From protein coffee to CBD soda: How brands are cashing in on the functional beverage boom

Beverage brands are cashing in on the growing demand for functional drinks among younger, health-conscious consumers by introducing increasingly innovative offerings, including protein-boosted coffees and CBD-infused sodas.

The $160 billion global functional drinks market has become an increasingly lucrative category, encompassing multipurpose drinks that claim to promise taste and enjoyment alongside wellness benefits, as consumers look for convenient ways to meet their health targets.

"Functional beverages are beverages that are going to provide an outcome," Sally Lyons Wyatt, global executive vice president and chief advisor of consumer goods and food services at consumer insights firm Circana, told CNBC.

"Convenience is definitely one factor, but it is also this quest to live longer, healthier...do you want to drink a beverage that's just there, or do you want the beverage to work harder for you?"

Around 75% of millennials and 80% of Gen Zers consume functional beverages ranging from energy drinks, probiotic drinks, and vitamin-enhanced drinks, according to EY's most recent consumer beverage survey of over 2,500 adults in the U.S. and Brazil.

Over half of respondents said they're willing to pay more for drinks that support their health and wellness goals, EY found.

Additionally, Circana's 2026 beverage evolution report showed that nearly 64% of consumers sometimes choose to have a drink as a snack, and this jumped to 70% for 25-to-34-year-olds, signaling increased appetite for drinks as meal replacements.

Starbucks introduced protein coffees sold in its stores across the U.S., Canada, and Europe in the past year to capitalize on the frenzy for multipurpose wellness drinks — an expansion of its ready-to-drink protein coffees in supermarkets launched in 2024.

"Functional beverages are really prevalent now in all kinds of categories across food and beverage, and protein is probably the frontrunner of those," Starbucks' EMEA Group Manager of Beverage Development Sam Henderson told CNBC.

"We're selling [almost] as much protein cold foam as we do flat whites, and as you can imagine, flat whites are a phenomenally popular beverage, and protein is performing the same at the moment," he said.

The broader industry is also looking to tap into the market, with French food and beverage corporation Danone recently acquiring the Steven Bartlett-backed protein drinks maker Huel as part of a reportedly $1.15 billion deal. Huel offers nutritionally complete protein shakes as meal replacements.

Meanwhile, soda giants PepsiCo and Coca-Cola also hopped onto the trend. Coca-Cola launched its prebiotic soda brand Simply Pop early last year in the U.S., while Pepsi acquired a prebiotic soda startup Poppi in a $2 billion deal.

"I think our consumers — all consumers — are looking for products that give them functional benefits more than ever before. I think people are educated more than they ever have been on nutrition and what they're putting into their bodies," Henderson said.

As coffee chains, soda brands, and startups vie for a slice of the functional beverage market, many are charging a premium compared with traditional products.

Starbucks' in-store protein coffee prices range from around $5.75 to $6.75, while its protein-boosted milk and protein cold foam can be added to any drink for an additional $1 and $2, respectively. "They're absolutely a premium offering," Henderson said.

TRIP, a U.K.-based wellness drinks startup founded in 2019, sells beverages containing adaptogens and botanicals with ingredients ranging from CBD to magnesium.

A single TRIP drink can cost over £2.00 ($2.60) and is found in supermarkets across the U.K., as well as several U.S. retailers.

"TRIP is a premium product; it is not merchandised alongside traditional soda," TRIP co-founder Olivia Ferdi said to CNBC. "We don't make standard sodas; we formulate daily wellness solutions, which customers recognize."

Ferdi explained that six years ago, functional drinks were an emerging concept, but they're now a "fundamental consumer necessity" that people are willing to pay more for.

Additionally, sourcing key ingredients like magnesium, lion's mane, and ashwagandha — a medicinal herb believed to reduce stress — requires different standards than manufacturing traditional soda.

"Our consumers aren't just paying for refreshment; they are investing in a functional benefit that supports their mental clarity and daily baseline."

There's scepticism around how effective supplements and vitamins like magnesium and collagen actually are, experts and nutritionists previously told CNBC. They warned that supplements aren't closely regulated by the Food and Drug Administration in the U.S. and that consumers should aim to get essential nutrients from foods instead.

In fact, the U.K.'s Advertising Standards Authority (ASA) banned a TRIP advert for its Cucumber Mint, Mindful Blend Drink in 2025, ruling that it made misleading claims about the drink's health benefits. This included wrongly suggesting that the drink could reduce stress and anxiety, and included unauthorized nutrition and health claims.

TRIP declined to comment on the ASA ruling, but Ferdi told CNBC last week that TRIP's products are developed by a team that includes experts on nutrition, food science, and culinary innovation.

"We also work closely with specialist formulation partners, regulatory experts, and manufacturing partners throughout the development process to ensure our products meet the relevant standards in each market where we operate," she added.

Both Starbucks and TRIP said that Gen Z and millennials are driving demand for their functional products, with social media playing a role in broadening exposure.

TRIP, which became TikTok Shop U.K's No.1 drink brand in January 2025, utilized a "social first" strategy to tap into this younger consumer base.

"Social media has been a massive catalyst for this, transforming functional beverages into a status symbol," TRIP co-founder Ferdi said. "On platforms like TikTok and Instagram, choosing a drink that supports your mental baseline has become a lifestyle statement."

In fact, 72% of Gen Z look to social media for food and drink-focused wellness trends, according to 2025 data shared with CNBC by food & beverages analytics firm Datassentials.

"They're [young consumers] going to be driving the growth over the next five years, because they're coming into those high-earning years and that gives them more buying power," Circana's Lyons Wyatt explained.

"If they're going to pay for something, they want to get the most benefit out of it, and that is why you would see coffees with protein and other benefits probably outpacing some of those that might just be good old-fashioned traditional options," she added.