Consumers looking for healthy options to fuel an active lifestyle have also fueled innovation and expansion in the functional aisle. The current value of the functional food ingredients market sits at $11.31 billion, according to Future Market Insights (FMI), and that number is expected to exceed $20 billion by 2034.

To further examine the research and trends leading this booming industry, WholeFoods Magazine spoke to industry leaders for a deeper analysis of what’s driving this market.

Benefit-Driven Consumers

Brands are finding innovative ways to cater to consumer demand for healthier alternatives, says Bret Barhoover, Category Marketing Manager for Specialty Nutrition, Cargill. “That broader, mainstream appeal is what’s driving growth in the active nutrition category. Successful brands are reaching beyond the hardcore athlete with products that appeal to consumers who want to make better nutritional choices,” Barhoover explains. “We’re also seeing functional food and beverages expand into a much wider array of product formats. Beyond ready-to-drink beverages, protein powders, and high-protein bars, functional foods and beverages are taking hold in all the categories, popping up in snacks, cookies, yogurts, confectionery, frozen desserts, and more."

In terms of benefits consumers are seeking, Stéphanie Bourret, Innovation Manager at Kerry, points to holistic health benefits such as digestive health, immunity support, and mood enhancement. “The emergence of new products catering to these specific areas has gained traction among consumers, underscoring a broader trend towards informed and proactive health decisions they take for themselves and their family," says Bourret. "As individuals increasingly prioritize holistic wellness, the demand for functional foods is poised to continue its upward trajectory.” 

Cognitive performance is also top of mind. Brian Zapp, Director of Marketing, Applied Food Sciences (AFS), has seen an increase in demand for nootropics, adaptogens, and a cleaner caffeine boost. “The gradual increase in demand for improving cognitive performance has led to an upsurge in clinical research, investing in ingredients that can bring tangible results to the nootropics market. Some of the ingredients that support this area include caffeine, adaptogens like ginseng, L-theanine, and ashwagandha, as well as functional mushrooms such as lion's mane.” 

Barhoover also sees a rise in interest for specialized categories, including children’s and women’s health. “Women’s health is a huge opportunity, especially in the active nutrition space," Barhoover says. "However, the classic approach of ‘make it smaller and make it pink’ isn’t going to work anymore." Case in point: Fewer than 5% of active nutrition products specifically target women. "That suggests there’s plenty of space for brands to move beyond ‘one size fits all’ and design products specifically for this market.”

Regarding the kids health market: “Children’s health is another growth area for the functional food and beverage space," Barhoover says. "You’ll see these products offer many of the same health and nutrition benefits, but they’re targeted to a younger population. Some will be backed by clinical research with children, but others may enter the space touting a lunch-box friendly, smaller size.” 

In-demand Ingredients

In addition to seeking out specific benefits, consumers are knowledgeable about ingredients that deliver. A few that are trending now:

'Biotics

“The emergency of synbiotics and postbiotics in functional foods and beverages is on the horizon, reflecting consumers' increasing interest in holistic wellness and personalized nutrition,” predicts Bourret.

Dairy Protein  

“For years, whey protein was the foundation for many functional foods and beverages,” says Barhoover.  “Up next, watch for dairy proteins made through precision fermentation. This technology offers new possibilities, including lactose-free dairy proteins and the potential for more soluble proteins that enable even higher protein fortification levels in beverages. There’s the potential for other benefits, too, as protein produced via precision fermentation may prove to offer advantages spanning scalability, affordability, and even sustainability as compared to traditional dairy proteins.”

Functional Flavorings

“Flavors not only enhance taste, but also serve to elevate consumer awareness of specific benefits associated with certain ingredients," says Bourret. "For example, the inclusion of lavender, known for its relaxation properties, can amplify the perceived health benefits of less known actives. While fruits continue to be popular, blending them with herbals and spices is gaining traction, opening up vast opportunities for flavor innovation.”

Hemp Protein

“We recently worked with a pancake brand that was looking to deliver 11g of protein to their product with the help of our hemp seed extract,” shares Zapp. “The power pancake turned out to have an excellent sensory profile, and the hemp protein helped aid in binding and reducing the load of other dry ingredients. This was a fairly simple solution to boost the functionality of a common breakfast food. We see similar approaches in adding digestive support to yogurts or juices that consumers already perceive to have such benefits.” 

Medicinal Mushrooms

Nutrient-packed mushrooms have been trending up over the past few years. However, Zapp contends, more research is needed to show the benefits of mushrooms like lion’s mane, reishi, cordyceps, chaga, and more. “While these powerful fungi have been around for thousands of years, there is very little human research to support their perceived benefits. That is why AFS has made a significant investment recently in researching and standardizing these mushroom varietals to not only prove their efficacy but also develop industry standards for myco-identification to safely show what active compounds are in these mushrooms and better understand why they are beneficial to our health."One AFS study explored the acute cognitive benefits of lion's mane in healthy adults. "Until now, most lion’s mane studies have focused on its impact on people with neurodegenerative diseases, and fewer have examined its acute (i.e. single-dose) cognitive effects," says Zapp. "But since consumers desire tangible results when taking functional food and beverages, we can safely demonstrate that our lion's mane extract can deliver nootropic benefits for focus and mood in as little as one hour of ingestion. With research like this, individuals seeking a more immediate cognitive boost can be empowered to consider lion's mane as a viable option, while product developers can alleviate confusion by providing more consistent structure-function claims and marketing strategies, reducing skepticism and increasing confidence in the market.”

Pea Protein

"Cargill’s pea proteins from industry-leader PURIS are an especially good choice for plant-based protein fortification,” adds Barhoover. “They feature a neutral flavor profile and improved solubility, making it easier than ever to achieve double-digit grams of product in functional foods and beverages.”

...and don't forget to keep it clean 

In addition to benefits, consumers want clean labels. “The clean label movement is continuing to get traction in helping food and beverages align with consumers," Zapp says. "Some simple ways of cleaning up labels are substituting synthetic ingredients with naturally derived ingredients." Seeing "caffeine from organic green tea," for example, can add familiarity and enhance trust.