PDA

View Full Version : are energy drinks here to stay?



popologist
06-06-2006, 04:04 PM
i know that energy drinks are all the rage right now, but... when do you think they'll reach the "saturation point" (or peak) and start to decline?

are they just a fad? or will the be around for decades?

or will there only be a handful still standing by the end of the decade?

i just wanted your input.

CStoreCatMan
06-06-2006, 05:16 PM
Think of it this way, CSD used to be the king of beverage categories...until alternative beverages came. Them more alternative beverages came...and the public started to switch. IMO, the only reason the energy category grew so fast is because the concept of an "energy drink" had never been done before. There were no alternatives...therefore its experienced unbelievable growth. We're at the point where the category has been in full swing for a few years...alternatives to energy WILL come and steal its glory. At that time, (which I believe will be prior to 2010) the energy category will remain with only the biggest players. The rest will retire to liquor and dollar stores...

[ 06-06-2006, 04:22 PM: Message edited by: CStoreCatMan ]

greg
06-06-2006, 05:46 PM
I think it is here to stay. Coca Cola was the first Real Energy Drink. If you look at its historical advertising it is plain to see that Coca-Cola was supposed to "pick you up". Of course like all things it will change as much as it will stay the same. Peoples taste, attitudes, needs/wants, change constantly and energy drinks are the point that they will change with them. Look at all the derivatives out there: Energy drinks with Juice, with cola,with alcohol, etc. Size differences also. Those things show that Energy drink makers are responding to different needs and wants of it's demographics.
Innovation along with an eye towards consumer demand will always keep energy drink sales climbing.

Skynet
06-06-2006, 10:02 PM
There will always be a market of college students, geeks, gamers, etc. that need it. The popularity will die down but it'll stay.

mr jones
06-07-2006, 02:23 AM
I think the energy category will stick around for a while, but I also think it will soon lose the luster its enjoyed so far.

[ 06-07-2006, 01:24 AM: Message edited by: mr jones ]

Ron Swedelson
06-07-2006, 03:02 PM
but can you really count coke as the original energy drink? I credit that more to the cocaine than the drink...
I think Energy drinks will be here for the long haul, but will probably start to morph a little bit. I don't look at energy drinks as simply a caffiene pick me up, we have chocolate, soda, cofee, and tea for something as simple as caffiene. But the whole package of caffiene and revitalizing vitamins and herbs, that is what an energy drink truly is. I think you will start to see them turning more and more soda like, or a gatoraide hybrid that actually taste good (Hansens Energade does not count). I don't see the smaller package being as popular for ever, but it will probably take a good 5-10 years for a full transition.

RunWithDaLilGuy
06-07-2006, 07:12 PM
i see similarities with the flavored malt beverage category on the alcoholic side of things. everyone thought after they all came out, and then jed's, ned's, doc otis, hooper's hooch, sublime, and the list goes on. but they are still around and kicking wine cooler's (the csd in this analogy)'s butt.

mike's and smirnoff ice/twisted, twisted tea... are not giving up the ghost, only gaining. i think energy will continue to do so for several more years. it's not just a fad like slap bracelets and orbitz, it's something that applies itself to consumers needs and wants.

that is, as we are constantly working harder, longer hours and playing harder at the same time, we humans need a boost. we also need to derive more from what we consume beyond simply good taste and "refreshment," whatever that is. with the advancement of humans and our lifestyles, so should our food products advance.

popologist
06-07-2006, 11:56 PM
it seems, for the most part, that most of us agree... that while energy drinks can't sustain this kind of growth forever, some of them will survive down the road.

i guess it also remains to be seen if/when soda sales will bottom out and then start to rebound... or at least level out.

Coco Rico
06-08-2006, 05:51 PM
I think that as consumer tastes continue to adapt to the energy drink as a standard - there are c-stores with multiple doors of energy now - they will become more and more ubiquitous. I think they represent a true threat to the traditional place of soda in our society. As younger and younger consumers mold their palates to energy drinks and other alternative beverages, traditional sodas run the risk of becoming a thing of the past. Perhaps in another 40 years, Coke and Pepsi will become obsolete... I hope not, but consumers are fickle.

Mr Zabe
06-08-2006, 06:15 PM
IMO....Every minute or so a potential soda pop drinker is born in the United States. Us Americana's love sweet,sugary tasting drinks and foods. Soda pop remains a main staple of the American beverage pallets.

Soda pop will be around for many more years than the 40 you have stated. I for one will drink it till I push up daisy's. I'll bet most American soda pop drinkers are much the same as I am.

