Energy drinks continued to register positive retail sales growth in 2020, although off-trade growth rates during the year were considerably slower than what was being recorded in the category earlier in the review period. The main reason for the significant drop in growth rates in the off-trade were the quarantine lockdown that was implanted across France between the middle of March and the end of May in a bid to control the spread of the COVID-19 virus and the subsequent significant declines seen in demand for energy drinks due to a substantial reduction in out-of-home consumption opportunities.
Red Bull remained a dynamic and highly influential presence in energy drinks during 2020, although somewhat paradoxically the brand’s performance remained under pressure due to its iconic image and leading position in the category. The Austrian-owned, Thai-origin brand remains a major investor in advertising and marketing campaigns, with the sponsorship of sports teams, sports events, music concerts and cultural events supporting very high levels of consumer recognition of the brand and its intellectual property in France.
Coca-Cola Entreprises’ Monster Energy gained ground on category leader Red Bull during 2020 as its volume share increased on the basis that it represents better value for money than the category leading brand. This became an important aspect of its position in in the aftermath of the COVID-19 pandemic as household incomes came under pressure and general economic uncertainty and high levels of unemployment resulted in widespread financial hardship.
Although energy drinks still has strong potential for further growth in per capita consumption in France, the launch of a new generation of healthier energy drinks will be required before this potential can be fully realised. Indeed, the penetration of energy drinks in France is considerably lower than in comparable markets such as Germany and the UK.
One point that the COVID-19 pandemic has brought into sharp focus for energy drinks brands operating in France is that impulse channels are the key to strong sales for the category. For this reason, identifying and exploiting new impulse channels is likely to be a major priority for all of the category’s leading players during the forecast period.
The forecast period is expected to see changes in the competitive landscape in energy drinks as smaller companies and less well-known brands become more important for the category. While the competitive environment in the category so far can be characterised largely as a two-way struggle between the traditional dominant leader Red Bull and its major challenger Monster Energy, 2020 has shown that there is considerable room for the development of smaller brands that represent better value for money.
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This report originates from Passport, our Energy Drinks research and analysis database.
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