“Sugar continues to be an issue in the market and the upcoming sugar tax in 2018 is expected to have an adverse effect on volume sales. 52% of users would cut back or stop drinking sugary sports and energy drinks if the price went up. However, 37% of the users who said that they’d reduce consumption would switch to low/no-sugar versions, offering an ongoing incentive for companies to innovate in this area as a way to keep consumers buying into the category.”
– Amy Price, Senior Food and Drink Analyst
This report examines the following issues:
- The sugar tax provides a challenge and an opportunity
- The trend for category blurring opens the market up to a wider audience
- Low-caffeine energy drinks could provide an alternative solution
This Report focuses on RTD (ready-to-drink) sports and energy drinks through both the retail and on-trade channels.
Sports drinks are drinks claiming to improve sporting performance or to speed up recovery. Most of these are labelled isotonic/hypotonic and claim to rehydrate and replenish nutrients after exercise. Examples include Lucozade Sport, Powerade and Gatorade.
Sports drinks are divided into three major types:
- Isotonic drinks: These have the same osmolality as that in the body, and are designed to aid rehydration, as they are said to be readily absorbed into the blood. Most sports drinks are isotonic, including Powerade and Lucozade Sport.
- Hypotonic drinks: These have a lower osmolality than body fluid and are said to be absorbed faster than isotonic drinks and faster than water into the blood.
- Hypertonic drinks: These have a higher osmolality than body fluids and are designed to be taken after exercise to replace electrolytes, aid recovery and provide an energy boost.
Energy drinks are drinks that specifically claim to provide an energy or stimulant boost, supporting mental alertness and/or physical performance. These generally include active ingredients such as glucose, caffeine or taurine, and may include other ingredients positioned as beneficial to health, such as ginseng and various vitamins and minerals.
The energy drinks market divides itself into three distinct categories:
- Refreshment energy drinks provide physical energy through glucose or a range of sugars, as in Lucozade Original Energy.
- Stimulant drinks are designed to stimulate both mind and body, and typically claim to improve concentration, reaction time and endurance. Stimulant drinks typically contain active ingredients such as caffeine and taurine, and are non-alcoholic. The best-known example is Red Bull.
- Energy shots refers to what are usually more concentrated versions of refreshment/stimulant drinks, ie they typically retail in a 50ml bottle rather than in a can of between 250ml and 500ml.