Consumers Are On Board With the Functional Drink Revolution

New EY research shows consumers increasingly prioritizing clean ingredients, functional benefits and lower sugar in their beverage purchases

The functional-beverage boom is in full swing. A new survey from consulting firm Ernst & Young (EY) reveals a notable wellness-driven shift in how consumers are deciding what beverages to buy, as more people are purchasing based on ingredients, sugar content and functional benefits.

In a survey of 2,512 adults in the U.S. (1,511) and Brazil (1,001), from November 20 through December 11, 2025, over half (58%) of Americans said they are paying attention to ingredients when purchasing drinks.

That intentionality is reflected even further in spending habits, as 52% of U.S. consumers said they’re willing to pay more for beverages that support their health and wellness goals, while two-thirds (66%) are opting for lower sugar, lower calorie drinks.

“Our research shows a clear rise in intentional beverage consumption, with consumers paying closer attention to ingredients, prioritizing functional benefits tied to health and wellbeing and modifying behaviors, such as reducing sugar and alcohol intake,” said EY Americas beverage leader Sean Harapko. “These shifts signal a more informed and selective consumer, particularly among younger generations, who are reshaping demand and accelerating change across the beverage product landscape.”

Wellness is clearly driving people’s drink choices, especially in Brazil, where 75% consumers asserted that immune support was a top driver of their functional beverage purchasing.

One of the key benefits people look for is energy, and Gen Z is leading the way, unsurprisingly. More than half of Gen Z (53%) and almost half of Millennials (47%) are consuming energy drinks at least every two weeks compared with 34% overall.

“For beverage companies, the winners will be those that deliver clear benefits, build trust through transparency and meet consumers where decisions are increasingly made across apps, social channels and personalized, data-led experiences,” Holston added. “Brands must design for multiple definitions of wellness.”

As the functional-drink market takes off, major companies like Gatorade are getting in on the action, with the legacy brand recently unveiling its lower-sugar option to appeal to consumers seeking better-for-you, minimally processed drinks. Its new beverage has 75% less sugar than the brand’s classic Thirst Quencher drink and no artificial flavors, sweeteners or colors.

Gatorade is just the latest to join an industry filled with beverages promoting a variety of health benefits.

Kim Kardashian recently joined Update as a co-founder and collaborator, a brand that offers a paraxanthine-based formula that Update says allows for a more stable and controlled energy without the crash and jitters. Los Angeles-based Aqua Theon, meanwhile, just closed a $13 million seed round, including a $5 million extension for its algae-based functional beverage brand OoMee.