The push for more sustainability and transparency is driving innovation in functional beverages as consumers demand drinks that do more than “replenish and refresh.” They want a product that supports their individual health goals, fits their lifestyle, and delivers on taste, says Gilbert Verschelling, senior director of Innovation, Beverages at dsm-firmenich.

Formulators working on these beverages focus on the technical complexity behind delivering high consumer expectations, from sugar reduction to stability in low pH environments. In addition to hydration, these beverages offer extra health benefits, such as energy management, immunity, gut health, and help support mental well-being.

“The market is seeing a boom in the use of nutritional ingredients that help consumers tackle their biggest health concerns,” Verschelling tells Food Ingredients First.

“A key solution for manufacturers is leveraging energy-focused premixes, uniquely formulated to be rich in high-quality B vitamins and caffeine, as well as natural extracts such as guarana, green tea, and ginseng — all increasingly popular in the beverage industry thanks to their role in reducing fatigue and boosting energy levels.”

More widely, adaptogens, nootropics, and other botanicals like ashwagandha, lemon balm, and passionflower are also growing in prominence for benefits like stress relief, relaxation, and overall wellness, which consumers are “increasingly keen to tap into.”

Eyeing “harmonious tastes”

However, he notes that health benefits can’t come at the expense of great taste. This is especially important in reduced-sugar offerings, which continue to be a “hot topic” in the functional beverage space.

“Consumers are simultaneously focusing on reducing added sugars and avoiding artificial ingredients, particularly when it comes to better-for-you categories. While artificial sweeteners have historically been favored for their stability and lower cost, producers are now increasingly opting for the label-friendly appeal of plant-based sweeteners, such as stevia and monk fruit.”

He flags that manufacturers need to build a “satisfying level of sweetness” with clean label appeal, effectively mask distracting off-notes, and finesse mouthfeel to deliver a truly enjoyable experience from “first look to final sip.”

Since no- and low-sugar functional beverages have “historically tasted dull, flat and lifeless,” Verschelling believes they present a taste challenge. Creating a more vibrant drink usually requires more than a “one-ingredient swap.”

“First, it’s about rebuilding a satisfying sweetness with a clean label appeal. Our TastePrint sweetening range does this by offering single sweeteners, crafted blends, and all-in-one integrated solutions. Then we need to layer more interesting notes.”

“Here, our high-performance, receptor-based flavor technology TasteGem flavors help brighten a drink’s flavor, bridge taste gaps, and round out a harmonious taste. And finally, when a little finessing is needed, ModulaSense flavors come to the rescue, giving beverage manufacturers precise control over unwanted taste notes, timing, or texture issues,”.

Unlocking stable hues with fermentation

Vibrant, natural colors enhance the visual attractiveness of beverages and influence consumer perception and appeal, according to Innova Market Insights. However, formulating functional beverages that look “enticing” across a long shelf life isn’t easy, says Verschelling.

“Color stability is a particularly difficult challenge in functional beverages wher there is a low pH, exposure to light, and contact with oxygen, all of which create a harsh environment for sensitive ingredients. Natural colors, although popular among consumers, tend to fade over time, making it difficult to maintain visual appeal.”

“To tackle this, we’re actively working on enhancing the performance of nature-inspired colors in low-pH and clear beverages and improving light and heat stability. Our next-generation carotenoids, for example, offer superior stability in acidic conditions while delivering an intense orange hue.”

dsm-firmenich is also working on “nature-inspired color development,” through fermentation to unlock a broader range of clear, stable hues such as pink, red, orange, and yellow for ensuring long-lasting vibrancy in functional beverages. 

“We produce β-carotene through fermentation, allowing for large-scale production without the need for additional land use or reliance on seasonal harvests.” The company is also exploring innovation opportunities in creating betalains, nature-derived pigments traditionally found in beetroot, through fermentation. 

“By doing this, we can offer more environmentally responsible alternatives to conventional beetroot extracts. These pigments provide vibrant purple, red and yellow hues. Combined with their fast dissolution, they are ideal for powdered beverage applications.”

Scientists consider traditional methods of extracting betalains from red beets wasteful as their concentration in the root vegetable can be as low as 0.2% of its wet weight, prompting R&D to develop substitutes.

Fueling healthy and sustainable innovations

Verschelling believes the functional beverage market will grow significantly, reaching an estimated US$219 billion by 2028, with a CAGR of approximately 9%.  

“With so many functional drinks on the market, beverages that deliver targeted health benefits and are formulated with quality ingredients will have the best chance of standing out from the crowd.”

He expects energy drinks to remain in high demand, along with NPD in beverages with sustained energy without the crashes associated with caffeine spikes. Ingredients that support gut health, immunity, sleep, and mood will also continue to gain traction as consumers look for a wellness boost that “slots easily into their daily routines.”

“Clear and transparent communication surrounding beverage ingredients will also be critical in the years ahead, particularly when it comes to sourcing and processing. The clean label trend isn’t going away, and consumers will continue to demand ethically sourced, minimally processed ingredients, pushing brands to prioritize natural and sustainable solutions,” he concludes.