If it feels like functional beverages like Plus Brand's Agua Plus are taking over grocery shelves, it's because they are. In 2016, for the first time ever, Americans drank more bottled water than they did carbonated soft drinks. That milestone was a stark marker of how consumer attitudes towards health have changed over the years. Yet bottled water's growth, while impressive, is modest relative to the rocket ship that is functional beverages.
Functional beverages are drinks with added ingredients or benefits such as dietary fibers, minerals, vitamins, probiotics, and/or added fruits. This includes enhanced fruit drinks, sports and energy drinks, as well as enhanced bottled water, like Plus Brand's Agua Plus. And by 2025, the functional beverage market is expected to reach 173 billion dollars at an annual growth rate of 7 percent.
This begs the question: What's driving the functional beverage revolution?
Plus Brand's Revolution of Awareness
As Plus Brand's founder and CEO, Chad Willis, explained in an interview with Progressive Grocer, modern consumers are more knowledgeable. They have a heightened sense of awareness as to what is in their beverages. Broadly speaking, this has driven a move towards bottled water as an alternative to potentially contaminated tap water or sugary drinks. But consumers' attitudes have taken another leap forward and that's driving functional beverage sales in particular.
That leap is a move toward drinks that aren't just healthy, but drinks that also solve a problem. In the case of Plus Brand, their core product is an alkaline water called Agua Plus. The main problem that Agua Plus solves is the high levels of acidity in traditional bottled water. Whereas traditional bottled water has a neutral pH level of 7, alkaline water generally has a pH of 8 or 9. In the case of Plus Brand, their water is bottled at a pH of 9+ after it goes through a 7-step purification process.
The lower pH level of traditional water means it is more acidic, which has potentially significant health implications. Two studies have indicated that alkaline water may improve blood flow and reduce acid reflux. And another study found that alkaline ionized water may improve health outcomes for people with high blood pressure.
Functional Beverage Sales Supercharged by Covid
Alkaline water is a big part of the functional beverage revolution, but it's only one part. And in many ways, it has benefited greatly from the increase in health awareness driven by Covid. While the functional beverage industry was seeing strong growth pre-pandemic, Covid helped spur it to new heights.
During the pandemic, more and more people became attracted to drinks with immune-boosting ingredients. These ingredients include ginger, turmeric, vitamin D, and more. And in that move to immunity-boosting drinks, consumers became more cognizant generally of what they were consuming. Having been exposed to beverages that could enhance immunity, they looked for other health benefits. Alkaline water, collagen drinks, and drinkable probiotics all joined immunity-boosters on the rising tide of health conscience.
The Leaders of the Functional Beverage Industry
Most consumers might leap to the conclusion that functional beverages are a bane to the big soda companies. But companies like Coca-Cola and PepsiCo sell the top two bottled water brands in the U.S., Aquafina, and Dasani. And on top of that, Coke and Pepsi are getting into the functional beverage game too. Pepsi owns Gatorade, Rockstar, Driftwell, and the kombucha brand, KeviTa. As recently as 2019 Coca-Cola invested $20 million in a kombucha drink and introduced an energy drink, Coca-Cola Energy.
Yet there's a sense that Coca-Cola and Pepsi can only go so far in the space of functional beverages. The industry is incredibly fragmented. Energy drinks and sports drinks, and drinks infused with Vitamin C, ginger, collagen, CBD, and probiotics, all appeal to various consumer subsets. And it's the small players in this industry that are nimble and innovative enough to meet this fragmented demand. A case in point is Plus Brand, an up-and-coming company making a splash with its Agua Plus alkaline water.
Plus Brand: Something We'd Give to Our Kids
As CEO Chad Willis explains, when people started to understand ingredients, he did as well. He'd look at a drink's ingredient label and without fail, he'd find a problem. He imagined that others did too. So Willis decided to make a drink of his own, one that he'd be happy to give to his kids. Those original values shone through in Agua Plus with its simple ingredient list.
Still, even with the values-driven approach of Plus Brand, it's hard to imagine making inroads against massive players like Coca-Cola. After all, many upstart brands that compete on quality against giant beverage brands have fallen before.
What makes Plus Brand unique, though, is the packaging technology they pair with their functional beverages. It's called All-Scratch! and it's a unique label on which customers can scratch their name. Developed to help consumers avoid the massive problem of bottle confusion, All-Scratch! helps eliminate the risk of picking up a germ or virus through an accidental sip of a water that isn't yours. This technology serves to set Agua Plus apart in another key area of consumer concern: sustainability.
By enabling drinkers to easily and conveniently label their Agua Plus, Plus Brand is eliminating waste caused by bottle confusion. The idea for this came when CEO Chad Willis brought a shipment of water to supply a large, multi-day family gathering. When he woke up after the first night, he grew increasingly frustrated walking around the house, seeing bottles everywhere. The worst part, he noticed, was that most of the bottles only had a couple of sips. Everyone kept discarding their bottles after getting them mixed up with each other.
Plus Brand Solving Problems... with Drinks and Packaging
Plus Brand's technology solves the big problem of bottle confusion with a seemingly simple solution. But a scratchable sticker on a water bottle is not nearly as easy to develop as one might think. Not only did Plus Brand need to make the label easily scratchable, it also had to be strong enough to be water, ice, and condensation proof. On top of that, the label had to be sun, heat, and friction-resistant. Despite all these constraints, Chad Willis, and COO and Co-founder, Adam Gauer, innovated until they had a solution.
Stories like these and the joint vision of entrepreneurs like Chad Willis and Adam Gauer show the scale of everyday problems functional beverages can solve.