Energy drinks still buzzing

Posted by Daniel Palmer on 28th January 2009

The global energy drink market countered fears over the economic conditions to register an approximate 15% increase in 2008. Leading beverage agency, Canadean, reports that growth has come from across the globe and ranges from 2% in Asia to 34% in East Europe, taking the energy drink category to more than 5 billion litres. The category has enjoyed a prolonged period of spectacular growth and has trebled in size since 2001. Canadean expect that by 2011 each global consumer will drink, on average, 1 litre of energy drinks annually.

Energy drinks are, however, the most premium of all soft drink categories and are inevitably vulnerable to changes in the economic environment; Canadean forecasts for the category has been cutback by around 2% since the unfolding of the worst of the financial crisis. Amendments were particularly pronounced in North America where the anticipated growth level has been reduced by around 6%. Despite this, the market is still expected to expand by almost a quarter. North America has been an important global driver, having made extraordinary progress in recent years; annual per capita consumption has soared from half a litre back in 2002 to almost 5 litres in 2008. By 2007 no one consumed more energy drinks than North Americans and by the end of 2008 North America will have almost caught up the leading region for energy drinks, Asia, where in 2002 energy drinks sales were 6 times those of North America.

Asia remains the leading global source of energy drink sales and there is a long tradition of energy drink consumption in the region. Asia, which Canadean advises had more than three quarters of all energy drinks sales a decade ago, now has slipped to just under a third of the global market. The Asian market for energy drinks has fluctuated and 2008’s 2% rise follows two years of decline.

Canadean’s consultants remain upbeat about the future prospects for the category, in spite of the deteriorating economic conditions. By 2011, they expect sales to have reached 7 billion litres – a further increase of more than a third on current figures. The transfer from ‘standard’ 250ml cans – made popular by Red Bull – to larger 355ml and 500ml cans is expected to spur growth. This transfer has already begun in Australia, with Mother (which relaunched last year with 500ml as its standard can) and V among those to introduce the larger half-litre cans. Canadean also anticipates more diet/sugar free offerings and a widening availability to lift sales into the longer term.