Energy Drinks - US - May 2018

OVERVIEW
What you need to know
Definition
EXECUTIVE SUMMARY 
Steady growth seen in 2017 and forecast through 2022
Figure 1: Total US sales and fan chart forecast of energy drinks, at current prices, 2012-22
The issues
Many beverages that offer energy are available…and widely used
Figure 2: Other drinks used for energy other than energy drinks/shots, March 2018
Concerns related to ingredients, safety and sweetness limit consumption
Figure 3: Reasons did not purchase energy drinks and shots, March 2018
Energy drinks often seen as “not for people like me” beyond 18-34 male demographic
Figure 4: Energy drinks/shots are “not for people like me,” by age/gender, March 2018
The opportunities
18-34-year-olds and parents are avid consumers who regularly use energy drinks
Figure 5: net consumption of energy drinks, for men, 18-34 year olds and parents, March 2018
Dads in particular are enthusiastic and regular energy drink consumers
Figure 6: Frequency of consumption of energy drinks, for 18-34 year olds, moms and dads, March 2018
Distinct reasons for drink/shot usage illuminate opportunities for differentiation
Figure 7: Reasons for usage, by type of product, March 2017
Interest is high in new flavors and drink recipes
Figure 8: interest in new flavors and drink recipes, for select demographics, March 2018
What it means
THE MARKET – WHAT YOU NEED TO KNOW
Growth remains positive, fairly stable in $13.4 billion market
Energy drink segment is largest and fastest growing
Highly competitive landscape with many drink options for energy
Concern with additives, sugar and safety continues to fuel innovation
MARKET SIZE AND FORECAST
2017 growth approaches 6% in the $13.4 billion market
Figure 9: Total US sales and fan chart forecast of energy drinks, at current prices, 2012-22
Figure 10: Total US retail sales and forecast of energy drinks, at current prices, 2012-22
MARKET BREAKDOWN
The top four brands control vast majority of the market
Figure 11: market share of MULO channel sales of energy drinks and shots, for top four brands and other/private label brands, 2018
Energy drinks dominates, accounting for majority of sales and growth
Figure 12: Market share of energy drinks, by segment 2017
Figure 13: Total US retail sales of energy drinks, by segment, at current prices, 2015 and 2017
Segment growth trends forecast to continue through 2022
Figure 14: Total US retail sales and forecast of carbonated soft drinks by segment, at current prices, 2016
C-stores comprise largest retail channel, but “others” fastest growing
Figure 15: Total US retail sales of energy drinks, by channel, at current prices, 2015 and 2017
MARKET PERSPECTIVE
Consumers turn to a wide range of drinks for energy
Figure 16: Other drinks used for energy other than energy drinks/ shots, March 2018
Demand is high for BFY drinks with more natural, low sugar profiles
Hybrid drinks notably tout BFY benefits and may inspire innovation
RTD coffee and tea compete directly with energy drinks in c-stores
Sports drinks are widely used for energy by men and women 18-34
“Enhanced” sodas and refreshed diet soda brands also compete
MARKET FACTORS 
Managing health, weight and energy in busy, on-the-go lifestyles
Positive macro-economic context underpins spending on energy drinks
Figure 17: Consumer confidence and unemployment, 2000-February 2018
18-34-year-olds, key to market growth, are increasingly diverse
Figure 18: US population aged 18+, by age, 2013-23
Figure 19: Population by race and Hispanic origin, 2013-23
Figure 20: Distribution of population, by age race and Hispanic origin, 2018
KEY PLAYERS – WHAT YOU NEED TO KNOW 
Four largest players account for 95% of MULO sales
Monster confirms leading position in the market
Red Bull expands reach and Rockstar grows, but slowly
Smaller natural labels innovate in flavors and functionality
BRAND SALES OF ENERGY DRINKS
Four largest suppliers account for 95% of MULO sales
Private label and “other suppliers” struggle to build share
Figure 21: Manufacturer sales of energy drinks, by leading companies, 2017 and 2018
WHAT’S WORKING?
