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Energy Drinks and Shots: U.S. Market Trends

Abstract

In broad strokes, health and wellness-related beverage products are seeing increased consumer penetration, while classic beverages-especially colas-are seeing consumer attrition. Specifically, functional ready-to-drink (RTD) beverages, namely energy drinks, sports drinks, and tea, have increased consumer penetration over the past few years.

While the energy drinks and shots market may be a small component of the non-alcoholic beverage industry, it is perhaps the most dynamic market-growing 60% from 2008-2012 according to Packaged Facts estimates in the all-new research report ‘Energy Drinks and Shots: U.S. Market Trends’. In 2012, total U.S. sales for the energy drinks and shots market was worth more than $12.5 billion.

Intense competition surrounds the beverage industry as marketers seek to increase market penetration and consumption frequency through positive alignment as a healthy and/or functional beverage. Thirst quencher/sports drinks remain the most formidable competitor for energy drinks as this type of beverage attracts a large constituency of energy drink users. Energy drinks are subject to competition from other energy-boosting beverages such as coffee and tea beverages, as well as an increasing number of new product innovations that tap into the energy trend but are outside of the beverage industry.

At present, energy drinks have the lowest consumption rates of any RTD beverage-a point which reflects the market's relative infancy but also its growth potential. Experian Simmons analysis shows the growth trend of this market, with the incidence of energy drink usage among adults rising from nearly 13% in 2006 to 17% in 2012. In addition, there is a modest segment of heavy users: 5% of adults consume energy drinks 5-7 times per month and less than 2% drink energy drinks 10 or more times. Consumers 18-34, men, Hispanics, Pacific region residents, and adults with children in the household are demographics that over index in energy drink usage.

Packaged Facts estimates that energy drinks account for some 78% market share, followed by 18% for energy shots, and energy drink mixes (roughly 4%) in 2012. A few select marketers dominate the energy drinks and shots market. This demonstrates the first mover advantage in each category. The result is a market that is highly dependent on a handful of key brands, namely Red Bull, Monster Energy, 5-Hour Energy, and Rockstar Energy.

Retail distribution of energy drinks and shots continues to expand at a fervent pace-making these products accessible at nearly any retail outlet from major grocery outlets to dollar stores and smoothie shops to sporting goods stores. Packaged Facts estimates that convenience stores hold the largest share of market sales (59%), followed by mass merchandisers (13%), supermarkets (10%), club stores/warehouse (5%), and drug stores (2%). In aggregate, all other retailers contribute a significant 11% to market sales.

Overall growth of energy drinks and shots is influenced positively by new product launches and expanded retail distribution. Economic factors and shifts in the U.S. adult population by age and ethnicity/race are also factors to market growth. An increasingly competitive market for “energy-boosting” products is perhaps the market's greatest threat.

Packaged Facts projects sales of energy drinks and shots will grow to a value of $21.5 billion by 2017, driven by continued economic recovery, expansion in retail distribution, and strong potential in new product development. Market opportunities are evident through product innovation (especially in energy drink mixes), the ability to increase consumption frequency, targeting older consumers, and leveraging interactive packaging.

