- COVID-19 has brought health and wellness to the forefront of many people’s minds, leading to an increase in demand for organic foods. The trend was not immediately apparent, but consumers are still interested in nourishing their bodies with natural products. They made health commitments that influenced their purchasing habits during the pandemic.
- Organic drinks are made using specific production criteria and do not contain any unnecessary additives. The organic label is only given to products in the United States that contain at least 95% organic-certified content. Organic and natural drinks are healthier alternatives to other beverages. They do not contain harmful ingredients like pesticides or GMO organisms. It’s not surprising that these drinks are becoming more popular with a growing health-conscious population.
Natural Food and Drinks Market Overview
- Natural and organic products are on the right track to steady growth. In 2021, the market grew 7.7% to $274 billion. Beverages are the second largest segment of the market after fruits and vegetables. Also, they are the fastest-growing category of functional products that target specific health concerns like hydration and energy.
- Although supermarkets and hypermarkets are the main distributors, convenience stores and online retailers significantly contribute to organic and natural drinks sales. Online purchases may play a significant role in this market. In 2021, e-commerce will increase by 50% to $23.5 billion. To gain market share, many emerging brands rely on non-traditional sales channels such as social media and online shopping.
- In this industry, many major beverage brands compete for market share. However, independent brands also have a place. Customers can choose from “clean” versions or new drinks with innovative claims of fame.
What is driving the growth of natural and organic drinks?
Increased public awareness about health and nutrition is the biggest driver for the industry. As part of a healthier diet, more people are drinking organic and natural beverages.
Many natural and organic beverages don’t place a high priority on their health benefits. However, drinks that are marketed around wellness will grow at 9% faster than the rest in 2022. Many consumers are taking a holistic view of their health. The health and wellbeing market is still booming. The “ecosystem of wellness” includes aspects like sleep, mindfulness and nutrition. Wellness-focused products perform exceptionally well and grow at a rate of over 5% per year.
This increased interest in wellness and health has led to a change in the definition of what is “healthy”. In 2016, “healthy” meant removing certain elements from your diet, such as sugars and fats. They are now focusing more on natural, unprocessed foods like fruits, vegetables and whole grains. People prefer to consume these nutrients through their diets rather than supplements. The idea that food can be used as medicine has led to brands including functional ingredients. Many brands use ingredients such as:
- CBD
- Collagen
- Adaptogens
- Nootropics
- Mushrooms
- “Super” greens
- Prebiotics and Probiotics
- HerbsMany brands have also seen success when they remove components such as added sugars or caffeine, animal products, alcohol, GMO ingredients, and animal-based products.
Sustainability and transparency are also important aspects of the natural and organic drinks sector. Customers want to buy ethically and know the origins of their food. There are more choices and peace of mind when you look at clean labels, organic certifications, and other industry credentials. These buyers are often attracted to items in this industry with initiatives that focus on sustainability and transparency.
Traceability of ingredients: Many customers want to know where their products are sourced, and they will buy them from companies that are transparent. Brands that use local ingredients, for example, can help reduce the environmental impact of long-distance transport and support small farmers. Buyers in the health and wellness market often appreciate these positive impacts.
Healthful production methods: Some organic and natural drinks promote production processes that are healthier for the environment or consumers. Plant milk, for example, comes in a variety of types that vary in the amount of land and water required and in greenhouse gas emissions produced during production.
Sustainability packaging: The beverage industry is no exception. Natural and organic brands are “green”, which is what most buyers look for. The U.S. consumer is willing to pay more and purchase more sustainable packaged products as long as they are easily available and clearly labelled.
Ethical practices According to research, consumers are willing to use their purchasing power to support products that adhere to ethical standards. Many buyers prefer brands that are committed to ethically treating people, animals, and the environment. Buyers may be looking for certifications and claims like “fair-trade,” “cage-free,” or “plant-based” on products.
Natural and Organic Beverages: The Future
This market is expected to continue its upward trend. The natural food and drink sector is predicted to grow at a rate of 11.44 % per year from 2022 to 2031, resulting in a market worth $361.3 billion by that time. Global organic beverages are even hotter, with a CAGR of 13% between 2023 and 2028.
Natural and organic beverages will have a stable future, as health and wellness are here to stay. The market will continue to be driven by awareness, but we expect other areas to grow.
The younger generations: Gen Z will have a greater interest in sustainability and ethical buying as they gain purchasing power.
Expansion of distribution: Currently, supermarkets are the dominant distributors of natural and organic drinks, but as their popularity increases, we will see them more in food service, convenience, and extreme value retail environments.
BevSource helps you navigate the organic and natural drink market.
The beverage industry is unique in the categories of natural and organic products. Work with beverage professionals to achieve success. BevSource’s experienced team can guide your brand from the development stage to post-production. We can offer you competitive pricing through our vast dealer network and provide extensive insight to help you make the right business decisions. We can help you overcome any roadblock, whether it’s a lack of time, knowledge or money.
BevSource offers a one-stop shop for all-natural, organic drinks. We have the resources and expertise to assist both established and new brands in the North American marketplace. Talk to an expert to find out how BevSource could help you build or launch your organic or natural drink brand.
