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Energy Drinks category review

By Chris Elliott

Brand View has reviewed the Energy Drinks category in four major retailers: Asda, Morrisons, Sainsbury’s and Tesco. There are many varieties of Energy Drink; this analysis will focus on the major brands within this category, present in the four retailers in 2014. The review will consider price, promotion by brand and by store, depth of cut and provide an overall analysis of emerging trends in 2014, as well as predictions for 2015.

Pricing Strategy Evaluation

The first aspect analysed was the price variations across the major brands throughout the latter half of the year. Red Bull was the highest priced per litre of the major Energy Drinks brands; since 2 June 2014 it averaged £4.02 per litre. This is 72.7 percent more expensive than the next highest priced brand, Relentless – this averaged £2.33 per litre.

Emerge had the lowest price of £1.02 per litre, since the 2 June. This was an average of 30.1 percent cheaper than supermarket’s own label Energy Drinks. We found that the own label ranges featured many flavours, whereas the Emerge range featured only one flavour. Emerge passed the cost savings, associated with producing only one flavour, onto the consumer; this explains the lower price per litre than own brand.


Promotion evaluation

Looking at promotion trends across the major brands, we found that Emerge had the lowest percentage of its range on promotion, with an average of only 15 percent.  For three months after 14 July there were no active promotions on Emerge.

Lucozade had the greatest percentage of its range on promotion throughout the four retailers. On average 81 percent of the range was on promotion; the majority of these promotions were multi-buy deals.

Relentless was the second most heavily promoted brand, with an average of 61 percent of its range on promotion. However, Relentless saw a large drop in promotions starting on 18 June. Tesco ended eight Relentless promotions and instead introduced ten promotions on Coca-Cola manufactured Monster and Powerade. Sainsbury’s conducted a similar exercise 12 days later; it stopped all promotions on Relentless and introduced seven promotions on Monster products. Asda also ceased its Relentless promotions on 29 June, but did not promote an alternative instead.

In the last six months, Tesco consistently promoted Relentless or Monster; they alternated brands, and never promoted both at the same time. Asda and Sainsbury’s also followed alternate brand promotion, but there were periods of overlap and instances of no promotional activity. Morrisons did not follow this pattern and often promoted products from each brand at the same time.

Depth of cut

As well as being the second most heavily promoted brand, Relentless also had the greatest average depth of cut at 28.1 percent. Brands such as Mountain Dew and Rockstar had greatest depths of cut at times – however, they also had periods of low depth of cut or no promotions. Relentless had a consistent depth of cut across the six months analysed peaking at 30.4 percent and dropping no lower than 25.9 percent.

Emerge had the lowest average depth of cut at 7.5 percent, 14 percent lower than the next lowest, Red Bull, which averaged  21.5 percent depth of cut. This illustrates that Emerge’s low shelf price is driven less by promotions and more by having a low base price.


Promotion trends by retailer

Using Red Bull as an example, we then investigated the promotions across the four retailers over the last six months in 2014. Although Tesco had run the most promotions, it had the lowest percentage of its Red Bull range on promotion, at 76.5 percent. Morrisons had the greatest percentage of its range on offer at 93.8 percent. Tesco offered the greatest depth of cut on Red Bull products with 29.4 percent and Sainsbury’s offered the lowest at 26.8 percent.


Trends in 2014

The biggest emerging trend found in our analysis of 2014 was a large increase in the number of flavoured Energy Drinks that supermarkets stock. There were 77 flavoured Energy Drinks added to shelves in 2014 across the four retailers analysed – this a 52.7 percent increase in range. There was also a sharp increase in the number of low sugar/low calorie Energy Drinks – there were 31 new listings, growing the range from 59 at the start of the year to 90 at the end. Morrisons did not list any new standard Energy Drinks in 2014, whereas Asda listed the most with ten.




Predictions for 2015

By evaluating the Energy Drinks range at the end of 2014, we can see that flavoured Energy Drinks outnumber standard Energy Drinks by more than two to one. This means that there are now almost as many low sugar/low calorie drinks available as there are standard Energy Drinks. With ‘Better for you ingredients’ expected to be a top trend in 2015, it is expected that more low sugar/ low calorie energy drinks will be listed. We also expect to see a narrowing gap between the number of standard Energy Drinks and healthier low sugar/low calorie Energy Drinks on the market.

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