Another Shot for Energy Shots?
The energy shots category has taken a few shots lately, both in sales and reputation.
Allen Brothers Wholesale Distribution, a convenience store distributor in Philadelphia that serves Pennsylvania, New Jersey, Delaware, Maryland, New York and Washington, D.C., confirmed it has experienced a “slight decline” in sales in the category recently.
“Not only is the press attacking energy drinks as unhealthy, but disposable income is still down it seems in our markets,” relayed Dave Oehlert, senior buyer at Allen Brothers. “With the decline of gas prices at the pump, we are seeing some lift, but this time of year things are normally slow, so it’s harder to gauge the impact from low gas prices.”
While sister category energy drinks are expected to see continued healthy single-digit growth, energy shots have been declining since 2013 and a continued decline of approximately 3 percent is forecasted from 2014 to 2019, according to market researcher Mintel.
Current nutritional trends warn against high sugar content, the effects of caffeine and artificial ingredients, which are traditionally found in energy shots.
In addition to ingredient/nutritional concerns, flavor is reportedly at the heart of the declining matter. In recent research, Mintel found that the majority of energy drink and energy shot consumers agree energy drinks taste better than energy shots, and less than one in five respondents said they drink energy shots because they enjoy the taste.
In late 2013 and 2014, the c-store channel leader in the category, 5-hour Energy from Living Essentials LLC, addressed its brand flavor profile with new launches (a limited-edition raspberry flavor and a limited-edition cherry flavor). In addition, new marketing and a sweepstakes — a “Yummification” competition that asked consumers to share how they enjoy 5-hour Energy — were aimed at appealing to young adult men, the segment’s target consumer.
This year, 5-hour Energy relaunched its entire product line with “new improved” flavors in its original offerings (berry, grape, citrus lime, orange, pink lemonade and pomegranate) and its extra strength offerings (berry, grape, sour apple and new strawberry-watermelon). Decaffeinated 5-hour Energy also has a new and improved citrus taste. The “new improved” line is already shipping and is being advertised nationally.
“Over the last year, the company conducted a series of focus groups to listen to the pulse of the consumer,” Melissa Skabich, director of communications for 5-hour Energy, told Convenience Store News. “The flavor relaunch, the most significant change to the taste of the product in 5-hour Energy’s 10-year history, is a direct result of this feedback.”
The company is optimistic that the better-tasting product “will result in increased demand through the existing and new user base,” she added.
Oehlert is looking forward to what the brand will do in the coming months to stay on top of the market. “5-hour continues to be the standard for shots, and we have brought in its new Strawberry-Watermelon and the reissued Cherry,” he said. “However, some rising companies, such as SK, are marketing to the next generation, trying to pull in younger consumers.”
Mintel has reported on the increased emergence of smaller energy shot manufacturers, offering consumers alternatives (often natural) in ingredients and flavors, which is expected to give the category a boost.
For instance, Hangover Joe’s Git-R-Done Energy is a caffeine-free and sugar-free energy shot launched in July, while Guayaki Yerba Mate Wild Berry Reishi Organic Energy Shot is a high-energy infusion made from the naturally caffeinated leaves of the South American mate tree.
New packaging in pouches and bottles is also offering consumers more convenient, portable options. At the same time, new bulk products for at-home use are expected to encourage greater consumption across more occasions.