Table of Contents

Chapter 1: Executive Summary

  • Scope of Report
  • Methodology
  • Energy drinks still have modest consumption rates
    • Table 1-1: RTD Non-Alcoholic Beverage Usage, 2006-2012(percent of U.S. adults)
  • Innovative beverages
    • Healthy beverages
    • Customizable and portable beverages
    • Relaxation beverages
  • Innovation opportunity
  • Encourage more frequent consumption
  • Target older consumers
  • Interactive packaging could remedy labeling concerns and more
  • Industry context
  • Energy drinks and shots deliver impressive growth
    • Table 1-2: Total U.S. Sales of Energy Drinks and Shots, 2008-2012 (in millions and percent change from previous-year period)
    • Explosive growth from 2011-2012
    • Mass-Market Category Performance
      • Figure 1-1: Percent Growth in SymphonyIRI-Tracked Sales of Energy Drinks and Shots, 2012 (percent change from previous-year period)
    • Product performance: Three core energy drink brands steer category growth
    • Product performance: Living Essentials dominates energy shots
    • Product performance: Kraft Foods' enters category with well-known brands
  • Convenience stores capture largest share of energy market sales
  • Market Innovation
    • “Diet” energy drinks
    • Proliferation of “natural” energy
    • Cross-pollination of energy drinks
  • Sales of energy drinks/shots projected to reach $21.5 billion by 2017
    • Table 1-3: Projected U.S. Sales of Energy Drinks and Shots, 2012-2017 (in millions of dollars and percent)
  • Top Marketers Dominate Energy Drink and Shot Sales
    • Figure 1-2: Top Marketers of Energy Drinks and Shots by Share of SymphonyIRI-Tracked Sales, 2012
  • Energy Drink Usage
    • Table 1-4: Energy Drink Usage Rates, 2006-2012 (percent of U.S. adults)
  • Young adults are core users of energy drinks
  • Frequency of Energy Drink Usage
  • Energy drink brand usage
    • Table 1-5: Energy Drink Usage Frequency by Selected Brands, 2012 (U.S. adults)
  • Energy drink consumers strive to be youthful and health-minded
    • Table 1-6: Energy Drink Consumer Agreement Index for
  • Selected Health and Nutrition Statements, 2012 (U.S. adults)

Chapter 2: Competitive Context for Energy Drinks

  • Highlights
  • Scope
    • Market Definition
    • Methodology
  • Energy Drinks in RTD Beverage Context
    • Energy drinks still have modest consumption rates
      • Table 2-1: RTD Non-Alcoholic Beverage Usage, 2006-2012 (percent of U.S. adults)
    • Energy drinks vs. colas
      • Figure 2-1: Usage Rates for Energy Drinks vs. Colas, 2006 vs. 2012 (percent of U.S. adults)
    • Energy drinks vs. sports drinks
      • Figure 2-2: Usage Rates for Energy Drinks vs. Sports Drinks, 2006 vs. 2012 (percent of U.S. adults)
      • Figure 2-3: Consumption Frequency of Energy Drinks vs.
    • Sports Drinks in last 30 Days, 2012 (in percentage of users who drank each beverage in last 30 days)
    • Energy drinks vs. coffee/tea beverages
      • Figure 2-4: Starbucks, DoubleShot Energy
      • Figure 2-5: Usage Rates for Energy Drinks vs. RTD Coffee and Tea, 2007 vs. 2012 (percent of U.S. adults)
      • Figure 2-6: Napco Inc., Versanto Force 3X Hyper-Caffeinated Coffee
      • Table 2-2: Coffee and Tea Usage, 2006-2012 (percent of U.S. adults)
  • Energy Drink Users' Consumption of Other Beverages
    • Energy drink users also enjoy other RTD beverages
      • Table 2-3 Indexes Among Energy Drink Consumers for Use of Selected Other Beverage Types, 2012 (U.S. adults)
  • Competitive Context: Beverage Innovation
    • Innovative beverages
    • Healthy beverages
      • Figure 2-7: Pinnacle Drinks, SoReal
    • Customizable and portable beverages
      • Figure 2-8: Kraft Foods, MiO Liquid Enhancers
      • Figure 2-9: Coca-Cola Company, Dasani Drops
    • Relaxation beverages
      • Figure 2-10: Marley's Ventures Inc., Marley's Mellow Mood
  • Market Opportunities
    • Innovation opportunity
      • Table 2-4: Usage Rates for Selected Types of Beverage Mixes, 2006-2012 (percent of U.S. adults)
      • Table 2-5:
    • Index Among Energy Drink Consumers for Use of Selected Beverage Mix Types, 2012 (U.S. adults)
    • Encourage more frequent consumption
    • Target older consumers
    • Interactive packaging could remedy labeling concerns and more

