The Energy Drinks Industry: An Overview
If you're looking for a pick-me-up, a coffee may give you the jolt you need. But if you're like the millions of other people who don't want a cup of java, you may end up reaching for an energy drink. These companies that produce these beverages say they increase your energy and alertness as well as provide you with a physical boost. That's because they contain significant amounts of caffeine.
Energy drinks are part of the broader soft drink category, which includes carbonated beverages, fruit and vegetable juices, bottled water, sports drinks, beverage concentrates, ready-to-drink tea, and ready-to-drink coffee. According to experts, energy drinks are the most popular supplements for teens and young adults in the United States along with multivitamins. The majority of these drinks are consumed by men between 18 and 34.
Global energy drink sales are estimated to reach $53.1 billion by the end of 2022. The industry is expected to grow by a compound annual growth rate (CAGR) of 7.1% by 2027 to an estimated $86.1 billion. This growth is attributed to rising incomes, urbanization, and an increase in health and wellness consciousness. Both the adult and adolescent populations are consuming energy drinks to support their busy and active lifestyles, due to the an increase in performance, endurance, and alertness. Due to the COVID-19 crisis, "immunity-boosting" beverage consumption is rising as consumers are searching for sources that provide vitamins and minerals.
North Americans consume more energy drinks than any other geographic market in the world, with the European market close behind. Plus, research shows that the Asia-Pacific region is expected to be one of the fastest-growing markets for the industry, with a CAGR growth of 5.1% by 2026, thanks to a more modern lifestyle and changing demographics.
Want to know more about the biggest players in this industry? Keep reading to learn about the largest companies in the energy drink market as well as some of the emerging trends.
- The energy drink industry is a booming business with several key names leading the pack.
- Red Bull, Monster, and Rockstar are among the biggest names in this saturated market.
- Red Bull is a privately-owned company and the dominant force in the market.
- Monster is publicly traded and entered into a strategic partnership with Coca-Cola in 2014.
- Rockstar was sold to PepsiCo in 2020.
- Global energy drink sales are estimated to reach $53.1 billion by the end of 2022 and are expected to grow by 7.2% between 2022 and 2027.
Redbull is owned by the Austrian company Red Bull GmbH. The company introduced the drink in Austria in 1987, marking the beginning of the global energy drink industry. Red Bull comes in 8.4-ounce cans in a handful of varieties, including original, sugar-free, Total Zero (no calories), and the Editions (watermelon, blueberry, tropical, coconut, dragonfruit, peach, and strawberry-apricot). The drinks’ main ingredients are caffeine, taurine, B vitamins, carbonated water as well as sucrose and glucose (except for the sugar-free version).
Red Bull is sold in 172 countries, where it employs more than 13,000 people, as of the end of 2021. Sales are surging in emerging markets, such as India (up 37%), Brazil (up 30%), and Africa (up 25%). The company continues to focus on its efforts to expand in the U.S., Western Europe, and the Far East.
The company is a private company owned by chief executive officer (CEO) Dietrich Mateschitz, along with Thai businessman Chalerm Yoovidhya and his family. Because the company is privately owned, there is very little financial information available. According to the company, more than 9.8 billion cans of Red Bull were sold in 2021. That's a jump of 24.3% from sales recorded in 2020, representing the best figures in the company's history.
California-based Monster Beverage (MNST) is a holding company that was founded in 1985. It employs more than 4,000 individuals (as of May 2022) and is headed by CEO Rodney Cyril Sacks. The company began selling Monster Energy drinks in 2002, originally created under the brand Hansen's Natural. In 2020, Monster is the second largest energy drink company with a market share of 39% after Red Bull.
Monsters drinks come in over 40 varieties. The company has 18 different brands, including the original Monster drink, Burn, NOS, and Predator. One 16 fluid ounce can of Monster Energy contains 160 milligrams of caffeine (or 10 mg per fluid ounce)—considered very high—and taurine, an amino acid considered to be a dietary supplement and mental stimulant.
The Monster drink is sold in 141 countries as of 2021. The company faces stiff competition domestically and internationally from Red Bull and Rockstar. In 2014, the company entered into a long-term strategic partnership with Coca-Cola (KO), which purchased a 16.7% stake in Monster. This move made Monster the exclusive energy play for Coca-Cola. The soft drink giant's distribution network reaches more than 200 countries. The two companies have done business together since 2008.
