Coffee is already a functional beverage – do we really need to add more ingredients to it?

In recent years, as more and more consumers increasingly prioritise their health and wellness, the functional beverage market has boomed. From prebiotic sodas to collagen-infused water to kombucha, supermarkets and grocery stores have started to stock a diverse range of ready-to-drink beverages that all seemingly serve a different purpose when it comes to improving our health.

Coffee has not been spared either. Whether it’s medicinal mushrooms, CBD, or plant-based adaptogens, manufacturers add a number of ingredients to RTD coffee beverages to allegedly boost health benefits. Demand for these products is continuously rising, with the value of the global functional beverage market expected to hit an impressive US $339.6 billion by 2030.

As many brands find success in this thriving market, however, it raises an important counterpoint. For many decades, the health benefits of filter coffee (especially without milk and sugar) have been well documented – with plenty of evidence showing that its high antioxidant content can improve life expectancy and reduce the risk of certain diseases, including Parkinson’s and diabetes.

So are functional ingredients just clever marketing? And should people just switch to drinking black filter coffee to experience the same health benefits? Dr. Steffen Schwarz, Managing Director at the Coffee Consulate, tells me why the answer isn’t as straightforward as we might think.

You may also like our article on what consumers need to know about coffee and health.

Why the functional RTD coffee market is booming

It’s been hard to ignore the explosive growth of functional beverages over the last few years. Brands manufacture and market these drinks to highlight specific ingredients and boost health benefits, including:

• Sports and performance drinks
• Probiotic beverages
• Plant milks
• Energy drinks and other caffeinated beverages
• Fortified, enhanced, or “smart” drinks

Functional beverages often include nutrients and bioactive compounds like minerals, vitamins, amino acids (AA), adaptogens, and nootropics that claim to improve health and have beneficial effects on bodily functions – such as enhancing immunity and mood, as well as reducing stress.

As they increasingly prioritise health and wellness, millennials and Gen Z drive the majority of growth in the functional beverage market. According to a 2024 McKinsey study, 56% of Gen Z consumers in the US say their fitness is a “very high priority”, compared to 40% of US consumers overall.

These demographics are also one of the biggest drivers of rising coffee consumption. The National Coffee Association’s latest National Coffee Data Trends report found that past-day coffee consumption in the US was driven by consumers aged 25 and over the most in spring 2024 – pushing the country’s coffee intake to a 20-year high.

At the same time, with busier on-the-go lifestyles, convenience has become one of the most important purchasing factors for younger people, too. This has created an interesting nexus between coffee, convenience, and wellness, so it’s no surprise that functional RTD coffee has exploded in popularity. 

A growing number of coffee companies now offer RTD products in many supermarkets and grocery retailers that claim to provide a wide range of health benefits. Additional ingredients like mushrooms (lion’s mane, cordyceps, and chaga are popular options), prebiotics, antioxidants, and organic plant protein are often front and centre on packaging labels as brands strive to compete in a lucrative market.

Functional on its own: The many health benefits of coffee

Consumer interest in health and wellness shows no signs of slowing down, and is therefore a viable market for coffee brands to operate in. It seemingly, however, overshadows a very simple yet important point: coffee is already a healthy beverage without additional functional ingredients

Dr. Steffen Schwarz is the Managing Director of the Coffee Consulate in Mannheim, Germany – a research and training centre which focuses on all areas of the supply chain. He explains how decades of verified studies indicate coffee’s positive impact on health and wellbeing.

“Regular coffee consumption is associated with a lower risk of developing type 2 diabetes due to antioxidants like chlorogenic acid that improve glucose metabolism and insulin sensitivity,” he tells me. “Its rich antioxidant content also helps reduce the oxidation of LDL cholesterol and decrease inflammation, contributing to better cardiovascular health and a reduced risk of heart disease and heart failure.”

The advantages don’t end here, however.

“Neurologically, coffee drinkers have a lower risk of developing Alzheimer’s and Parkinson’s diseases, thanks to caffeine and other compounds that reduce inflammation and oxidative stress in the brain,” he adds. “Additionally, coffee has protective effects on the liver, and even helps slow disease progression in those with existing liver conditions. Coffee’s antimutagenic and antioxidant properties also contribute to a reduced risk of various cancers, and its rich antioxidants like alkylpyrazines help mitigate oxidative stress and inflammation.”

Although “superfood” has become something of a buzzword that is difficult to substantiate for many food and beverage products, thousands of peer-reviewed scientific studies indicate that moderate coffee consumption is beneficial to human health – especially when consumed without milk and sugar.

So is the functional beverage market purely based on marketing?

As health consciousness remains a top priority, companies have made the smart decision to capitalise on this. In fact, an estimated 73% of global consumers believe that wellness has become an essential element of branding strategies. This begs the question of whether the growth of the functional coffee industry is based more on successful marketing than improving consumer health.

“The functional beverage market’s rapid growth is largely driven by marketing and the convenience these products offer,” Steffen explains. “Many functional beverages are promoted for their added health benefits, but the advantages of these additives over regular black coffee are often overstated.

“While these beverages may contain additional vitamins, minerals, or other health-promoting compounds, their benefits are minimal when considering the potential negative effects of added sugars and artificial ingredients,” he adds. “Many consumers prefer RTD options for their convenience, despite the added sugars and artificial ingredients that may counteract some of the health benefits.”

Steffen believes black coffee is a better alternative for health-conscious consumers.

“Black coffee is absolutely a healthy beverage choice – it’s low in calories and free of added sugars and fats,” he says. “It provides all the health benefits of coffee without the potential negative effects associated with additives found in many functional beverages.”

Moreover, if more consumers were willing to switch to specialty-grade black filter coffee for health reasons, there could also be a greater appreciation of factors such as origin, terroir, processing method, sensory profile, and quality – which would benefit the entire supply chain.

But black coffee isn’t to everyone’s taste

It’s still important to acknowledge, however, that not everyone enjoys the taste of filter coffee – and these consumers, of course, play an important role in the industry. Some people may perceive the higher levels of acidity in pour over and batch brew as undesirable, and they may even cause health problems for some.

“Despite its many benefits, coffee can have some negative health effects,” Steffen says. “High consumption can cause gastrointestinal disturbances, such as acid reflux and stomach ulcers, especially in sensitive individuals.

“For some, particularly those sensitive to caffeine, coffee can increase heart rate and blood pressure,” he adds. “Regular caffeine consumption can lead to dependence and withdrawal symptoms, such as headaches and irritability, once you remove it from your diet.”

In line with this, Steffen emphasises that moderation is key.

“It’s crucial to consume coffee in moderation to maximise its health benefits while minimising potential risks,” he says. “The effects of coffee can vary greatly among individuals, so personal tolerance and health conditions should be considered, and ongoing research is essential to fully understand the complex effects of coffee and its numerous bioactive compounds on human health.”

There’s clear demand for functional RTD coffee, and convenience is one of the biggest drivers of market growth. But filter coffee also has a number of health benefits that not all consumers may be aware of.

Increasing consumption of black coffee would come with a number of advantages, but we need to remember that the industry has to remain inclusive of all types of coffee drinkers – whether they prefer filter coffee or RTD products.

Enjoyed this? Then read our article on coffee as the original “superfood”.

Perfect Daily Grind

Want to read more articles like this? Sign up for our newsletter!