Energy drinks continue to grow sales
Monster expands its leading position in the energy drink segment
Monster Zero Energy Ultra stands out as strong performer
Red Bull’s growth is more modest, but is innovating to expand reach
Figure 22: Red Bull 2017 recap, 2018
Smaller, specialized product lines drive Rockstar’s growth
Figure 23: rockster God of War promotion, April 2018
While growth slow for most “other suppliers,” a few make inroads
Arizona RX Energy and V8 Fusion Plus Energy show growth
Several other suppliers grow sales from 2017-18
WHAT’S STRUGGLING?
Brand recognition matters, private label and smaller brands struggle
The energy shot segment continues to lose volume and share
WHAT’S NEXT?
Premium, natural ingredients and flavors
Natural energy and benefits, with ingredients from probiotics to propolis
THE CONSUMER – WHAT YOU NEED TO KNOW 
Males, those aged 18-34 and parents stand out as peak users
Usage of energy drinks twice that of shots
Supermarkets, c-stores and mass are top retail channels
Seeking “on the go” energy is key, but many other reasons cited
New flavor is key innovation, sought by four in ten
Brand allegiance is high, favoring leading suppliers
Barriers to usage include ingredients, sweetness and safety
FREQUENCY OF CONSUMPTION
Four in ten consume energy drinks
Figure 24: Frequency of consumption of energy drinks and energy shots, March 2018
Those aged 18-34 are key energy drink/shot consumers
Figure 25: Frequency of consumption of energy drinks, by age, March 2018
Males are more likely to be avid, frequent consumers
Figure 26: Frequency of consumption of energy drinks, by gender, March 2018
Parents consume more energy drinks
Figure 27: Frequency of consumption of energy drinks, by parental status, March 2018
Affluent consumers use energy drinks less often
Figure 28: Frequency of consumption of energy drinks, by household income, March 2018
TYPE OF DRINK
Regular energy drinks remain most widely consumed
Figure 29: Type of energy drink or shot, March 2018
Men show high use of a wide range, while women turn to natural drinks
Figure 30: Type of energy drink or shot, by age and gender, March 2018
Upper-income consumers over-index for natural energy drinks
Figure 31: Type of energy drink or shot, by household income, March 2018
Parents use a greater number and range of energy drinks/shots
Figure 32: Type of energy drink or shot, by parental status, March 2018
Non-Hispanics over-index for regular drinks, Hispanics for natural shots
Figure 33: Type of energy drink or shot, by Hispanic status, March 2018
RETAILER USED
Energy drinks purchased at wide range of retailers
Figure 34: Retailers used to purchase energy drinks/shots, march 2018
Men 18-34 most likely to consume energy drinks at bars, restaurants
Figure 35: Retailers used to purchase energy drinks/shots, by age/gender, march 2018
Income shapes retailers favored for energy drink/shot purchase
Figure 36: Retailers used to purchase energy drinks/shots, by household income, march 2018
Parents shop more at mass merchandisers, club stores, internet retailers
Figure 37: Retailers used to purchase energy drinks/shots, by parental status, march 2018
REASONS FOR USAGE
Energy “on the go” is the top reason for usage
Figure 38: Reasons for usage of energy drink/energy shot, March 2017
Taste and refreshment important for drinks, functional benefits for shots
Figure 39: Reasons for usage, by type of product, March 2017
Figure 40: Reasons for usage of energy drink, by type of drink/shot, March 2018
Correspondence analysis shows how reason can shape product choice
Figure 41: Correspondence analysis – Motivations for drinking, March 2018
Those 25-34 cite range of functional benefits to energy drink/shot usage
Figure 42: Reasons for usage of energy drink or shot, by age, March 2018
impacts reasons for usage
Figure 43: Reasons for usage of energy shots, by gender, March 2018
Lower income users turn to energy drinks for wide range of reasons
Figure 44: Reasons for usage of energy drink, by household income, March 2018
Parents’ many reasons for consumption supports their engagement
Figure 45: Reasons for usage of energy drink, by parental status, March 2018
Hispanic origin shapes reason for consumption
Figure 46: Reasons for usage of energy drink, by Hispanic origin, March 2018
ATTITUDES AND INTERESTS RELATED TO ENERGY DRINKS/SHOTS
