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    Features

    A Deep Well for Hydration, Complex Flavors, and Health Ingredients

    Bottled waters today can help consumers maintain their physical and mental health, one sip at a time.

    A Deep Well for Hydration, Complex Flavors, and Health Ingredients
    ¡Cactus! Organic Cactus Water is produced from cactus leaf rather than prickly pear. It is available in lime, papaya, and watermelon flavors.
    By Christine Esposito, Managing Editor, Happi09.01.22
    The shift away from sugary beverages has been in the works for years. Consumers continue to shun soda and artificially-sweetened drinks, opting to quench their thirst with a widening array of bottled waters. There is a steady stream of new carbonated and flat waters with sophisticated flavors and functional ingredients that provide physical and mental health benefits beyond basic hydration.

    The global flavored water market is expected to rise from $23.44 billion in 2021 to $25.38 billion this year. And thanks to a forecasted compound annual growth rate (CAGR) of 8.3%, the sector may be worth nearly $35 billion by 2026, according to The Business Research Company.

    In the U.S., bottled water sales rose 12.7% to $22.5 billion in multi-outlets with c-stores, according to recent data from Information Resources, Inc. Non-flavored still and flavored still dollar sales rose at nearly identical rates of 15.3% and 15.2%, respectively (see Figure 1).

    Competing for share of this growing pie are the biggest names in the beverage space—PepsiCo, The Coca-Cola Company, and Keurig Dr Pepper—as well as established private players like Hint and Spindrift. Meanwhile, startups and indies are putting their own spin on H20.

    In this increasingly more crowded marketplace, brands must keep consumers’ attention through innovative product development and slick marketing.

    Flooding the Market

    National Beverage Corp., the maker of LaCroix, recently recorded its highest net sales ever—$1.14 billion, an increase of 6.1%. Company officials noted that volume gains came despite what they said was excessive discounting by various competitors.

    One way that LaCroix stays ahead of the pack is through flavor expansion. In 2021, the company introduced Beach Plum, Black Razzberry, and Guava São Paulo. More recently, LaCroix rolled out Cherry Blossom. The launch was supported by social and outdoor media, spot radio, consumer sampling, and retail in-store displays as well as an appearance at the National Cherry Blossom Festival in Washington D.C.

    Waterloo Sparkling Water, which recently launched a creative campaign called “Water Down Nothing” said it has recorded significant distribution gains. It now has national authorization in all Safeway Albertson stores, including Vons and Jewel-Osco, as well as increased distribution at leading national retailers like Target, Kroger, Costco, Walmart, and Walgreens and regional retailers including HEB, Harris Teeter, and Hy-Vee.



    “The momentum behind Waterloo, with sales growth five times the category rate in 2022 and our continued distribution growth, is proof of consumers demanding sparkling waters that deliver a unique, full-out flavor experience and of retailers seeking differentiated products like ours that drive category growth,” said Jason Shiver, Waterloo CEO.

    Waterloo expanded its flavor options as well, with seasonal varieties like Cherry Limeade and Blackberry Lemonade which, like the rest of its lineup, are made with non-GMO Project Verified natural flavors and purified carbonated water.

    An island vacation was the inspiration for its most recent flavor, Passion Fruit. According to Adam Price, senior vice president of operations and flavor development lead, Waterloo’s team worked over the course of 10 months to develop the limited edition flavor, which was available at retailers nationwide including Whole Foods, HEB, Central Market, select Costcos, and Hy-Vee, through the summer only.

    According to Price, flavor authenticity is what drives people to drink Waterloo, but the Austin-TX based company said it also focuses on aroma, mouthfeel, and carbonation, too.

