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The Asia Pacific functional beverage market is the largest in the world, with more growth ahead as consumers seek out functional drinks for immunity, energy, and more during the pandemic. Here’s a look at the fastest-growing functional drinks for 2023—plus key opportunities for brands.
Asia Pacific (ASPAC) accounts for 40% of functional beverage sales globally, making it the leading market for functional beverages, according to Euromonitor data.1 The $74.5 billion ASPAC functional beverage market is forecast to grow by 5.4% from 2021 to 2026, reaching $97 billion.2
Yogurt beverages continue to be the top-selling functional beverage type in ASPAC, with sales of $27.2 billion in 2021.3 The immune health associations have made this a go-to wellness beverage during the COVID pandemic for many Asian consumers. Mintel reports 90% of consumers in China agree COVID has increased their awareness of the importance of immunity.4
| Functional Beverage Type | Sales in Billions (2021) |
|---|---|
| Yogurt beverages | $27.2 |
| Energy drinks | $15.6 |
| Dairy alternative beverages | $9.0 |
| Sports drinks | $6.3 |
| Functional juices | $5.9 |
| Sports protein RTD and meal replacements | $4.9 |
| Functional waters | $3.1 |
| Functional carbonates | $2.1 |
| Functional RTD coffees and teas | $0.4 |
Energy drinks, which make up the largest functional beverage category in regions such as North America, Europe, and Latin America, are the second most popular in Asia Pacific after yogurt beverages.5 Both yogurt beverages and energy drinks have high growth ahead in the ASPAC market, with a forecast CAGR of 7.0% between 2021 and 2026.6 Only the sports protein RTD and meal replacements category is growing faster (at 7.9%).7
ASPAC’s fastest-growing functional beverages (forecast from 2021 to 2026) are:
The rapidly growing functional protein beverage category is part of a larger trend in rising protein consumption in Asia Pacific. New food and beverage launches with high and added protein claims have been growing in China, for example, with dairy proteins the most popular proteins for fortification.
A growing interest in healthy lifestyles, along with increasing incomes, is contributing to ASPAC consumers' interest in protein to support general wellness. The single-serve, on-the-go format of meal replacements and sports protein RTDs makes them convenient ways to add protein to the diet. In addition, a greater awareness of the importance of regular exercise to health is influencing the use of functional protein beverages to support workouts.
Beverage companies can look to the recent successes of functional and “plus” dairy drinks in the ASPAC market for insights into which benefits are important to today’s consumers. These fortified and functional milks are showing up in markets from China to Japan to Vietnam, often in RTD formats and in a variety of flavors.
Of 2021’s ASPAC new product launches of milks with these types of claims, 25.8% are vitamin/mineral fortified, while 8.9% have high/added protein.9 For functional claims, these beverages address bone health (16.6%), energy (8.5%), brain and nervous system (6.0%), eye health (5.5%), immunity (5.0), and digestion (4.6%).10 Companies should be aware that too many artificial additives and too much sugar are the main consumption barriers for functional drinks.11
To develop functional beverages that will address the needs of ASPAC consumers, Glanbia Nutritionals' functional beverage ingredients—including our functional protein and custom premix solutions— can get you there. Contact us today to learn more.