WHITE PAPER // TREND RESOURCES
FUNCTIONAL
BEVERAGES —
FROM ENERGY
TO RELAXATION
Lisa Demme,
Beverage
1900 Averill Road, Geneva, IL 60134
630.578.8600 | www.fona.com
page 1
In 2011 the energy drinks and energy
shots market sales were estimated at $8.1
billion, which represented a dollar sales
growth of 16% over 2010. The market has
regained its growth after experiencing a
dip in 2009, which is generally attributed
to the influence of the recession. Mintel
projects the market to attain 92% growth
during 2011-16 on the strength of a
steady stream of innovations from the
top energy drinks/shots manufacturers
like Red Bull, Monster Energy, Rockstar
and 5 Hour Energy. Some of these new
products such as Rockstar Recovery,
Monster Rehab, Rockstar 2X, and
5-hour Energy Extra Strength already
show signs of success, evidenced by
impressive dollar sales growth in these
line extensions.
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The relatively young status of the
category itself, especially within energy
shots, holds great promise for growth.
To enjoy uninterrupted growth across
the category, there absolutely will be
the need to engage new consumers and
the need to extend beyond the energy
claim. To accomplish this, energy drinks
and energy shots will need to broaden
their functional platforms while allaying
consumers concerns about product safety.
Energy drink makers do not “own”
energy and we see a proliferation of
energy bars, chewing gums, strips and
sprays positioned to take share of the
energy platform. The newest format we’ve
seen is a 2012 innovation, AeroShot—
a lipstick-size inhaler that contains
caffeinated and vitamin B-fortified
powder that the users can inhale through
the mouth to get energy boosts. Invented
by Harvard professor David Edwards,
AeroShot so far has been sold as a dietary
supplement— a positioning questioned
by the Food and Drug Administration.
Many of these formats are cheaper
energy boost options so it becomes
important that beverage manufacturers
offer experiential benefits and functional
benefits not easily imitated by other
energy-boosting formats. Energy drink
manufacturers will therefore need
to move beyond this single claim of
energy to grow their consumer base and
ultimately their sales.
Additional benefits that beverages can
deliver to differentiate themselves beyond
energy include promoting benefits of
hydration and unique flavor experiences.
Many energy drink manufacturers
are now crossing over into other nonalcoholic beverages to create these unique
flavor hybrids. Monster and Rockstar
in 2011 and 2012 have exhibited a move
toward this strategy where both brands,
gauging the popularity of RTD tea and
lemonade flavor, successfully introduced
lemonade flavored and tea-based
products.
Natural or “clean energy” is some of
the new buzz surrounding this category
as is the emergence of innovation that
addresses the opposite need-state of
energy and one that promotes calm or
relaxation. In the following report we will
explore a few of these game changers and
cite relevant examples of manufacturers
and retailers who have led the innovation
from the polar opposite need-states of
energy to relaxation. We will close with
an overview of trending U.S. flavors
across the energy drinks and energy shots
beverage categories.
“CLEAN/NATURAL” FINDS FAVOR
WITH ENERGY SEEKERS
Natural energy drinks claim to have
all-natural ingredients, especially the
source of their caffeine. Most natural
energy drinks derive their caffeine from
green tea extract while some use green
coffee bean. In comparison, most energy
drinks use synthetic caffeine. The trend
toward eating all-natural foods has
created a space for natural energy drinks.
Mintel’s exclusive survey reveals that
1900 Averill Road, Geneva, IL 60134
630.578.8600 | www.fona.com
page 2
half of all energy drink drinkers find
the “made from all-natural ingredients”
claim influential when purchasing energy
drinks. Therefore, all-natural energy
drinks may have sustainable growth
potential.
In addition to being healthy, consumers
looking for natural energy likely consider
it safe compared to regular energy
drinks. However, it is likely that allnatural energy drinks may contain as
much caffeine as regular energy drinks,
albeit from natural sources. Therefore,
natural energy drinks could differentiate
by listing the amount of caffeine on
packaging, if the product has less caffeine
than regular energy drinks.
Natural energy drink products initially
were launched by relatively unknown
beverage manufacturers, which evoked
little confidence in consumers. FRS
Healthy Energy is the only brand that
has exhibited impressive growth of 109%
in FDMx in the 52-week period ending
March 18, 2012. However, the brand’s
sales at $9 million remain miniscule
compared to the top three brands in the
segment.