Chapter 3: The Market

  • Highlights
  • Industry context
    • Table 3-1: SymphonyIRI-Tracked Sales of Energy Drinks and Shots, 2012 (in millions and change from previous-year period)
    • Figure 3-1: Growth in SymphonyIRI-Tracked Sales of Energy Drinks and Shots, 2011 vs. 2012 (percent)
  • Market Size and Growth
  • Energy drinks and shots deliver impressive growth
    • Figure 3-2: Total U.S. Sales of Energy Drinks and Shots, 2008-2012 (in millions of dollars)
    • Table 3-2: Total U.S. Sales of Energy Drinks and Shots, 2008-2012 (in millions and percent change from previous-year period)
  • Market Composition
    • Dynamic market allows for growth across all categories
    • Energy drinks a $9.8 billion market
      • Table 3-3: Total U.S. Sales of Energy Drinks and Shots by Product Category, 2008-2012 (in millions)
    • Energy shots and energy drink mixes steadily increase market share
      • Figure 3-3: Share of Total U.S. Sales of Energy Drinks and Shots by Product Category, 2008-2012
    • Explosive growth from 2011-2012
      • Figure 3-4: Total U.S. Sales of Energy Drinks and Shots by Percent Growth, 2008-2012
    • Mass-Market Category Performance
      • Table 3-4: SymphonyIRI-Tracked Sales of Energy Drinks and Shots by
    • Product Category, 2012 (in millions and change from previous-year period)
      • Figure 3-5: Percent Growth in SymphonyIRI-Tracked Sales of Energy
    • Drinks and Shots, 2012 (percent change from previous-year period)
    • Sales performance for energy drinks
      • Table 3-5: Total U.S. Sales of Energy Drinks, 2008-2012 (in millions of dollars and percent)
    • Product performance: Three core energy drink brands steer category growth
      • Figure 3-6: Leading Brand Shares of SymphonyIRI-Tracked Sales of Energy Drinks , 2012
      • Table 3-6: SymphonyIRI-Tracked Sales of Energy Drinks by Marketer and Brand, 2012 (in thousands of dollars and percent)
      • Table 3-6: [cont'd.] SymphonyIRI-Tracked Sales of Energy Drinks by
    • Marketer and Brand, 2012 (in thousands of dollars and percent)
    • Sales Performance for energy shots
      • Table 3-7: Total U.S. Sales of Energy Shots, 2008-2012 (in millions and percent change from previous-year period)
    • Product performance: Living Essentials dominates energy shots
      • Figure 3-7: Leading Marketer Shares of SymphonyIRI-Tracked
    • Sales of Energy Shots, 2012
      • Table 3-8: SymphonyIRI-Tracked Sales of Energy Shots by
    • Marketer and Brand, 2012 (in thousands and percent
    • change from previous-year period)
    • Energy drink mix
      • Table 3-9: Total U.S. Sales of Energy Drink Mix, 2008-2012 (in millions of dollars and annual percent change)
    • Product performance: Kraft Foods' enters category with well-known brands
      • Figure 3-8: Leading Brand Shares of SymphonyIRI Sales of
    • Energy Drink Mix, 2012
      • Table 3-10: SymphonyIRI-Tracked Sales of Energy Drink Mix by Marketer and Brand, 2012 (in thousands of dollars and change from previous-year period)
  • Retail Distribution
    • Convenience stores capture largest share of energy market sales
    • Retail expansion of energy drinks and shots
      • Figure 3-9: Share of U.S. Sales of Energy Drinks and Shots by Retail Channel, 2012 (in percent)
      • Table 3-11: Total U.S. Sales of Energy Drinks and Shots by Retail Channel, 2012 (in millions of dollars and percent share)
  • Factors to Market Growth
    • Market Innovation
    • “Diet” energy drinks
    • Proliferation of “natural” energy
      • Figure 3-10: Campbell Soup Company, V8 Energy Shots
      • Figure 3-11: Starbucks, Refreshers Energy Drinks
      • Figure 3-12: Jamba Inc., Jamba All-Natural Energy Drinks
    • Cross-pollination of energy drinks
    • Convenience store channel store growth
      • Table 3-12: Number of convenience stores, 2006-2012
    • Economic conditions
    • Median income
      • Figure 3-13: Median Household Income in Inflation-Adjusted Dollars, 2006-2011
    • Unemployment and underemployment
      • Figure 3-14: Unemployment and Underemployment Rates in the U.S., 2007-2012
    • Consumer confidence
      • Figure 3-15: Consumer Confidence Index, 2007-2012
    • Shifts in population of key demographics
    • Young adult population
      • Figure 3-16: U.S. Adult Population by Age, 2011
    • Hispanic population
      • Figure 3-17: U.S. Adult Population by Race/Ethnicity, 2011
    • Linking energy drink/shot consumption with health risk
    • Competitive energy products
      • Figure 3-18: PureBrands, Sheets Energy
      • Figure 3-19: Rocasuba, Inc., Spot On Energy
      • Figure 3-20: Spotonenergy.com Comparison Chart, November 2012
      • Figure 3-21: AeroDesigns Inc., AeroShot Energy
      • Figure 3-22: Aeroshots.com, Tedeschi Food Shops Promotion November 2012
      • Figure 3-23: PepsiCo Frito-Lay., Cracker Jack'D
      • Figure 3-24: Jelly Belly Candy Company, Sport Beans
  • Market Forecast
    • Sales of energy drinks/shots projected to reach $21.5 billion by 2017
      • Figure 3-25: Projected U.S. Sales of Energy Drinks and Shots, 2012-2017 (in millions of dollars)
      • Table 3-13: Projected U.S. Sales of Energy Drinks and Shots, 2012-2017 (in millions of dollars and percent)

