^{Tectonic Shifts}
The end of beverages
(as we know it)

Thom Walton sees opportunity in the blurring
of traditional beverage categories

Words: Thom Walton
Images: Ricardo Rey

The Big Idea:

Traditional beverage categories are blurring as consumer purchase behavior is increasingly led by need state.

That opens new territory for beverage brands to compete with adjacent sectors including health, nutrition, lifestyle and experience.

Winning brands will focus less on what drinks are, and more on what they do and signal (and what format they come in).

Q: When is a beverage not a beverage?

A: When it does more than quench
your thirst.

The beverages industry has long been organized by clear categories. Tea, coffee, juice, water, soda. But in 2026, these categories are blurring faster than ever, as consumers increasingly choose beverages based not only on where they sit on the shelf, but also on the benefits they offer.

Standing in a grocery store or scanning a café menu, modern consumers are no longer just wondering “Will I like this?” They’re asking: “What will this do for me?”, “How will it make me feel?” and “What does it say about me?”
The blurring of categories is nothing new – what has changed is the speed, intensity and commercial significance of the shift.

And within change lies opportunity for brand owners and foodservice operators.

Beyond category lines
And just as traditional beverage categories blur in the minds of the consumer, so too do the boundaries between beverages and adjacent sectors. This means beverage brands are no longer competing only with other beverage brands; they are competing with food, supplements, pharmaceuticals, beauty and lifestyle brands for relevance, occasions and share of spend.

That creates risk in the form of a wider competitive set competing for the same moments, but, more importantly, it opens up a much bigger playing field.

For brands and operators willing to think beyond traditional category lines, the opportunity is significant. Here are four areas where that shift is creating new space for growth.

Opportunity #1 - Beverages as medicine.
“Food is medicine” is one of the oldest adages – and it’s one modern consumers increasingly adhere to. Whether it’s nootropics for mood and sleep, fiber for gut health, or for a range of purported health benefits, the beverage industry is buzzing with functionality.

Consumers increasingly choose beverages based not only on where they sit on the shelf, but also on the benefits they offer.”

This trend is building speed. According to Finlays’ consumer research, 58% of people in the US say they often or always look for functional benefits when choosing a beverage, while one in three say they’re very likely to purchase more functional beverages in the next 12 months [Finlays, 2026].

Meanwhile, according to Mintel, functionality is the third most sought after characteristic US consumers look for when buying a non-alcoholic beverage. And by 2030, functional beverages could be worth approximately $250bn globally [Euromonitor, 2026].

In short, consumers seeing beverages as medicine is a rich opportunity for beverage brands and operators to capture value that once sat firmly outside the category.

Opportunity #2 – Beverages as sustenance and nutrition
The blurring of beverage and adjacent categories also creates opportunities in terms of sustenance and nutrition.

Protein is perhaps the clearest example. Protein supplements were so in demand that this year there were fears over shortages. In the last five years, protein-enriched beverage launches in the US have grown by 12 percentage points [Mintel, 2026] and protein is increasingly showing up on beverage menu boards, for example Starbucks’ Protein Cold Foam.

Fiber is also having a moment. Our research shows that 36% of consumers want to increase their intake [Finlays, 2026] and it is showing up more in food and beverage as a result. Meanwhile, the low-sugar drinks market is expected to reach $7.3bn by 2030, growing 17% by the end of the decade [Euromonitor, 2026]. And of course, beverages are increasingly being reformulated to cater for GLP-1 appetites.

Linked to this, growth in the nutritional drinks segment — which Mintel forecasts to reach $10.13bn by 2030 — is another key battle ground.

For brands and operators willing to think beyond traditional category lines, the opportunity is significant.”

What will most influence consumers’ beverage choices in 2027 and beyond?

How the drink makes them feel
What the drink does for their health
What the drink signals about identity or values
Novelty, theatre and experience
Convenience and format flexibility

11% of US consumers rank “a good replacement for a meal or snack” among their top three reasons for choosing a beverage [Finlays, 2026]. Ultimately, consumers increasingly want beverages that can satisfy and support specific nutrition goals, creating the opportunity to compete for occasions typically owned by snacks, supplements and even full meals.

Opportunity #3 – Beverages as
personal identity
Driven by social media and celebrity, consumers increasingly see what they buy as an expression of their personal identity. This holds true for beverages too. Research reveals that 61% of US consumers choose beverages that are reflective of their personal identity or values. And this is particularly pronounced amongst millennial consumers where 75% choose brands that say something about them [Finlays, 2026].

This shift is already manifesting in several ways. Some beverages signal aspiration through celebrity association or premium cues. Others communicate values, whether that is sustainability, ethical sourcing or wellness. Still others act as aesthetic or cultural markers: The matcha order, the functional soda, the LTO all say something about taste, lifestyle and belonging. Social media amplifies all of this, turning beverages into visible signals of who consumers are.

As a result, beverages are no longer competing only with other drinks, but with fashion, beauty and lifestyle brands for cultural relevance and share of spend. The advantage beverages have is accessibility.

Not everyone can afford the latest fashion drop, but many can justify an $8 beverage that’s trending on Instagram. A recent example of this is Chagee Tea and its Dior-inspired packaging offering affordable luxury.

Driven by social media and celebrity, consumers increasingly see what they buy as an expression of their personal identity.”

Opportunity #4 - Beverages as experience
In the age of “little treat culture,” beverages offer consumers an accessible way to add novelty, indulgence and mood-lifting pleasure to the everyday. That helps explain the rise of frozen drinks, loaded coffees, dirty sodas, bubble teas and other visually distinctive formats: they blur the line between beverage, snack and dessert, while giving people a low-cost way to make the moment feel more special.

The numbers show why brands and operators should take this seriously. Our research shows that 84% of millennial consumers in the US are interested in limited edition or seasonal beverage drops and 70% say new and exciting menu items are important when choosing where to eat and drink out [Finlays, 2026].

Together, those signals point to a beverage industry that is becoming an experience category in its own right. Brands and operators who seek to create theater, novelty and inspiration, and most importantly, who seek to own the cultural moment, will be best placed to win.

Supercharged format innovation
The other driving force behind the blurring of categories is format innovation. Forget cups, cans and bottles, think functional ice cubes, pickle juice sachets, matcha in squeeze tubes and bone broth powder sticks (all of which are already available).

The profusion of beverage formats is helping to break down and rebuild the conception of what a beverage can be in novel and attention-grabbing ways. Looking across the coming decade, it is this intersection of consumer need and format innovation where things will become particularly exciting.

So, is it the end of beverages?
No – consumers still know the difference between a coffee and a cola. But it is perhaps the end of beverages as we know it. The shift towards buying by need-state rather than category has major implications for the beverage industry, as does the profusion of novel formats.

Together, these shifts dramatically expand the role beverages can play in consumers’ lives. Beverages are no longer confined to quenching thirst. They can support health, provide sustenance, signal identity and create moments of pleasure, all while competing for value that once sat well beyond the beverage aisle.

For brands and operators, the long-term opportunity is there for those who think outside the box… as well as outside of the category.

Thom Walton
Corporate Affairs Director Finlays