Energy Drinks (non-aseptic) saw total dollar sales of $7.19 billion, up 5.74% for the 52 weeks ending Dec. 28, 2014, according to Information Resources Inc. (IRI). Unit sales for the same period totaled 2.97 billion, up 6%.
Red Bull led the category with $2.84 billion in dollar sales, up 7.16% over last year. Monster Energy followed with $935.8 million in dollar sales, up 9.23% over last year. NOS came in third with $301 million in dollar sales, up 25.33%.
Based on its most recent Beverage Buzz survey, Wells Fargo Securities LLC estimated that Monster’s c-store volume grew 9% in the fourth quarter of 2014, with minimal net retail pricing growth, likely driven by an increase in promotions.
“We continue to believe Monster is well positioned to drive substantial growth through its innovation pipeline and international expansion; however with potential minor disruption issues as it transitions distribution in the U.S.,” said Bonnie Herzog, managing director of beverage, tobacco and convenience research for Wells Fargo.
Monster currently distributes more than 90% of its product in the U.S. through Anheuser-Busch and Coca-Cola. Following the closing of the partnership—anticipated this month—Coca-Cola will have nearly 100% of the distribution of Monster products in the U.S., which should better align the distribution across geographies and accelerate Monster’s U.S. growth trajectory, Herzog explained.
Monster and Coca-Cola announced the partnership back in August, in a move Herzog called “a big win for both companies as it capitalizes on the respective strengths of each.”
Wells Fargo predicts a near-term slow-down in domestic Monster sales as competitive pressures mount from Red Bull, as well as due to expected minor “bumps” as it transitions to one distribution partner, which could negatively impact Monster’s sales in the first half of 2015, Herzog said.
At Beaverton, Ore.-based Plaid Pantry, energy drink sales keep going up at its 109 convenience stores. “I thought they would slow down at some point, but so far they haven’t. They just keep on going,” said Butch Fulton, merchandising manager for Plaid Pantry.
“Rockstar keeps coming out with new flavors and that caused sales to jump for a while. Rockstar is far and away our No. 1 in unit sales. Red Bull and Rockstar run back and forth on being the top for dollar sales at our stores each month. Monster is a distant third. It has had a really nice increase over the last two years, but it’s quite a ways below the others,” Fulton said.
In 2014, he noted, Monster tried to increase prices and lost share. As it brought its price back down, its share slowly came back. “This market is a little different. Monster is usually No. 2 or No. 1, but in this market Rockstar is No. 1, and you don’t have to go very far away from Portland to see that change to. In Seattle, Monster is still No. 2,” Fulton said.
Plaid Pantry offers energy drinks from about 11 companies. “Coca-Cola’s NOS is the biggest share jumper in the past two years—it’s really taken off. Now with Monster and Coke merging, I’m not sure how NOS will be impacted.”
Plaid Pantry is also doing well in its market with Guayaki Organic Yerba Mate, currently the chain’s No. 6 most sold brand of energy drinks. Red Bull debuted its new editions flavors on Feb. 16 with Red Bull Yellow, Red Bull Orange and Red Bull Cherry Editions. The single serve can for all Editions will be increasing to 12-fluid-ounces. “It’s going to be a big hit for them,” Fulton said. Fulton predicted energy drinks will be up another 5-6% in 2015, at the expense of carbonated soft drinks.