Energy drink sales are surging and are expected to continue to gain strength throughout 2023 and beyond.
The energy drink category posted sales of $12.2 billion, a sizeable gain of 8.5%, with unit sales up 3.5% for the 52 weeks ending Jan. 1, 2023, according to Chicago-based research firm IRI.
Leading brands included Red Bull, with almost $4.9 billion in sales, up 5.1%, and Monster, which recorded sales of $3.43 billion, a powerful 9.4% gain.
Energy drinks continue to drive the packaged beverage category, according to Megan Chmura, senior director of merchandising for GetGo, which operates more than 260 locations throughout Pennsylvania, Ohio, West Virginia, Maryland and Indiana.
Innovation from major players and performance energy represent the bulk of continued growth in this market, Chmura said.
“Increases in this area come at the expense of the energy shot category,” Chmura said, “which continues to decline. More 12-16-ounce ready-to-drink products now come with a lower retail price and cleaner ingredients than what’s typical in the energy shot category.”
GetGo will also be watching new brands that have a focus on the younger generations.
“Newer brands are increasingly coming to market with co-branding opportunities with other established brands or are hitting the market with major support from social media influencers,” Chmura said.
Continued Growth Ahead
Steven Montgomery, president of b2b Solutions LLC in Lake Forest, Ill., expects that energy drink sales will continue to grow in importance to convenience stores in the year ahead.
“A Goldman Sachs survey reported that c-store retailers expected to see this category to have sustained double-digit growth in 2023,” Montgomery said.
Part of that growth will be fueled by new products that are sugar-free, positioned as healthier and that offer additional flavors, he added.
“Energy drink companies are also expanding into new market segments. One example is Monster Energy’s expansion into the juice, water and alcoholic beverage categories.”
Both types of growth, Montgomery explained, allow the energy drink companies to gain more shelf space in a c-store’s walk-in cooler. “One caveat is to make sure the amount of space is supported by sales of that item.”
C-store retailers can increase their sales of this important category by bringing in new items, Montgomery continued, as research has shown that over 70% of adult customers discover new products and brands at convenience stores.
“Research by Molson Coors reported that 25% of energy drink customers would buy a different brand if their preferred brand was not available,” Montgomery said.
This same research found that those customers bought prepared food, indicating an opportunity for c-stores to cross-promote or bundle energy drinks with foodservice — much in the same way they have done for years with carbonated beverages.
