Energy Drinks - US - May 2016

OVERVIEW
What you need to know
Definition
EXECUTIVE SUMMARY
The issues
Energy shot sales continue to struggle
Figure 1: Total US retail sales and forecast of energy drinks and shots, by segment, at current prices, 2010-20
Consumers drink energy drinks/shots on occasion
Figure 2: Energy drinks and shots drinking occasion – Activity and occasion, February 2016
Safety concerns still present
Figure 3: Energy drink and energy shot attitudes – Safety concerns, February 2016
Energizing products available across food and drink categories
Figure 4: Food and drink products launched with the product description of “energy” with word variants, rolling year March 30, 2016
The opportunities
More consumers drinking, drinking more
Figure 5: Energy drink and shot consumption, trended January 2015 to February 2016
Increase consumption through usage occasions
Figure 6: Energy drinks and shots drinking occasion – Activity, February 2016
Interest in bulk offerings
Figure 7: Energy drink behaviors – Behaviors toward bulk energy drinks, February 2016
Niche innovation opportunity with premiumization, health
Figure 8: Energy drink and energy shot attitudes – Innovation, February 2016
What it means
THE MARKET – WHAT YOU NEED TO KNOW
Category sees continued growth
Energy drinks dominate category
Availability for functional energy across food and drink markets
Millennials, Hispanic consumers help drive growth
MARKET SIZE AND FORECAST
Category sees continued growth
Figure 9: Total US sales and fan chart forecast of energy drinks and shots, at current prices, 2010-20
Figure 10: Total US retail sales and forecast of energy drinks and shots, at current prices, 2010-20
Figure 11: Total US retail sales and forecast of energy drinks and shots, at inflation-adjusted prices, 2010-20
MARKET BREAKDOWN
Energy drinks dominate category
Figure 12: Total US retail sales and forecast of energy drinks and shots, by segment, at current prices, 2010-20
Energy drinks experience steady growth, energy shots stall
Figure 13: Total US retail sales and forecast of energy drinks and shots, by segment, at current prices, 2010-20
All channels experience sales gains from 2013-15
Figure 14: Total US retail sales of energy drinks and shots, by channel, at current prices, 2013 and 2015
Natural channel see growth
Figure 15: Natural supermarket sales of energy drinks and other functional beverages, at current prices, rolling 52-weeks Feb. 2014-Feb. 2016
MARKET PERSPECTIVE
Energizing products available across food and drink categories
Figure 16: Food and drink products launched with the product description of “energy” with word variants, rolling year March 30, 2016
Energy drink/shot consumers also drink sports and nutritional drinks
Figure 17: Sports and nutritional drink consumption – Any consumption, by energy drink and shot consumption – Any consumption, February 2016
Consumers drink multiple energy drink and shot brands
Figure 18: Energy drink and shot consumption – Sole and primary drinkers, by brand, December 2015
MARKET FACTORS
Energy drinks and shots in the media
Millennial population has positive growth
Figure 19: Population by generation, 2011-21
Hispanic population growing
Figure 20: Population by Hispanic origin, 2011-21
Overlap between Millennials, acculturated Hispanics, and parents
Millennials as parents
Figure 21: Households with own children, by age of householder, 2013
Hispanics as parents
Figure 22: Households with own children, by Hispanic origin of householder, 2013
Hispanics as Millennials
Figure 23: Generations, by Hispanic origin, 2016
KEY PLAYERS – WHAT YOU NEED TO KNOW
Leading companies experience healthy sales gains
Energy drink brands see MULO sales growth
Private label energy drinks, 5-hour ENERGY shots continue to decline
Category innovates with flavors, natural/organics, functionality
MULO SALES OF ENERGY DRINKS AND SHOTS
Leading energy drink companies continue to dominate, grow
Manufacturer sales of energy drinks and shots
Figure 24: MULO sales of energy drinks, by leading companies, rolling 52-weeks 2015 and 2016
WHAT’S WORKING?
Leading energy drink brands see MULO sales growth
Red Bull
Figure 25: Red Bull energy drink consumption, trended 2011-15
Monster
Figure 26: Monster Energy energy drink consumption, trended 2011-15
Rockstar
Figure 27: Rockstar energy drink consumption, trended 2011-15
Private label shots experience turn around
Figure 28: MULO sales of energy drink shots, by leading companies and brands, rolling 52-weeks 2015 and 2016
WHAT’S STRUGGLING?
