- AB InBev's Anheuser-Busch will use its distribution network (AB One) to distribute ShineWater, a ready-to-drink hydration beverage with 100% of the daily recommended vitamin D, the company said in a statement. ShineWater declined to disclose any additional financial details about the deal, including whether Anheuser-Busch invested in the company.
- The deal will expand ShineWater’s availability throughout its geographic network on the West Coast, in the Northeast and in Oklahoma, opening the door for the product to be sold at stores where Anheuser-Busch products are carried.
- The vitamin D water is the latest food and beverage brand to latch onto the functional trend as shoppers look for more than sustenance or refreshment from the products they purchase and consume.
As companies such as AB InBev, Molson Coors and others have struggled with declining beer sales, they have gravitated toward other beverages to provide them with a platform for future growth — many of them outside the alcohol category they are intimately familiar with.
Molson Coors, for example, has invested in Huzzah, a full-flavored seltzer with added probiotics; Golden Wing, a grain-based milk alternative fortified with protein and nutrients; and Zoa, positioned as an above-premium energy drink with natural ingredients, vitamins, electrolytes and amino acids.
Anheuser-Busch has previously leveraged its existing sales and distribution network for other third-party products. They include wine and RTD cocktail brand Beatbox and dietary supplement Amino Energy + Electrolytes. As companies like AB InBev look for growth, it makes sense for them to leverage their robust distribution networks to increase sales and dabble into offerings that would otherwise be out of their usual area.
Anheuser-Busch's network of distributors it owns is described by the company as "a critical asset" that allows the country’s largest brewer to pilot new consumer offerings, and then expand the most promising ones to its larger wholesaler system.
"Meeting [the consumer's] changing needs is why we’re focused on expanding and innovating within our beyond beer portfolio,” said Scott King, vice president of marketplace for Anheuser-Busch's AB One.
The deal to distribute ShineWater is unlikely to provide a meaningful boost to sales at AB InBev, but it shows the company is making inroads in its push to be more than just an alcohol company. For ShineWater, the partnership gives them quick access to new markets by tapping into the beer giant's robust distribution network. In early 2020, ShineWater changed its branding and distribution strategy, leading to a 10-fold increase in sales across the country, the company said.
In addition to beer makers, other companies have taken notice of growing consumer demand for products with a functional benefit.
Vita Coco’s parent company All Market this summer announced it is expanding into a new segment of functional beverages with the launch of protein-infused waters called Pwr Lift. PepsiCo released a functional water called Driftwell last year aimed at combating stress and inducing relaxation.
Food and beverage giant Nestlé has moved quickly to get in the functional drinks game through a series of moves. Its latest occurred in March when it acquired Essentia Water, a maker of ionized alkaline water, for an undisclosed amount. Ocean Spray also has launched a line of functional water called B1U that highlights the names of each functional blend — I need a boost, I need rhythm, I need immunity and I need power — prominently on the label.
The fact that companies are angling to enter this arena is unsurprising given the shift in consumer dynamics and the surge in sales that has followed. Statista estimated retail sales of enhanced bottled water alone are forecast to reach $5.3 billion in 2022 from $4.11 billion four years earlier.