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Energy Drinks - US - May 2017

Published By :

Mintel

Published Date : Jun 2017

Category :

Energy Drinks

No. of Pages : N/A

The energy drink category has shown strong growth from 2011-16, with sales forecast to increase through 2021. The segment has benefited from offering functional benefits with strong appeal to Millennials, parents, Hispanics, and men 18-34. Competition is growing however from sports drinks, BFY (better-for-you) beverages, RTD (ready-to-drink) coffees, and new hybrid drinks. Growth will hinge on capitalizing on energy drinks’ appeal to existing consumers, while expanding reach via innovations in flavor and functionality, including the development of healthier energy drink options.

Table of Content

OVERVIEW
What you need to know
Definition

EXECUTIVE SUMMARY
Growth slows in 2016, but projected to remain strong through 2021
Figure 1: Total US sales and fan chart forecast of energy drinks/shots, at current prices, 2011-21
The issues
Consumers can find energizing properties in a range of beverages
Figure 2: Any use and regular usage of drinks with energizing properties, by type of drink, February 2017
Energy drinks widely associated with caffeine, sugar, and artificial ingredients
Figure 3: Ingredient associations, by type of beverage, February 2017
Select attitudes suggest multiple challenges for market
Figure 4: Select attitudes towards energy drinks and shots, February 2017
The opportunities
Younger consumers, parents, Hispanics show robust category engagement
Figure 5: Any usage of energy drinks and shot, by select demographics, February 2017
Men 18-35 post high usage and cite many reasons for using energy drinks
Figure 6: Drinking motivation, for all and men 18-34, February 2017
Opportunities in low sugar, natural and organic formulations
Figure 7: Factors that would encourage increased usage, for all and women 18-34, February 2017
Interest in flavors, enhancements and premium ingredients is high
Figure 8: Interest in innovation related to ingredients and enhancements, February 2017
What it means

THE MARKET – WHAT YOU NEED TO KNOW
Growth continued in 2016, forecast to remain strong through 2021
The energy drink segment dominates and propels category growth
Crowded competitive landscape with BFY drinks, RTD coffee and tea
Demographic trends, including growth of Hispanics, support category
Challenges, opportunities in natural formulations, and healthy ingredients

MARKET SIZE AND FORECAST
Growth slows in 2016, but projected to remain strong through 2021
Figure 9: Total US sales and fan chart forecast of energy drinks, at current prices, 2011-21
Figure 10: Total US retail sales and forecast of energy drinks, at current prices, 2011-21

MARKET BREAKDOWN
Branded products dominate, with private label less than 1% of sales
Figure 11: Market share of MULO channel sales of energy drinks and shots, for largest and “other” brands, 2017
Energy drinks comprises the largest, fastest growing, segment
Figure 12: Market share of energy drinks, by segment 2016
Figure 13: Total US retail sales of energy drinks, by segment, at current prices, 2014 and 2016
Energy drink segment to post robust growth through 2021
Figure 14: Total US retail sales and forecast of carbonated soft drinks, by segment, at current prices, 2016
Full range of retail channels grow energy drink/shot sales from 2014-16
Figure 15: Total US retail sales of energy drinks, by channel, at current prices, 2014 and 2016

MARKET PERSPECTIVE
Range of competing products, many with higher levels of penetration
Figure 16: Consumption of drinks with energizing properties, by type, February 2017
Demand high for more natural ingredients, and labeling transparency
Quest for BFY drinks propels demand for enhanced bottled water
Enhanced juices and hybrid drinks offer natural energy drink alternatives
Fast-growing RTD Coffee and Tea offerings
Sports drinks appeal to men 18-35, compete on functionality
“Enhanced” sodas leverage brand recognition, plus tout added benefits
Hybrid drinks create more competition…and potential confusion
Energy drinks in food service and as mixers for cocktails/mocktails

MARKET FACTORS
Fast-paced lifestyles spur demand for convenient, functional beverages
Obesity drives demand for healthier, low or zero sugar drinks
Engagement among iGeneration and Millennials key to growth
Figure 17: Usage of energy drinks, by generation, February 2017
Figure 18: US population aged 18+, by age, 2012-22
Diverse young consumers and parents key to market
Figure 19: Population by race and Hispanic origin, 2012-22
Figure 20: Hispanic share of population, by generation, 2017
Figure 21: Usage of energy drinks, for Hispanics and Hispanic Millennials, February 2017

KEY PLAYERS – WHAT YOU NEED TO KNOW
Three largest suppliers command 86% of MULO sales
Monster grows sales in energy drinks, emerges as leading supplier
Private label slumps, while “others” build sales and share
Growth in premium drinks, natural flavors, organics, and botanicals

MANUFACTURER SALES OF ENERGY DRINKS
The three largest energy drink suppliers command 86% of MULO sales
Private label slumps, while “Other suppliers” see sales and share grow
Figure 22: Manufacturer sales of energy drinks, by leading companies, 2016 and 2017

WHAT’S WORKING?
Leading energy drink brands see MULO sales growth
Monster benefits from Coke partnership, focus on 18-35-year-old males
Monster sees mostly hits, with a few misses
Red Bull posts gains, reaches Millennials with expanded Editions line
Rockstar grows sales with new variations
Figure 23: Rockstar shoot with supermodels, February 2017
Figure 24: Rockstar sponsorships of Sabrosa Craft Beer, Taco & Music Festival, April 2017
“Other suppliers” build sales and make in-roads
Brand extensions from Starbucks, Mountain Dew, and AriZona grow sales
Other brands growth share and share from 2016-17

WHAT’S STRUGGLING?
Private label slumps
Energy shot sales drop in segment dominated by 5-hour ENERGY

