6 Trends Driving the Probiotic Drinks Market

Trend #1: Single Shots and RTDs Gain Popularity
The probiotic drinks industry is rapidly expanding its use of single-shot and RTD formats, with a variety of new brands investing in these delivery systems.

Probiotic drinks manufacturer Hälsa, which specializes in a non-dairy oat-based probiotic beverage line, recently released an RTD oat-based yogurt drink to the American market.1 And last year, Farmhouse Culture’s innovative probiotic Gut Shots garnered the brand $6.5 million in Series D investment funding from the General Mills business development and venturing unit 301 INC.2

Chris Glab, cofounder of Wildbrine (Santa Rosa, CA), says that his company recently added two brand new probiotic shots to its product line. “We’re adding a beet dill shot and a smoky kale shot,” Glab says. “There’s definitely a push for ready-to-drink and one-shot products in the market. Probiotic drinks started off in natural food stores, but it’s now evolved into an industry with more products.”

Jim Tonkin, president and owner of consultancy Healthy Brand Builders (Scottsdale, AZ), agrees. Ready-to-drink probiotics are gaining shelf space in both specialty and general retail outlets, he says, and companies are creating new SKUs for the space.

“Most specialty stores have full reach-in refrigerators with five of the top-selling brands in them. This category has arrived, and it is a category,” he says. “People are getting into it, whether their whole brand is built around it or they just have three SKUs in play.”

Tonkin notes that while probiotic shots have traditionally done very well in Europe and Asia, the United States has been slow to the party. Now, though, shots and RTDs are gaining in market share.

References:

1. “Hälsa debuts 100% clean label oat yogurt drink.” BevNet. Published online March 2, 2018.

2. “Farmhouse Culture lands $6.5 million investment led by 301 INC to help fuel national expansion of probiotic-rich products.” BusinessWire. Published online March 8, 2017.

Photo from Wildbrine.

Trend #2: A Multifunctional Approach
Probiotic drinks, while typically seen as gut health supplements, are now incorporating other functional claims to meet changing market demands. Bella Tumini, brand manager for Suja Wellness (Oceanside, CA), says that Suja’s probiotic line includes not only pressed waters and vinegar juices, but also kombuchas that offer additional functional benefits beyond simple gut health support.

“It’s no secret that the probiotic beverage industry is having its moment,” Tumini says, “and a lot of beverage brands want to get in on the gut-health trend. Our kombuchas provide an added functional benefit by introducing adaptogenic herbs, which have been shown to help the body adapt to stress and restore balance.”

Tumini says that probiotic drinks often combine multiple functional ingredients, and that this push toward multifunctional formulations is driving category expansion in the kombucha and drinkable vinegar spaces.

Photo from Suja Wellness.

Trend #3: Appealing to Boomers and Millennials Alike
Probiotic beverages are generating appeal across generational lines, with both Baby Boomers and Millennial consumers adopting the drinks, albeit for different reasons.

Tonkin says that Millennial consumers are adopting probiotics in droves thanks to the power of word-of-mouth marketing. “The experimental Millennials love this stuff,” Tonkin says. “They’re a big portion of the buying population-brands simply have to pay attention to them. When they opt in, they tell their friends, and then their friends opt in, and suddenly you have a trend.”

Glab agrees. However, he also notes that it’s not just the power of the trend that’s driving Millennial consumers toward probiotics. “Millennials are among the chief consumers of these products,” Glab says, “and they’re very concerned about what they’re putting in their bodies. [My cofounder Rick Goldberg] and I are both close to 60, and when we were in our twenties we weren’t anywhere near as worried about our health as today’s 20-somethings are. It’s refreshing to see that people are worrying about what they’re putting into their bodies early on.”

Glab notes that aging Baby Boomers are also picking up probiotic drinks as a means of supporting and maintaining a healthy lifestyle. These older consumers may be adopting probiotics due to worries about staying healthy in old age, or simply as a lifestyle enhancer.

The common thread between the generations seems to be a concern around functionality. “A lot of consumers like the idea of balancing gut health,” Glab says. “We’ve heard people tell us, ‘We went out last night, we had a little too much wine, and one or two of those [Wildbrine] Live Shots kind of helped balance things.’”

Photo © iStockphoto.com/AdrianHillman

Trend #4: New Avenues for Flavor Companies
Tonkin says that the probiotic drinks space presents a great opportunity for flavor developers, one that will only grow as the probiotic market continues to thrive. Says Tonkin: “The more people open their minds to a specific kind of functional ingredient, the more the scientists get into the ball game. The folks that are responsible for flavor development and formulations have been asked to get into the probiotic space, because probiotics by themselves don’t taste very good. And if you can’t make something taste good, you’ll never win the game.”

