Functional Content Drives the Functional Beverage Category
One look at the cold beverage vault in a convenience store or grocer and you don’t need to be a consumer goods expert to notice the influx of beverages calling out their added functionalities, such as electrolytes for hydration, adaptogens for brain health or fermentation for gut health.
Functional drinks are a major trend in beverages, expecting to become a $200 billion market in the next seven years, up from $110 billion three years ago. There is a bevy of brands driving the popularity of the products, and they’re proving the beverages to be a powerhouse trend in the CPG industry.
But to stand out in the growing, crowded product segment, how do brands get noticed by consumers? What is the functional ingredient? How does it compare against competing versions?
The brands that can deliver the right information using digital tactics and content will rise in popularity among consumers and further accelerate the exploding category.
Functional Beverages Make Headlines To highlight the rise of the category, a few brands have garnered attention over the last few years in the functional beverage market, especially in the hydration segment. Gatorade introduced Gatorlyte two years ago, and Liquid I.V. powder packets gained notoriety over the last few years through celebrity endorsements. Nuun, a popular plant-based hydration tablet brand among athletes, was recently acquired by Nestle.
As more companies join the category, information that explains how the products should be used and what they do for the body is incredibly important. This includes how consumers use the beverages, referring to a controversial WaterTok trend circulating on TikTok.
Brands need to produce content that better educates consumers about functional beverages. Now is the perfect time.
Content That Educates Gets Into Carts Brands have a huge opportunity to pull the right digital levers to educate consumers about their products. For some consumers, this may be the first time they’re hearing about functional beverages.
For example, a beverage that uses cardamom to improve digestive health and reduce cholesterol is likely going to need to call out that messaging. That beverage brand can comb through first-party data on a mobile shopping app, for example, to find consumers interested in low-cholesterol products. They can instantly serve that consumer shoppable content to get that cardamom product onto a mobile shopping list.
Shoppable content can be served to consumers based on diet trends or areas of interest in the ingredients themselves to find the right thirsty consumers. Products can be advertised with offers or shoppable action buttons to gain trial, explain how the functional ingredients are sourced, or highlight how the beverage improves a consumer’s daily life. Vitamins that support metabolism. Probiotics that help gut health. Botanical extracts that support sleep. All of these beverages have a story to tell and can be personalized inside shoppable content.
The shoppable ads save consumers time and energy in researching functional beverage benefits.
Digital Ads That Build Awareness For an example of how functional beverages can leverage digital tactics, Hydrant, an early hydration packet company, helped build awareness by delivering digital content on the benefits of its product. Hydrant created digital ads running on mobile shopping apps that touted its rapid hydration function and saw a bump in the product getting added to mobile shopping lists.
More specifically, the company reported that it saw a 96% incremental bump in shoppers adding the product to a list. These shoppers previously had not tried Hydrant. The product itself did the rest, as the company saw more than 30% of the consumers become repeat buyers.
The bottom line is that awareness works. Brands that find consumers interested in functional beverages, deliver meaningful content and an easier way to buy will gain trial and ultimately more loyal consumers in a fast-rising category. It’s a matter of making digital content functional for functional beverages.
About the Author: Molly McFarland, co-founder and chief revenue officer of AdAdapted offers a unique perspective being a woman in the tech start-up world. A native of Maine and graduate of Tulane, McFarland began her career as a marketing professional and has since grown into an impressive, innovative and charismatic founder of a fast-growing advertising platform. She brings expertise in the mobile advertising environment, add-to-list solutions and extensive knowledge on how to reach consumers in an ever-changing ad space.