Six Trends Driving the Sports Drinks Market

Nov 5, 2015
  • Sports performance products come in many forms: bars, powders, ready-to-drink formulas, and sports drinks. Among these, sports drinks such as Gatorade, which focus mainly on rehydration and recovery, and ready-to-drink (RTD) versions of powdered mix-in supplements are currently the most dynamic in the market, with sports drinks leading the entire Nutritional and Performance Drinks category, according to reports from market research firm Mintel. But across all segments of the sports nutrition market, a few other trends are also evident.

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  • First, Sprinting Demand for Sports Drinks

    Sales of all nutritional and performance drinks grew by 42% in the United States from 2009–2014 (29% when adjusted for inflation), according to Mintel’s January 2015 report on the market, with sports drinks in particular leading the way. (Mintel groups nutritional drinks—those offering nutrition and convenience and that fill a specific nutritional need—together with sports and performance drinks.)

    The sports drink segment “benefits from a high perception of good flavor, affordability, and an interest in the products among general consumers, including non-athletes,” the report states.

    A full 60% of U.S. adults consume sports drinks, Mintel reports, and not all of these consumers are athletes. This “broadening of usage occasion” will be important to the category in general, the firm adds, feeding trends such as blurring boundaries between hydration beverages (which are marketed to a broad swath of the population) and sports drinks, which have historically targeted athletes.

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  • Clean Label and Label Transparency

    Following today’s demand for clean label, sports nutrition companies are placing renewed focus on transparency regarding what ingredients the products contain. “A lot of brands are moving away from proprietary blends of ingredients toward what I call ‘open label,’” says Chris Schmidt at Euromonitor.

    Lu Ann Williams of Innova Market Insights points to chia and beetroot as two ingredients perceived as very healthful that are now being used in sports nutrition powders, and she adds that organic protein ingredients are currently trending in this market, too.

    Orgain’s new Organic Hydration powders, launched in June 2015, capitalizes on current demands for “clean” ingredients, transparent labeling, and organic protein sources. The company calls the powders the “first-ever USDA Organic hydration powder.” The products are made with organic coconut water; no synthetic vitamins or minerals; organic, food-based B vitamins; and plant-based, gluten-free, soy-free, non-GMO ingredients.

    Photo from Orgain

  • Sports Nutrition Powders Now on the Go in RTDs

    “A number of sports nutrition companies have been encroaching on the sports- and energy-drink market with new RTD products” that are reformulations of existing mixable powder-supplement products, says Euromonitor’s Schmidt. This trend, Schmidt adds, began a few years ago with the launch of VPX’s Bang360 energy drink/pre-workout RTD product.

    More recently, such companies as Optimum Nutrition and Nutrabolt/Cellucor have launched RTD versions of their intra- or pre-workout formulas, and MusclePharm is “rumored to be launching an RTD version of its Amino 1 intraworkout product later this year,” Schmidt says. “These launches are unique and innovative in that they go beyond the traditional hydration claims of energy drinks like Gatorade and Powerade with their energy-boosting and muscle breakdown–protection ingredients,” he adds.

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  • Powder Products Still Strong

    But do not take this to mean that powder products aren’t doing well; these are also still going strong, and according to some, the powder market is seeing resurging interest.

    At the recent SupplySide West trade show in October, Dupont Nutrition & Health (St. Louis) cited Euromonitor estimates predicting that the global market for protein supplement powders will garner $2.7 billion in 2015 alone, up 11.3% compared to 2014. The larger sports nutrition powder category is expected to grow to $7.7 billion, up 10.4% compared to 2014.

    “If you look back three or four years ago, or even about five years ago, the powder market wasn’t growing as rapidly as it is now,” said Greg Paul, PhD, marketing director, global consumer segments, Dupont Nutrition & Health. “It was more of a mature industry, and things like the bars and the ready-to-drink beverages and more convenient ones were growing faster. But in the last five years, there’s been a rejuvenation of that powder category, with people looking to get more protein in their diet and looking to supplement protein every day into their diet. That’s typically how powdered beverages are consumed.”

