Energy Drinks in Thailand

PROSPECTS

Energy drinks weathers the healthy living trend better than some other categories

While the sugar tax and rising health consciousness in Thailand had a negative influence on the performance of energy drinks in 2018, it recorded a much smaller decline in off-trade volume sales than most other soft drinks categories affected by the same factors, with retail volume sales returning to marginal growth in 2019. This was largely due to sustained demand among blue-collar workers in labour-intensive roles and those who drive for a living, as these groups regularly consume energy drinks for their stimulant effect and are less sensitive to price increases.

Health set to be a focal point for innovation as competition from other products increases

The sugar tax implemented in Thailand in late 2017 is progressive, meaning the higher the sugar content of the product, the greater its tax burden. Moreover, the tax is due to be increased every two years until 2023.

Millennials become a new target group for energy drinks

Faced with increasing maturity and a relatively narrow core base, several players in energy drinks have recently sought to broaden the appeal of the category. For example, the latter part of the review period witnessed the introduction of a number of premium variants aimed at mid- to high-income consumers who only purchase energy drinks occasionally.

COMPETITIVE LANDSCAPE

Osotspa remains the clear leader in 2019

Osotspa Co maintained a commanding lead in energy drinks in off-trade value terms in 2019. This was mainly due to the strength of its M-150 brand, although the company also offers the Shark and Magnum brands.

The sugar tax encourages players to introduce reduced sugar products

The strength of the health and wellness trend and sugar tax introduced by the government in 2017 encouraged players to reformulate their brands to reduce sugar content. TC Pharmaceutical Industry Co, for example, launched its sugar free Ready Plus, while Siam Winery Co introduced its sugar free Red Bull Plus.

A concentrated competitive environment

Carabao Tawandang Co was the second leading company in energy drinks in 2019, followed by TC Pharmaceutical Industry Co. Together, the three leading players accounted for the lion’s share of off-trade current value sales in the category and generally consolidated their strong positions as smaller players lost share.

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