Energy Shot Market Still Has Growth Potential
NATIONAL REPORT -- Although the energy shots market is unlikely to sustain its initial "meteoric" rate of growth, it is not necessarily cooling and still has significant growth potential, according to a Beveragedaily.com report. The market could even target a wider audience than energy drinks, predicted market researchers.
While companies such as Red Bull have seen great success with energy drinks, the energy shot market has posed greater challenges; in July, Red Bull discontinued its Red Bull Energy Shot product. However, according to Euromonitor drinks analyst Richard Haffner, this merely indicates the two markets have distinct differences and beverage companies should approach them differently.
"Energy drinks are about rebelliousness, and are associated with extreme sports, young people and young men in particular," Haffner told FoodNavigator-USA. "They are all about a social scene. Shots appeal to a wider group including older people, women and professionals, the office audience, and are not about being rebellious, but conformity: staying alert, working harder. Drinking one is not a social activity; it’s more of a solitary thing to keep you going."
Mintel senior analyst Garima Goel Lal concurred, adding, "We're seeing that 55-plus-year-olds are buying energy shots." She pointed out that while growth in the U.S. energy shots market slowed during the recession, it still showed robust growth. Goel Lal also noted that ingredients may be more important than brands to consumers, as the growth of private-label energy shots could mean they are willing to try cheaper products made with the same ingredients.
It is also possible that other energy formats such as gums and chews could appeal to price-sensitive consumers, according to the FoodNavigator-USA report. Sheets Energy Strips, endorsed by NBA star LeBron James, have made strides in recent months, signing exclusive distribution deals with Convenience Valet and Energy1 Distribution, as CSNews Online previously reported.
The key to market success is winning consumers' trust, according to Goel Lal. To do this, companies should focus on concerns about product safety and promote them as more natural and less sugary, she said, as some critics have pointed out that energy shots are often stocked on retail counters rather than with other dietary supplements, which could theoretically lead to customers consuming too much caffeine and vitamins.
Market data from SymphonyIRI shows the energy shots market rose 31.6 percent, to sales of $1 billion in supermarkets, drugstores, gas and convenience stores, and mass merchandise outlets excluding Walmart during the year ended June 12, according to the report.