Are functional beverages the next big thing… or are they already?

I just read a fantastic summary from Informa Markets on momentum in the functional beverage market, standing at $92 billion with projections to hit $106.93 billion by 2026. Functional can mean a lot, from gut health, to blood pressure, to cholesterol management but the cognition and mood category represents one of the most compelling opportunities in the industry.

The Market Opportunity

The nootropics market alone is projected to hit $15.6 billion by 2028. The data reveals a market where Generation Z (65%) and millennials (62%) are actively seeking calming and relaxing claims, while functional soft drink purchases surged 108.8% across U.S. retail channels in 2024, outpacing all other functional beverage categories by significant margins.

t thats just the tip of the iceberg, the addressable market is staggering: over 1 billion people globally report regular stress and anxiety, while cognitive performance concerns affect professionals, students, and aging populations alike. We’re talking about a truly universal consumer need.

There are two different markets here, and they so far are very mixed up.

There is a growing consumer awareness about the negative effects of high-sugar, high-caffeine combinations. As negative health effects of high-sugar, high-caffeine formulations gain media attention, consumers are exercising greater caution when selecting energy beverages. Market response to alternative energy ingredients has been remarkable. According to SPINS, matcha sales in functional beverages for brain health had 393.6% growth, reaching $2,095,538 in 2024 compared to $424,562 in 2023. This surge demonstrates consumer appetite for clean energy alternatives that provide sustained focus without the negatives of caffeine. This could be termed Instant energy – and relates to fuelling and readiness different to that of mood.

The second area is that of calm, anxiety management alongside executive function, ability to think fast, accurately and reduce stress negative effects. These can be assessed using physician tools, patient reported outcome measures such as Hamilton Anxiety Rating , the Beck Depression Scale, PHQ9.

When we look at executive function, the favourites are Trail Making Test and the Stroop test, but the work in concussion management does open the door to larger batteries in work I carried out in schoolboy rugby.

The Science Behind the Shift

What separates today’s functional beverages from yesterday’s energy drinks is evidence-based formulation. Leading brands are leveraging ingredients with genuine clinical backing:

L-Theanine + Caffeine – This synergistic combination has been shown in multiple studies to improve attention and task-switching accuracy while reducing caffeine-induced jitters. Research demonstrates enhanced alpha wave brain activity, the signature of calm focus, but is this just trying to offset some of caffeines side effects?

Adaptogenic Botanicals – Ashwagandha, in particular, has demonstrated, among some mixed meta analysis, participants reporting improvements in stress and anxiety scores, but again there are improvements in so many areas with Ashwaganda is can be counterintuitive

Functional Mushrooms – Lion’s Mane has shown promise in supporting cognitive function through potential nerve growth factor stimulation, while Reishi is being studied for its calming properties, some of these cellular studies look at the neuroplasticty effect of BDNF – which is a mutifucntional secondary effect – noted to rise with high intensity exercise.

CBD & Minor Cannabinoids – Emerging research suggests CBD’s interaction with the endocannabinoid system may help regulate mood and stress responses, though regulatory frameworks continue to evolve, globally.

Peptides – New work on food grade peptides shows cortisol lowering abilities from Nuritas and subsequent changes in mood, and function and we will offer new data in 2025 on this alongside sleep.

Beyond Apps: The Shift Toward Neurochemical Solutions

Here’s what’s particularly fascinating: consumer behavior is revealing a growing sophistication in mental wellness approaches. While meditation apps like headspace and CALM continue to grow, there’s a parallel movement toward interventions that work at the neurochemical level.

The psychedelics market tells this story clearly. Psilocybin therapy is advancing through Phase 3 trials for treatment-resistant depression, with the psychedelic therapeutics market projected to reach $10.75 billion by 2027. Meanwhile, prescription options like esketamine (Spravato) for depression and the growing interest in microdosing reflect consumers seeking tangible neurological impact.

This creates a compelling middle ground for functional beverages. They sit between passive behavioral interventions (apps, meditation) and clinical pharmaceuticals—offering bioactive compounds with mood and cognitive effects, but in accessible, everyday formats without prescriptions or stigma. It’s neurochemistry made consumer-friendly.

The consumer insight is clear: people want solutions that do something at a biological level, not just guide their breathing.

We can look in the UK at TRIP has experienced remarkable growth and is now one of the UK’s most successful functional beverage brands, the 6th largest carbonated drinks company in the UK and the country’s largest privately owned carbonated drinks business . The brand commands 88% of the UK CBD drinks market share  and is stocked in over 30,000 UK shops – it’s the only drinks brand stocked across all 12 of the UK’s leading national retailers , including Sainsbury’s, Waitrose, M&S, Tesco, Boots, Superdrug, and Holland & Barrett.

The brand experienced explosive 522% growth in the 52 weeks to February 2023 , making it the UK’s fastest-growing soft drinks brand. Trip was revealed to be the fastest-growing food or drinks brand of the last 16 years  in an Alantra study. The company turned its UK operations profitable in 2024. Trip’s success is heavily driven by Gen Z consumers – 60% of Gen Z don’t drink alcohol , and Trip has become the #1 best-selling drink on TikTok  with tens of millions of views.

Interestingly, Trip has expanded beyond CBD with their Mindful Blend range (without CBD), which is now outselling their CBD-infused drinks in key retailers like Sainsbury’s, Waitrose and Tesco . This diversification may help them navigate ongoing UK regulatory uncertainty around CBD.

The Path Forward

We’re witnessing a fundamental shift from behavioral modification to biological optimization. Consumers don’t just want to meditate their way to better mental health—they want compounds that work with their neurochemistry. The brands that will win are those that combine credible science, premium experiences, and authentic wellness positioning while navigating the regulatory landscape thoughtfully.

The cognition and mood functional beverage space isn’t emerging, it’s erupting. And it’s positioned perfectly at the intersection of consumer demand for efficacy and accessibility.

What ingredients or approaches are you watching in this space?