In 2012, Starbucks entered the energy
drinks category through its all-natural
Starbucks Refresher. The company, with
its marketing muscle and high brand
awareness, may gain consumer trust.
Should natural energy drinks proliferate,
Mintel believes they are not likely to
create direct competition for regular
energy drinks because key energy drink
consumers, adults aged 18-34, are less
likely than average to express interest in
all-natural ingredients in energy drinks.
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FRS Healthy Energy Cherry
Limeade Energy Drink is said to be
a delicious performance product,
powdered by a patented formula
containing quercetin, green tea
catechins and essential vitamins.
The all-natural product contains
90 calories, 3% fruit juice, and is
free from artificial sweeteners,
colors and flavors.
Starbucks Refreshers Orange
Melon Sparkling Green Coffee
Energy Beverage is a lightly
carbonated blend of 25% fruit
juice, B vitamins, ginseng and
green, unroasted coffee beans
without any coffee taste. This
energy boost beverage contains
only 60 calories.
Vuka Think Sparkling Energy
Drink is a lightly carbonated mix
of pomegranate and lychee, with
DMAE, ginkgo biloba, and panax
ginseng and natural caffeine
to keep one alert and active. It
further contains vitamins B-3,
B-5, B-6, B-12, and grape seed
extract, is free of preservatives and
sweetened with all natural stevia.
Nestlé Jamba Strawberry Banana
All-Natural Energy Drink is free
from artificial colors, artificial
flavors, and taurine and contains
natural caffeine to help support
mental alertness. The product
contains
70% juice.
NEW INNOVATION IN ENERGY
DELIVERY = SUPER CONVENIENCE
Energy drink mixes represent the smallest
segment in the market. However, this
segment has exhibited impressive growth
during 2010-11. The growth could be
attributed to a couple of energy drink mix
brands that offer on-the-go convenience:
Kraft Foods’ Crystal Light On-the-Go
and Four C Foods’ 4C Totally Light 2Go
Energy Rush. In addition to dry pack
stick pack mixes, in 2012 Kraft Foods
unveiled its MiO water enhancer line
extension with an energy component.
Gauging MiO’s success in the bottled
water category, this product holds great
promise for growth in the energy sector
as well.
MiO Energy Liquid Water
Enhancer is available in a Green
Thunder, a natural and other
natural black cherry flavor.
page 3
numerous flavor line extensions that
add natural flavor and variety through
addition of 100% fruit juice for a natural
refreshing element to better compete
and combat flavor fatigue amongst
its followers. Flavors often reinforce
the tropical origin of the coconut like
Vita Coco introduction last summer of
Tropical Fruit, which combines coconut
water and pink guava, orange, red dragon
fruit and pineapple juices.
Crystal Light Energy has a series of flavors:
Wild Strawberry, Grape, Citrus and Peach
Mango exclusive to Walmart.
4 C Totally Light 2Go Energy
Rush is available in Berry,
Orange, Strawberry and Half
and Half and has two variety
packs.
OTHER FUNCTIONAL BEVERAGES
VIE FOR “ENERGY” SHARE
Outside of the energy drink and shot
category there are numerous beverage
manufacturers creating products with
functionality designed to meet the
general consumers need for additional
stamina and endurance required to
support their busy and active lifestyle.
An example of such a functional beverage
is the segment newcomer to the juice
category — coconut water. Coconut
water introductions like Zico and Vita
Coco made from green coconuts, are free
from added sugar and therefore naturally
low in calories, are a natural source of
potassium and are positioned as natural
hydration to support sports and workout
recovery. Directly marketing itself as
a sports drink alternative, it is also a
realistic assumption that coconut waters
are crossing over and taking share from
energy beverages as well.
Both Vita Coco and Zico lines have
quickly innovated and produced
1900 Averill Road, Geneva, IL 60134
630.578.8600 | www.fona.com
OPPOSITE END OF THE SPECTRUM –
“RELAXATION”
The success of energy drinks suggests
that there may be opportunity to tap into
the opposite need-state or occasion and
market “relaxation” beverages.
