Category Focus: Energy Drinks
August 15, 2008
Bulls, monsters and rockstars continue to dominate the energy drink scene, but as this very male and very youth-oriented category matures, it is expanding to include a softer side, with natural products and drinks that blend energy with juice and hydration concepts.
The energy drink category grew 26 percent through the four major retail channels of grocery, drug, mass merchandise (excluding Wal-Mart) and convenience stores during the year ending June 15, according to Chicago-based market research firm Information Resources Inc. Total category sales were more than $4.5 billion, of which $3.7 billion were sold through convenience stores.
Little variation exists among the top brands across retail channels. Red Bull, Monster Energy, Rockstar and Full Throttle hold the top spots in all outlets. As individual products, Red Bull leads the category by a huge margin, selling $1.68 billion in IRI’s measured retail outlets, nearly a billion dollars more than its next closest competitor. The brand holds nearly 37 percent market share in the category.
But Monster and other top brands such as Rockstar have multiple brand extensions on the market, and when combined, Monster SKUs brought in a closer $1.2 billion. Flagship Monster Energy holds more than 17 percent market share in IRI’s measured outlets. Monster Energy XXL holds 4.4 percent market share, and newcomer Monster Java picked up a 3.3 percent share in its first year.
Most of the major energy drink brands picked up double-digit sales increases during the past year, including a 27 percent gain by Red Bull, a 32 percent increase by Monster Energy and a 12 percent increase for Rockstar’s flagship product. Rockstar Juiced, a juice and energy combo, grew nearly 49 percent. Triple-digit gains were made by NOS Energy Drink, which was up 176 percent vs. the prior year; PepsiCo’s Amp Overdrive, up 214 percent; and SoBe Essentials, up 135 percent.
New products abound
As energy drinks become a more permanent fixture in the beverage marketplace, the category also is becoming more diverse. Through the end of June, Mintel’s Global New Product Database has measured 229 new energy drink introductions, compared with the 60 that rolled out during the same period in 2007. Manufacturers are looking to unique demographics for their products, whether through brand name, formulation, flavor, packaging or marketing.
Coffee/energy drink hybrids may be the category to watch during the next year, as evidenced by the success of Hansen’s Java Monster lineup in its first year on the market. The company added new flavors earlier this year, including Lo-Ball, a low-calorie version of Java Monster that offers 50 calories per serving, and Nut-Up, Java Monster’s take on a non-fat soy latte. Java Monster Chai Hai + Energy is a chai-flavor formulated with tea, cream, spices and an energy ingredient blend.
Monster also added an “international” line of Java Monster beverages, and with a nod toward the energy-drink-as-cocktail-mixer trend, suggests mixing them with certain spirits. Java Monster Irish and Java Monster Russian are coffee and cream flavored varieties, which the company, suggests combining with whiskey and vodka, respectively.
Starbucks and Pepsi-Cola also got into the game this summer with Doubleshot Energy + Coffee, a new line of ready-to-drink coffee products containing coffee, B vitamins, guarana and ginseng. The line is available in Mocha, Vanilla and Coffee flavors, and packaged in single-serve 15-ounce cans.
Another up-and-coming category, energy shots, are part beverage, part supplement. Bookoo Holdings Inc., Addison, Texas, teamed with convenience store chain Circle K to create an extension to Circle K’s GazZu energy drink brand called the GazZu Shooter.
NOS Energy Drinks, inspired by the auto racing community, rolled out NOS Powershot, a 2-ounce formulation that is described as a liquid energy supplement. “This is not NOS Energy Drink! Powershot is highly concentrated and much more powerful,” reads the brand’s packaging.
Wet Planet Beverages, Rochester, N.Y., also went with the energy shot concept, with the Jolt line extension Jolt Endurance Shot. The 2-ounce, sugar-free product contains amino acids, electrolytes, vitamins and enzymes in addition to caffeine. The company says the formula is intended to provide six hours of energy.
And Drinks That Work Inc., Westlake Village, Calif., released a new flavor of its Upshot Energy Shot, a 2.5-ounce energy booster. 5Berry Upshot Energy Shot Pomegranate contains five berries, including goji, red raspberry, blackberry, blueberry and pomegranate. Upshot contains 200 mg. of caffeine.
New twists on the traditional
Energy drinks have a unique ability to zero in on specific market segments, as Hobarama LLC’s new Bawls Guarana G33k B33r proves. The Miami-based company extended its Bawls Guarana brand to a very specific, techy audience, with the root beer-flavored product that takes its name from “Leet Speek,” a language popular among high-tech fans who like to substitute letters with numbers.
The company also released Bawls Guarana Exxtra, a sugar-free variety that contains 50 percent more caffeine – 96 mg. per 10-ounce serving and 150 mg. per 16-ounce serving – than the original Bawls Guarana flavor.
