As expected, this month’s National Association of Convenience Stores (NACS) trade show was a major showcase for the latest and greatest in the still-evolving “energy+” category, which has seen functional ingredients and fitness trends converge with product innovation (and some familiar candy flavors) to create a dynamic new force within the beverage market. BevNET contributor Joshua Schall tracked developments within the space at this year’s show. And if you haven’t seen his post-NACS dispatch with BevNET/NOSH editor-in-chief Jeff Klineman, check that out here.
Are we collectively ready to proclaim that being a great tasting “carbonated water with sugar/sweetener, flavor, and caffeine” just isn’t enough anymore? Energy without the “plus” is boring!
Don’t get me wrong, I’m still the guy that hastily grabs a white Monster during pitstops at roadside convenience stores…or at least that was my default shopping behavior for many years. Dissecting that historical purchasing pattern now, it’s hard not to believe those decisions were greatly influenced by the Coca-Cola distribution system having that magical ability to make those textured white cans consistently available whenever and wherever I needed them most. And that’s probably a good transition to talk about the current state of Energy+ within the convenience sales channel.
While I might be a bit biased considering my professional background, I’ve always believed the best and brightest sports nutrition brands could compete against any large CPG incumbent when it comes to functional food and beverage. And if you walked around this year’s NACS Show expo, you undoubtedly started to see that happening. Not only was there an extremely noticeable uptick in first-time exhibitors that would be considered “incubated within the supplement industry,” but current Energy+ leaders like CELSIUS and C4 Energy didn’t hold back, going bigger and louder to essentially fill the void left by Bang Energy.
Even if they won’t ever admit it publicly, large energy drinks incumbents like Red Bull and Monster Energy should be worried about the “often imitated, never duplicated” influential epicenter of the CPG industry…supplements. Because at this point the proof is in the pudding, as NielsenIQ all-channel data shows that CELSIUS, C4 Energy, GHOST, Alani Nu, and many others that have roots in the supplement industry, account for nearly $3 billion in sales. But what if I told you this “changing of the guard” within the granddaddy of them all energy drinks sales channel is only getting started?
Maybe you think I’m drinking too much of my own Ryse Fuel Kool-Aid, but here’s several notions I’m still left pondering post-NACS Show about the Energy+ drinks subcategory…
Energy+ in the After Bang Celsius Era
It’s time we all give Bang Energy the respect they deserve for what they did in the late 2010s to totally disrupt the energy drinks market. Bang Energy put Energy+ on the map, which forced Monster Beverage Corporation into a defensive product strategy, and at the same time inspired many supplement brand entrepreneurs to take the leap from pre-workout powders to energy drinks. Additionally, Bang Energy was instrumental in broadening the appeal of energy drinks by attracting more health-conscious consumers.
Taking all that expansive categorical momentum and sprinting with it was CELSIUS. On the business front, there was not a bigger double beneficiary than CELSIUS of the Bang Energy distribution musical chairs game that happened from April 2020 to August 2022. After the wildly successful first year of the CELSIUS and PepsiCo partnership, Energy+ has now transitioned fully into its “After Bang Celsius Era.” And it’s this next leg of the Energy+ growth story that should make the Big 2 energy drink incumbents nervous because John Fieldly, Doss Cunningham, and Dan Lourenco, won’t make the same competitive mistakes as Jack Owoc.
Spider-Man Meme Moment for Energy+
You’ve probably seen a hundred different variants by now, but one of the most popular Marvel memes on the internet involves an animated Spider-Man pointing accusingly at a copy of himself. I think Energy+ could benefit from a Spider-Man meme moment right now…
- Which Amount of Fluid Ounces? If you weren’t Bangin’ with the 16 oz can, you weren’t Hangin’ in the Energy+ drink category. That is until CELSIUS made the 12 oz slim can cool (and acceptable within convenience store coolers). Yet, even within CELSIUS this “can size merry-go-round” is still happening today.
- How Many Milligrams of Caffeine? According to a beverage CEO client of mine in 2017, “300mg was going to kill someone.” But then most Energy+ pushed caffeine amounts higher, until they decided that 200mg plus other nutraceutical ingredients was the sweet spot (for now).
- Which Segmentation Should We Extend Into? Beyond gym-goers looking for muscle gainz, Energy+ brands seem to be attracted to those consumers looking for professional gainz too. But you also see others pushing closer to the party crowd that Red Bull has owned for decades and even others that think they can be a friend to the Ozempic weight loss crowd.
I get it…differentiation is this super important business buzzword. Yet, I believe for Energy+ to dethrone the kings of the energy drinks market, they need to philosophically come together like Hulk Hogan and Randy ‘Macho Man’ Savage to form the Mega Powers.
Is Natty Light Energy+ Next?
Hi, my name is Joshua Schall, and I’m an artificially flavored and sweetened Energy+ drink enthusiast. I’m not sure I’ve ever admitted that publicly, but they say that’s the first step in recovery, right? I grew up the typical Rust Belt kid eating mostly a hodgepodge of way-too-sweet, packaged foods and beverages. That “white trash palate” should have worn off, like my love for Natty Light beer did after college, but some things are harder to kill than 50 Cent.
But what I noticed at this year’s NACS Show is nothing short of a miracle…
- I tasted a few all-natural Energy+ drinks that were great.
- I tasted some lightly flavored and sweetened Energy+ drinks that were great.
Which makes me think…will flavor science progress far enough for a “Natty Light Energy+ brand” to hit a billi in sales before the end of this decade?
More NACS Coverage from BevNET:
- GHOST Enters Hydration; Lemon Perfect Upgrades to 15.2 Oz; AHA Ends
- KDP Ignites C4, Revamps Bai
- Coca-Cola CSDs Gets Sleek & Spiced
- Pepsi Revs Up Energy, Revamps Cold Brew
- Celsius Steps (Back) Up to 16 oz. Format
Joshua Schall, MBA is a CPG industry strategist with an emphasis on the emerging and intersecting categories of functional food, beverage, and nutritional supplements. Within the last 11 years, he’s successfully built J. Schall Consulting into a world-renowned leader in growth strategies for clients that range from pre-launch to billion-dollar portfolio companies. He accredits much of this success as both a content creator and strategist to his dynamic fascination of the constantly changing consumer behaviors, which has allowed him to “see around the corner” and become a firebrand throughout the full entrepreneurial ideation to consumerization cycle.