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Transcript

ENERGY DRINKS

FHE Group Assignment

By Anurag

Mahima

Shrutika

Introduction

  • A segment of healthcare and wellness that grows in popularity everyday is Energy Drinks

  • Capturing a niche that is increasing in size everyday, especially among fitness enthusiasts and athletes
  • Great examples of stellar marketing, highlighting economical aspects in a highly competitive segment.

Red Bull

  • Owned by Austrian company Red Bull GmbH, founded by Dietrich Mateschitz and Thai businessman Chalerm Yoovidhya
  • Introduced in Austria in 1987, with a catchy tagline "Red Bull Gives You Wings"

Brands in Question

  • Sold in 172 countries in a 8.4 ounce cans, in a handful of varieties including sugarfree, Total Zero (No calories)
  • Employs more than 13,000 people, marketing includes multiple sports team ownerships, athlete endorsements and music

Monster Energy

  • Monster Beverage (MNST) is a California based holding company founded in 1985, headed by CEO Rodney Sacks
  • Company began selling Monster Energy drinks in 2002

Monster Energy

  • Second largest energy drink company after Red Bull, with 40 varieties of Monster drinks
  • Sold in 141 countries, entered a long- term strategic partnership with Coca-Cola in 2014

Supply and Demand

Market Situation

Variables affecting market supply

  • Price of inputs
  • Technological change

Market Supply

  • Price of substitutes in production
  • Number of firms in the market
  • Expected future prices

Revenue and other metrics

Red Bull Sales

Monster Sales

Market Outcomes

  • Fiercely contested market with equal substitutes
  • Steadily growing industry with wide scope for expansion
  • No government regulation to speak of

Conclusion

  • Chances of penetrating the health and fitness segment by serving health enthusiasts
  • Calorie and sugar-free alternative variants can quickly replace traditional soft drinks

Takeaways

  • Energy drinks are fast becoming a staple in the western world, eventually in the east too
  • Red Bull and Monster poised to be at the top for a while

Our Assessment

  • Excellent performance by the two brands and close competition by other players