WHAT’S NEXT?
More Energy drinks with natural, organic, and premium ingredients
Natural energy drinks with botanicals, honey and super foods

THE CONSUMER – WHAT YOU NEED TO KNOW
Usage is highest among men 18-34, Millennials, parents, and Hispanics
Boosting energy is top motivator, but secondary reasons are many
Interest is high for products with lower sugar, more natural ingredients
Energy drinks still generally associated with less-healthy ingredients
Consumers eager for innovation in flavor and functionality
Key attitudes suggest challenges, opportunities for suppliers

USAGE OF ENERGY DRINKS AND SHOTS
About one in five regularly consume energy drinks
Figure 25: Usage of energy drinks and energy shots, February 2017
iGeneration and Millennials comprise core energy drink consumer base
Figure 26: Usage of energy drinks, by generation, February 2017
Gender also at play, with males 18-35 as top energy drink consumers
Figure 27: Usage of energy drinks, by age and gender, February 2017
Parents consume more energy drinks
Figure 28: Usage of energy drinks, by parental status, February 2017
Hispanics – especially Hispanic Millennials – use more energy drinks
Figure 29: Usage of energy drinks, by Hispanic origin, February 2017
Figure 30: Usage of energy drinks, for Hispanic Millennials, February 2017

REASONS FOR USAGE
Energy drives usage, but flavor, mood, and mental focus also important
Figure 31: Drinking motivation, February 2017
Users 18-34, especially males, cite reasons for usage beyond energy
Figure 32: Motivation for energy drink/shot usage, by age and gender, part i, February 2017
Figure 33: Motivation for energy drink/shot usage, by age and gender, part ii, February 2017
Parents cite a greater number and range of benefits to energy drinks
Figure 34: Motivation for energy drink/shot usage, by parental status, February 2017
Flavor is an important driver for Hispanic consumption
Figure 35: Motivation for energy drink/shot usage, by Hispanic origin, February 2017

FACTORS THAT MAY ENCOURAGE INCREASED USAGE
Consumers seek lower sugar, sustained energy, and refreshing flavors
Figure 36: Factors that would encourage increased usage, February 2017
Women 18-35 especially interested in hydration, natural formulations
Figure 37: Factors that would encourage increased usage, by age and gender, February 2017
Parents seek more flavors, organic options, and small sizes
Figure 38: Factors that would encourage increased usage, by parental status, February 2017
Hispanics seek energy drinks in more refreshing flavors

INGREDIENT ASSOCIATIONS
Energy drinks associated with caffeine, sugar, and artificial ingredients
Figure 39: Ingredient associations, for range of beverages, February 2017
Males 18-34 more likely to cite range of ingredients in energy drinks
Figure 40: Ingredient associations, for energy drinks and shots, by gender and age, February 2017
Parents also associate energy drinks with wider range of ingredients
Figure 41: Ingredient associations, for range of beverages, by parental status, February 2017
Hispanics associate sugar, vitamins, and electrolytes with energy drinks
Figure 42: Ingredient associations, for range of beverages, by Hispanic origin, February 2017

INTEREST IN INNOVATIONS
Interest highest in energy products in fruit and tropical flavors
Figure 43: Interest in flavor innovation, February 2017
Interest in enhancements and premium ingredients is high
Figure 44: Interest in innovation related to ingredients and enhancements, February 2017
Fruit flavors show widespread appeal; women seek coffee flavors
Figure 45: Interest in innovation, parental status, February 2017
Integration of antioxidants and probiotics may expand energy drink appeal
Figure 46: Interest in innovation, by age and gender, February 2017
Parents interested in new flavors, premium ingredients
Figure 47: Interest in flavor and ingredient innovations, by parental status, February 2017
Hispanics show high interest in flavor innovation
Figure 48: Interest in innovation, by Hispanic origin, February 2017

ATTITUDES TOWARD ENERGY DRINKS AND SHOTS
Attitudes suggest challenges, opportunities for market
Figure 49: Attitudes toward energy drinks and shots, February 2017
A quest for new drinks, flavors propels iGeneration users to cut back
Figure 50: Attitudes towards energy drinks and shots, by gender and age, February 2017
Parents find drinks refreshing, hydrating – but sometimes are embarrassed to use them
Figure 51: Attitudes toward energy drinks and shots, by parental status, February 2017
Both Hispanics and Asians more likely to find energy drinks refreshing
Figure 52: Attitudes toward energy drinks and shots, by race and hispanic origin, February 2017

APPENDIX – DATA SOURCES AND ABBREVIATIONS
Data sources
Sales data
Fan chart forecast
Consumer survey data
Abbreviations and terms
Abbreviations

APPENDIX – THE MARKET
Figure 53: Total US sales and forecast of energy drinks/shots, at inflation-adjusted prices, 2011-21
Figure 54: Total US sales and forecast of energy drinks, at current prices, 2011-21
Figure 55: Total US sales and forecast of energy drinks, at inflation-adjusted prices, 2011-21
Figure 56: Total US sales and forecast of energy shots, at current prices, 2011-21
Figure 57: Total US sales and forecast of energy shots, at inflation-adjusted prices, 2011-21
Figure 58: Total US retail sales of energy drinks, by retail channel, at current prices, 2010-20
Figure 59: Average household size, by race and Hispanic origin, 2016
Figure 60: Distribution of generations by race and Hispanic origin, 2017
Figure 61: Median household income, by race and Hispanic origin of householder, 2015

APPENDIX – KEY PLAYERS
Figure 62: MULO sales of energy drinks by leading companies and brands, rolling 52 weeks 2016 and 2017
Figure 63: MULO sales energy shots by leading companies and brands, rolling 52 weeks 2016 and 2017

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