The market research company said the European market for functional and flavoured waters rose 5 per cent to 3,600 million litres in 2008.
“Increasing public awareness about the benefits of hydration and mounting concerns over calories in other soft drinks have led to extensive innovation in flavoured and functional waters over the past few years,” said Zenith market intelligence director Gary Roethenbaugh.
“Scientific advances in tailoring functional ingredients to beverage-based applications have widened the opportunities for functional products.”
Zenith said advances in formulation have been coupled with improvements in marketing.
Demand is increasing for waters with simple and clear messaging on functional consumer benefits in such areas as fitness and weight management waters.
Functional water is the smaller partner in the functional – flavoured water duo but it is the faster growing category. The market share split was 84 – 16 per cent last year, with functional water advancing 1 per cent on 2007.
In geographic terms Eastern Europe is also the smaller and fastest growing region. Sales increased 8 per cent last year to 400 million litres and Zenith expects the majority of additional future demand to come from the region.
In Eastern Europe organic growth is expected to come through new product launches while in the West, repositioning, rebranding and continued investment in marketing will be catalyst for market expansion.