Private label energy drinks continue to decline
Energy shot sales decline, reflective of 5-hour ENERGY struggles
Figure 29: 5-hour ENERGY shot consumption, trended 2011-15
WHAT’S NEXT?
Energy drinks innovate with new flavors, step closer to premiumization
Natural and organic energy gain traction
Opportunities for more functionality
Connecting through new channels and partnerships
THE CONSUMER – WHAT YOU NEED TO KNOW
Cross-consumption between natural and regular energy drink/shot types
More consumers drinking, drinking more
Older Millennials drive energy drink and energy shot growth
Parents heavy energy drink/shot consumers
Fathers, mothers target energy drink/shot consumers
Hispanics over index for energy/shot consumption
Morning, afternoon most popular times for consumption
Before exercise, as occasional pick-me-up most popular ways to drink
Opportunity to reach drinkers through interests, activities
Mass merchandisers leading purchase location for energy drinks/shots
Flavor more important in energy drink selection
Flavor, effectiveness equally important to energy shot purchases
One in five purchase single-serve more often than bulk
Interest in all-natural/niche innovation, safety concerns persist
ENERGY DRINK AND ENERGY SHOT CROSS-CONSUMPTION
Cross-consumption between natural and regular energy drink/shot types
Figure 30: Energy drink and shot consumption – Any consumption, by energy drink and shot consumption – Any consumption, February 2016
AWARENESS ON THE RISE
More consumers drinking, drinking more
Figure 31: Energy drink and shot consumption, trended January 2015 to February 2016
Figure 32: Energy drink and shot volume consumption, by # of drinks in the last 30 days, December 2015
CORE CONSUMERS – GENERATION
Older Millennials heaviest energy drink consumers
Figure 33: Non-alcoholic beverage consumption – Energy drinks, by generation, November 2015
Older Millennials drive energy drink and energy shot growth
Figure 34: Energy drink and shot consumption – More/same/less, by iGeneration and Millennials, February 2016
Little change with Gen X, Baby Boomers drinking habits
Figure 35: Energy drink and shot consumption – More/same/less, by Generation X and Baby Boomers, February 2016
CORE CONSUMERS – PRESENCE OF CHILDREN
Parents heavy energy drink consumers
Figure 36: Non-alcoholic beverage consumption – Energy drinks, by parental status, November 2015
Parent consumption increases, slight growth among non-parents
Figure 37: Energy drink and shot consumption – More/same/less, by parental status, February 2016
CORE CONSUMERS – GENDER AND PARENTAL STATUS
Fathers, mothers target energy drink consumers
Figure 38: Non-alcoholic beverage consumption – Energy drinks, by gender and parental status, November 2015
Fathers are key audience
Figure 39: Energy drink and shot consumption – More/same/less, by men and parental status, February 2016
Energy drink/shot growth with mothers
Figure 40: Energy drink and shot consumption – More/same/less, by women and parental status, February 2016
CORE CONSUMERS – RACE AND HISPANIC ORIGIN
Hispanics over index for energy drink consumption
Figure 41: Non-alcoholic beverage consumption – Energy drinks, by race and Hispanic origin, November 2015
Hispanics most likely to increase energy drink/shot consumption
Figure 42: Energy drink and shot consumption – More/same/less, by Hispanic origin, February 2016
DAYPART
Morning, afternoon most popular for energy drink/shot consumption
Figure 43: Energy drinks and shots drinking occasion – Day part, February 2016
DRINKING OCCASIONS
Before exercise, as occasional pick-me-up most popular ways to drink
Figure 44: Energy drinks and shots drinking occasion – Activity and occasion, February 2016
Millennials over index at usage activities and occasions
Energy drinks/shots part of Older Millennials routine
Figure 45: Energy drinks and shots drinking occasion – Activity and occasion, by generation, February 2016
Opportunity to appeal to mothers through activities and occasions
Figure 46: Energy drinks and shots drinking occasion – Activity and occasion, by women and parental status, February 2016
Consumers drink energy drinks between meals
Figure 47: Energy drink behaviors – Consumption with/without a meal February 2016
LIFESTYLE INTERESTS