Chapter 4: The Marketers

  • Highlights
  • Top Marketers Dominate Energy Drink and Shot Sales
    • Figure 4-1: Top Marketers of Energy Drinks and Shots by Share of SymphonyIRI-Tracked Sales, 2012
    • Top Energy Drink and Shot Marketers by Category
      • Figure 4-2: Share of SymphonyIRI-Tracked Sales of Energy Drinks and Shots by Category, 2012
    • Red Bull and Monster Beverage continue to grow market share
    • Living Essential losing ground as energy shot category matures
    • Kraft Foods experiences strongest growth via energy drink mixes
      • Figure 4-3: Kraft Foods Inc, MiO Energy
    • High Performance Beverage performs well; Soda manufacturers' brands falter
      • Table 4-1: Top Marketers and Brands of Energy Drinks and Shots by Share of SymphonyIRI-Tracked Sales, 2012 (in millions of dollars and change over previous-year period)
      • Figure 4-4: Top Marketers of Energy Drinks and Shots by Share of SymphonyIRI-Tracked Sales, 2012
    • Top Brands
    • Red Bull launches Total Zero
    • Name change by Monster Beverage Corp. reflects powerhouse brand
    • Rockstar International churns out new products that go beyond energy
      • Figure 4-5: Rockstar International, Rockstar Relax
      • Table 4-2: Top Marketers and Brands of Energy Drinks and Shots by SymphonyIRI-Tracked Sales, 2012 (in millions of dollars and percent share)
    • Table 4-2: [cont'd.] Top Marketers and Brands of Energy Drinks and Shots by SymphonyIRI-Tracked Sales, 2012 (in millions of dollars and percent share)
    • Table 4-3: Top Brands of Energy Drinks and Shots by SymphonyIRITracked Sales, 2012 (in millions of dollars, share, and change over previous-year period)
  • Company Profile: Red Bull North America
    • Performance: Continued Growth
    • Sales analysis
      • Table 4-4: SymphonyIRI-Tracked Sales of Red Bull North America
    • Energy Drinks and Shots, 2012 (in thousands of dollars and percent change from previous-year period)
    • Volume and unit analysis
      • Table 4-5: SymphonyIRI-Tracked Sales of Red Bull Energy Drinks and Shots, 2011-2012 (in volume and units and percent change from previous-year period)
    • Brand Qualities
      • Figure 4-6: Red Bull, Red Bull Editions
    • Marketing Strategies
    • The Red Bull Consumer
      • Table 4-6: Demographic Snapshot of Red Bull Energy Drink Consumers, 2012 (U.S. adults)
    • Opportunities and Outlook
  • Company Profile: Monster Beverage Corp.
    • Performance: Strong Innovation
    • Sales analysis
      • Table 4-7: SymphonyIRI-Tracked Sales of Monster Beverage Corp.
    • Energy Drink, 2012 (in thousands of dollars and change from previous-year period)
    • Volume and unit analysis
      • Table 4-8: SymphonyIRI-Tracked Sales of Monster Energy Drinks, 2011-2012 (by volume and unit metrics and percent change from previous-year period)
    • Brand Qualities
      • Figure 4-7: Monster Beverage, Monster Energy
    • Marketing Strategies
    • The Monster Energy Consumer
      • Table 4-9: Demographic Snapshot of Monster Energy Drink
    • Consumers by Age Bracket, 2012 (U.S. adults)
    • Opportunities and Outlook
  • Company Profile: Living Essentials
    • Performance: Slow and Steady
    • Sales analysis
