The rise of functional water

Cadbury Schweppes, one of the world's largest beverage and confectionery producers, has this week become the latest multinational to link itself to the growing market for functional water products. Consumer health consciousness has led to a shift in demand within the soft drinks market to healthy alternatives over existing products like carbonated beverages. These concerns have driven a rapid increase in demand for enhanced water products. In Western Europe alone, functional water consumption rose to an estimated 273m litres in 2006 from just 30m litres in 2000, according to analyst group Zenith International. A growing number of the beverage industry's major players like Coca-Cola have expanded their presence into the segment. The group revealed it had recently acquired Energy Brands, known as Glaceau, and its fortified ranges like Vitaminwater, for $4.1bn. Though Glaceau will continue to operate as a separate business entity from Coca-Cola North America, it will make use of its new parent company's supply chain, marketing power and foodservice. It is not just health concerns which appear to be driving the market for more functional water brands, with companies looking towards skin care benefits as well. Kate Shapland has spent two years with her business partners developing the Sip brand of bottled water through her company Inside Out Beauty. With consumers already well aware of the importance of water in a diet, she told BeverageDaily.com that enhancing the product was allowing manufacturers to specifically target exclusive markets for their goods. "As we developed the project we realised that all soft drinks appear to be designed by men, and none are aimed at women,"​ she said. Shapland then created Sip, which contains 100 per cent natural ingredients like botanicals, vitamin C, and antioxidants like selenium, and claims maintain healthy skin. This, Shapland added, though not targeted exclusively for women, has allowed the company to move into more niche areas for beverage demand. "Not all women like water, with many reaching for coffee or Diet Coke before a glass"​, she said. However by offering an alternative beverage with both a novel taste and functionality, she believed customers are more likely to try a new product. With such a specific focus particularly aimed at markets that larger brands might "struggle"​ with, Shapland said that beverage groups would be able to compete within the market with new and innovative varieties of bottled water. Not all though are convinced that fortified mineral waters are the right step for healthier diets, with nutrionists maintaining that fresh food sources remain the best means of fulfilling the body's nutritional needs. "We get what we need from food and do not need the vitamins and minerals added to waters," said​ American Dietetic Association spokesperson Tara Gidus. "It is always best to try to meet your nutrient requirements with natural foods."​