Soft Drinks

Clean energy and hydration: Health solutions in beverages

Introduction

In November 2024 FMCG Gurus and Sensapure Flavors presented a webinar exploring shifting consumer attitudes towards health and well-being. The webinar examined the drivers behind consumer demand for clean energy, hydration and instant health solutions in the functional beverage category.

Prioritizing day-to-day wellness and energy levels in 2025

Over the past 18 months consumers have changed their focus from long-term health to improving day-to-day wellness. This is particularly true for mood enhancement and stress alleviation. FMCG Gurus’ consumer insights show only 1 in 5 global consumers regularly feel energized. This can impact their ability to perform day-to-day tasks. As a result, boosting energy levels will be a priority for consumers in 2025.  

“Consumers can often feel tired and fatigued. They are worried that this may be a reflection of an overall drop in their health. This is driving demand for energy boosting products. At the same time, industry legacy issues means that consumers can sometimes be conscious of seeking these products out. This is creating the opportunity, particularly within the beverage space, to promote the concept of clean energy and make the link with hydration to target those consumers that are seeking out products that will help them get through the day both physically, emotionally and cognitively.”

Mike Huges, Head of Research and Insights, FMCG Gurus

Clean label claims for energy boosting beverages

Consumers may have an unfavorable perception of energy boosting products as having a short-term impact and potentially containing high levels of sugar. The industry need to change this by offering formulations that are free from dietary evils and artificial ingredients. In contrast, they should focus on ingredients that are natural, clean and offer a sustained energy boost. Consumers are open to new products and willing to research and be educated about new ingredients.

Opportunities & Recommendations

During the Q&A our panel members discussed how brands can capitalize on opportunities around energy in the ready to drink market. This included what to do next from a consumer perspective and how to customize this approach for different cohorts. Sensapure Flavors explored their role in flavor innovation and product development capabilities. They also discussed new ingredients and flavors in the energy drink category. 

“Getting away from ingredients that consumers see as “bad” is important. Novel ingredients like lutein and zeaxanthin, which are good for eye health, play into the gamer space - that’s a space that’s pretty new [...] Also, ingredients that provide satiety like amino acids, plant-based proteins, also non-nutrient sweeteners - ingredients other than sugar and artificial sweeteners, that have a natural skew and don’t contain a lot of calories.”

Derek Greer PhD, Senior Director R&D, Sensapure Flavors

“Today’s consumers are very astute in doing the research and understanding what works best for them. Transparency on the label and having clinical data that backs up the claims of those ingredients is very important. Clean label is a trend we have been seeing not only in energy but across the world of functional beverages.”

Tony Colalillo, Senior Vice President of Sales & Marketing, Sensapure Flavors

Find out the latest consumer insights and opportunities for your industry. To sign up to FMCG Gurus’ future webinars, please click here.

Soft Drinks Trends: Changing Habits and Nutritional Labels

Introduction

On a global scale, a significant number of beverage choices are driven by habits, as consumers select specific drinks based on their needs. It's not surprising that certain product categories have maintained a consistent proportion of regular consumers over time. However, there has been a noticeable increase in consumers turning to cordial, squash, and syrups weekly in recent years. FMCG Gurus’ consumer insights reveal that 53% of global consumers said they drink cordial, squash, and syrups either daily or weekly in 2024. This has increased by 12% since 2021. This rise in cordial consumption can be linked to people seeking more cost-effective options. This is due to increasing prices, especially in product categories they regularly purchase from. On the other hand, there has been a decline in the number of people consuming chilled juice weekly, likely due to its premium pricing. 

During a Period of Financial Uncertainty, Consumers are Spending in the Health and Wellness Market more Sparsely

When assessing beverages with health benefits, there has been a decline in individuals regularly consuming these products compared to 2021. For instance, FMCG Gurus’ market research highlights that in the protein drink category, 26% of consumers drink this beverage daily or weekly. This shows an 11% decrease in consumers purchasing protein drinks daily or weekly since 2021. This decrease is particularly pronounced in the isotonic drinks category. While consumers remain proactive about their health, a reduced concern about illness, coupled with escalating prices, has led to a shift from an unwavering focus on health to a more thoughtful approach. This implies that consumers are still interested in health and wellness products but are using them less frequently. Additionally, it is possible that they are more discerning about their effectiveness, necessity, and value, especially for products with higher price points. 

When Checking Nutritional Labels, Consumers are more Likely to Look at Negative Dietary Ingredients

When choosing beverages, many consumers review the nutritional details on the packaging, a percentage that has remained consistent over the past two years. The inclination to inspect labels varies depending on the beverage category. Generally, consumers are more inclined to review information for negative dietary aspects rather than ingredients associated with health benefits. Sugar is the most commonly checked ingredient. While the sugar content does not necessarily deter individuals from purchasing, particularly for occasions of indulgence, it does underscore how people are mindful of the sugar content in soft drinks. Additionally, the association with health issues such as obesity is clear. This has been influenced by heightened attention to the topic over the past few decades. 

