San Antonio taps into the functional drink boom
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As Americans rethink alcohol, beverage brands and businesses — including a new San Antonio shop — are betting on drinks that promise social connection without the hangover.
Why it matters: Consumers are increasingly choosing beverages based on what they want drinks to do — energize, improve gut health or help them unwind — fueling a boom in products marketed around function.
Driving the news: On The Brightside is among the latest entrants, launching canned drinks made with Zembrin, an extract of the succulent kanna that founder Adam Terry says is designed to promote a calming, "pro-social" effect without intoxication.
- It joins brands like Recess, Hiyo and Trip, which market mood-support beverages as alternatives to alcohol or THC.
What's happening: Consumers are increasingly shopping for beverages by effects and occasions rather than traditional categories, Circana adviser Sally Lyons Wyatt tells Axios.
Zoom in: San Antonio's newly opened Kava Cantina, a nonalcoholic bottle shop, is betting on that shift, stocking booze-free drinks with kava, adaptogens, mushrooms, L-theanine and other functional ingredients.
- Owner Kandice Rae Kutugata tells Axios every product the shop currently stocks has a functional component or purpose, rather than simply being nonalcoholic.
What they're saying: "People aren't just asking, 'What can I drink instead of alcohol?'" Kutugata says. "They're asking, 'What's in this? What makes it different? What kind of experience am I looking for?'"
By the numbers: Functional beverages generated $31.3 billion in U.S. sales over the past year, up nearly 11% year over year and about 147% over four years, per NielsenIQ data shared with Axios.
The big picture: Younger consumers "are not necessarily abandoning alcohol — they are redefining what belongs in the adult beverage occasion," Lyons Wyatt says, pointing to moderation, novelty and mood support as growing priorities.
- "The category is not yet a full substitute for alcohol," Lyons Wyatt says.
Reality check: Drinks with mood-enhancing ingredients aren't evaluated by the FDA for effectiveness, and evidence supporting their impacts varies widely by ingredient.
The bottom line: Americans aren't just choosing what to drink. They're increasingly choosing how they want drinks to make them feel.