Energy drinks are the best-performing category for two reasons, Lyons Wyatt said. First, prices haven’t risen as much compared with other categories, and second, it’s popular with the “home-centric life we have, and people going back to work are looking for a little boost.”
Regarding prices, Lyons Wyatt said she has seen not only energy but any category holding prices steady “getting a lot of bang for their buck” from consumers seeking savings.
Lyons Wyatt adds that she’s seeing more category blurring. “There’s this move toward physical and mental health supplement with C4, which is energy and hydration, and the Starbucks Baya, which is coffee fruit-based energy,” she said. “There’s Bang, which has creatine. And they’ve all launched successful innovations that still have energy and stimulation but with performance-based attributes.”
Hemphill adds that about half of energy drink volume is via c-store sales, a “vital channel” for this category. “As goes the performance of c-stores, so goes the performance a lot of times of energy drinks,” he said.
Recently, however, Hemphill said more competitors have entered the market, some championing healthier, premium products.
“While there is innovation, the tried-and-true brands have introduced line extensions that have also helped,” Hemphill said.
Monster and Red Bull dominate, with Rockstar a distant third but also a significant player, he said.