The company's stock trades on the Nasdaq. The stock was down 1.06% on a year-to-date (YTD) basis as of June 6, 2022, with a market cap of $48.39 billion. According to year-end reporting, Monster's consolidated net sales were $5.54 billion for the fiscal year 2021—an increase of 20.5% from the previous year. The company doesn't report year-end sales per individual brand. Gross profits reported as a percentage of net sales were reported for the year at 56.1%.
Rockstar International founder and owner Russ Weiner introduced Rockstar Energy in San Francisco in 2001. Its marketing strategy includes affiliations with action sports, motorsports, live music, and models. Rockstar comes in 16-ounce cans in 30 flavors, including Rockstar original, sugar-free, pure zero line, recovery drinks, and more. Rockstar is sold in convenience and grocery stores in more than 30 countries.
Weiner sold the privately held company to PepsiCo (PEP) in 2020 for $3.85 billion. The soft drink company reaches consumers in more than 200 counties, adding Rockstar to its beverage lineup, which includes Pepsi, Gatorade, and Tropicana. The company said it planned to relaunch the Rockstar brand in the United States and internationally before integrating it into its supply chain.
Although PepsiCo doesn't release financial information about specific brands, we can make some determination about how Rockstar is poised to position itself within the company. Sales of Rockstar topped $851 million in 2019.
Top Emerging Companies and Trends
The energy drink market is saturated, making it more difficult for smaller and newer companies to compete. This means there's no real threat to energy drinks market dominance. Sales for energy shots like 5-Hour Energy or Tweaker have declined since COVID-19 reduced the "impulsive nature of energy shot consumption."
There is room in the energy drink market for companies to differentiate themselves from the leading players, which look remarkably similar in their advertising, promotions, and sponsorships. Competitors face challenges such as distribution, obtaining shelf space, and generally offering something unique to the customer.
Red Bull and Monster are on top of the trends in the energy drink and soft drink industry, allowing them to widen their product offerings to compete with smaller players, including Bang, who has been gaining market share in the past year. This brand showed significant growth in the market in 2019, faring much better than other natural energy drinks thanks to its "super-creatine."
We can expect to see the following trends in the energy drinks industry in the future:
- A boost in the availability of plant-based energy ingredients in these beverages, including guarana and maca
- Nootropic energy to help increase help the consumer's focus and mental clarity
- The reformulation of drink formulas to include kola nut and natural caffeine, and more exotic flavors
Experts warn that the sleep patterns of teenagers can be drastically altered with the excessive consumption of energy drinks.
Examples of On-Trend Energy Products
|Protein||Muscle Monster Energy Shake|
|Coffee||Java Monster; Muscle Monster Energy Shake (coffee flavor)|
|Organic||ORGANICS by Red Bull||Rockstar Organic|
|Cane Sugar||Rockstar Organic|
|Green Tea||Monster Energy Dragon Iced Tea in Green Tea|
|Zero Calorie||Red Bull Total Zero, Red Bull Zero Editions||Monster Energy Zero Sugar||Rockstar Sugar Free, Rockstar Pure Zero, Rockstar Unplugged, Rockstar Xdurance|
|No/Low Carb||Red Bull Sugarfree||Lo-Carb Monster Energy||Rockstar Unplugged, Rockstar Pure Zero. Rockstar Xdurance|
|Electrolytes||Monster Hydro Super Sport||Rockstar Recovery|
|Other||Red Bull Editions (seven fruit-flavored varieties)||Monster Energy Nitro (with nitrous oxide)||Rockstar Punched, Rockstar Boom|
Notes: This is not an exhaustive list of product offerings that fit the categories shown. There is also some overlap between categories. For example, zero-calorie drinks also have zero carbs.
Monster Energy Drink FAQs
How Old Do You Have to Be to Drink Monster Energy?
While there is no legal age limit to how old you have to be in order to drink Monster Energy, the company agreed that it would not market any of its energy beverages to children under the age of 12 in the U.S. This includes marketing and selling drinks, coupons, and samples in and around K-12 schools, as well as advertising in areas where children are the primary audience, such as television, radio, and the internet.
