by The food and drink industry has come under enormous pressure in recent years as costs have increased, as a result of factors including climate change and geopolitical unrest. In addition, the cost of living crisis has hit consumers hard, tightening budgets and changing purchasing behaviors.
However, despite these challenges, activity in the mergers and acquisitions market has provided positive news for the food and beverage industry.
In addition, certain food and beverage trends have emerged and developed into unstoppable fads, bringing consumers and brands with them. But what is the biggest and biggest trend in the world of food and drink? Well, many would argue that it is wellness.
Consumers are embracing wellness in a way few could have predicted, even ten years ago. But its undeniable popularity has taken it to a global value of 5.61 trillion USD, according to the market insight firm, Statista. Furthermore, this figure is expected to rise to 8.47 trillion USD by 2027.
Looking more closely at this trend, we find many smaller trends within it. Gut health is one of the most recognized. Another sports nutrition, with a CAGR of 9.0% from 2019 and a projected value of 33 billion GBP by 2028. And this success is the result of a flurry of activity within the mergers and acquisitions market.
In fact, M&A activity in the EMEA sports nutrition sector has been particularly active, with eight significant deals so far in 2024, as the continued shift in consumer behavior towards health and wellness is driving market growth.
Why is sports nutrition so popular?
Interest in sports nutrition has been growing steadily within the fitness trend over the past decade. Once thought of as a hobby for gym enthusiasts, lifting weights while looking at themselves in the mirror has now firmly entered the mainstream, with people of all ages and sporting preferences choosing to refuel.
“Sports nutrition and drinks are surprisingly widely used despite their unique function of supporting sports and fitness,” says Emma Clifford, senior food and drink analyst at market insight firm Mintel. “As a result, sales are booming and at the heart of this strong performance is the growing appeal of these products beyond the small number of elite sportspeople and gym fans.”
But why have sports nutrition foods and drinks, often called functional foods and drinks, become popular with the casual consumer? The answer seems to lie in lifestyle.
“The category is attracting more ‘lifestyle’ users who see these products as compatible with a healthy, active lifestyle,” says Clifford. “The shift towards mainstream consumption is fueled by the increased availability and visibility of accessible snacks and drinks from sports nutrition brands.”
In addition, social media has a huge influence on consumer behaviours, with influencers setting trends and, quite literally, influencing their followers. In addition, the terms #fitness, #fitspo, #fitfam, and #fitgoals, now dominate social media as some of the most searched and posted types of content. This parallels the decline in alcohol consumption across Europe.
“There are clear trends from less healthy lifestyle products, for example alcohol consumption has been declining for quite some time,” Mark Lynch, partner at corporate finance advisory firm Oghma Partners, told FoodNavigator.
So what sports nutrition food and drinks are popular with consumers, driving market growth and attracting investment?
“Beverages, protein powders and more recently protein snack bars have helped drive growth in the sector so are attractive areas for buyers to look at,” says Lynch.
What are functional foods and drinks?
Functional foods and drinks are foods and drinks, which claim to have an additional function, by adding certain ingredients. These functions are generally related to promoting better health.
The term, functional food, can also apply to traits intentionally bred into edible plants, such as purple potatoes, that have been modified to increase anthocyanin.
What’s next for the sports nutrition trend?
While no one can predict the future, it’s a pretty safe bet to say that the sports nutrition trend is here to stay. But how will the sector develop?
The answer to this seems to be through development into other areas of food and drink, attracting consumers from different demographics to the current younger generations.
“The intersection of sports nutrition and senior nutrition is going to be an interesting area going forward – this is a promising area of focus,” says Oghma Partners’ Lynch.
The continued growth of the high protein foods and drinks trend is likely to be a major aspect of sports nutrition.
“The broad benefits of protein have been responsible for pushing it into the limelight in the context of healthy eating,” says Mintel’s Clifford. “These multiple positive associations mean that the use of high protein products is not limited to consumers with a single nutritional desire or need.”
In addition, continued market strength is likely to encourage further investment in sports nutrition products and brands.
“Looking forward, we expect relative valuations to remain healthy and a higher volume of larger deals as economic conditions continue to improve,” says Oghma Partners’ Lynch.
