The drinks shelf has seen significant change in recent years, going from a smaller collection of SKUs to a multi-beverage portfolio spanning varied shopper needs, flavours and temperature zones. Boundaries between categories are becoming increasingly blurred, with brands expanding across a broader range of sub-categories and meeting multiple shopper needs with one product. 

The health imperative – wellness becomes central 

Shoppers are looking to lead heathier lives, and they are increasingly turning to the drinks category to help them in this mission. Younger shoppers are drinking less alcohol and increasingly seeking drinks that support health, moderation and specific wellbeing needs. From hydration to functional benefits, to low or no alcohol content, retailers and manufacturers are adapting and expanding ranges to provide all shoppers with the health support they seek. 

Functional drinks have seen the biggest growth, with the category expanding significantly and multiple claims appearing on packs across fridges and shelves. Protein drinks and meals in a bottle also remain key parts of innovation, alongside growing interest in nootropics and cognitive-performance beverages.  

Alcohol-free is a key area of development which is seeing strong growth, with demand for alcoholic beverages decreasing across demographics. Brands and retailers are adapting their ranges in response to this change; Diageo launched mid-strength variants of established spirit brands in the UK, and BILLA (Austria) and Delhaize (Belgium) both introduces new lo and no options to their ranges. 

The key underlying theme in this space (and the opportunity for the industry) is a shift away from single benefits into a broader wellness proposition, combining key trends with holistic health and wellbeing benefits that support multiple shopper needs in a single product. The away from home sector presents chances to test and learn and is responsible for strong growth in the category, with innovation driven by social media trends. 

Private label development – premium value 

As the region with the highest share of private label globally, Europe is a hotbed for innovation for retailers. Across the drinks category, it is being focused on premiumisation while maintaining value. Tied into the upcoming festive period, Aldi UK has launched an advent calendar which includes cans of its premium ready-to-drink cocktails alongside chocolate truffles. 

As the BWS category is closely linked to socialisation and consumption occasions, there is an opportunity for retailers to leverage their brands and assortment to generate hype and excitement. Aldi Nord launched a pop-up wine bar in Antwerp, showcasing its broad range of premium wines and providing shoppers with a limited-time experience. 

Across other segments of the category, retailers have been testing and learning with flavours, formats and packaging. Tesco is trialling Finest-branded coffee machines in Express stores in the UK, with drinks included in meal deals for additional value.  

Coop Italia recently launched a limited edition Nuda Cola (Naked Cola), which is transparent as it lacks any additional colouring additives. This is part of the retailer’s ongoing efforts to remove unnecessary ingredients from its private label products, and positions it as a more premium and on-trend option. 

Legislation: packaging, ingredients and regulation 

Shopper-driven demand is, of course, not the only element shaping the drinks category in Europe. Governments around the region are increasingly passing legislative measures that impact the category, with the main ones being incoming sugar tax and the growing regulation of energy drinks. Increasing scrutiny of health claims and marketing practices is also shaping innovation. 

Sustainability plays a big role in the category, with packaging being a key area of focus. As legislation moves from planning into implementation, retailers and suppliers will need to prepare for broader roll-out in 2027. Some retailers have moved early on this, like Ekoplaza in the Netherlands providing wine in reusable bottles. While this initiative is not brand new to the industry, it is the first time a retailer has used a single bottle for multiple brands in the country, bringing further efficiencies and reducing complexity. 

Future growth in the category will depend not only on consumer demand, but also on retailers’ and suppliers’ ability to navigate an increasingly complex regulatory and sustainability environment. 

What this means for you 

The European drinks market is shifting from category-led to need-state-led growth. Growth is increasingly being driven by consumer need states such as hydration, energy, wellness, moderation, and enjoyment rather than traditional beverage categories. 

There is opportunity for growth as the category evolves and moves to serve multiple consumption occasions, shopper needs and trends while adapting to growing legislative and regulatory pressures. Both retailers and suppliers can focus on three key takeaways:  

• Rebalance towards moderation and functionality: zero-sugar, hydration, energy, alcohol-free and multi-benefit drinks are the strongest cross-market opportunities in Europe 

• Manage value more precisely: premiumisation still works, but affordability pressures mean it must be balanced with accessible packs, promotions and strong pricing credentials and tiers 

• Prepare for operational change: packaging compliance, deposit-return systems, portfolio consolidation and supplier alliances will increasingly influence range economics as much as shopper demand