ROCKVILLE, Md. -- Energy drinks, including sports drinks, are gaining momentum at the expense of carbonated beverages, said Food Navigator USA.com, citing a new report from Packaged Facts, Rockville, Md. The report, "Energy Drinks in the U.S.," forecasts the total U.S. retail value, including products sold through foodservice channels, will grow at a compound annual growth rate of 12% and reach $9.3 billion by 2011.
While growth in this category has indeed been noteworthy, the market for these beverages still represents a small proportion of the entire [image-nocss] beverage market and as such spells further opportunity for marketers to diversify into more functional niches, according to Packaged Facts.
"Energy drinks accounted for just 2% of all non-alcoholic beverages sold in IRI [Information Resources Inc.]-tracked channels in 2006, up from less than 1% in 2004," said the report. "But the phenomenal growth seen in recent years could continue, propelling energy drinks to capture a larger piece of the pie."
The market researcher estimated that the total retail market value for energy drinks in the United States stood at approximately $5.4 billion in 2006, up 18% from $4.5 billion in 2005. The marketwhich includes sales through food and drink service establishmentsgrew at a compound annual growth rate of 45% for the 2002 to 2006 period.
"Going forward, energy drink marketers should consider several growth areas and strategies, particularly targeted marketing," the report said. Packaged Facts cites women, Hispanics and a growing aging population as key target groups. The trick to marketing an energy drink has less to do with targeting active individuals than positioning it along the lines of an energetic personality type, it said.
"The purchase of an energy drink brand brings the consumer close to the aura that is built around the brand," said the report. "Attractive and evocative packaging, guerrilla tactics and other alternative marketing practices will be important tools for marketing the nature of energy drink brands."
Functionally speaking, the key driver behind the growth of this market, according to the analysis, is the convenience and portability of energy drinks as a functional delivery system.
In terms of brands, Red Bull remains the No. 1 energy drink marketer, with 43% of the market in 2006. This is followed by the Monster brand energy drink, at 16% and Rockstar at 12%.
The report added that at 7%, Coca-Cola Co.'s Full Throttle also shows promise.
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