NEW YORK -- As consumers continue their slow but steady migration away from carbonated soft drinks, teas and sports drinks are seeing benefits, but the biggest winning segment in the cold vault is energy drinks, according to a recent retail survey conducted by Wells Fargo Securities.
"The energy-drink category continues to be the most important volume and profit driver for convenience stores, followed by teas and sports drinks," reported Wells Fargo senior analyst Bonnie Herzog in an equity research report released Monday.
(See Related Content below for previous reporting on the survey.)
According to the survey, energy drinks "have the lowest sensitivity to higher gasoline prices," with 74% of retailer respondents indicating "no" or "low" sensitivity. Overall, about 65% of the respondents indicated that higher gasoline prices have had no impact on first-quarter packaged-beverage volume trends. Juices had the highest sensitivity.
"Energy-drink volume growth remains robust, with several convenience-store retailers noting strong performance within the category," Herzog noted. "Furthermore, results indicate the continued secular shift toward healthier beverage choices, with energy drinks among the subcategories well positioned to benefit. Incremental growth from new brands and product innovation is expected to further support the positive growth trends."
Energy drink-related comments from retailers in the survey, which focused on the first quarter of 2012, included:
- "Energy and tea are driving growth."
- "Energy drinks are driving the overall growth of the category, followed by tea, bottled water and sports drinks, respectively."
- "Volume growth was driven by sports drinks, energy drinks, teas and private-label soda and water."
- "Volume was driven by take-home and energy. Immediate consumption was down, especially CSDs."
- "Energy and sports drinks are more destination or planned purchases as opposed to CSDs, water and juice."
Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.