Mubarak Malik has seen a lot of Gatorade in his life. A longtime sports trainer who worked with pro teams including the Pittsburgh Pirates and New York Knicks, Malik grew frustrated with the lack of healthy hydration options for his players, who, despite having access to quality nutrition, still ran deficits of magnesium, vitamin D, and B vitamins (which OG Gatorade, packed full of sugar, lacks). After experimenting with different mixes of vitamins and coconut water in 2020, he launched Barcode, which is currently raising a $100 million funding round and boasts NBA phenom Victor Wembanyama as an investor, brand partner, and spokesperson. 

Barcode is just one of many success stories emerging from the growing category of sports beverages focusing on hydration and, increasingly, exceptional amounts of electrolytes and salt. It’s what consumers crave.

“Sports brings everyone together,” Malik said. “With these athletes, it’s a lifestyle. It’s not just the game — it’s what are they wearing, what are they consuming, how do they continue to be optimal. And that’s where eyeballs have shifted.”

Sometimes categorized as functional beverages, these drinks have exploded in popularity, driven by social media-driven marketing campaigns focused on influencers and sports stars. LMNT, cofounded by “Healthy Rebellion” podcast host Robb Wolf, leans heavily into salt replacement — it’s trademarked the phrases “Salty AF” and “Stay Salty” — and surpassed $206 million in sales last year, nearly tripling its 2022 sales. Malik thinks Barcode will make $10 million this year and predicts $25 million in sales in 2025. Taste Salud, a functional line of aguas frescas with Hispanic-inspired flavors, took three years to hit $20 million in sales, and now can be picked up at Target and Walmart.

“With a lot of these things, the word saturation probably doesn't necessarily apply,” Joshua Schall, a consumer-packaged-goods strategist who runs his own consulting firm, said. “Long term the outlook is still extremely strong.”

And that’s not even considering the truly big names attached to this trend. YouTuber Logan Paul’s brand, Prime, saw demand skyrocket (only to plummet after controversy around its marketing), soccer star Lionel Messi recently launched Mas+ by Messi (in a partnership with the makers of White Claw), and category leader Gatorade, which controls 46% of global sales, launched Gatorade Water, an electrolyte-infused alkaline water, in February. Mexico-based Electrolit, which entered the US market in 2014 and now has distribution deals with Keurig Dr Pepper, makes $400 million in annual retail sales, sees double-digit growth, and is the fifth-largest sports-drink brand in the US.

The global market for electrolyte hydration drinks, already worth about $43 billion, is expected to grow to $59 billion by 2030. Beyond increasing the demand for coconut water and sea salt, the rise of these products showcases a new marketing strategy and storytelling around beverages. While most Americans may not necessarily have a hydration issue — and as newsletter Fitt Insider says, many people get too much salt — brands hope “sipping electrolytes becomes a habitual box to check,” a daily routine.

Schall credits the introduction of Liquid IV in 2012, an electrolyte-infused drink, as an early influence on the category. Pedialyte, a medical supplement for infants sold by Abbott, was having a second life as a hangover cure — one that the medical company didn’t want to promote — which opened the door for Liquid IV. The drink smartly focused on everyday hydration needs. Not everyone is, as Gatorade’s famous ad campaign said, going to “be like Mike,” but zeroing in on everyday life and active lifestyles spoke to a much wider audience.

”They were talking to the soccer moms that other brands never really spoke to,” Schall said. In addition, Schall credits the rise of the vessel — the Yeti water bottles and Stanley mugs — as signifiers of wellness, which double as the perfect place to add a powdered drink mix. 

What’s more, a shift towards home workouts has been reinforced by both the pandemic and the rise of online workout platforms such as Glo, Peloton, and Nike Training Club, said Nandini Roy Choudhury, client partner for food and beverages at Future Market Insights. These twin trends, which allow people to work out more easily for less money, have helped sales of electrolyte-enhanced water surge, Choudhury said.

This is also where the trend intersects with new marketing and distribution strategies. Many of these beverages eschew traditional grocery-store distribution networks, whose limited shelf space can make it costly to compete with popular products. Slotting fees at grocery stores can reach up to $250 to $1,000 per item per store, or more. Instead, these nascent brands begin with direct-to-consumer (DTC) online sales, especially in cheaper-to-ship packet form. 

When Malik began Barcode, he didn’t have the capital to, as he said, launch six flavors, pitch five big distributors, and look at five national chains. By selling direct and listening to social media and customer feedback, he was able to constantly iterate and tweak. In 2021, the packaging, a minimal white bottle with a barcode, was changed 10 times.  

“We learned all these things when we launched as a direct-to-consumer brand,” Malik said. “If, back in 2021, we launched and looked to CVS or Walmart for where we should be positioned, we wouldn’t have gotten enough feedback and data points.”  

With the same ease consumers have dropping a powdered, electrolyte-enhanced mix into a glass of water, aspiring beverage entrepreneurs can combine easy-to-share online marketing with quick-to-scale e-commerce sales and distribution. Powdered drinks are both cheaper and quicker to make via contract manufacturers. The health focus of these emerging brands has also changed consumer attitudes, Euromonitor International beverage-industry expert Erwin Henriquez said, which used to associate powders with overly sweet kids’ drinks. Recent entrants, like Possible and Hydrate, market themselves as sources of natural hydration.  

And because young brands have built up followings and repeat customers through DTC, when they are ready to graduate to the packaged-beverage market, they can point to a large fanbase — and ZIP-code-targeted sales data — to find their way to store shelves. 

“That's the beauty of CPG today: you can stay on top of what’s happening culturally,” Malik said. “Figure out how your brand fits into a lifestyle, and meet those needs from a functional standpoint.” 

Schall sees the market becoming more competitive. The big players haven’t ceded the space; PepsiCo’s Gatorade, for instance, has launched a number of new electrolyte-infused products, shifting assets and strategies to stay nimble and cover a wide swath of this evolved marketplace. After years of entrants to the category and a barrage of new variants, flavors, and ingredients, Schall predicts a plateau of activity followed by a sorting out of the market. Even this overactive market needs to rebalance and reset.

“There needs to be some time where things settle in, where people figure out the three or four types of hydration products that work for the most amount of people,” Schall said. “Then all the rest will be table scraps.”  

Patrick Sisson is a reporter covering cities, technology, and business.