Energy Drinks in Latvia

PROSPECTS

Legislation continues to act as a barrier to promotion and distribution

The Law on the Circulation of Energy Drinks provides regulatory limitations on the promotion and distribution of energy drinks to minors, in particular. This legislation remains a strong obstacle to development and sales growth in energy drinks in Latvia.

Healthier-positioned options set to drive growth in energy drinks

Consumer perceptions of energy drinks are unlikely to change dramatically in the forecast period, although there remain opportunities for companies to improve the image of the category through education and reformulations. Therefore, healthier alternatives positioned as energy drinks may become growth drivers in the forecast period.

Functional niches offer growth avenues for local and international players

The planned increase in excise tax for sugary drinks is expected to accelerate and widen the availability of sugar-free options in the forecast period. The availability of energy drinks that do not accentuate sugar intake concerns is a key way to engage consumers and change their perceptions of this type of soft drink.

COMPETITIVE LANDSCAPE

Leading players benefit from high brand awareness and wide distribution

Coca-Cola HBC Latvia (Burn and Monster Energy), Red Bull and Cesu Alus (Dynami:t) remain the leading players in off-trade volume and value share terms in 2019. Through investments in marketing and consumer engagement and distribution, these branded players have fostered high brand awareness and secured wide availability in the off- and on-trade channels.

Novelties and trendy image foster interest in Red Bull

Red Bull continues to see off-trade value share growth in 2019, although intense competition is having a downward effect on the company’s off-trade volume share at the end of the review period. Nonetheless, Red Bull continues to count on strong support from local consumers.

New products and entrants increase the competition in energy drinks

The category continues to see new product development from established players and the entry of new players and brands at the end of the review period. For example, in 2019, Cesu Alus added new Dynami:t Party Mode On to the existing Dynami:t range, which features Original, Vampire, Caffeine Free Energy and Gamers Edition.

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