The energy drinks market - Spain

1.2 Global market

The global energy drinks market is expected to grow at a CAGR of +*.*% between **** and ****. As a result, market size is expected to rise from US$**.* billion in **** to US$***.* billion in ****.

sales trend for energy drinks World, ****, US$ billion Source: ****

Consumers are increasingly demanding sugar-free, glucose-free and fructose-free drinks, which is driving the market.

The main channel worldwide for the sale of this type of beverage is supermarkets, which account for over **% of revenues. The remaining quarter is accounted for by the CHR (***) segment, particularly nightclubs. This is the most promising segment, and should continue to grow.

Market share breakdown by place of consumption World, ****, % (***) Source: ****

1.3 Spanish market

In ****, Spaniards consumed ** million euros worth of energy drinks. When measured in terms of aggregate value, the market is small compared with the UK or Germany, for example. Nevertheless, it should continue to grow over the coming years, as consumers become acculturated to the product.

sales trend for energy drinks Spain, ****-****, € million Source: ****

1.4 Consequences of Covid-19

There is no indication that the energy drinks sector as a whole will be particularly affected by COVID-**. Beverages remain non-cyclical and demand is fairly stable.

However, there are risks that expected growth could be reduced in light of the global pandemic. These risks could include, for example, people spending less time outdoors and therefore consuming fewer activity-related energy drinks. In addition, brand exposure has fallen considerably due to the cancellation of sporting events. Nevertheless, Red Bull and Monster continue to market their products extensively through their athletes, who often have social media accounts. For example, Instagram remains a hot spot for product placement for Red Bull, so it's plausible to assume that this mitigates the adverse effects of reduced marketing and exposure.

Another risk, particularly for smaller companies, is their survival due to lack of liquidity. Small businesses have much lower capital reserves, and if sales are affected, even moderately, this could have an impact on the risk of bankruptcy. in turn, this would lead to even greater market concentration in the hands of Red Bull and Monster.

Overall, beverage consumption in Spain rose by +**% in ****, driven by in-home consumption. Among the beverages preferred in times of pandemic, energy drinks ...

2.1 Consumer profile

Young people and adults with children are the main consumers of energy drinks in Spain. The volume consumed per person is particularly high among the video game community. Finally, bars and nightclubs are the preferred places to consume drinks like Red Bull.

Energy drink consumption by category Europe, ****, % (***) Source: ****

Despite a dip between **** and ****, total energy drink consumption has remained stable since ****, thanks to a strong rebound in ****.

evolution of energy drink consumption by volume Spain, ****-****, millions of liters Source: ****

It's interesting to see the figures at micro level too. Consumption volume per person remains stable at between *.* and *.* liters per person per year.

trends in energy drink consumption at micro level Spain, ****-****, liters/units Source: ****

2.2 Raising awareness of health issues

Consumers are increasingly turning to energy drinks, which are associated with an active, healthy lifestyle. **% of Europeans see a direct link between eating well and staying healthy. In fact, since the pandemic, consumers' priorities are as follows:

Staying fit ; be active; Eat a balanced diet.

Consumer awareness of the links between food and health Europe, ****, % Source: ****

Energy drinks are seen as a way to stay healthy, but only to a certain extent, as consumers now pay attention to the composition of the beverages, to find out whether they are natural or not. Buyers now know which health attributes to associate with which product. The issue of sugar has also become central, and many are aware that there are sugars that are less harmful than others. Producers must therefore continue to innovate, by reviewing the way their products are developed. [***]

The consumption of energy drinks by teenagers has become a public health issue of concern to a number of autonomous communities. The ESTUDES survey (***) reveals that the consumption of energy drinks is very common among teenagers. However, it is not recommended at this age, due to the high caffeine and taurine content of these drinks. In ****, **% of Spanish boys aged between ** and ...

3.1 Overview of market structure

Source: ****

3.2 Companies and jobs

Data collected by INE allow us to study the non-alcoholic beverage manufacturing industry, which includes energy drinks, under CNAE code ****: "Fabricación de bebidas no alcohólicas; producción de aguas minerales y otras aguas embotelladas". The number of companies in this sector is declining.

number of companies manufacturing non-alcoholic beverages Spain, ****-****, units Source: ****

On the other hand, the number of people in employment is on the rise: the workforce grew by +*. *% in **** compared to ****.

change in the number of people employed in the non-alcoholic beverage sector Spain, ****-****, units Source: ****

3.3 Brands and Distribution

The market is made up of * types of player: integrated producers who are also distributors, and distributors who do not produce. red Bull is integrated throughout the production chain, right up to distribution, while Monster (***). Coca-Cola is also present through the Aquarius brand, which it launched at the time of the **** Barcelona Olympic Games. The presence of this drink, which is best known in Asia, is unique on the European continent. Its historic rival Pepsi is challenging it in this segment with the launch of Rockstar.

Aquarius and Red Bull remain the two best-known brands in Spain, thanks in particular to their mobilization of the sporting imagination. They vie for top spot in terms of popularity by region. In fact, Tiendeo has aggregated the digital data of Spanish brands to produce a ranking of the most searched-for brands on the Internet. Aquarius and Red Bull appear in either first or second place in all autonomous communities, except Asturias, where Monster comes in second.

the Spanish energy drinks market is largely dominated by Red Bull, Aquarius, and Monster Energy, which is becoming increasingly popular. These are the most popular and well-known brands, as revealed by the study of internet searches in the ...

4.1 Price

INE data provides information on unit price trends for energy drinks under code **.*.*.* T: "Bebidas energéticas (***)".

unit price trends for energy drinks Spain, ****-****, €/l Source: ****

4.2 Offer diversity

Most beverages are sold in ** or ** cL cans. There are different price ranges, enabling them to reach a very wide audience. To differentiate themselves, manufacturers play on flavors, which are often exotic. Most brands have a sugar-free version.

Source: ****

4.3 Innovations

The most buoyant segment is the health argument. Traditional players are offering new, organic, more natural recipes. This is the case with Red Bull, which has launched its yerba mate drink in Europe, an infusion that is very popular in Argentina and Paraguay. This innovation is an opportunity for manufacturers outside the energy drink segment to gain a foothold in this market. Such is the case of Perrier with its Energize version. This innovation brings together two fast-growing trends: energy drinks and flavored waters.

Source: ****

5.1 Current regulations

In general, energy drinks sold in France are subject to EU regulations, which lay down specific provisions for the labelling of energy drinks.these are set out in Regulation (***) No. ****/**** on the provision of food information to consumers. Under this regulation, energy drinks must be labelled with the words "High caffeine content. Not recommended for children, pregnant or breastfeeding women", followed by the amount of caffeine per *** ml in brackets.

To combat over-consumption of these beverages, some of whose ingredients are harmful to health if ingested in excessive quantities, the government has introduced a tax on sugary drinks. This measure also applies to energy drinks, which are subject to a **% VAT. As a result, the price of a liter of Monster has risen from €* per half-liter to €*.**. The aim is to reduce consumption of these highly chemical liquids, which contain stimulants and a high sugar content. The aim is to prevent them from having health consequences for consumers, notably by causing obesity or destroying intestinal flora. [***]

6.1 Segmentation

• Red Bull
• Monster Energy
• Coca-Cola - Burn
• Sanmy
• Coca-Cola Europacific Partners CCEP
• Nocco