America's thirst for soda pop is unquenchable. smile.gif

CStoreCatMan
06-08-2006, 07:26 PM
Mr Z -- Agreed. I understand the previous point on energy...but its an ALTERNATIVE to CSD...not a REPLACEMENT. Soda will be around for a long time. Remember, CSD's started declining for several reasons...

1. Alternative beverages - are you telling me nobody will come up with an alternative to energy??? You bet your sweet @$$ they will! :D

2. Health concerns - have you looked at the numbers on an energy can? Much worse than CSD...its only a matter of time until e-drinks are labeled the new obesity demons!

3. Pricing - not in all areas, but in some (like here in SoCal) CSD pricing has gotten a bit out of hand and is now out of the consumer's perceived "value." Energy prices keep going up...and even though they are perceived as premium beverages, consumers will only be willing to pay so much.

Thanks...my $0.02

Coco Rico
06-08-2006, 07:51 PM
Look, my post was a hypothetical. But look around, an entire generation is growing up right now in a climate where sodas are not the cool beverage of choice and e-drinks are. Mr. Z when you were a child, developing your palate for soda, there weren't the alternatives that exist today.

The reality is that e-drinks have hung around and are growing as a category much faster than anyone ever thought possible. As a category, they have come on with a force unlike anything else. The reality is that in Austria, where this whole craze started, CSDs are second to e-drinks and that trend is becoming more and more evident in more established markets across Europe. Why do you think Coke began playing with e-drinks years before they launched their own in the US?

You want to talk health concerns? The #1 selling energy drink in the world (in case I have to remind you, it's Red Bull) uses glucose and sucrose as it's sweetners (same as in fruit) and is filled with nothing else but 80mg caffeine (less than a cop of coffee), vitamins and an amino acid that benefits the body. You tell me how that is in any way worse for you than any CSD that contains High Fructose Corn Syrup and that can be purchased 58oz at a time. HFCS is truly scary, and the only reason it still exists is because too much $$$ is at stake for anyone to truly advocate change.

And pricing??? It's like a broken record with you guys. You all had the same argument when Red Bull first launched... "an 8oz will never sell for $1.99..." Consumers are willing to pay that much and more... Red Bull has made billions off that simple understanding.

Do I really think in 40 years soda will be obsolete?... I don't know, but I'm not blind enough to not see it as a possibility.

CR

Mr Zabe
06-08-2006, 08:00 PM
Dear Boy.
Any parent that lets a 4 year old drink RB with meals is lacking in parental skills. Trust me your zest for energy drinks is admirable yet I do think your view is narrow minded.

Energy drinks will always be a nitch beverage that will do extremly well in sales. They will continue to have growth in consumption but to a point. Yes, energy drinks will be around in 40 years just like soda pop will be as well.

Soda pop drinkers are "taste junkies". We savor taste as opposed to effect. We like average amounts of caffeine but taste and carbonation are the most important thing to us. Junkies of sweet carbonated beverages are not going to suddenly like energy drinks. Sorry it's not going to happen. IMO smile.gif (No bad feelings.)

[ 06-08-2006, 07:03 PM: Message edited by: Mr Zabe ]

Coco Rico
06-08-2006, 08:24 PM
Mr. Zabe,

I respect your knowledge and your opinions, but don't ever call me "Boy" again.

Do not confuse my ability to posit hypotheticals as a lack of common sense on my part.

And for your information, it's "niche" not "nitch."

CR.

Mr Zabe
06-08-2006, 09:12 PM
Dear Boy is one of the highest endearments that I share with FRIENDS and board mates. Lighten up. smile.gif

I post my opinions any lack of common sense is on you and not me. If you post something it is fair game for me to respond to it.

As everyone knows, my spelling sucks. LOL It's not a deal breaker, is it? LOL

Again I'm sorry if no one has ever called you Dear Boy. My close friends call me many things, I guess that's because of my life experieces or my personality. Trust me I meant no bad will or to demean you in anyway.

[ 06-08-2006, 08:13 PM: Message edited by: Mr Zabe ]

mr jones
06-08-2006, 09:33 PM
Coco - I have to agree with Zabe that you seem to think energy drinks are the best thing since sliced bread. They're on fire..right now. So were sodas 5-6 years ago. Then alternatives came. CStoreCatMan is right...there will be alternatives to energy drinks down the road. Its not conceivable now because the category is hot. But it will happen.

Right now, many c-stores have full doors of energy. I think the category is here to stay...but when it does shrink (and it will) it will end up in about a half door with only the biggest players represented. That's my prediction...

