The energy drinks market - United Kingdom

1.1 Definition and scope of the study

Energy drinks are a type of soft drink rich in caffeine, sugar, and other stimulants. Energy drinks are consumed to boost energy levels, often in relation to sports. However, energy drinks are not necessarily associated with sports but are also consumed in leisure settings.

The most common ingredients in energy drinks are caffeine, taurine, guaran, and vitamins. On top of this, additional energy is provided through high levels of sugar.

The global energy drinks market is expected to continue on the positive growth path seen during the last couple of years. In particular, between 2019 and 2025 the market is expected to grow at CAGR 7%. [mordorintelligence] Several key drivers will drive this expansion; first, as consumers focus more on fitness, they are more inclined to consume energy drinks. Secondly, energy drinks offer immediate energy boostswhich are often more effective than coffee.

The global market is highly concentrated and dominated by three brands, namely Monster Energy, Red Bull and TC Pharmaceutical Industry. Together, these players accounted for 43.9% of sales in 2019. The position of these players will most likely remain intact for the years to come due to the massive marketing expenditures implemented by Red Bull and Monster in particular.

The UK market is expected to grow at a CAGR of 4.3% between 2019 and 2025. This growth is fueled by the prevalence of low-sugar drinks which will attract more consumers and fit in with societal health trends. Another important point of product differentiation is innovation in flavour; this aspect continues to be key in the market, proven by the fact that the largest players persistently release new flavours to attract customers. An example of this is Red Bull’s coconut berry flavour, or Lucozade’s watermelon & strawberry cooler.

Unlike on the global stage where Monster is the largest player measured through sales, we find that Red Bull has the strongest presence in the UK. In 2018 Red Bull had almost 3.8 million users in the UK. The second most consumed brand was Lucozade. [Kantar] The UK market is highly concentrated.