Power up!

Growth, innovation and opportunity are driving the sports & energy category.

by Elena Dimama

Energy drinks have become crucial for the convenience sector, especially in an age of increased health and wellbeing awareness.

According to Nielsen, the category is worth £80m in the convenience market, and the growth shown over the past year does not seem to wane.

Big winners

‘Stimulants’ were the biggest winner in the convenience market last year, according to Britvic’s Soft Drinks Review 2022, increasing market share to 26.9% and overtaking ‘cola’ as the number one category in the sector.

“Monster Energy and Red Bull remained the key brands driving category growth, with year-on-year value sales up 30% and 21% respectively,” it reads. “While these brands helped meet increasing shopper demand for energy-giving products, there remains a significant opportunity for further growth in stimulants, with 91% of the UK population not currently purchasing stimulant drinks.”

Indeed, the sports and energy category has totalled more than £256m compared to 2021, and is now worth over £1.8bn, according to Nielsen Scantrack Value Sales for the 52 weeks to 27.08.22. “This growth has been fuelled by the increased demand for functional energy drinks amongst shoppers. These drinks have added over £171.6m in value vs YA and have exceeded the billion-pound mark, now worth over £1.2bn annually,” Red Bull adds.

The sports drink segment, in particular, can prove to be quite crucial for retailers, as sports drink shoppers can be quite loyal, according to Matt Gouldsmith, Channel Director, Wholesale, Suntory Beverage & Food GB&I. “if retailers don’t have the brand, format or flavour they’re looking for, they may go elsewhere. This means leading brands like Lucozade Sport, which has seen year-on-year growth of almost 38% in the convenience channel, are an incredibly important part of any chiller.”

The numbers in the overall category back up the numbers above; a whopping 906 million litres of sports and energy drinks were consumed in the United Kingdom in 2021, according to Statista. More importantly for independent retailers, energy drinks are identified as a drink for the occasional user. Over 4.3 million consumers drink an energy drink less than once a month, while approximately 545 thousand consumers drink energy drinks once a day or more often, Statista’s research found.

Branded success

Red Bull launched its Apricot-Strawberry flavour 2022 Summer Edition in March. “After a successful launch it has proven to be the best NPD so far for Red Bull amassing over £2.2m in the first six months of launching, and will now become a permanent flavour,” Red Bull notes.

“With the performance of the Red Bull Editions portfolio growing across all metrics – achieving a +83.5% uplift in sales, now totalling £11.2m – the new SKU delivers all of the functional benefits of Red Bull Energy Drink, along with a juicy surge of apricot and strawberry that combine to deliver a sweet, refreshing flavour.”

The latest Red Bull Summer Edition is also available in a Sugarfree option. According to recent insight, sugar-free variants have grown spend by 30.5%, and this new edition is expected to appeal to health-conscious shoppers who increasingly opt for low- or no-sugar variants.

In addition, the new Lucozade Alert hit shelves last year – high in caffeine and boasting Vitamin B3 to help reduce tiredness. “The range responds to a clear consumer need for a stimulation drink which tastes great, is low calorie and more relevant to a wider audience. This presents a great opportunity to help retailers drive maximum sales,” Gouldsmith says.

Meanwhile, Coca-Cola Europacific Partners (CCEP) has also identified an opportunity for further sales growth in the next three years.

“Monster is the no.1 deliverer of value growth in the whole of the GB soft drinks market, worth £455m and adding more than £100m of value in the past year alone,” Amy Burgess, Senior Trade Communications Manager at CCEP, says. “To keep the range popular with customers, we’ve continued to innovate when it comes to flavour.

“We’ve recently launched Monster Khaotic – a shake-up of one of the original Monster Juiced variants – and Ultra Gold, which blends a juicy pineapple taste with the renowned Monster energy blend, giving consumers a delicious, refreshing energy boost with no calories and no sugar. The introduction of new flavours helps to maintain momentum behind the Monster brand.”