    Liquids & Lifestyles

    In June, Albertsons Companies relaunched its Soleil Sparkling Water. Made with carbonated water and natural flavors (but no added sugars, sweeteners, or sodium) Soleil comes in 15 different flavors—original, blood orange, peach, pineapple, tangerine, watermelon, raspberry lime, mango, lemon, lime, grapefruit, berry, cranberry raspberry, black cherry, and cucumber melon. The refresh included new packaging with updated artwork and a marketing campaign that leveraged TikTok and Spotify. Albertsons tapped some of TikTok’s most creative names—including Sam Myerson, Sharlize True, Yai Ariza, Bree Kish, The Griffin Brothers, Chase Del Rosario, and others—to reintroduce Soleil on a national scale. The product line is available nationwide exclusively at Albertsons stores including Safeway, Jewel-Osco, Acme, and Shaw’s.

    The Coca-Cola Company is also leveraging the celebrity world as its Vitaminwater range has teamed up with Lil Nas X. The latest in the pair’s “Nourish Every You” campaign puts the spotlight on Vitaminwater Shine, its zero-sugar, nutrient-enhanced water beverage that contains biotin and vitamins A, B5, B6, and B12.

    Core Hydration, a Frisco, TX-based premium water brand that is part of Keurig Dr Pepper, tapped Golden Globe- and Academy Award-nominated actor and multi-platinum recording artist Hailee Steinfeld as its brand ambassador. Steinfeld is featured in the brand’s new “Find Your Core” campaign.

    “Hailee truly understands the importance of staying balanced and hydrated during her busiest of days to ensure she’s maintaining her mental and physical health and wellness. Hailee is on a mission to raise awareness about the importance of finding balance, making her an ideal ambassador for Core,” said Kelli Freeman, vice president, brand marketing at Core Hydration.

    Flow Beverage Corp. this summer signed an accord that makes its Flow Alkaline Spring Water the official water of Norwegian Cruise Line (NCL).

    “We are delighted to be partnering with a world class organization like NCL. Increasing our presence in the food service sector is one of the key growth pillars we identified in our strategic framework,” said Flow’s CEO Nicholas Reichenbach. NCL operates a fleet of 28 ships under the Norwegian Cruise Line, Oceania Cruises, and Regent Seven Seas Cruises brands. Specifics of the accord were not revealed at press time.

    More recently, Flow Beverage Corp. added three new organic flavors to its Flow Vitamin-Infused Water—Cherry, Citrus, and Elderberry. Flow contends its vitamin-infused water products are a healthier alternative to similar products in the functional water category; the beverages contain 120% of the daily recommended value of vitamin C and are an excellent source of zinc.

    Marketing is a big part of the strategy at Liquid Death Mountain Water, too. This brand has been gaining traction with customers and investors since its launch in 2019. The Santa Monica, CA-based company raised $75 million in Series C funding and expanded its roster with new flavored options Berry It Alive, Severed Lime, and Mango Chainsaw.

    Purposeful Pours

    Beyond new flavors, functional waters that provide benefits beyond hydration are also rising in number. The category is expected to post a CAGR of 7.78% between 2020 and 2025, according to Technavio.

    One recent entrant is Nirvana HMB + Vitamin D3, a spring water that Nirvana Water Sciences Corp. unveiled at Natural Products Expo West this year. The functional beverage mixes muscle recovery with immunity and is the first and only water infused with evidence-based muscle recovery and immunity benefits, according to the company.

    The new water expands on Nirvana HMB spring water, which is infused with myHMB Clear, a patented water-soluble form of βeta-hydroxy βeta-methylbutyrate (HMB) that is licensed exclusively to Nirvana. Known to help build lean muscle mass, increase strength, and improve muscle recovery, athletes have typically consumed HMB in supplement form. Nirvana Water Sciences contends research proves water is the best HMB delivery mechanism. Vitamin D3 has been shown to be essential for helping muscles reach their full functional potential. When combined with HMB, vitamin D3 optimizes the effectiveness of HMB, producing a powerful synergistic effect, according to the company.

    Naji Abumrad, MD, FACS, chairman of Nirvana’s scientific advisory board, calls it a “powerhouse combination,” and Elisandrix Matos, Nirvana’s marketing director, said the functional water is suited for everyone—from professional athletes to weekend warriors.

