| This is free marketing research on the health drinks industry and can include information on the background, market structure, definitions, competitors, trends and developments of health drinks and is related to other topics such as sports drinks, beverages, diets and exercise.
Table of Contents
Health drinks are a part of the functional food and drinks category which also includes such beverages as energy foods and drinks, sports drinks, health soft drinks, etc. The category of health drinks also includes such drinks as soy milk and other soy based drinks, fruit juices, targeted health drinks, such as calcium rich drinks for the bones, and any other new age drink with health benefit such as many herb and berries that are coming into the international markets from Asia and South America. Over a dozen health drinks promising weight loss, cell-damage-reducing antioxidants and natural energy have reached supermarket shelves in 2007, while many more still in the pipeline.
While Americans drank over 19 billion gallons of beverages in 2005, other than tea and coffee, a large segment of these are for health-conscious consumers, with ingredients and additives such as natural sugars, chromium - tied to weight loss - Omega-3 fatty acids, calorie burning, enhanced water, juices designed to help with skincare, weight management and detoxification, or enhanced with anti-oxidants. Consumer food and drink choices are no longer driven by taste alone, but are clearly increasingly affected by awareness of nutrition and health factors with lifestyle aspirations becoming a more deciding factor now.
The total sales of health foods and health drinks in 2006 were approximately $20 billion through distribution channels such as mass-market, television shopping channels, health/natural food stores, large discounter houses such as Wal-Mart, and warehouse “big-box” clubs. With more functional foods and beverages available in the market combined with medically beneficial ingredients, health and wellness are now included in top criteria driving consumer food choices.
The health drinks market is growing rapidly but is still a small industry in the U.S. This is generally grouped with the category of beverages or the sub category of sports drinks or energy drinks. The pure health drinks market is currently just a fraction of those categories by most industry definitions.
§ Functional foods Functional foods and beverages are products that make a distinct, written health claim; may be enhanced in some way with added ingredients like calcium to have beneficial effects. They produce a specific health benefit and may bear FDA approved claims. § Superfoods Name given to everyday fruits, vegetables, fish and fowl that are seen as enhancing health and long life. These may include nutrient-rich blueberries, beans, tomatoes, pumpkins, oranges, oats and wild salmon; pomegranates, cinnamon, onions, dates and red peppers; foods containing antioxidants etc. § Energy drinks Beverages designed to give you a burst of energy using a combination of methylxanthines, usually some form of caffeine, B vitamins, and herbs. Some may contain high levels of sugar. § Sports drinks Designed to replace the body-electrolytes, while you sweat, at sports or exercise. They contain water, with some form of sugar, minerals such as potassium and sodium, and flavors. They provide an instant source of carbohydrates: Sugars and other energy compounds that help to feed the muscles and can delay fatigue. In 2005 global sales of “healthy” drinks, including bottled water, fruit juices, and sports and energy drinks may have been as high as $138 billion, which would represent 45% of the entire soft-drinks market. Growth rates in specific categories of this industry may be seven times higher than those for carbonated drinks for example. And the sector continues to gain market share as consumers move away from alternative soft drinks towards health drinks.
The actual category of health drinks, however, is not likely to be more than a $100 million industry in the U.S. But it may also be the fastest growing. Essentially these beverages are also known as “nutraceuticals”, as they are targeted to provide nutrition to the body. Many of these products are derivatives of tea or herbal drinks. Sales of health drinks may have been only about $20 million annually 10 years ago and are now up five fold.
Health drinks claim to provide New Age type healing remedies and often include specific minerals, vitamin compounds, herbs or other supplements. The major players in the field include large multinational companies such as Coca-Cola Enterprises and PepsiCo, while the rest of the market is fragmented, with a number of niche players. In addition, leading drugs companies like GlaxoSmithKline PLC, with their Lucozade and Ribena brands, are also part of the health drink market.
There is a blurring of lines continuing in the industry. The market for bottled water could be $100 billion per year, eclipsing the health drink market. Yet, Glaceau in Europe has been successfully marketing Vitaminwater and Smartwater. Are these health drinks? They claim to provide select vitamin ingredients in the drink. It may need to be resolved, as Coca Cola agreed in 2007 to pay US $4 billion for Glaceau including its Vitaminwater brand.
Significant global markets other than the U.S. for health drinks include Japan and other Asian countries.
General Metrics
Top ten functional drinks categories as share of global soft drink launches in 2004-2006 Share of Launches 2004 2006 Cognitive Health 9.4 % 8.3% Digestive Health and Anti Allergy 7.1% 7.2% Joint and Bone Health 4.0% 3.1% Diabetes Control 3.5% 3.1% Blood Pressure Control 3.0% 2.2% Cholesterol Control 1.6% 2.2% Immune System Health -- 1.3% Trends and Recent Developments Further market penetration and increasing frequency of product usage among the general population will boost product sales. Young adults may be a key market segment for future growth. Prospects for the healthy drink market may be strong but there are issues that will need better clarification. Manufacturers are careful not to be overly explicit with claims for precisely what health benefits are to be derived from the drinks. To make specific claims would likely bring a closer scrutiny from the FDA or other governmental agencies and may lead to labeling challenges etc.
At the moment though, the population is continuing its trend toward an older age ratio, especially in Japan and Western Europe. As this segment of the world's population increases, so should the demand for health-based solutions with drinks and other functional products with specific health benefits.
The market may be poised for real growth. Another industry estimate defines the entire wellness and health drinks market as a US $41 billion business in 1999 and having grown to US $55 billion in 2005.
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