      • Figure 4-8: 5-Hour Energy, Pink Lemonade
      • Table 4-10: SymphonyIRI-Tracked Sales of Living Essentials
    • Energy Shots, 2012 (in thousands of dollars and percent change from previous-year period)
    • Volume and unit analysis
      • Table 4-11: SymphonyIRI-Tracked Sales of 5-Hour Energy Shots, 2011-2012 (in volume and units and percent change from previous-year period)
    • Brand Qualities
    • Marketing Strategies
      • Figure 4-9: 5-Hour Energy, “Why Do You Want To Walk?”
    • Sweepstakes
      • Figure 4-10: 5-Hour Energy, 5-Hour Energy Work Day Marathon App
    • The 5-Hour Energy Consumer
      • Table 4-12: Demographic Snapshot of 5-Hour Energy Shot
    • Consumers by Age Bracket, 2012 (U.S. adults)
    • Opportunities and Outlook
  • Company Profile: Rockstar International
    • Performance: Solid Growth Supported by Innovation
    • Sales analysis
      • Table 4-13: SymphonyIRI-Tracked Sales of Rockstar International
    • Energy Drink and Shots, 2012 (in thousands of dollars and change from previous-year period)
      • Table 4-14: SymphonyIRI-Tracked Sales of Rockstar Energy Drinks, 2011-2012 (in volume and unit metrics and percent change)
    • Volume and unit analysis
    • Brand Qualities
      • Figure 4-11: Rockstar International, Rockstar Recovery
    • Marketing Strategies
      • Figure 4-12: Rockstar International, Rockstar Boat Giveaway
    • The Rockstar Consumer
      • Table 4-15: Demographic Snapshot of Rockstar Energy Drink
    • Consumers by Age Bracket/Generation, 2012 (U.S. adults)
    • Opportunities and Outlook
  • Competitor Briefs
    • PepsiCo
      • Table 4-16: SymphonyIRI-Tracked Sales of PepsiCo Energy Drinks, 2012 (in thousands of dollars and change from previous-year period)
    • Kraft Foods
      • Table 4-17: SymphonyIRI-Tracked Sales of Energy Drink Mixes, 2012 (in thousands of dollars and change over previous-year period
    • High Performance Beverage
      • Table 4-18: SymphonyIRI-Tracked Sales of Energy Drinks and Shots, 2012 (in thousands of dollars and change over previous-year period)
    • Coca-Cola Company
      • Table 4-19: SymphonyIRI-Tracked Sales of Coca-Cola Company
    • Energy Drinks, 2012 (in thousands of dollars and change over previous-year period)
    • Private Label
      • Table 4-20: SymphonyIRI-Tracked Sales of Private Label Energy
    • Drink Products, 2012 (in millions of dollars and change over previous-year period)
  • Marketers and Brands to Watch
    • Figure 4-13: Top Marketers and Brands of Energy Drink Products by SymphonyIRI-Tracked Dollar Sales Growth, 2012 vs. 2011 (in millions of dollars)
    • Energy drink brands by dollar growth
      • Table 4-21: Top Energy Drink Brands by SymphonyIRI-Tracked
    • Dollar Sales Growth, 2012 vs. 2011 (in percent and dollar change over previous-year period)
    • Energy shot brands by dollar growth
      • Table 4-22: Top Energy Shot Brands by SymphonyIRI-Tracked
    • Dollar Sales Growth, 2012 vs. 2011 (in percent and dollar change over previous-year period)
    • Energy drink mix brands by dollar growth
      • Table 4-23: Top Energy Drink Mix Brands by SymphonyIRI-Tracked
    • Dollar Sales Growth, 2012 vs. 2011 (in percent and dollar change over previous-year period)