Caribbout Export Corp., Bayamón, Puerto Rico, features the Hispanic-targeted Ciclón Energy Drink line, and recently added new C* Cranberry and C* Berry Strong flavors. Ciclón products are packaged in 16.6-ounce and 8.3-ounce cans, and were developed with a formulation that does not contain guarana or glucoronalactone. The products do contain caffeine, inositol, ascorbic acid, calcium-d-pantothenate, riboflavin, biotin and vitamins B6 and B12.
On the more traditional side of the category, Dr Pepper Snapple Group, Plano, Texas, got into the energy drink category this spring with a product called Venom, which is packaged in a re-sealable 16.9-ounce aluminum bottle. The energy drink contains caffeine, l-carnitine, guarana, ginseng and taurine. Two flavors include Black Mamba, with 120 calories and 29 grams of carbohydrates; and Mojave Rattler, a low-carbohydrate, low-calorie variety with 25 calories and 4 grams carbohydrates.
Soft drink companies PepsiCo and Coca-Cola expanded their energy lineups with new product concepts containing electrolytes. Pepsi released Amp Energy Relaunch, Traction and Elevate. Relaunch is Citrus flavored and contains electrolytes and B vitamins. Traction is Grape flavor, and is enhanced with maltodextrin and d-ribose. Elevate features a Mixed Berry flavor and l-theanine.
Coca-Cola added Full Throttle Hydration, combining energy ingredients with the electrolyte benefits of a sports drink. The product is available in a Tropical Mix flavor.
Guru Energy Drink, based in Montreal, also introduced energy hybrids Guru Sports (Lemon-Lime flavor), Guru Iced Tea (Green Tea Honey-Lemon flavor) and Guru Juicy (Tangerine flavor), which combine Guru’s energy ingredients and botanical extracts. The non-carbonated, all-natural beverages are certified organic.
Bio-Engineered Supplements and Nutrition Inc., Boca Raton, Fla., developed Endorush, an energy and performance beverage line that also combines energy ingredients with electrolytes for hydration. Available in Grape Fix and Fruit Punch Fix, Endorush contains no calories and a formula that includes amino acids, electrolytes, antioxidants, as well as caffeine.
Red Bull went the other direction this year, with its first non-energy formula, Red Bull Cola. The product will be marketed as a 100 percent natural cola, with no preservatives, phosphoric acid or artificial flavors. The cola contains kola nut, coca leaf, and while it has slightly more caffeine than a traditional cola, the company is staying away from energy references.
Red Bull Cola initially was launched in seven countries, including the United States, in June, with a release in Las Vegas. Domestically, the cola will be available in 8.4-ounce cans in bars, restaurants and nightclubs. In grocery and convenience stores, it will be available a in 12-ounce can and four-packs.
Ocean Spray, Lakeville-Middleboro, Mass., showed a different side of energy drinks this spring when it rolled out Cranergy, a more female-oriented mix of cranberry juice, five B vitamins, vitamin C and green tea extract. The product is packaged more like a juice than an energy drink, in 12-ounce and 46-ounce bottles, and features Cranberry Lift and Raspberry Cranberry Lift varieties.
Cranergy joins Bloom Energy from Del Monte Foods, San Francisco, which rolled out last year as a juice and energy blend, also targeted to women. The product contains calcium and vitamin D in addition to energy-promoting B vitamins and caffeine from white tea.
Apple & Eve, Port Washington, N.Y., also put a new twist on energy and juice blends and took on the morning with Awake. The product contains taurine, caffeine, EGCG, l-carnitine and a host of vitamins.
Sambazon, San Clemente, Calif., rolled out Sambazon Amazon Energy, an organic energy drink made with acai, other “superfruits” and botanicals. The energy drink features acerola, an exotic citrus cherry that helps deliver more than 1,000 percent of the recommended daily allowance of vitamin C per can. Amazon’s energy blend combines Brazilian guarana as well as branded ingredients such as Guayaki yerba maté and Steaz green tea extract.
Honest Tea, Bethesda, Md., took its organic tea base and added an energy formulation to the lineup this spring. Citrus Green Energy Tea contains green tea, yerba maté, oranges and lemons. Playing on the “energy” theme of the new product, Honest Tea pledged to buy renewable energy credits to help offset the energy consumed in its production chain.
Also using tea as its energy base, Inko’s White Tea Energy hit the market, promoting the “jitter-free” benefits of white tea. The ginger and lemon-flavored energy drink creates a point of difference by being 100 percent natural, and offers an energy product to the natural foods retail segment, from which more traditional energy drinks had been shut out.
Steaz Energy, from the Healthy Beverage Co., Newtown, Pa., went natural and socially conscious with a certified organic, Fair Trade and kosher formulation. The product derives its energy components from green tea and yerba maté. The company recently added Lime, Orange and Diet Organic Berry flavors to the line.
And making use of alternative sweeteners, Texas’ Organic Beverage Co. rolled out Syzmo. The Blue Agave flavored drink is certified USDA Organic and is made with coffee fruit, guarana, green tea and yerba maté. It also has a low glycemic index rating of 30. The drink launched in original Blue Agave flavor, Passion and Prickly Pear.