How Did Monster Beverage's Stock Split Work?
Monster split its stock four times between 2005 and 2016. The company did a two-for-one split on Aug. 9, 2005, and Feb. 16, 2012. Shareholders received four shares for each share they had on July 10, 2006, and three shares for every one share held on Nov. 10, 2016.
Who Are Monster Beverage's Major Shareholders?
The company's top individual shareholders include Rodney Sacks (50.2 million shares), Hilton Schlosberg (48.9 million shares), Mark Hall (795,356 shares), Emelie Tirre (247,172 shares), Thomas Kelly (126,292 shares), and Guy Carling (90,898 shares).
What Institutional Investors Hold Monster Beverage Stock?
As of March 30, 2022, Monster's top institutional investors were FMR (25.8 million shares), Vanguard Group (30 million shares), Blackrock (24.4 million shares), Loomis Sayles & Company (18.9 million shares), State Street Corporation (17 millions shares) and AllianceBernstein (14.3 million shares). About 65% of the company's shares are held by institutions.
The Bottom Line
The energy drink industry has been growing profitably for years as other once-popular beverages have declined, and it appears on track to keep growing despite regulatory and health challenges. One of the three leading companies is privately owned, limiting options for investors who want direct exposure to Red Bull through this category. But investors can still reap the benefits of public beverage stocks like Monster along with exchange-traded funds (ETFs) that focus on the food and beverage industry.
Disclaimer: The author does not own shares of or have a financial interest in any companymentioned in this article.
Why are energy drinks on the rise? ›
The global Energy Drinks Market is driven by an increase in health consciousness among individuals, an increase in urbanization, a rise in demand for non-carbonated drinks, and a rise in disposable income.Is the energy drink industry growing? ›
31, 2022 (GLOBE NEWSWIRE) -- According to The Brainy Insights, the energy drinks market is growing at a CAGR of 8.1% from 2022-2030. The growing demand for instant energy and hydration drink among athletes and working professional is anticipated to boost the demand for energy drinks.Was jolt the first energy drink? ›
Jolt was the first energy drink, with all the sugar and twice the caffeine. But it was disguised as a cola, and by the time it rebranded, Monster and Red Bull dominated. Jolt Cola was born in 1985, when it hit shelves promising all the sugar and twice the caffeine of regular soft drinks. Creators Joseph and C. J.Why did Jolt Cola fail? ›
In 2009, the Jolt Cola company would file for bankruptcy because of disputes with their supplier due to pricing issues for new packaging but would rebrand as Jolt Energy. And don't call it a comeback, but in 2017 Jolt Cola returned, released through the Dollar Store.What is the main problem with energy drinks? ›
Some of the dangers of energy drinks include1: Dehydration (not enough water in your body). Heart complications (such as irregular heartbeat and heart failure). Anxiety (feeling nervous and jittery).When did energy drinks become popular? ›
The first energy drink appeared in the U.S. in 1949 and was marketed as “Dr. Enuf”. In Europe, they were launched for the first time in 1987; then the market expanded throughout the world, becoming very popular after the launch of Red Bull in 1997.What is the fastest growing product in the drink industry? ›
Current statistics show that within the US, Coca-Cola Zero Sugar is the fastest-growing soft drink, increasing 11.5 percent in retail value and eight percent in volume in 2019.How fast is the energy drink market growing? ›
|By End User||Kids Adults Teenagers|
|Market size value in 2022||USD 91.94 billion|
|Revenue forecast in 2030||USD 177.58 billion|
|Growth Rate||CAGR of 8.3% from 2022 to 2030|
Since 2006, Jolt Cola and related flavors have been rebranded as Jolt Energy.