    To meet this demand, Dupont launched its newest quick-dissolve soy protein powder, Supro XT 221D, which disperses in liquid in just nine seconds—faster than any other isolated soy protein powder on the market today, the company says, noting that typically a good-dissolving powder will disperse in 25 seconds, and an average powder will do so within 35–40 seconds.

    Minerals supplier Albion Human Nutrition (Clearfield, UT) is also looking to take its ingredients to powders. The firm debuted powder versions of its magnesium ingredients at SupplySide West: 1) for energy, a magnesium lysinate glycinate (MLG) powdered drink, and 2) for sports recovery, a magnesium glycinate glutamine (MGG) powdered drink.

    Magnesium’s profile in the sports nutrition market is growing because it is intrinsically involved in ATP formation and, thus, sports performance, the firm said. The lysine bound to magnesium in MLG has been shown to help increase muscle synthesis, while the glutamine in MGG helps promote the formation of glycogens and muscle tissue and fight muscle breakdown.

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  • Healthy Energy

    Formulators looking to provide an energy boost, but with healthier ingredients, are turning to proven alternatives. Take Driv, a new energy recovery and endurance drink mix powder from Fanda Labs.

    Instead of caffeine, which the company says “can be dehydrating,” Driv features 2 g of Bioenergy Ribose, an ingredient marketed as “a game-changer for the athlete in all of us,” says Bioenergy Life Science’s (Ham Lake, MN) regional director Marianne McDonagh. “This product is all natural with no added sugar or artificial flavors or sweeteners,” she adds.

    Fanda Labs describes Bioenergy Ribose as “a natural, clinically proven 5-carbon sugar that your body uses to make adenosine triphosphate (ATP). ATP is the source of all cellular energy.” In evidence within Driv’s marketing message is the trend toward less-extreme or even non-athletes consuming sports nutrition beverages, as well as a focus on “clean” ingredients and transparent labeling.

    Brands are “changing in the way they formulate and market their products,” adds McDonagh. They are “stepping away from the commonly used ingredients and incorporating all-natural, scientifically proven, FDA GRAS-affirmed ingredients that are proven effective. Consumers today are much more aware of what they are putting into their bodies and research the source of these ingredients and the science behind them.”

    With healthy energy in mind, Novel Ingredients (East Hanover, NJ) highlighted its new Kinetiq ingredient at SupplySide West. As an improved version of the company’s previous Advantra Z Citrus aurantium thermogenic ingredient, Kinetiq contains several naturally occurring bioflavanoids which, when combined with Citrus aurantium, showed in a recent study a significant increase in resting metabolic rate of 183 kilocalories over a 24-hour period, according to Jeff Avila, vice president of marketing.

    Avila said that today’s sports nutrition consumers are increasingly looking for “stimulant-free” energy, something that Kinetiq provides without increasing heart rate, blood pressure, or affecting the central nervous system or causing “jitters.”

    “If I were to really talk about growth, I mean, thermogenics and weight management are always there, but I think in terms of sort of a changing trend, I’d say the focus is more around stimulant-free energy,” Avila added.

    Photo from Fanda Labs

  • Closer to Food

    Look for sports nutrition products to become more closely aligned with the overall food market in general. At a conference at SupplySide West, David Sprinkle, research director of Packaged Facts, spoke about how these two markets are converging. As an easy example, he said, more food marketers are looking to boost protein content, such as with Quaker’s Protein Baked Bars.

    But sports nutrition marketers are also borrowing from the food industry, including finding flavors outside of classic sports nutrition flavors that will help this category appeal mainstream. Sports marketers are introducing fruity notes like the strawberries-and-cream version of CytoSport’s Muscle Milk. Sprinkle also pointed to products like Clif Organic Energy Food Pizza Margherita energy gel.

    PepsiCo’s popular Gatorade G Series Lime Cucumber beverage exemplifies the market trend toward more “natural,” botanical flavors, Innova Market Insights’ Lu Ann Williams adds. “The incorporation of these types of ingredients conveys naturalness and wellness,” she says.

    Look for boundaries to blur further between sports nutrition and general food, Sprinkle concluded. “We can see that sports nutrition increasingly fits in the mainstream market overall, because, after all, nutrition is nutrition.”

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