    At ¡Cactus! Organic Cactus Water, the point of differentiation is its USDA-certified organic nopal cactus leaf. When it is combined with water, the result is a light, clean, refreshing hydration source, excellent for the body in hot conditions or after an intense workout. The hydrocolloid in nopal cactus leaf binds to water and acts like a sponge; it is what gives the cactus the ability to absorb and retain water and micronutrients and survive in the scorching desert heat, said Founder Sarita Lopez, who contends her brand is one of “very few” cactus waters on the market that is produced from the cactus leaf rather than prickly pear.

    ¡Cactus!, which is available in lime, papaya, and watermelon flavors, is sold in regional grocery stores throughout the Southwest U.S. The Napa, CA-based brand has recently expanded its distribution nationwide with Amazon.

    R&D and Product Development

    Talking Rain, the company behind Sparkling Ice sparkling water, recently received a patent for a novel ingredient that is used to stabilize natural colors in beverages. The patent has been five years in the making, according to the Preston, WA-based company.

    Sparkling Ice’s beverages are housed in clear packaging that highlights the brand’s eye-catching flavors, but does little to shield the fluid inside from exposure to sunlight. When Talking Rain wanted to make a switch from artificial colors to colors from natural sources, the R&D team was tasked with developing a new formula that could withstand light so the product would retain the vibrant look throughout its entire shelf life and product lifecycle.

    “This led us to the discovery of the use of a novel ingredient, Indian gooseberry extract,” Rachel Montenegro, senior manager of technical advancement and one of the patent inventors, said in a statement. “Finding this ingredient to stabilize our natural colors from light degradation allowed us to become one of the first brands in our industry to successfully transition to using colors from natural sources, giving us a competitive advantage.”

    Indian gooseberry extract had been used in Sparkling Ice Coconut Pineapple since the brand transitioned to colors from natural sources in 2018.

    The patent (“Indian Gooseberry Extract as a Natural Color Stabilizer for Beverages”) was invented by Montenegro, Emma Last, Jagriti Sharma, Erik Throndsen, and Kraig Van Wieringen. It was submitted in 2018 and after rounds of amendments, the patent was issued on June 7, 2022.

    Talking Rain has been under the guidance of a new CEO since April (Ken Sylvia) and it also recently unveiled new dedicated lab space at its Preston campus.

    In June, The Alkaline Water Company Inc.—the country’s largest independent alkaline water company—began production of its Alkaline88 water at a co-packing plant Century Springs in Wauwatosa, WI—marking the first time that the pH 8.8 water is being produced in the Midwest region of the U.S. The new production capacity will help reduce the company’s costs and carbon footprint, said the Scottsdale, AZ-based company, which has Shaquille O’Neal as an advisory board member.

    Shaq is also brand ambassador for its other properties like Alkaline88 Plus Sport, a water that is infused with natural flavors, vitamins, and other dietary ingredients.

    In The Mood: CBD & Hard Waters

    There continues to be growth in the “elevated” water sector. These options go beyond basic hydration and great flavor, offering mental wellness benefits to consumers.

    PepsiCo’s Soulboost sparkling water beverage, for example, sells Lift Black Cherry Citrus and Lift Blueberry Pomegranate, which contain 200 mg of Panax ginseng to help support mental stamina, and Ease Strawberry Rose and Ease Blackberry Passionfruit, which are formulated with 200 mg L-theanine to help support relaxation.

    Spindrift is wading farther into the hard beverage market. Having made its foray into the category just over a year ago, it added new varieties of Spindrift Spiked sparkling waters including Grapefruit, Lemon, Blood Orange Tangerine, and Passion Orange Guava.

    The latter was a flavor that had been one the company wanted to make for years, according to Bill Creelman, Spindrift founder and CEO. It combines aromatic and complex passion fruit with a splash of sweet guava and a pop of orange for brightness.

