enhancing their reliability and credibility. Our trained researchers engage with Key Industry Participants (KIPs), including:

Established market leaders
Raw data providers
Network partners like resellers and distributors
End-user representatives

Objectives of Primary Research

To confirm the accuracy and relevance of collected data
To understand current market conditions and forecast future trends

Industry Analysis Matrix