Sugar-free beverages are the special category of beverages that uses artificial or natural sweeteners in place of sugar, thereby reducing the negative effects of sugar-sweetened beverages.
This category of beverages has especially been designed to keep track of the rising obese population coupled with the growing diabetic population. Sugar-free beverages have been proved by several studies to have a positive impact on weight management as well as the prevention of type 2 diabetes.
Thus, sugar-free drinks have become increasingly popular as a result of the growing health and wellness trend. Fruit and vegetable juices, soft drinks, energy drinks, dairy beverages, and other foods are among the products available, which also come in a variety of flavors, including gluten-free, organic, and more. Consumer preferences have shifted as a result of rising concerns about obesity and diabetes.
Rising concerns related to sugar-sweetened beverages is driving the market
The rising prevalence of the obese population is becoming a global concern, which has resulted in increased demand for sugar-free beverages. According to CDC National Centre for Health Statistics estimates, during the year 2017-2018, the prevalence of obesity was 42.2%, which lead to an increase in cases of heart strokes.
Thus, sugar-free beverages are being considered as an effective step towards reduction in the obese population. This drink contains artificial sweeteners which are 600 times sweeter than the traditional sugar and hence used in small quantities which low-calorie content. Since more people are inclined towards a calorie deficit diet, it boosts the market demand.
A widening spectrum of beverages can be an opportunity for the market. The introduction of different flavored energy drinks, fruit and vegetable juices are likely to gain consumers’ interest.
North America is leading in the global sugar-free market as the United States and Canada are focusing more on reducing sugar consumption
North America has evolved as the largest market for sugar-free beverages accounting for nearly XX% of the global sales revenue in 2020. The rising prevalence of obesity and the diabetic population in the country has resulted in people shifting towards a sugar-free lifestyle. Moreover, the steps taken by the United States and Canadian government towards increasing taxation on sugary beverages have further helped the growth of the sugar-free beverages market.
The United States has imposed soft drink taxes in four cities of California, keeping track of overconsumption of soft drinks in these cities., which has encouraged manufacturers to reformulate their product lineups in favor of sugar-free drinks. Energy drinks are the fastest-growing in the sugar-free beverage category which is getting popular among millennials with 61% of the population consuming these beverages.
The global sugar-free beverages market is highly fragmented with a large number of beverages companies introducing new product lineups containing zero sugar.
Some of the key players in the market include Hershey Company, Kellogg, Nestle, PepsiCo, and Mars Incorporated. The market competition is intensifying as manufacturers are strategizing their gameplay based on consumers' increased demand for reduced sugar contents in their beverages.
Consumers are very concerned about the health characteristics of their food, and of environmental and social impact, now more than ever. Owing to this, the major market players are coming up with new ideas to tackle the arising concerns to justify their supremacy.
For instance, Nestle S.A introduced a KitKat bar that distills its sweet flavor from a cocoa fruit without any added refined sugar. Nestle is converting the cocoa pulp into a powder and adding it to chocolate as a sweetener. In Jan 2020, PepsiCo’s Mtn Dew brand added a sugar-free variant to its existing carbonated soft drinks in the U.S.