What Happens When Big CPG Launches Into a Nascent Functional CPG Category?

Every industry has its behemoths. In packaged non-alcoholic beverages, it’s really a head to head battle between The Coca-Cola Company and PepsiCo, but this isn’t a piece of content about the war between Red & Blue. It’s a piece of content about when any of the CPG industry behemoths enter a nascent functional category through internal product development of new offerings. Should this be seen as a net-positive or net-negative? 

The inspiration of this content came from the recent announcement that PepsiCo was launching a functional packaged beverage called Driftwell. This functional beverage would specifically be considered a relaxation beverage, which is a small segment in the overall functional water beverage category worth $2.97 billion in the U.S., that is anticipated to grow 5% this year. That small market size is what makes this launch so intriguing because it could have lasting implications on the nascent functional beverage category for years to come.