US energy drinks market led by Red Bull and Monster

Press Release   •   Feb 18, 2013 09:26 GMT

The US energy drinks market is estimated to have increased by 60% over the past four years, hitting an estimated value of $12.5 billion in 2012. The industry is expected to continue this growth path, by rising to a valuation of $21.5 billion by 2017.

This growth will be driven by a number of factors, including an increasingly stable economic situation, expansion in retail distribution, and strong potential for increased product development.

This industry produces soft drinks that help boost energy through various ingredients, including caffeine, vitamins and herbal supplements. Common vitamins and herbs include vitamin B, guarana and taurine.

Intense competition surrounds the US energy drinks 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.

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 US energy drinks and shots market.

Red Bull continues to dominate as the US energy drink leader, but Monster has been catching up quite a bit in the last two years. While, 5 Hour Energy certainly has the energy shot market cornered with none of the others anywhere in the same universe as 5 Hour.

It has been estimated 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%).

Although the outlook looks promising for the market, many believe that the US energy drinks market has reached a saturation point. This has been reached earlier than expected because energy drink manufacturers have historically been poor innovators.

Red Bull, for example, has had two product lines in 15 years - original and sugar free. It has had a few minor offshoots in response to consumer concerns - but no true innovations. Monster has nearly 30 different flavours but no real clear differentiation between the products or their target markets.

For more information on the US energy drinks market, see the latest research: US Energy Drinks Market

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