The market for sports and energy drinks was valued at £941m in 2008, a 10 per cent increase on 2007. Estimates for 2009 see the category breaking the £1bn mark – equivalent to 525m litres.
“Unlike other markets such as smoothies, which were seeing impressive growth until the recession arrived, sports and energy drinks have continued to grow their value,” said Jonny Forsyth, senior drinks analyst at Mintel.
“Cash-squeezed consumers are viewing these products as value for money rather than a luxury, which stands in contrast to smoothies and bottled water, both of which have suddenly seen growth reverse.”
Limited appeal
However, the growth of the category has been limited by an inability to penetrate beyond a core consumer base. Currently, energy and sports drinks only appeal to one third of the UK population, a figure that has remained static over the past five years.
“There has been a distinct failure to grow penetration of sports and energy drinks in the UK. Instead, the market has succeeded by increasing frequency of drinking amongst young male converts in particular,” said Mintel.
The challenge and opportunity for the industry moving forward is to attract new consumer groups, including women, 35-54 year-olds and workers, according to the analyst.
“This means increasingly stealing share from carbonates and bottled water in particular. The problem is that energy drinks appeal most to the physically active and men aged between 15 and 34 (who) do more exercise than anyone else. A more mainstream opportunity lies in targeting mental rather than physical energy.”
Market growth
Driving the category have been energy drinks, valued at £716m in 2008, with sports drinks sales coming in at £225m. This compares to 2004 sales of £475m and £136m for energy and sports drinks respectively.
Mintel forecasts that the category will grow a further 48 per cent over the next five years to reach £1.5bn, whilst volume sales will rise by 44 per cent to reach 757 million litres.