Coco Rico
06-08-2006, 11:00 PM
Actually, I'm pretty sure I consider Weller 12 year old Bourbon the best thing since sliced bread. And I'll lighten up when you both decide to take the cheap shots out of this dialogue. I don't claim to have all the answers, just my own observations and experiences that have provided me with a fairly eventful and successful life.

I'm here to share and gain knowledge, not satisfy some weird desire to levy insults at anonymous people across an electronic medium - that's just lame and I get no satisfaction from that. I learned a long time ago not to disregard the impossible. Achieving the impossible is what makes life interesting - at least for me.

CR

[ 06-08-2006, 10:01 PM: Message edited by: Coco Rico ]

popologist
06-09-2006, 08:28 AM
fact: in the last ten years, the big-3 soda companies hold the same TOTAL market share as they did then (coke 43%, pepsi 31% and drpepper7up 15%)... about 90%.

fact: red bull (the best-selling energy drink) still only controls 1% of the soft drink market. that's less than diet mountain dew and about the same as coke zero (which has only been out one year).

prediction: the energy drink market is approaching a saturation point, and, once that happens, a lot of brands will go under, and only the strongest will survive.

the way i see it, there's still some years of steady growth for e-drinks ahead, but, i also think that the "demographic" is limited (primarily to active males in their teens to their late 30s). once that demographic is saturated, then the growth will slow or stop, and a lot of smaller brands will go under or be bought up by bigger fish. i'd probably give it another ten years before this happens, since e-drinks are still relatively new, and there's still a lot of innovation in ingredients and taste, which will keep people interested.

Liquid Brands
06-27-2006, 03:21 AM
Hi,

The Energy Drink Market is still growing by 60% per year depending on the size (and the report you read).

Even the category leaders posted double digit growth numbers last year. They are going not only after the energy drinkers… they want converts… new drinkers coming of age or switching from coffee or other drinks.

Not only that, the only real product selling internationally is Red Bull, Monster just signed a deal for Mexico, Rockstar has several distributors in Mexico and the others are not there. Mexico is the second largest consumer of soda and holds another boom in the category along with other countries.

Even in the USA, I’ve done research in the several mid west and southern towns where they still don’t have good penetration for energy drinks. You find 2 or maybe 3.

When talking with distributors they tell me they are still looking for new energy drinks. They no longer just carry 1 or 2, some of them have 6 or 8! Even the beer distributors!!!!!

I think it will grow a few years more…


Thanks,


Jorge

greg
06-27-2006, 12:17 PM
All of you guys are talking about the Energy Market shrinking. Do you guys realize that by the fall the population in this country(USA) is going to hit 300mm people. Furthermore, the population by 2040 is estimated to make a 100mm increase to 400mm. Thats a lot of energy drinks, water, soda, beer, etc to continue any growth in the market place.
From the United Nations World population Prospects Report I found this:
In 2000, the world had 6.1 billion human inhabitants. This number could rise to more than 9 billion in the next 50 years. For the last 50 years, world population multiplied more rapidly than ever before, and more rapidly than it will ever grow in the future.

Just a glimpse of things to come for this World of ours.

popologist
06-27-2006, 01:37 PM
we know it's still growing, but... it's also hyped a lot, too.

and, like i said, red bull has been around for at least a decade, and, yet, coke zero, which was introduced just last year, sells as much already.

just to put things in perspective.

SURGE
06-27-2006, 02:51 PM
E-drinks will survive the slowing down of the market (uneducated guess maybe 10 more years of insane growth) but soda is forever- its cheap, has brand recognition, and is availible in similar configurations around the world.

I think we are already in some ways seeing edrinks slow down. The move to 16oz cans is less profitable and takes far more space and man power to get to the end sale point. Why go 16oz when you can charge the same and put less into the product while at the same time being able to fit far more product on the truck? I would venture to guess the reason 16oz has exploded is because the gravy train that was 8oz was in the foreseable future going to decelerate. I would guess that in 15 years edrinks will be far bigger in size (or lower cost) and that the market will be quite a bit larger but growing at a far slower rate.

greg
06-27-2006, 03:36 PM
Surge,
How much bigger can an energy drink get and still be a)Safe B) effective and c)somewhat healthy than a 24oz Monster?
Most E-drinks have 28-32g of sugar per serving. That is outrageous.
A larger drink to be effective will have to have pleanty of caffeine, but what about the down side off all that sugar.

16 oz may very well be the norm or possibly a slight move backwards to a 12 oz that packs a little more punch.

I believe the E-drinks will be a very important part of any companies portfolio in the future. Just as teas and non carbonated, and juices are an integral part today.