Energy Drinks, an Antipodes Perspective
07 May 2013
Australia and New Zealand represent a market totaling over twenty five million people. This is a comparable size to Malaysia, Taiwan or Venezuela whilst much bigger than many Middle Eastern and most East European nations. A sizeable consumer audience indeed, yet, because of their geographical location these two countries have historically been overlooked in respect of the international soft drinks trade. Fortunately, both have basked in their splendid isolation and built up a strong self-contained soft drinks industry with its own unique features in respect of product, brand and packaging preferences.
Of course, not all soft drinks are produced locally, although most are. The main imports have been energy drinks. Foreign supplies of these stimulating beverages now total around 100 million liters a year; but that includes intra-trade between the two countries. New Zealand actually supplies the leading energy drink of both markets. The brand in question is V, from Frucor Beverages (owned by Suntory Holdings). Canadean research reveals that this brand is still responsible for more than one-third of total energy drinks volumes across Australia and New Zealand, despite inroads being made by the likes of Red Bull. Meanwhile Mother (owned by Coca-Cola), which also features as one of the top sellers, has its origins in Australia. Yet both V and Mother are largely unknown elsewhere in the world.
Mother was instrumental in the leap in popularity of the 50cl energy drink can. This container had been around earlier but it really took off following the re-launch of Mother in this size in mid 2008. The 50cl can is now responsible for two-fifths of category volume across Australia and New Zealand, slightly in excess of the contribution made by the more internationally recognized 25cl size. But, on a global basis, the 50cl can is still in its infancy, being responsible for less than 5% of energy drinks volumes.
Another popular pack for energy drinks, ‘down under’ has been the single-serve non-refillable glass bottle. It may have lost out in recent years, to larger sized packs, but is still responsible for a 15% localized market share today. This is higher than the international norm and partially reflects a seasonal shift in favor of bottles over the summer months when Australasian consumers are outdoors more and prefer the convenience of resealability. Screw cap glass bottles are most favored by female drinkers. Indeed, the launch of sugar-free versions of both V and Red Bull in 2003 was believed to have encouraged the use of glass bottles amongst diet conscious females. Canadean can reveal that, today, sugar-free energy drinks hold around a 7% category share across Australia and New Zealand. This is slightly above the global average, but only in line with what it was back in 2003. Clearly, most target consumers, in an age range of 18-35, are more interested in the energy boost provided by these beverages and not so concerned with calorie control.
Energy drinks volumes have more than quadrupled across these two markets in the past ten years and continue to expand, albeit at a decelerating rate. Sustained consumer interest and new consumption occasions, coupled with a broadening of product variations, and supported by image focused marketing, are continuing to drive the category. As a result, antipodean demand is forecast by Canadean to exceed 220 million liters by 2018.