Coconut water tipped to redefine sports drink market

By Guy Montague-Jones

- Last updated on GMT

Related tags: Coconut water, Drink, Beverages, Alcoholic beverage, Pepsico

A new market report predicts that coconut water is set to redefine the sports drinks market after Coca-Cola and PepsiCo both put their weight behind the new niche last year.

The sports drinks market in the US has gone through a difficult year with the recession taking a 12.3 per cent slice out of volumes, according to new data from the Beverage Marketing Corporation (BMC).

But one bright spark within the sports drink fold is coconut water. New Nutrition Business ​has just published a report hailing coconut water as “the fast-growing new category”, ​with retail sales already above $450m worldwide.

Natural sports

What makes coconut water interesting for brand owners is that it offers many of the same isotonic benefits as formulated sports drinks but in an all-natural form. No additions are necessary, not even sweetener.

The drink offers calcium, magnesium, and potassium to the sports enthusiast with the need for fortification.

Coconut water is also described as being “hypo-allergenic” which means that it causes few or no allergic reactions.

New Nutrition Business​ said these benefits have been seized upon by start-up companies in Germany, the US and elsewhere, who are using new processing technologies and new brands to grow coconut water sales quickly and command premium prices.

Investments

This has not gone unnoticed in the beverage industry. New Nutrition Business ​said Coca-Cola, PepsiCo, Europe’s biggest brewing families and even Madonna have invested in coconut water.

Last year, PepsiCo acquired Ajaccio, a Brazilian maker of coconut water, while Coca-Cola took a minority stake in Zico Beverages.

Marketers will be paying close attention to how these investments pan out over the next year or so. Up until now, coconut water has only made inroads in the US market and to a lesser extent, the UK and German markets.

Related topics: Markets

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