    “Together, these fruits create a taste that is transportive. If there’s a flavor to make you fall in love with hard seltzer, it’s this one,” he said.

    CBD-enhanced waters are also populating the marketplace, which many see as an alternative to alcoholic beverages.

    Cannabis beverage sales in the U.S. topped $421 million in 2021—more than double 2019 figures—and the sector will double again to nearly $1 billion by 2025, according to forecasts from the Brightfield Group.

    Drink Recess Inc., New York, sells Recess sparkling water infused with hemp extract and adaptogens like L-theanine and lemon balm. Flavors include coconut lime, blood orange, blackcherry chai, peach ginger, pomegranate hibiscus, and limited edition “zero proof” margarita.

    Day One Sparkling CBD Water contains citrus zest and 20 mg of broad-spectrum THC-free CBD. Grapefruit, lemon, and lime flavors are available from the venture-backed beverage company which is based in Los Angeles and is the official CBD brand of USA Pickleball.

    At Sweet Reason, consumers can pick a sparkling water with 10 mg of CBD or the brand’s Evening Blends, which contain 30 mg and are meant to replicate the feeling and effect of alcohol, according to the brand.

    Bayou City Hemp, a Houston, TX-based hemp processing and extraction company, is now in the beverage market with a new CBD seltzer. Sold under its flagship brand name, Mixer Elixir Ranch Water seltzer is a zero-proof (non-alcoholic), zero-calorie, and zero-sugar sparkling water that contains 25 mg of hemp-derived CBD. Designed to be a ready-to-drink beverage or cocktail mixer, a nano-emulsion makes it easier for the body to absorb the CBD and feel the effects faster, according to Ben Meggs, co-founder and CEO. The seltzer has a crisp, citrus-lime taste and hints of agave.

    From sophisticated flavor combinations to doses of CBD, elevated waters are flowing freely in today’s beverage market.


    Using Olfactory Science To Enhance Water

    Air Up—a self-described “scent-flavored” hydration company that’s been selling in Europe since 2019—has recently entered the U.S. market. Founded by Tim Jäger, Lena Jüngst, Fabian Schlang, Jannis Koppitz, and Simon Nüesch, the team says it harnesses the power of German-engineering and design with breakthrough science that helps cut down on single-use plastic bottles of water.

    The company’s goal is to meet the needs of a parched America; Air Up contends 75% of Americans remain chronically dehydrated.

    Air Up’s refillable drinking system is said to transform the taste of plain water through retro nasal smell. The tongue is only responsible for a portion of one’s taste experience; the majority of taste comes from olfactory receptors where the brain interprets scents as flavor. By triggering the retro nasal effect, consumers sip plain water while the brain “tastes” flavor. The initial prototype was developed as part of a college thesis after finding that unhealthy cravings for sugar are connected to one’s perception of flavor, according to Lena Jüngst, a company co-founder.

    Air Up sells branded flavor pods with prices starting at $39.99 for a starter set that includes a bottle and a pack of three flavor pods. Consumers can also purchase any pack of three standalone flavor pods starting at $7.99. There are currently 10 flavors, from lemon and cucumber to more layered options like orangeade and mango-passion fruit.

    Available in Germany, Austria, France, Belgium, Italy, Netherlands, Sweden, Switzerland and the UK, Air Up recently tapped Christian Hauth to serve as co-CEO to help guide its expansion. To date, Air Up said it has more than 2 million customers and expanded its global staff to nearly 300.

    The company has raised upwards of €60 million in capital to-date, which has been used to accelerate expansion, extend its product portfolio, and establish production facility collaborations around the world. As of 2022, Air Up investors include PepsiCo Inc. and some high-profile names like Ashton Kutcher.

    “I was intrigued by the depth of research, science, and engineering that went into reimagining the hydration experience, and after trying it for myself, realized Air Up was onto something brilliant,” Kutcher said in a statement. “Now, with the brand coming to the U.S., I believe American consumers are going to love it.”
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