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Segmenting the protein beverage market — 5 key categories you should know

5 min read


(Photo: Flickr Creative Commons user Mike Mozart)

Protein has become a buzz word in the food and beverage industry. It’s up there with gluten-free, non-GMO and all natural. Consumers crave it and brands are launching new products and re-branding existing SKUs to feature the protein claim more prominently on the front label. There are a variety of forces driving the growth of this category, two of the most influential being the increased awareness of the benefits of protein for satiety, weight management and muscle health, and the busy on-the-go lifestyles that are creating a demand for convenient meal replacements, particularly among millennials. Protein is an ingredient that is relevant to (almost) all age groups and consumer segments, which is one of the reasons for its popularity and widespread application.

The company I work for develops beverages and flavors, and we first hear about many trends —  especially the more fringe ones — from the entrepreneurial companies we work with. Then, when we see the same trend filter into the private label projects, we know the trend is established. This has been the case in the world of protein beverages.

The market can be broken down into five key categories: legacy RTDs, performance beverages, breakfast beverages, recreational beverages and plant-based and alternative sources. It is possible to further segment each of these groups, but in order to provide a brief and simple understanding the following should suffice.

Legacy ready-to-drink (RTD) products are the traditional protein-forward products that have been around the longest. These are the adult nutrition products like Ensure, child nutrition products like PediaSure and weight management products such as Slim Fast. While this group tends to be the least innovative, it has seen a facelift as the protein gospel continues to spread. Some of the best examples of this modernization are new product offerings for children, such as Danon’s Danimals. Weight loss shakes have also seen a shakeup, as much in flavor variety as quantity of brands in the space.

Performance beverages are the sports nutrition protein products for athletes. The most popular protein source in this category is whey. It’s not surprising that this segment makes up the majority of the overall market share of protein products. This group is dominated by protein powder, but ready-to-drink products are a close second and are also undergoing significant annual growth. The products in this segment range from a straightforward brands such as Muscle Milk to very sophisticated and occasion specific powders for the most elite athlete.

Breakfast beverages are an emerging category with no clear market leader at the moment. They have a medium level of protein, about 10-12 grams per serving, and they are merchandized in the cereal aisle. The brands in this space seem to be trying to one-up each other with each brand adding an additional claim on top of its predecessor. For instance, Post went natural and now other brands are starting to make the other functional claims to further differentiate themselves from the competition.

Recreational beverages are RTD products targeted at the general population and contain about 20 grams of protein per bottle. This category speaks to the awareness of protein among mainstream consumers. Recreational protein beverages typically contain additional functional ingredients like juice, coconut water or caffeine and the protein claim is an additional point of differentiation. Some examples of products that represent this category are the Odwalla Protein Monster, Naked Protein Zone and the Coco Libre Protein. Each of these products is an extension to an existing product line, created to cash in on the popularity of protein.

Plant-based and alternative sources are exactly what their title describes. Protein containing products that are sourced from a diverse set of raw ingredients sourced from plants or other vegetarian sources. The protein source is typically a blend of soy and pea proteins, but can contain many other varied ingredients such as legumes, nuts, seeds or quinoa.

What is next for protein beverages? The category will continue to grow and we will see many new product rollouts in 2015 targeting specific consumer segments and new usage occasions. We will also see more innovation in terms of flavor profiles and protein-plus products with other functional benefits such as digestive health and weight loss. More plant based proteins are on the horizon as consumers continue to seek out more natural products.

 Laura Klibanow is the Marketing Director at Imbibe, a flavor and beverage development company in Niles, Ill. She is focused on monitoring flavor, ingredient and product trends in the food and beverage industry and provides valuable insights to brand owners to help them formulate and develop products for long-term success.


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