Within the drink category (including
alcohol) launches of drinks described
as supporting relaxation have remained
fairly steady these past four years with
an average of 230 launches per year
between 2008 -2011. In 2012 we are
seeing an increase in relaxation beverage
introductions. A few examples that were
early entries with the positioning claim of
relaxation are:
Marley’s Mellow Mood Citrus
Flavored Drink (also available
in Berry flavored) is lightly
carbonated, all natural and is said
to reduce stress and relieve tension.
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Slow Cow 100% Natural
Relaxation Drink is calorie-free
with no artificial sweeteners,
colors or preservatives and is said
to help improve the memory and
learning capacity.
KickBack and Relax Relaxation
Drink is a grape flavored drink
made with herbs and is claimed to
relax without hangovers or side
effects.
The demand for functional beverages that
offer relaxation and/or stress relief is high
in the U.S., suggests Mintel’s research
published in Functional Beverages—U.S.,
May 2010, where 48% and 36% of
all functional drink buyers aged 18+
indicated an interest in functional drinks
that help relieve stress and elevate mood,
respectively. More importantly, adults
aged 18-24, who exhibit the highest
incidence of drinking energy drinks, show
the highest interest in functional drinks
with relaxation attributes. Therefore the
conclusion can be drawn that both energy
drinks and relaxation drinks share the
same key consumer.
page 4
target consumer group, no brand in the
relaxation drinks category has made
marketing efforts matching those of
Red Bull and Monster. Additionally,
the ingredient list—melatonin, kava
root, etc.—of many relaxation drinks
has drawn scrutiny from the FDA.
Nevertheless, the energy drink makers
have noticed the competition and some
have decided to participate. In 2012,
Rockstar, the number three energy drink
manufacturer, introduced its relaxation
drink Rockstar Relax and new entries in
the shot format came forth from Mini
Chill and I-Chill.
Even though relaxation drinks and
energy drinks both have the same
1900 Averill Road, Geneva, IL 60134
630.578.8600 | www.fona.com
RockStar Relax Tropical Guava
Relaxation Drink is a sugar-free
herbal blend that incorporates the
calming extracts from chamomile
and passionflower into a noncarbonated drink.
TOP FLAVORS FOR ENERGY &
RELAXATION DRINKS
Berry, Orange, Pomegranate, Citrus and
Lemon are the top 5 flavors used in new
drink product introductions ( January
2007-December 2011 - Energy Drink,
Juice & Tea Categories) with an energy
claim or the word “energy” used in the
label or description. When we draw out
the top five flavors with a relaxation
claim or “relax” in the label or description
the top five flavors are Lemon Balm,
Pomegranate, Tropical, Raspberry and
Pineapple. When flavoring energy drinks,
beverage scientists are looking for flavors
that go well in high-sugar/high-acid
bases, while covering or complementing
the functional ingredients.
Mini Chill Berry Bliss Flavor
Relaxation Shot is a sugarfree natural stress relief
drink. According to the
manufacturer, it acts into
mood and focus, and is said
to be non-drowsy and free
from caffeine.
I-Chill Blissful Berry Shot is a
proprietary blend of melatonin,
valerian root, rose hip and B
vitamins, which is said to be the
perfect formula to help consumers
“unwind from the grind.
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TOP 20 TRENDING FLAVORS
FOR ENERGY
Categories of: Energy Drinks, Juices,
RTD Teas in the U.S.
January 2007 – December 2011
TOP 15 TRENDING FLAVORS FOR
RELAXATION
Categories of: Energy Drinks, Juices &
RTD Tea in the U.S.
January 2007 – December 2011
page 5
FONA CAN HELP!
Flavoring energy drinks and functional
beverages can be tricky due to certain
properties of ingredients such as caffeine
and ingredients like vitamins, minerals
and amino acids. Let FONA’s flavor
experts help create your perfect flavor.
From concept to manufacturing, we’re
here every step of the way. Contact
our Sales Service Department at
630.578.8600 to request a flavor sample
or visit www.fona.com.
SOURCES
Mintel GNPD
Mintel Food & Drink
Green-Indicates Over Average Index to
Prior Year; Red-Indicates below Average
based Upon Prior Year.
Green-Indicates Over Average Index to
Prior Year; Red-Indicates Below Average
based Upon Prior Year
1900 Averill Road, Geneva, IL 60134
630.578.8600 | www.fona.com
Functional Beverages — U.S., May 2010,
Mintel.
© FONA International Inc. All rights reserved.