energy drinks

Energy for the People: The Rise of Energy Drinks

By 2026, global sales of energy and sports drinks will reach an estimated value of $225 billion dollars. The United States is one of the leading markets for energy drinks with sales reaching $14 billion in 2021. Red Bull and Monster Energy are the dominant energy drink brands in the US in 2021 and account for almost half of the market.

While energy drink sales have risen, the sale of energy shots has steadily declined. In 2020, the revenue of energy shots was $978 million and in 2021, it decreased substantially to $824 million dollars. This decline is due to a variety of factors. The largest being the pandemic. Many convenience stores and fitness facilities, large vendors of energy drinks, have temporarily closed due to COVID, and with these closings, purchases have dropped. Also, the decision to consume an energy shot is often an impulsive one and, therefore, does not guarantee a steady stream of customers. However, as the world returns back to a sense of normalcy with businesses and gyms reopening, energy shot sales may recover and will no doubt positively affect the energy drink boom.

The eSports industry has undeniably contributed to increasing the awareness of the entry drink sector. Gamers often consume energy drinks to boost their performance as the caffeine in energy drinks heightens cognition, reaction time, and fatigue resistance. Related to energy drinks, pre-workout drinks and supplements are also popular and are forecasted to reach $12.6 billion in 2027. But how are they really different from energy drinks? In short, both products increase your energy levels but pre-workout supplements are heavily focused on improving athletic performance and endurance.

North Americans consume more energy drinks than any other region, with 2 in 3 consumers being male. The typical energy drink consumer is between the ages of 13 and 35 years old. Younger consumers are drawn to drink them due to claims of improving performance and alertness as well as perceptions of energy drinks as a healthier alternative to soda. Energy drinks are also the most popular supplement for teens and young adults in the USA, tying with multivitamins.

While the energy drink market has a loyal consumer base with 30% drinking regularly, non-users regard these drinks as too sugary, too artificial, too caffeinated, and tasting poorly. How does the market plan to appeal to more consumers? One big change consumers can expect to see is the increase in the use of plant-based energy ingredients and reformulations to include more natural sources of caffeine. Consumers can also anticipate a wider range of exotic flavors which will undoubtedly appeal to a broader audience. New technology will allow for improved manufacturing processes, specifically in regard to reducing the sugars naturally found in fruit juices.

the business of energy drinks