Just over 15 years ago in 1997, Red Bull made waves in the food and beverage industry when the fizzy caffeine infused drink was first released in the US. These days it seems that every convenience store across the country has almost entire wall dedicated to colourful cans of Red Bull, Rockstar, Monster, and other jitter-inducing coffee alternatives.
Combined, the revenue generated from these drinks amounts to a US$ 12.5 billion market. Despite the huge demand for these products however, the Energy Drinks market in the US is currently facing a big problem: the high publicity of health concerns related to the ingredients used in energy drinks.
In 2002, health officials in Germany began tracking the side-effects of energy drinks and noted adverse effects like high blood pressure, respiratory issues, liver damage, seizures, and death. Similar studies were not conducted or highly publicized in the US until 2010 when poison control centers moved beyond monitoring generalized caffeine problems and began focusing on energy-drinks specifically.
Since the beginnings of these studies, the energy drink market has received a lot of negative attention to the point that the American Medical Association may push a ban on the sale of highly caffeinated beverages to consumers under the age of 18.
Vendors are not quick to let this backlash impact revenues however, and have responded to the public’s concerns by introducing an increasing number of energy drinks with advanced, natural, and ultimately more healthful ingredients.
In the past year, a number of manufacturers have launched energy drinks which substitute caffeine with natural extracts from organic raw green coffee beans, organic guarana, ginseng, gingko biloba, and green tea. For instance, Scheckter’s Organic Energy is the latest 100% organic product on the market.
Meanwhile other companies like Rockstar and Monster are keeping their products caffeinated, but adding essential vitamins like Vitamin C and B12 to drinks in an attempt to offset their negative health effects.
But is it working?
In short, yes.
The Energy Drinks Market in the US is forecast to grow at a CAGR of 12.9 percent for the 2012-2016 period, even with the barrage of negative publicity being tossed around regarding the canned beverages.
It would be unfair to declare that the only factor behind this growth is the advent of healthy energy drinks however. Also playing a huge role in the rise of revenue is the increasingly fast-paced lifestyle among today’s consumers, increased casual consumption of the drinks, and the expansion of the Global Beverage industry as a whole.
Combined, these trends are likely to keep the Energy Drink Market buzzing well after the caffeine wears off.
For more information, view our 2012-2016 report on The Energy Drinks market in the US.
