Functional Food and Beverages Market by Type (Bakery Products, Confectionery Products, Snacks, Energy Drinks, Sports Drinks), Application (Health & Wellness, Immunity, Clinical Nutrition, Cardio Health), Distribution Channel - Global Forecast to 2030

The Functional Food and Beverages Market is expected to reach $532.98 billion by 2030, at a CAGR of 8.9% during the forecast period of 2023 to 2030.

The increasing demand for healthy & nutrition-rich diets, rising demand for sports & performance drinks, growing innovation and new product developments, and changes in lifestyles and rising incidences of chronic diseases are the key factors driving the growth of the functional food and beverages market. Furthermore, the increased investment and expansions in the functional food and beverages industry and rapid growth in the retail sector are expected to offer significant opportunities for the players operating in this market.

Increasing Demand for Healthy & Nutrition-rich Diets to Drive the Growth of the Functional Food and Beverages Market

Consumers are becoming increasingly concerned about their health and paying more attention to their lifestyles and dietary habits. The global demand for healthy & nutrition-rich diets is rising with the growing world population. According to the Food and Agriculture Organization (FAO), in 2050, the global demand for food, particularly nutrient-rich, will be twice as compared to 2013.

In recent years, consumer awareness regarding health, nutrition-rich diets, calorie reduction, and food safety has grown globally, which is expected to transform the food & beverage sector and boost the growth of the functional food and beverages market. Furthermore, the incidence of type 2 diabetes has increased significantly in recent years and is expected to increase in the coming years. The rising incidence rate of diabetes is mainly attributed to the increasing number of people living sedentary lifestyles. According to the International Diabetes Federation (IDF), approximately 537 million adults (aged 20–79 years) across the globe had diabetes in 2021. The number is expected to reach 783 million by 2045, of which 541 million will be at increased risk of developing type 2 diabetes. Thus, the increasing cases of diabetes and increased consumer interest in nutrition and health are expected to boost the demand for healthy & nutrition-rich diets, subsequently driving the demand for functional food and beverages.

Moreover, the growing health-conscious population has boosted the demand for nutritional bars and beverages, increasing the sales of functional food and beverages. Consumers are increasingly spending on value-added food categories to maintain healthier lifestyles, boosting the sales of functional food and beverages. Increasing awareness among people regarding strengthening their immunity to prevent risks of infections has compelled them to maintain healthy lifestyles and adopt proper dietary habits. These factors are expected to drive the growth of this market across the globe.

 Click here to: Get Free Request Sample Copy of this report

Key Findings in the Functional Food and Beverages Market Study:

In 2023, the Functional Food Segment to Dominate the Functional Food and Beverages Market

Based on type, in 2023, the functional food segment is expected to account for the larger share of the functional food and beverages market. The large market share of this segment is attributed to the growing demand for nutritional & fortifying food products and rising awareness about the health benefits of consuming these products. Consumers are drawn to foods with functional ingredients to lower the risk of specific health concerns, such as obesity, weight loss, diabetes, and cardiovascular diseases, which contributes to the growth of this segment.

In 2023, the Health & Wellness Segment to Dominate the Functional Food and Beverages Market

Based on application, in 2023, the health & wellness segment is expected to account for the largest share of the functional food and beverages market. The large market share of this segment is attributed to the factors such as the increasing health consciousness among consumers and the growing demand for clean-label and non-GMO food products.

The E-commerce Segment to Witness Highest Demand During the Forecast Period

Based on distribution channel, in 2023, the E-commerce segment is projected to register the fastest growth in 2023–2030. The rapid growth of this segment is mainly driven by the growing preference for personalization, the convenience offered by E-commerce, the availability of greater discounts compared to offline stores, and a greater product selection experience.

Asia-Pacific: Fastest-growing Regional Market

Based on geography, in 2023, North America is expected to account for the largest share of the functional food and beverages market, followed by Europe, Asia-Pacific, Latin America, and the Middle East & Africa. The major market share of North America is attributed to the well-established food & beverage industry, high awareness of the health benefits of functional food and beverages, growing popularity of protein bars, shakes, and cookies among millennials as healthy snacking options, and high demand for nutritional products across the region.

However, the market in Asia-Pacific is slated to register the fastest growth during the forecast period. The growth of this regional market is driven by the rising awareness about the health benefits of functional food and beverages, increasing disposable incomes, rapid urbanization, the rising incidence rate of diabetes and obesity, the increasing adoption of low-carb and clean-label trends, the growing demand for sugar-free products, and the rising health wellness trends in the region.

Key Players

The report includes a competitive landscape based on an extensive assessment of the key growth strategies adopted by leading market participants in the functional food and beverages market between 2020 and 2023. The key players profiled in this functional food and beverages market study are The Coca-Cola Company (U.S.), Danone S.A. (France), Glanbia plc (Ireland), Hearthside Food Solutions LLC (U.S.), Mars, Incorporated (U.S.), Meiji Holdings Co., Ltd. (Japan), Nestlé S.A. (Switzerland), Raisio plc (Finland), Royal FrieslandCampina N.V. (Netherlands), The Kraft Heinz Company (U.S.), Arla Foods amba (Denmark), Amway Corporation (U.S.), PepsiCo, Inc. (U.S.), Kellogg Company (U.S.), and General Mills, Inc. (U.S.).

Scope of the Report:

Functional Food and Beverages Market, by Type

• Functional Foods
  • Bakery Products
  • Confectionery Products
  • Snacks
  • Dairy Products
  • Infant Food Products
  • Other Functional Foods
• Functional Beverages
  • Energy Drinks
  • Sports Drinks
  • Fortified Juices
  • Dairy-based Beverages
  • Other Functional Beverages

Functional Food and Beverages Market, by Application                               

• Health & Wellness
• Sports Nutrition
• Weight Management
• Immunity
• Digestive Health
• Clinical Nutrition
• Cardio Health
• Other Applications

Functional Food and Beverages Market, by Distribution Channel               

• Supermarkets & Hypermarkets
• Convenience Stores
• Specialty Stores
• E-commerce
• Other Distribution Channels

Functional Food and Beverages Market, by Geography

• North America
  • U.S.
  • Canada
• Europe
  • Germany
  • France
  • U.K.
  • Italy
  • Spain
  • Rest of Europe
• Asia-Pacific
  • China
  • Japan
  • India
  • Australia
  • South Korea
  • Rest of Asia-Pacific
• Latin America
  • Brazil
  • Mexico
  • Argentina
  • Rest of Latin America
• Middle East & Africa

Key Questions Answered in the Report: