Energy drinks are primarily consumed by teens and young adults to boost energy and performance. The global energy drinks market is dominated by Red Bull, Monster, and Rockstar, and is growing due to rising consumption among adolescents. However, excessive consumption of energy drinks, which often contain high levels of caffeine, can negatively impact physical and mental health, especially when mixed with alcohol. The COVID-19 pandemic has disrupted the energy drinks industry through supply chain and sales channel impacts, but the market is expected to recover as economies reopen.

2.  Energy drinks are primarily consumed as energy booster
and physical performance enhancer, and also widely used
as a dietary supplement by many teens and young adults
worldwide. The millennial population, between the age
groups of 18-35, are the main consumers of these drinks
and the demand for energy drinks globally is growing
rapidly due to increase of consumption among adolescents.
According to a data, almost one-third of teens between 12
and 17 years drink them regularly keeping the view that
these products give them energy boost to improve physical
and cognitive performance.

3.  Over the last few years, the consumption of energy drinks
are growing significantly among teenagers and the market
for the drinks globally is expanding substantially due to the
rise in numbers of sports players or athletes. One key
reason for growing demand for energy drinks is that
consuming large amount of caffeine is primarily believed to
be offering desired effects such as improved memory,
increased alertness, and elevated mood.
Nevertheless, the global energy drinks industry is a highly-
saturated market controlled by a few giants; thus, the
market scope for new players in the industry is very
minimal and discouraging. Meanwhile, the market is
currently facing several challenges because of the wide
availability of substitute drinks in the forms of packaged
juices, aerated beverages, and malted health drinks that
offer low prices compared to the energy drinks.

4. Main Compositions and Types of Energy Drinks:
 Different manufacturers use different components for their variance of
energy drinks although the drinks usually serve one main purpose i.e.
to boost physical stamina. However, energy drinks primarily contain
caffeine, taurine, herbal extracts, vitamins, glucuronolactone,
proprietary blends, and amino acids as the major ingredients. Other
components of energy drinks may include guarana (another source of
caffeine sometimes called Brazilian cocoa), sugars, ginseng, yohimbe,
carnitine, and bitter orange.
On the basis of product types, two kinds of energy drinks are available;
normal drinks and shots. Normal energy drinks has a size of ordinary
soft drinks, available in 16-oz. bottle while shots have a concentrated
caffeine amount with a container of 2 to 2½ oz. In shots, the levels of
caffeine contents are around 113-200 mg whereas the normal drinks of
16-oz bottle contains 70 to 240 mg of caffeine. According to National
Center for Complementary and Integrative Health, United States (US)
Dept. of Health and Human Service, consuming large amounts of
caffeine may, however, cause serious heart and blood vessel problems
such as heart rhythm disturbances and increases in heart rate and
blood pressure for children as well.

5. Some Major Manufacturers of Energy Drinks and their
Current Market Portfolio
 These five players namely Red Bull GmbH, Monster
Beverage Corp., Rockstar Inc., The Coca-Cola Co., and
PepsiCo Inc. in combine dominate the global market for
energy drinks by occupying more than 85% of the total
market share. Red Bull, Monster, and Rockstar are some of
the most popular energy drink brands worldwide.

6. Red Bull GmbH and its Products
 It is an Austrian beverage company and a privately held energy
drinks manufacturer that introduced the drink in 1987 for the
first time. Later, the company gained popularity when its famous
product, Red Bull became a widely consumed drink in the US in
1997. Currently, markets for Red Bull are widely expanded across
167 countries with a strong sales experience in India, Japan,
Turkey, Scandinavia, Russia, and Brazil. According to the
company’s website, Red Bull GmbH sold over 7.5 billion cans in
2019 and contributed the highest market share for energy drinks
globally. As per Forbes, the market value of the company was
estimated at USD 20 billion in December, 2019.
Red Bull has many sizes including 12-ounce cans with different
varieties such as original, sugar-free (5 calories), total zero (no
calories), and Editions (cranberry, blueberry, tropical, zero-
calorie orange, and zero-calorie cherry). The key components of
the drinks are caffeine, taurine, B vitamins, sucrose, glucose, and
carbonated water. The company heavily invests on advertising
strategy and relies on extreme sports sponsorship, buzz
marketing, and television ads.

7. Monster Beverage Corp. (MNST) and its Products
 MNST, a California-based energy drinks manufacturer, was considered
to be the big challenger for Red Bull company’s products in the next
few years after it was founded in 1990. It failed to compete with Red
Bull in the late 90s but subsequently gained its popularity in 2002
because of the growing sales in the US. Currently, the company has its
markets over 114 countries and is trailing after Red Bull; meanwhile,
these two companies is presently controlling more than 70% of the US
energy drink market. According to Euromonitor International, Red
Bull had about 32% of the worldwide market while Monster had about
14% in 2013. As given in the company’s website, till June 30, 2020, the
company had $921.3 million in cash and cash equivalents, $250.8
million in short-term investments and $2.1 million in long-term
investments.
Monster drinks has its popular 16-ounce cans with a range of 36
varieties including its flagship Monster Energy drink to double-
strength, coffee-flavored, fruit-flavored, no-calorie, protein-enhanced,
and other varieties. The main ingredients of Monsters’ drinks are
carbonated water, sucrose, glucose, taurine, Panax ginseng, L-
Carnitine, caffeine, B vitamins, glucuronolactone, inositol, and
guarana, though ingredients vary somewhat by flavor.

8. Rockstar Inc. and its Products
 Rockstar Inc., is a subsidiary of PepsiCo Inc., was founded in
2001 in San Francisco, Las Vegas. As of 2009, it covered 14% of
the US energy drink market. The company’s tagline is that its
energy drinks are “designed for those who lead active lifestyles.”
Currently, the energy drinks of Rockstar are available in
convenience and grocery stores in more than 30 countries
including the US, Canada, Europe, and Asia; and its market
strategies are solely based on affiliations with action sports,
motorsports, live music, and models.
It has offered 27 different products ranging from Rockstar
Original energy drink to zero carb (10 calorie) and zero-calorie
versions, recovery drinks, coffee flavors, and more. Main
ingredients of the drinks include carbonated water, sucrose,
glucose, taurine, caffeine, L-Carnitine, milk thistle extract,
ginkgo Biloba leaf extract, guarana seed extract, and Panax
ginseng root extract. It currently contributes about 10% of the US
energy drink market. According to Forbes, the annual average
sales growth of the company has declined rapidly over the years.

9. Key Problems Associated with the Consumption of
Energy Drinks
 Some negative outcomes are evident when energy drinks are consumed
excessively. For quite often, many youngsters have developed a habit of
either using energy drinks with alcohol or excessive consumption to
reduce stress and stay alertness in several occasions. To mention some
key problems of excessive consumption of energy drinks are as
follows:Excessive Caffeine Content
 Considering the health problems associated with the excessive
consumption of energy drinks, The US Food and Drug Administration
(FDA) set a caffeine limit of 71 mg per 12 ounces of soda and about 120
mg per 12 ounces for energy drinks. However, energy drink
manufacturers may choose to classify their product as a supplement to
sidestep the caffeine limit. For companies that classify their energy
drinks as beverages, the American Beverage Association published
voluntary guidelines that advise accurate listings of caffeine content,
restriction of marketing to children, and reporting of adverse events to
the FDA. However, compliance to these guidelines has been found to
be low.

10.  Mixing with Alcohol
 Combining Energy drinks and alcohol is a major trend for a
large number of underage drinkers or young adults, which
often lead to the situation of binge drinking. Studies
pointed out that people consume more alcohol when
mixed with energy drinks since caffeine keeps the body
alertness and reduces the level of intoxication. As per the
report by Centers for Disease Control and
Prevention (CDC), those drinkers between the aged of 15 to
23 drinkers, who had the habit of drinking alcohol mixing
with energy drinks, consume four times more to pursue
binge drinking in the US. CDC also found that 10.6% of
students in grades 8, 10, and 12 from US schools and 31.8%
of young adults aged 19 to 28 have history of consuming
alcohol mixed with energy drinks at least once in the past
year.

11.  Other Health Conditions
 In some case, high consumption of energy drinks may be
linked to adverse cardiovascular, psychological, and
neurologic events, including fatal events. The International
Society of Sports Nutrition suggested that higher-calorie
energy drinks can lead to weight gain, and that their high
glycemic load could negatively affect blood glucose and
insulin levels. Thus, consumption of energy drinks for
children and adolescents without the guidance of parents
could result severe health conditions for the kids.

12. Current Market Trends and Performance
 As per a detailed report, the global energy drinks market was valued at USD
51,728.4 million in 2019 and is projected to reach USD XX,XX3.2 million by
2027, expanding at a CAGR of 6.5% during the forecast period.
Among the two types, the nonalcoholic segment is dominating the global
market for energy drinks because of the reason that it boosts the energy by
improving physical and cognitive performance. In 2018, the nonalcoholic
segment controlled the major share of the market that accounted for more
than 50% of the global energy drinks market and the segment is expected to
witness a higher growth during the forecast period. Meanwhile, the alcohol
segment that contains an average of around 2% to 5% of alcohol by volume, is
growing at a significant rate due to surge in demand from the mature
economies such as the United Kingdom, Australia, the US, and Spain.
On the basis of the end user, the adult group segment are the major consumers
of the products and contributed a major market share of around 45.90% in
2018, due to rise in consumption of energy drinks by working adults to
maintain a healthy lifestyle. This segment is anticipated to grow with the
highest CAGR of 6.70% during the forecast period, owing to increase in
consciousness toward intake and diet among sports athletes.

13.  Among the sales channel, the increase of retail sales through e-
commerce platforms contributed huge opportunities for
expansion of energy drinks in the global market. Online sales are
growing rapidly and preforming well for energy market growth
since many manufacturers have preferred to attach with the
giant e-commerce retail shop. However, the wide availability of
energy drinks on supermarkets are also contributing to boost the
market expansion significantly.
At present, the United States, China, and Brazil are the major
destinations for energy drink markets globally. Among regions,
North America is currently occupying the majority share in the
global market for energy drinks due to the higher consumption
by a large portion of teenager population and increasing health
concerns among consumers. However, Asia-Pacific is expected to
grow at the highest CAGR of 7.4% during the forecast period and
expected to reach USD 26.4 billion by 2025 due to the rise of
disposable incomes of the large populations of the region. In
combine, Asia-Pacific and North America is currently occupying
more than half of the global energy drinks market share.

14.  In Europe, the market share for energy drinks is projected
to grow at a CAGR of 6.5% over the forecast period and to
reach USD 19.52 billion by 2025 due to growing healthy
concerns and increasing consumer adoption rate in the
region, supported by the rise of marketing efforts by many
leading manufacturers. The growing demand from the
European consumers for healthy, zero-calorie, and low-
sugar functional products, in order, also boosted energy
drink production in the region. Although, markets for
energy drinks in South America and Middle East & Africa
have relatively smaller scope due to less consumers but
observing the growing interest for children and adolescents
for energy drinks in the region are expected to push the
global market at a considerable rate.

15. Analysis of Market Strategies for Manufacturers
 Other competitors in the global market for energy drinks include Arizona
Beverages USA, Keurig Dr Pepper Inc., Living Essentials Marketing LLC.,
N.V.E. PHARMACEUTICALS, National Beverage Corp., Osotspa Public
Company Limited, Power Horse Energy Drinks GmbH, Rhino Rush, Taisho
Pharmaceutical Holdings Co. Ltd., Tweaker, and VITAL 4U. Many of these
companies are actively engaged in adopting several market strategies such as
product launch, entering partnership or collaboration agreements, and
acquisition and merger to enhance their market position in the global
footprint. Some of the major events for the manufacturers’ attempts for
strengthening their portfolios are as follow:

Early this year, Monster Beverage Corp. entered an agreement with the Coca-
Cola Company to expand their presence in the market. Under the deal, Coca-
Cola agreed to transfer its energy drinks including NOS, Full Throttle, Burn,
Mother, Play and Power Play, and Relentless to Monster corp. In 2015, Coca-
Cola acquired nearly 17% equity stake in Monster for USD 2.15 billion in cash
and opened its global distribution arm to Monster to improve their
manufacturing and strengthen their distribution. In return, Monster agreed to
transfer its non-energy drinks such as Hansen’s, Hubert’s, Peace Tea, and Blue
Sky to Coca-Cola, which helped to increase their sales globally.

16.  Monster and Rockstar have broaden their soft drink
products to compete with smaller players. For example,
Rockstar has an organic offering and Monster has its green
tea products to widen their market presence. According to
BeverageDaily, the market for energy drinks has been
expanded with the addition of new products based on with
branched-chain amino acids (BCAAs), protein, beetroot
extract, and creatine.
 Other relatively new varieties of existing energy drinks are
based on no sugar, no carbs, no calories, and, counter-
intuitively, no caffeine products, which indicate a high
selling point globally besides the availability of coffee
flavors and non-carbonated flavors.
 Many manufacturers have adopted several marketing
strategies including limited-edition drinks offered only in
certain store chains and flavors tailored for different
countries, to promote their products and increase their
control in the global market.

17. COVID-19 Impact on Energy Drinks Market
 Consumer products food & beverage companies are facing challenges
since the global production and their business activities are largely
affected by the ongoing COVID-19 impact. Energy drinks industry is
among the major sectors of food and beverage category that suffers a
drastic setback due to the sudden disruption of commercial
productions and global supply chains. Consumption at home through
the means of online retails has steady increased due to the emergency
lockdown of outsource sources but the large sales growth is generally
associated with the out-of-home consumption, which brings a major
drawback.
Monster’s second quarter net and gross sales were adversely impacted
by the COVID-19 pandemic, in part due to disruption in the supply of
the company’s bottlers/distributors reducing their inventory levels.
However, the company claimed to have experienced a sequential
improvement in sales in the latter half of the quarter as certain
countries and states began to gradually re-open. Based on currently
available information, the company does not expect the COVID-19
pandemic to have a material impact on its liquidity.
Nevertheless, the slow return of global economy and the re-opening of
various industries indicate an optimistic view of the future market for
consumer foods and beverage products.