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
Market Supply
- Price of substitutes in production
- Number of firms in the market
Revenue and other metrics
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