Opportunity to reach drinkers through popular activities
Figure 48: Activities/sports played or performed in the past 12 months, by energy drink and shot consumers, December 2014-15
Appealing to top interest of drinkers
Figure 49: Consumer interest in sports/activities – Part 1, by energy drink and shot consumers, December 2014-15
Room to connect with consumers through at-home hobbies, activities
Figure 50: Activities/sports played or performed in the past 12 months –Part 1, by energy drink and shot consumers, December 2014-15
PURCHASE LOCATION
Mass merchandisers leading purchase location for energy drinks/shots
Figure 51: Energy drinks and shots purchase location, February 2016
Older Millennials purchase at a variety of outlets
Older consumers purchase at limited retail locations
Figure 52: Energy drinks and shots purchase location, by generation, February 2016
IMPORTANT ENERGY DRINK ATTRIBUTES
Flavor more important than price
Figure 53: Energy drinks purchasing factors, February 2016
IMPORTANT ENERGY SHOT ATTRIBUTES
Flavor, effectiveness equally important to energy shot purchases
Figure 54: Energy shots purchasing factors, February 2016
BULK AND SINGLE-SERVE ENERGY DRINK PREFERENCES
23% purchase single-serve more often than bulk
Figure 55: Energy drink behaviors – Behaviors toward single-serve energy drinks, February 2016
Millennials purchase single-serve energy drinks
Reaching mothers and non-mothers through bulk and single-serve
Availability, price savings encourage bulk purchases
Figure 56: Energy drink behaviors – Behaviors toward bulk energy drinks, February 2016
Older Millennials drive bulk purchases
Figure 57: Energy drink behaviors – Behaviors toward bulk energy drinks, by generation, February 2016
ATTITUDES TOWARD ENERGY DRINKS AND ENERGY SHOTS
Growing interest in natural
Figure 58: Energy drink and energy shot attitudes – All natural energy drinks/shots, February 2016
Safety concerns still present
Figure 59: Energy drink and energy shot attitudes – Safety concerns, February 2016
Total consumers not yet on board with age, gender specific products
Figure 60: Energy drink and energy shot attitudes – Gender/age specific, February 2016
Innovation opportunity with premiumized offerings
Interest in added health benefits
Figure 61: Energy drink and energy shot attitudes – Innovation, February 2016
APPENDIX – DATA SOURCES AND ABBREVIATIONS
Data sources
Sales data
Fan chart forecast
Consumer survey data
Consumer qualitative research
Abbreviations and terms
Abbreviations
Terms
APPENDIX – MARKET
Figure 62: Total US retail sales and forecast of energy drinks, at current prices, 2010-20
Figure 63: Total US retail sales and forecast of energy drinks, at inflation-adjusted prices, 2010-20
Figure 64: Total US retail sales and forecast of energy shots, at current prices, 2010-20
Figure 65: Total US retail sales and forecast of energy shots, at inflation-adjusted prices, 2010-20
Figure 66: Total US supermarket sales of energy drinks and shots, at current prices, 2010-15
Figure 67: Total US convenience store sales of energy drinks and shots, at current prices, 2010-15
Figure 68: Total US drugstore sales of energy drinks and shots, at current prices, 2010-15
Figure 69: Total US sales of energy drinks and shots sales through other retail channels, at current prices, 2010-15
APPENDIX – KEY PLAYERS
Figure 70: MULO sales of energy drinks, by leading companies and brands, rolling 52-weeks 2015 and 2016
Figure 71: MULO sales of energy drink shots, by leading companies and brands, rolling 52-weeks 2015 and 2016
APPENDIX – CONSUMER
Figure 72: Energy drink and/or shot consumption, by total demographic consumption, by brand, December 2015
Figure 73: Energy drink and/or shot consumption, by total brand consumption, by demographics, December 2015
Figure 74: Energy drink and/or shot consumption – Past 30 days. by demographics, December 2015
Figure 75: Activities/sports played or performed in the past 12 months, by energy drink and shot consumers, December 2015
Figure 76: Consumer interest in sports/activities, by energy drink and shot consumers, December 2015
Figure 77: Activities performed, by energy drink and energy shot consumers, December 2015
APPENDIX – BEVERAGE BLURRING
Figure 78: Non-alcoholic beverage consumption – Energy drinks, by demographics, November 2015