Industry is missing energy shot potential in Europe, says analyst

By Guy Montague-Jones

- Last updated on GMT

Related tags Energy shots Coffee Europe

5-hour Energy has led the US energy shot market to $1bn in annual sales
5-hour Energy has led the US energy shot market to $1bn in annual sales
Risk aversion and a failure to learn the marketing lessons from the US have frustrated the market for energy shots in Europe, according to a new report.

Julian Mellentin, report author and editor of New Nutrition Business, told that European energy shot sales for the 12 months to August 2010 added up to just €200m. That is not much more than a fifth of the sales earned on the other side of the Atlantic in the US.

Since arriving on European shores in 2007, energy shots have spread across the continent gaining the strongest foothold in Germany and the UK. But it is this expansion into new countries, rather than good organic, like-for-like growth that has been responsible for the sales growth of the past three years.

Calling for a leader

Mellentin said the big problem in Europe is the absence of a small entrepreneurial leader in the image of “5-hour Energy” in the US. Instead the early pioneers in Europe have been big companies like GSK that have failed to take the necessary risks to make energy shots work.

An aggressive attitude, and a highly innovative approach to merchandising, marketing and distribution enabled 5-hour Energy to more-or-less create the energy shot market in the US.

Being more risk averse by nature, big companies have failed to follow in the footsteps of 5-hour Energy in Europe.

There has been an unwillingness to commit to the task of creating a new market, according to Mellentin. With pre-conceived ideas of the beverage landscape and without the reassurance of market research – hard to obtain with new product concepts – the market commentator suggested that energy shot makers in Europe have plumped for the wrong strategy.

Young or old consumers?

Mellentin said energy shots are too often aimed at the saturated youth market, where they are at risk of canibalising the existing energy drink segment.

Instead, he said: “The real growth market for energy shots is as a fruity/all-natural way of delivering energy to the 35 to 55 year-old consumer.”​ As a more portable option than coffee, energy shots could offer a new drinking occasion to older consumers looking for a natural energy boost.

According to the analyst, the vision could be for drinks that offer “new ingredients with a higher ‘natural and healthy’ score than found in the current energy drinks; and new carriers – something other than caffeinated beverages – with better health credentials, such as dairy and fruit juices.”

The energy shot market is one of the subjects discussed in the new reported entitled ‘10 Key Trends in Food, Nutrition & Health 2011'.

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Posted by Tony Parente,

We have been marketing natural energy shots to the health & wellness market for a few years and certainly before the advent of soft drinks shots. No caffeine.
Talk about shots to the industry and many buyers immediately they think of 5 Hour Energy or Red Bull shots and the conversation goes dead. There is an aversion to these shots and it seems too many people have had their fingers burnt. Many think they were a one-hit wonder and now slowly disappearing over the sunset.This makes our job a great deal more difficult to bring the conversation back on track. Nonetheless we succeed.

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Posted by Kaare Axelsen,

Would we really be able to get away with such a claim here in EU ?? I do agree there are no marketeur who are either big enough or wish to take the financial risk of launching across EU with specific claims - and often multi-retailers will not stock it unless it is an approved claim.... so not as easy as in other markets outside EU. Be great to see this kind of marketing (within reason)

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