Health-Ade splashes into prebiotic soda with SunSip launch

Dive Brief:

• Kombucha maker Health-Ade is expanding its lineup in the functional beverage space with the launch of a prebiotic soda called SunSip. The extension is designed to “meet new consumers looking for better-for-you soda alternatives,” according to the company. The sodas are available in four flavors: Raspberry Lemonade, Cherry Cola, Strawberry Vanilla and Root Beer.
• The drinks eschew artificial sweeteners, with each can of soda containing a blend of fruit juice, monk fruit and cane sugar. Each can has a total of 5 grams of sugar. The ingredient list also includes prebiotics from agave inulin fiber, zinc, selenium and vitamins C, B6 and B12.
• As consumers seek more nutrition from their food and beverages, new entrants in the category like SunSip aim to offer an alternative to soda without lots of sugar or artificial flavors.

Dive Insight:

Health-Ade is the second best-selling kombucha brand in the U.S., hitting $113 million in sales last year, according to Statista data. By entering soda, the kombucha company adds to the mix consumers who feel “too daunted” to try the more acidic taste of fermented black tea, according to Charlotte Mostaed, Health-Ade’s chief marketing officer.

The company wanted to make a soda that doesn’t contain sweeteners such as stevia, aspartame and erythritol because of the backlash to those ingredients over potential health risks, she said in an interview.

“As we talked to consumers about what they want out of a beverage as they try to reduce their traditional soda consumption, they wanted to make sure that nothing ingredient-wise has any negative offshoots,” Mostaed said.

After Health-Ade conducted consumer taste tests, it found the combination of the natural sweetener with a dash of cane sugar was the preferred combination, the executive said.

Health-Ade believes the SunSip brand can help it grow into a larger player in the beverage space outside of kombucha. The functional beverage industry is projected to be worth $62 billion by 2027, growing at a compound annual growth rate of 4.5%, Euromonitor data showed. Expanding its kombucha into canned beverages last year from bottles allowed Health-Ade to broaden the reach of its products, Mostaed noted. 

“This was a way for us to provide a lower barrier to entry, at a lower price point and with a lower amount of liquid in the can while also communicating that it’s not some medicinal thing that you only drink at one point in the year,” Mostaed said.

The kombucha market has been on the radar of major soft drink players for several years. Soda giant Coca-Cola invested $20 million in Health-Ade in 2019 before investment firm First Bev acquired a controlling stake in the company two years later.

Coca-Cola also tested the waters of an entry into the kombucha space with two offerings — Cidewinder, developed with its Minute Maid brand in 2019; and Honest Kombucha. Both offerings have since been discontinued.

SunSip will face competition from already established prebiotic soda brands Poppi and Olipop which have seen exceptionally strong sales growth in recent years.

Other better-for-you soda brands also are harnessing consumer desire for a less sugary alternative to drinks like colas and ginger ale. Zero sugar soda brand Zevia has experienced significant growth since 2020.