How much caffeine did Jolt have? ›
Jolt Cola contains 10.00 mg of caffeine per fl oz (33.81 mg per 100 ml). A 16 fl oz can has a total of 160 mg of caffeine.What is the oldest energy drink brand? ›
To fill the void, the Taisho company created an herbal "energizing tonic" called Lipovitan in 1962. The tonic looked, smelled, and tasted like cough syrup and is widely considered the first modern energy drink.Which Coke flavor failed? ›
Blind taste tests suggested that consumers preferred the sweeter taste of the competing product Pepsi, and so the Coca-Cola recipe was reformulated. The American public reacted negatively, and New Coke was considered a major failure.What was Coca-Cola's biggest mistake? ›
Coca-Cola announced on April 23, 1985 that it would discontinue its beloved Coca-Cola in favor of a new product that millions derisively called “New Coke.” The experiment did not last very long. New Coke was a disaster from the start. It came across to many as an irrational reaction to the surge in sales of Pepsi-Cola.Why did Coke stop making coke energy? ›
“As we scale our best innovations quickly and effectively like AHA and Coca-Cola with Coffee, we need to be disciplined with those that don't get the traction required for further investment. It is for that reason we've made the decision to discontinue Coca-Cola Energy in North America.”What are the pros and cons of energy drinks? ›
A few pros of consuming energy drinks are mood and attitude improvement, a better workout performance, a zero calories option, and the obvious energy boost. A few cons are they can become addictive, may cause health issues, weight gain, and sugar highs. Energy drinks can actually improve your cognitive functions.Why Should energy drinks be avoided? ›
A nutritional comparison shows that a 12-ounce cola drink contains about 39 grams of sugar, 41 grams of sugar in an energy drink. Research has found that consuming high-sugar drinks of any kind can lead to weight gain and an increased risk of type 2 diabetes, cardiovascular disease, and gout.Why do energy drinks affect people differently? ›
In your liver, there's a cocktail of enzymes that are designed to tackle different substances. The CYP1A2 enzymes are the ones that metabolize caffeine, and some people produce less of the one that knocks out caffeine quickly (the CYP1A2*1F (rs762551) enzyme, to be exact).Are energy drinks becoming more popular? ›
The global energy drinks market is projected to grow at a compound annual growth rate of 8.1% through 2030, due to consumers' increasing focus on wellness, endurance and alertness, according to Acumen Research and Consulting.How popular are energy drinks in the US? ›
Energy drinks are the second most popular dietary supplement among U.S. teens and young adults behind multivitamins. Most energy drinks contain 100–300 milligrams of caffeine per serving, although amounts can vary. Up to 400 milligrams of caffeine per day is considered safe for most adults.
How are energy drinks so popular? ›
As a boost of energy
One of the most reasons people drink energy drinks is to give them a boost of energy. It is popular among athletes, who need a faster recovery after exercise, or consume pre-workout to give their body the boost it needs to perform best during exercise.
Top Selling Energy Shots 2021 (USA)
|Energy Shot Brand||Sales||Change|
Energy Drinks Market Snapshot (2022-2032)
|Data Points||Key Statistics|
|Energy Drinks Market Projected Value (2032)||US$ 125,001.16 Million|
Revenue in the Beverages segment is projected to reach US$257.30bn in 2023. With a projected market volume of US$88,770.00m in 2023, most revenue is generated in the United States. In the Beverages segment, the number of users is expected to amount to 1,454.4m users by 2027.Who are the biggest consumers of energy drinks? ›
In 2022, the per capita volume consumption of energy drinks in the United States was the highest worldwide, at an average of 28.4 liters per person. This was followed by the United Kingdom, Japan, and Spain with approximately 12, 10.5, and 8.8 liters respectively.Who are the major players in energy drink industry? ›
The U.S. energy drink market is mainly dominated by key players such as Red Bull North America Inc Monster Beverage Corp, and Vital Pharmaceuticals Inc., based on sales figures. Red Bull generated U.S. sales worth almost four billion U.S. dollars with its energy drink that "gives you wings".What is the most popular energy drink? ›
In the United States, the number one energy drink, by sales, is Red Bull. This Austrian-made drink has been around since 1987 and is now sold in over 165 countries.Is energy the biggest industry in the world? ›
As you might expect, the global energy market is pretty massive. Estimates suggest that in 2018, global energy investment reached around $1.85 trillion. Other figures estimate that global oil and gas exploration and production is the 8th largest industry in the world by revenue, worth $2.7 trillion in 2021.Which industry drinks the most? ›
- Mining (17.5%)
- Construction (16.5%)
- Accommodations and Food Services (11.8%)
- Arts, entertainment, and recreation (11.5%)
- Utilities (10.3%)
Mining: These workers showed the highest rates of heavy alcohol use, with 17.5 percent of those in the mining industry reporting past-month heavy drinking. Construction: In the month prior to the survey, 16.5 percent of those working in the construction field drank heavily.
