Growth and Opportunity Abound in the RTD Beverage Market

By: Watson Team on May 21, 2019

The U.S. ready-to-drink (RTD) sports drink market has grown to $6.5 billion annually thanks to new categories of consumers.1 Learn how the broad appeal of convenient, healthy refreshment is winning fans beyond the sports crowd and which innovations can help RTD beverage manufacturers capitalize on this growing opportunity.

Global Growth of Sports Drinks

The expansion of sports drinks isn’t just a U.S. phenomenon. The $28 billion global sports drink market is forecast to grow at a CAGR of 8.6% between 2018 and 2023, according to Orbis Research.2 While North America leads the global market at 37% of market share, the Asia-Pacific region is close behind at 30%. 

Busy lifestyles, high disposable incomes, and a growing interest in health and wellness are drivers in North American and European countries, while increasing disposable income and high populations of young people are drivers in emerging economies, such as China and India. 

Millennials are the largest consumer segment driving growth in sports drinks. However, consumers of all types are seeking health benefits from sports beverages and other functional beverages in their pursuit of active nutrition. 

What Is Active Nutrition?

Consumers’ growing demand for beverages with benefits in a convenient RTD format has not only expanded the appeal of sports drinks but is also blurring the lines between sports, energy, and nutrition drinks. The interest in functional beverages by active consumers who are not necessary athletes represents an incredible opportunity for beverage manufacturers.

Whereas sports nutrition addresses the needs of athletes, which can include energy, stamina, hydration, exercise recovery, and muscle building; active nutrition caters to the needs of those living active, healthy lifestyles who wish to optimize their physical and mental health. Active nutrition also covers different life stages, providing different nutrition options for seniors than for teenagers, for example.

Two people running outside.

Those seeking active nutrition might regularly purchase a variety of RTD beverage types—from sports drinks to meal replacement beverages, from to protein shakes to vitamin waters—based on their perceived needs for the day. To tap into the growing market of single-serve sports drinks and other functional, active nutrition beverages, let’s look at some key opportunities.

Trends and Opportunities in RTD Functional Beverages

1. Clean Label Sugar-Free Sweeteners

Sugar-free and low-sugar are back in a big way in the beverage category. Flavored waters, coconut waters, and lightly sweetened teas are just a few examples. Consumers are becoming more aware of the extra calories that sugar brings (especially when it comes to healthy beverages), but they’re not willing to sacrifice flavor. Natural high-intensity sweeteners like stevia and monk fruit are clean label alternatives to sucralose and aspartame.

2. Plant Proteins

Protein remains a hugely popular ingredient and claim in healthy RTD beverages. Plant-based alternatives to whey are vegan-friendly and have a health halo. While soy protein has comparable bioavailability to whey protein, manufacturers might also consider using an allergen-free plant protein like pea protein or even a blend of different types of plant proteins.

3. “Nutrients of Concern” Fortifications

The most recent Dietary Guidelines for Americans report has declared five nutrients of public health concern: calcium, potassium, vitamin D, dietary fiber, and for certain at-risk groups, iron. Since all of these are mandatory label nutrients, it’s easy for consumers to compare beverages on the content of these nutrients. Fortifying RTD beverages with these nutrients can not only make a product stand out but can also help address an important need.

 

4. Functional Variety Packs

Consumers interested in sports and active nutrition use functional foods and beverages to address specific health, performance, and energy needs. But these can vary from day to day based on things like physical activity, eating patterns, amount of sleep, and how they feel. How about a variety pack that provides more than just flavor options, such as a functional beverage six-pack with two sports drinks, two protein beverages, and two energy drinks?

5. Grab-and-Go Dry Beverage Mixes

Single-serve dry beverage mixes allow consumers to make their own RTD beverages whenever they want. They’re also lightweight and portable. Dry beverage ingredients aren’t limited to sweeteners, colors, and flavors. They can contain any number of functional ingredients such as vitamins, minerals, amino acids, proteins, fibers, botanicals, and even gums. Watson’s innovative Sol-U-PakTM (made from edible film) is a dry beverage pouch that fully dissolves in water. It works well with shaker bottles and lets consumers avoid carrying heavy RTD bottles to work or the gym.

Winning the Game with Healthy Nutrition

These are just a few of the ways that RTD beverage manufacturers can grab the attention of sports and active nutrition consumers and become part of this growing opportunity. When manufacturers put the health and needs of consumers first, they’re sure to win!

Learn about using our Custom Nutrient Premixes to create a winning RTD functional beverage for your consumers!

References

1. Caballero, M. (2017). Sports Shift: New Sports Drinks Incorporate, Evolve Beyond Isotonics. Retrieved from https://www.bevnet.com/magazine/issue/2017/sports-shift-new-sports-drinks-incorporate-evolve-beyond-isotonics

2. Orbis Research. (2018). Global Sports Drink Market 2018 By Trends, Types, Growing Demand, Consumption, Key Manufacturers, Opportunities, Analysis and Forecast 2023. Retrieved from https://www.reuters.com/brandfeatures/venture-capital/article?id=38258