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Is the Energy Drink Market Out to Kill As It Makes a Killing?

Is the Energy Drink Market Out to Kill As It Makes a Killing?

The energy drink market just won’t stop growing. As it continues to solidify its hold on its well-established sectors, it’s begun to get its fingers into several other highly-specific little sectors.

When one group reacted to the energy drink craze with rabid enthusiasm, the companies pushed products that were louder, more extreme, more shameless…

When another group reacted to what they perceived as unhealthy drinks marketed through exploitative campaigns targeting the young and vulnerable, the companies pushed “alternative” products that boasted herbal ingredients and played up their “natural” and “healthy” benefits.

We have energy drinks for extreme athletes. Energy drinks for endurance athletes. Energy drinks for women. Energy drinks for dieters. Energy drinks for clubbers, ravers and bar-hoppers. Energy drinks for students. Energy drinks for grown-ups. Energy drinks for energy drink lovers. And energy drinks for energy drink haters.

Because of this, the energy drink market continues to grow every single day. The forward push continues. The backlash continues. But either way, in one form or another, they’re here to stay.

Some of us are more caffeinated than ever. And some of us are more skeptical than ever.

We’re aware of the fact that the energy drink market is not sensitive to the health, let alone the concerns, of consumers. As long as they’re competing and profiting, it seems worth the risks.
History of the Energy Drink Market

If the energy drink market is the universe, then the day Red Bull hit the United States in 1997 was the Big Bang. This Thai energy drink (called Krating Daeng) marketed by the Austrian company Red Bull GmbH quickly rose to the top and hasn’t moved an inch. Red Bull is still the world’s leading energy drink brand, giving wings to about 65% of the energy drink market.

The secret to Red Bull’s success has, of course, been its marketing and unique positioning. Originally aimed at young people wanting to stay up late and do well on tests and in sports, Red Bull quickly took over a new market, infiltrating bars and clubs everywhere as the energy drink cocktail was born.

Red Bull promised to give you wings. And any health concerns raised around Red Bull’s high levels of caffeine only seemed to make the drink sexier to its market.

Once Red Bull had established that there was a desperately starving market for energy drinks, new brands emerged with names like Monster and Rockstar that marketed towards the young crowd by sponsoring sports events and music festivals and tours. Hip hop artists sponsored their own lines of energy drinks to appeal to the young, urban hip hop crowd like Lil Jon’s Crunk, Nelly’s Pimp Juice and Kanye West’s TBD Guru Energy Drink.

Riding on the wake of the illicit nature of these “extreme” energy drinks came brands like Cocaine Energy Drink, which has been banned and re-released twice in its short history, only to emerge more popular and in-demand than before.

Now that growth of these brands is finally slowing (still growing, just not quite as manically), we have seen the emergence of healthier alternatives to the energy drinks that caused so many to collapse of heart failure and seizures if not merely suffer headaches, insomnia and heart palpitations.

Brands like ACT Energy Drink, XS Energy Drink and Verve Energy Drink have hit the market while the old more extreme brands have branched out and released sugar-free energy drinks and low-carb energy drinks to appeal to this emerging second-wave market.
Growth and Projections of the Energy Drinks Market

Red Bull still remains the leader of the energy drink market with an approximate 65% share of the market worldwide. After it’s introduction to the U.S. in 1997, the energy drink market had grown to almost 400 million per fiscal year by 2001. By 2005, it had reached about $4 billion. Growing at an annual rate of about 12%, the energy drink market is expected to pass up the $9 billion mark by 2011.

Recent estimates have put the share of the U.S. energy drink market at 40% for Red Bull, 23% for Monster, 12% for Rockstar, 8% for AMP and 4% for Full Throttle.

While the majority of energy drinks were originally targeted towards athletes and students, the market has expanded to include a larger sector generally defined as being under 35 years of age and predominantly male.

Diet energy drinks and natural energy drinks are currently catapulting in growth as they reach a more health-conscious crowd along with the female market that traditional energy drinks have not as widely appealed to in the past.
Trends and Buzz in the Energy Drink Market

The explosion of energy shots proves that the energy drink market boom is not ready to die down just yet. In 2008, sales of this specific sector of the market came in at approximately $560 million and continues to grow. These tiny 2 or 3 ounce drinks are selling for up to $3 per shot with 5-Hour Energy leading the pack in sales and popularity.

On the exact opposite end of the spectrum, we’ve seen a growth since 2002 of energy drinks being packaged in larger cans. Many countries (including the U.S. and Canada) have limited the amount of caffeine per serving in energy drinks. In response to this, we’ve seen many companies (including Monster and Rockstar) sidestepping this by simply packing two servings into one can.

2007 saw the emergence of energy drink powders and tablets marketed as the more convenient and portable form of energy for athletes and people on the go.
Where Will the Energy Drinks Market Go Next?

energy-drink-marketWith energy drink brands like Cocaine, Blow and Pussy still catching the eye and loosening the purse strings of consumers, we’ll likely see the birth of more and more outlandish and extreme brand names designed to piss off parents and make young people feel cool and wild enough that it’s worth the $2-3 a pop.

Enough people will remain skeptical, steadfast and outspoken enough that the healthy energy drink market will likely continue to grow with more and more featuring energy drink herbal ingredients like green tea extract, ginkgo biloba and ginseng.

Energy drink companies will continue to appear more transparent with the truth about energy drink nutrition as well as the real energy drink ingredients. Whether pure truth will actually surface and whether consumers will actually take caution is another story.

Will we see enough publicity surrounding the dangers of energy drinks to actually give the energy drink market a good scare?

Unlikely.

Our country is obese and dying of diabetes and heart disease too, but we don’t seem to change our ways despite our awareness. It’s the weakness of human nature up against the power of the market.

And it doesn’t seem the energy drink market is any different.