Dive Brief:
- Beverage sales in the food retail industry totaled $295 billion in 2025, up 3% from the year prior — a significantly slower rate than the 7% annual sales growth recorded between 2019 and 2024, FMI — The Food Industry Association found in its inaugural Power of Beverage report.
- Nonalcoholic drinks fueled the overall category’s growth last year, with a 5% year-over-year boost to $221 billion. Alcoholic beverages, meanwhile, saw sales drop 2% to $74 billion in 2025.
- Shoppers’ desire for drinks that match specific needs is reshaping the category, FMI stated in the report, noting that people who use GLP-1s are seeking beverages that align with trends such as hydration, sugar reduction, alcohol moderation and protein intake.
Dive Insight:
As grocers look to juice their beverage sales, FMI suggested retailers reorganize the category around the specific benefits consumers look to gain from the drinks they consume.
For example, grocers may want to group beverages by need states like hydration, energy, protein, digestive support and relaxation. Retailers can also use merchandising and messaging to better help shoppers find drinks that fit those occasions, FMI said.
“Electrolytes for hydration,” “protein to help keep you full,” and “low or no added sugar” are a few examples the trade association gave for how grocers can highlight functional benefits. Samples, coupons and bundled offers, FMI noted, can encourage product discovery.
“Beverages that deliver on consumers’ personalized needs and specific, meaningful outcomes are less likely to experience trade-down,” FMI wrote in the report. “This broader view of value is creating a new playing field for premium beverages and private brands to grow.”
For online merchandising, FMI recommended that grocers make sure they have filters and detailed product pages to help consumers find items based on specific needs.
The trade association’s report is based on a survey of over 2,000 U.S. grocery shoppers conducted May 19-26 as well as Circana sales data and insights from Nichefire.
Beverages represented six of the 20 top retail categories tracked by Circana for the 52 weeks ending Nov. 29. Energy drinks and weight-control beverages each grew sales by 15% compared with the same period a year ago, followed by coffee (13%), carbonated beverages (6%), bottled water (4%) and milk (4%).
While grocers and convenience stores continue to dominate retail beverage sales, both channels have ceded share to pure-play e-commerce — a small channel that has grown to account for 3% of beverage sales. FMI noted that social media is also a small but growing channel worth keeping an eye on. TikTok brought in $46 million in beverage sales during the fourth quarter of 2025, according to Circana.