Why was Jolt discontinued? ›
What is this? The slogan worked, and Jolt Cola became successful for many years until 2009 when it filed for bankruptcy. The reason for it is the dispute with their can supplier Rexam. Jolt cola's company agreed to buy 90 million cans from them.Is Jolt Cola coming back? ›
Yes, you read that correctly. The original American energy drink, Jolt Cola, is returning in September.What was the 90s high caffeine soda? ›
During the go-go 1990s, "heavy citrus" colas like Mountain Dew, Mello Yello and Surge battled for supremacy in the (at the time) lucrative caffeine-overload market.What drink has the most caffeine ever? ›
At 714.3 mg per fluid ounce, DynaPep has the highest caffeine content per ounce of any beverage on the market.How much is 400 caffeine? ›
For healthy adults, the FDA has cited 400 milligrams a day—that's about four or five cups of coffee—as an amount not generally associated with dangerous, negative effects.How much sugar is in jolt? ›
According to the nutrition label on the Jolt site, a 16-ounce serving of the cola packs 190 calories and 50 grams of added sugar. An equivalent serving of Coke has the same calorie count and 52 grams of sugars.
Red Bull traces its origins to a similar drink called Krating Daeng, which was introduced in 1976 in Thailand by the pharmacist Chaleo Yoovidhya. While doing business in Thailand, Dietrich Mateschitz purchased a can of Krating Daeng and claimed it cured his jet lag.How many Red Bulls can you drink in a day? ›
While safe doses of caffeine vary by individual, current research recommends limiting caffeine to 400 mg per day or less in healthy adults ( 28 ). As one small 8.4-ounce (260-ml) can of Red Bull provides 75 mg of caffeine, drinking more than 5 cans per day could increase your risk of caffeine overdose ( 2 ).What was the first American energy drink? ›
In America, the first energy drink was presented in 1985 under the name of Jolt Cola. It is interesting that at the time the drink was presented not as energy, but as “carbonated soft drink”. It was made for students and young professionals who would use it in stressful situations and to boost energy.Why does mcdonalds Coke not taste like Coke? ›
In a FAQ section of the website, the answer to “Why does the Coca-Cola taste so good at McDonald's?” reads: “The water and Coca-Cola syrup are pre-chilled before entering our fountain dispensers with the ratio of syrup set to allow for ice to melt.
Which Coca-Cola is the healthiest? ›
Zero nutritional value
- Calories: 0.
- Fat: 0 grams.
- Protein: 0 grams.
- Sugar: 0 grams.
- Sodium: 2% of the Daily Value (DV)
- Potassium: 2% of the DV.
Pepsico's lawsuit, filed in United States District Court in Manhattan, contended that Coke, in violation of the Sherman Anti-Trust Act, unfairly pressured independent food-service distributors, who supply the majority of the fountain business, to carry only Coke products by threatening to cut off their supply if they ...Can you drink 10 year old soda? ›
Carbonated soft drinks or sodas are not perishable, and are safe past the date stamped on the container. Eventually flavor and carbonation will decrease.What flavor is the New Coke? ›
The new drink—which fuses strawberry and watermelon flavors with a great Coke taste—drops in the United States in July and will be available in select countries around the world. A zero-sugar version also will be available.Where did energy drinks become popular? ›
Energy drinks were more popular in Japan from 1960s. The era of energy drink started during 1962 with Lipovitan D by a company named Taisho in Japan. Lipovitan D had extra caffeine and vitamins and was marketed as medicinal tonics.Why did the price of Monster energy go up? ›
Monster Beverage stated that during 2020 and 2021, it experienced a shortage of supply that impacted its operation and sales. Perhaps that is the reason that it was accumulating large inventory at hand.Which gender consumes more energy drinks? ›
Patterns of caffeine use
Men were more likely to report consuming EDs (p = 0.0121), and women were more likely to report drinking coffee, tea, soda, and “other caffeinated beverages” (p ≤ 0.0416 for all).