Chapter 5: The Consumer

  • Note on Experian Simmons Data
  • Highlights
  • Energy Drink Usage
    • Table 5-1: Energy Drink Usage Rates, 2006-2012 (percent of U.S. adults)
    • Young adults are core users of energy drinks
      • Table 5-2: Energy Drink Use by Age Bracket and Generational Cohort, 2012 (U.S. adults)
      • Figure 5-1: U.S. Adult Population by Age, 2011
    • Men more likely to consume energy drinks
      • Figure 5-2: Goddess Energy, Inc., Flirt Energy Drink
      • Table 5-3: Energy Drink Use by Gender, 2012 (U.S. adults)
    • Energy drinks are popular among minority race/ethnic groups
      • Table 5-4: Energy Drink Use by Race/Ethnicity, 2012 (U.S. adults)
      • Figure 5-3: U.S. Adult Population by Race/Ethnicity, 2011
    • Pacific region residents show uptick in energy drink consumption
      • Table 5-5: Energy Drink Use by Region of Residence, 2012 (U.S. adults)
    • Parents of young children more likely users of energy drinks
      • Table 5-6: Energy Drink Use by Presence and Age of Children in Household, 2012 (U.S. adults)
      • Figure 5-4: U.S. Adult Population by Presence of Children in Household, 2000-2010
  • Frequency of Energy Drink Usage
    • Table 5-7: Energy Drink Usage Frequency, 2006-2012 (percent of U.S. adults)
    • Energy drink brand usage
      • Figure 5-5: Hansen Natural, Monster Rehab Protean + Energy Drink
      • Table 5-8: Energy Drink Usage Frequency by Selected Brands, 2012 (U.S. adults)
  • Attitudes of the Energy Drink Consumer
    • Energy drink consumers strive to be youthful and health-minded
      • Table 5-9: Agreement Indexes Among Energy Drink Users for Selected Health and Nutrition Statements, 2012 (U.S. adults)
    • Energy drink users seek convenient short cuts
      • Table 5-10: Agreement Indexes Among Energy Drink Use for Selected Time and Convenience-Related Statements, 2012 U.S. adults)
    • Energy drink consumers experiment with food flavors and products
      • Table 5-11: Agreement Indexes Among Energy Drink Users for Selected Food Statements, 2012 (U.S. adults)
    • Willing to try new beverages, but may prefer alcoholic varieties
      • Table 5-12: Agreement Indexes Among Energy Drink Users for Selected Beverage Statements, 2012
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