Recognizable, Streamlined, and Natural Ingredients are Appealing to Many Consumers

The current challenges posed by the cost-of-living crisis have affected consumers' financial stability. However, it is vital to recognize that individuals prioritize value perceptions over affordability when selecting soft drinks. Furthermore, consumers are still willing to upgrade to products they perceive as high quality. This is particularly clear when seeking moments of affordable indulgence to escape and compensate for reduced expenditures in other areas. This underscores the importance of emphasizing innovation rather than solely focusing on offering the lowest price in new product developments. Encouragingly, pushing the boundaries of premium within economy segments can prompt consumers to reconsider their perspectives. On a global scale, consumers highlight that 100% natural production methods greatly influence their view of premium quality. This indicates a desire for assurance that products are meticulously crafted with a focus on natural ingredients, associated with healthiness, sustainability, and superior quality. 

This article is based on FMCG Gurus: Soft Drinks Trends – Country Reports 2024. For more information, please click here.

Soft Drinks: Consumption Habits and Health Approaches

Consumers are Regularly Turning to Cordial, Squash, or Syrups

A trend over the past three years has been the increase in consumers turning to cordial, squash, or syrup. For instance, FMCG Gurus' consumer insights reveal that 54% of global consumers say they drink cordial, squash, or syrups at least weekly. This category, traditionally seen as a more economical alternative to juice, has seen this increase, while there has been no fundamental shift in the overall consumption of juice.

This surge in the preference for a more budget-friendly option aligns with price inflation, prompting individuals to moderate their food and beverage expenses. It suggests that consumers are increasingly turning to cordials for economic reasons. This presents an opportunity for brands in the soft drinks industry to focus on affordable innovation. As a result, this will challenge consumer perceptions and associations with cordials. 

Health Based Beverages are being Consumed Less Frequently

In comparison to three years ago, there has been a decrease in consumers who report regularly turning to health-focused beverages. This is particularly evident in the functional juice and water category. For example, FMCG Gurus' market research highlights a 21% drop in consumers drinking functional juice or water between 2021 and 2024. This shift can be attributed to two primary factors. Firstly, the impact of COVID-19 on purchasing behavior across food and beverage categories has lessened compared to three years prior. Secondly, the association of healthy beverages with premium pricing at a time when individuals are grappling with everyday living expenses. This has led consumers to move away from the mindset of "health at any cost" and towards a more considered approach to wellness.

As a result, consumers continue to purchase health and wellness products, but with less emphasis on spending and a focus on the effectiveness, necessity, and value for money of the products. With price inflation expected to continue influencing consumer purchasing patterns and consumers reducing their consumption of such beverages, it becomes essential for brands in the health and wellness market to ensure that their products align with the key consumer needs in terms of claims, format, and product attributes. 

Perceptions Regarding the Healthiness of Energy Drinks are Shifting

In striving for a well-rounded diet, consumers embrace a balanced approach to health. This involves some choices driven by the goal of managing well-being through indulgence. This approach extends to the beverage sector, where there is no direct link between the perceived unhealthiness of a category and efforts to reduce consumption.

One trend in recent years is the shifting attitudes towards the health aspects of energy drinks. There has been a noticeable drop in the percentage of consumers viewing energy drinks as unhealthy. However, for the first time, respondents were more inclined to label them as healthy. For instance, FMCG Gurus' consumer insights reveal 39% of consumers who say they purchase energy drinks deem them to be healthy, compared to 19% in 2021. This shift indicates that consumers are moving away from perceiving energy drinks as essential pick-me-ups that require moderation due to their immediate energy boost followed by a crash. Instead, energy drinks are now seen as a safe option providing sustained and consistent energy without side effects. This change is driven by fatigued consumers seeking products to support them both physically and cognitively throughout the day. 

Consumers are Conscious of Sugar in the Soft Drinks Market

Consumers continue to prioritize awareness of product ingredients. This is despite a slight decline compared to the pandemic period, attributed to reduced risk aversion and health consciousness. There remains a strong desire to avoid ingredients perceived as detrimental to personal health and the broader environment. Notably, sugar ranks as the top ingredient of concern for consumers. For example, FMCG Gurus' market research highlights that 51% of global consumers are concerned about sugar in beverages. This reflects the heightened attention to sugar content within the beverage industry. In addition, concerns about weight amid uncertain times are leading individuals to seek solace in less healthy food and drink.

Interestingly, there has been an increase in individuals expressing concerns about artificial sweeteners over the past three years. This aligns with the growing emphasis on naturalness claims within the soft drinks market. 

This article is based on FMCG Gurus: Soft Drinks – Global Report 2024. For more information, please click here.