High interest in new flavors and frequent impulse buys
Figure 47: attitudes related to energy drinks and shots, March 2018
Men more likely to report routine usage and stock up on drinks
Figure 48: attitudes related to energy drinks and shots, by gender, March 2018
Impulse buys are widespread among 18-24-year-olds
Figure 49: attitudes related to energy drinks and shots, by age, March 2018
Parents more likely to be routine energy drink users
Figure 50: attitudes related to energy drinks and shots, by parental status, March 2018
Hispanics buy more on impulse, less interested in brand and new flavors
Figure 51: attitudes related to energy drinks and shots, by Hispanic origin, March 2018
BEHAVIORS AND PREFERENCES IN ENERGY DRINKS/SHOTS
About half stick with familiar brands and flavors
Figure 52: Behaviors and interests related to energy drinks and shots, March 2018
Age and gender shape a number of behaviors
Figure 53: Behaviors and interests related to energy drinks and shots, by age and gender, March 2018
Affluent users are more likely to consider type of sweetener
Figure 54: Behaviors and interests related to energy drinks and shots, by household income, March 2018
Parents use different flavors and are attentive to sweeteners
Figure 55: Behaviors and interests related to energy drinks and shots, by parental status, March 2018
Hispanics show less concern with brand and sweeteners
Figure 56: Behaviors and interests related to energy drinks and shots, by hispanic origin, March 2018
ATTITUDES LIMITING USAGE OF ENERGY DRINKS AND SHOTS
Attitudes suggest challenges, opportunities for market
Figure 57: Reasons did not purchase energy drinks and shots, March 2018
Sweetness, flavors and ingredients limit usage of 18-34-year-old females
Figure 58: Reasons did not purchase energy drinks and shots, by age/gender, Part i, March 2018
Figure 59: Reasons did not purchase energy drinks and shots, by age/gender, part ii, March 2018
Income shapes concern with artificial ingredients
Figure 60: Reasons did not purchase energy drinks and shots, by household income, March 2018
Non-parents are more likely to find drinks “aren’t for people like them”
Figure 61: Reasons did not purchase energy drinks and shots, by parental status, March 2018
ALTERNATIVES TO ENERGY DRINKS/SHOTS
Coffee tops long list of other beverages used for energy
Figure 62: Other drinks used for energy other than energy drinks/ shots, March 2018
18-34-year-olds show high usage of beverages beyond coffee, tea, CSDs
Figure 63: Other drinks used for energy other than energy drinks/shots, by gender/age, Part I, March 2018
Figure 64: Other drinks used for energy other than energy drinks/shots, by gender/age, Part II, March 2018
Parents use greater number, range of alternative drinks
Figure 65: Other drinks used for energy other than energy drinks/shots, by parental status, March 2018
Hispanics show somewhat higher usage of coffee, tea and sports drinks
Figure 66: Other drinks used for energy other than energy drinks/ shots, by Hispanic origin, March 2018
APPENDIX – DATA SOURCES AND ABBREVIATIONS
Data sources
Sales data
Fan chart forecast
Consumer survey data
Direct marketing creative
Methodology – Correspondence analysis
Abbreviations and terms
Abbreviations
APPENDIX – MARKET 
Figure 67: Total US sales and forecast of energy drinks/shots, at inflation-adjusted prices, 2012-22
Figure 68: Total US sales and forecast of energy drinks, at current prices, 2012-22
Figure 69: Total US sales and forecast of energy drinks, at inflation-adjusted prices, 2012-22
Figure 70: Total US sales and forecast of energy shots, at current prices, 2012-22
Figure 71: Total US sales and forecast of energy shots, at inflation-adjusted prices, 2012-22
Figure 72: Total US retail sales of energy drinks, by retail channel, at current prices, 2012-27
APPENDIX – KEY PLAYERS 
Figure 73: MULO sales of energy drinks by leading companies and brands, rolling 52 weeks 2017 and 2018
Figure 74: MULO sales energy shots by leading companies and brands, rolling 52 weeks 2017 and 2018
APPENDIX – CONSUMER 
figure 75: teen consumption of energy drinks/shots, by age, any consumption, Spring 2017
figure 76: teen consumption of energy drinks vs. shots, by age, spring 2017
figure 77: teen consumption of energy drinks/shots, by age and number of drinks last thirty days, Spring 2017