Farmhouse Culture’s Director of Marketing Marc McCullagh says that his company strives to stay on the cutting edge of probiotics, with new flavors and product formats like sparkling punches opening up new flavor experience avenues.

“Sparkling fermented drinks are a great way to experiment for people who are just getting into probiotic-rich foods,” McCullagh says. “We recently added a sparkling fermented beet drink to our lineup to make it easier to get a dose of probiotics. It’s not a kombucha; it’s a drink made from a fermented beet base.”

McCullagh says that the company has also introduced a new snack food line as a means of adding other superfood benefits to probiotic products. Farmhouse Culture’s Kraut Krisps offer consumers a probiotic-rich tortilla chip style product made from sauerkraut.

For probiotic drinks, flavoring will be an essential future development, which means flavor companies will find a variety of new opportunities in probiotic drinks.

Photo from Farmhouse Culture. 

Trend #5: Fruit and Vegetable Juices Carve Out Market Share
Probiotic beverages have typically come in the form of drinkable yogurts, but now, probiotic-enriched fruit and vegetable juices are entering the market to compete with yogurt drinks, offering a new avenue for brands to innovate in.

While refrigerated drinkable yogurts still occupy a larger piece of the overall market, says SPINS Retail Reporting Analyst Kimberly Kawa (Chicago, IL), functional probiotic juices are seeing impressive growth. SPINS data shows a 76% year-over-year growth in sales of probiotic juice drinks from January 2017 to January 2018.

Kawa says that while yogurts are a mainstay, she expects the non-dairy probiotic drinks market to drive innovation. Says Kawa: “Functional juice beverages often contain more than just probiotics and dip into herbal ingredient trends, superfoods, and protein boosters. We’re also seeing probiotics enter the nutrient-enhanced water segment in a big way. Water products that contain probiotics report 99% growth over the year prior, reaching $3.1 million in annual sales. Refrigerated coconut waters with probiotics have been gaining traction as well.”

A representative for Tropicana/PepsiCo (Purchase, NY), says that functional juices have grown at twice the rate of total juice and juice drinks in recent years, and that the category is dynamic and evolving.

“Consumers are looking for different ways to incorporate probiotics into their diets,” the representative says. “There’s no shortage of new offerings and innovations that provide a functional benefit without compromising on taste.” The expansion of the probiotic drinks market has led Tropicana to introduce an additional flavor, Orchard Green, to its line of probiotic drinks.

Photo from Tropicana.

Trend #6: Consumer Education Remains a Challenge
Consumer education around probiotics still poses a significant hurdle for brands, and explaining the benefits of probiotics will be key to securing future market growth. For some brands, that could mean content marketing. For others, it could mean exhibitions and conferences.

Wildbrine recently attended the TED2018 conference in Vancouver, BC, Canada. Subtitled The Age of Amazement, TED2018 brought together leading minds in the fields of science, art, politics, and business to talk about the future of work, industry, technology, and globalization. Glab says that TED Conferences reached out to Wildbrine because TED found Wildbrine’s live shots and srirachas to be quite innovative.

Tonkin says that consumer education on probiotics is something he’s been addressing from the podium for years, and that growing the market in the future will require brands to start educating consumers around the benefits of probiotics. “Probiotics is coming into its own, but it still has a long way to go on consumer education,” he says. “We saw the same thing with antioxidant ingredients many years ago-consumers don’t understand the benefits. If you ask consumers to talk about what probiotic health means, you’ll notice they have a hard time explaining it. They know it’s something that’s supposed to be good for you, but they can’t explain what it is or how it works.”

Julie Smolyansky, CEO of Lifeway Foods (Morton Grove, IL), says that aside from basic consumer education around probiotic ingredients, the industry also needs to prioritize additional education around labeling practices. “We’re throwing around a lot of words in the industry,” she notes, “but we’re not doing a good enough job of explaining what those words mean. If you send a lot of non-dairy probiotic products into a lab, you’ll be shocked to find that they’re mostly dead. There’s a lot of snake oil on the market. We have standards around what words mean and how food is labeled, but we don’t have a regulator to police the industry.” Smolyansky contends that additional government regulations are required in order to guard the nutrition industry against false claims, and that the probiotics industry is in need of a Congressional hearing in order to build rules around what constitutes a probiotic.

Future growth, experts agree, will depend on better communicating the value of probiotics in tangible terms that consumers understand.

Photo © iStockphoto.com/exdez