What’s more, the company has boosted its Relentless range with a new zero-sugar range, including two flavours, Peach and Raspberry, accompanied by a new pack design to broaden the appeal of the brand.

The sugar conundrum

Wellbeing and natural ingredients have been increasingly popular in the last year. With young consumers a particularly crucial age group for the energy drinks segment, this represents an opportunity for the category to expand.

“Retailers should consider evolving their energy away from just stimulants, giving enough space on the fixture to growing brands in natural energy, such as Purdey’s to appeal to these consumers and help them to live a more naturally energised and balanced lifestyle,” Britvic’s report adds.

It is a sentiment shared across the soft drinks giants, with Red Bull noting that consumers “increasingly pick up sugar-free and zero formats that appeal to the more health-conscious shopper”.

“Sugar-free variants have been growing penetration by 48.8% and, in independent markets, Low or No Sugar variants have seen faster growth than Full Sugar, with 21.8% growth vs Full Sugar 16.9%,” says Red Bull.

“35-year-old affluent females are the most common Red Bull Sugarfree shopper profile, signalling demand for low-sugar alternatives amongst feminine shoppers looking for a functional boost during their day.”

The healthier lifestyle trend is also one observed by CCEP, with Burgess adding that shoppers are increasingly looking for food and drink with functional qualities that can help them achieve maximum results during sports or workouts.

“This has meant the performance energy drinks segment has grown in popularity. Healthier Choices is another key growth driver in our Refresh Tomorrow soft drinks category vision,” she adds. “At CCEP, our Reign Total Body Fuel range is in 20% growth and worth over half of this subsector. The Reign Total Body Fuel range also contains a range of flavours, including Peach Fizz and Orange Dreamsicle.

“Reign Total Body Fuel Peach Fizz is packed with the flavours of succulent peach and a hint of citrus fruits, while Orange Dreamsicle is inspired by the classic frozen treat with orange citrus and vanilla bean flavours.”

Flavour trends

Stocking different flavours can be key to driving growth in the segment. “Flavours are a proven way of bringing new shoppers to the energy drinks category – over half of whom have trialled Energy Drinks for the first time – and driving 83% incremental growth,” Red Bull says.

“Within Sports & Energy, flavoured variants have grown by 20.1% and Red Bull Editions have been growing penetration by 165.3%. With tropical and exotic flavours growing 23% more than all other mainstream flavours on offer, now is the perfect time for retailers to stock up on the Red Bull Editions 250ml range to capitalise on the demand for flavoured variants and maximise sales.”

Britvic’s report reiterates the same point, noting that stocking a range of core stimulants flavours and new variants “has been key to the success in the category”. “Range expansion has been vital in keeping pace with increased demand and retailers should consider stocking a selection of products and flavours to help attract new shoppers into the category, including bestselling brands such as Monster, Red Bull, Rockstar and Relentless,” the report reads.

In fact, 17% of sports and energy drink consumers “actively” seek out new flavours, according to the report, with the demand being met through a variety of NPD and flavour expansions across the brands.

Packaging matters

Larger formats have driven over £228m in value to the category, seeing significant growth of +15.9% vs a year ago, according to Nielsen Scantrack. Penetration of these formats is 49.7% up compared to a year ago, the Kantar Combined Panel has found, while multipacks are in strong double-digit growth (13.2%) and driving 47% incremental growth.

“Now is the perfect time for retailers to stock up on multipacks,” Red Bull says, “with penetration growing by 8.7% in the last 52 weeks.

“Red Bull Energy Drink 250ml 4-pack is the No.1 bestselling multipack in the Sports & Energy category. Energy drink multipacks have delivered 68% incremental growth into the category, driven by existing shoppers trading up from single cans to multipacks.”

Britvic adds that larger packs are “particularly popular with the 34% of energy drink users who consume these drinks at least twice a week”. “Take-home packs of energy drinks are now worth £46m and have grown 16% over the past year,” the report notes.