The sports and energy sector continues to grow, up 7.1% year-on-year, making it an increasingly valuable part of your offering. And with brands continuing to spend millions on marketing there’s no signs of that growth slowing down, so retailers are well-placed to take advantage. by Kevin Scott
It has become an increasingly competitive marketplace and one where unheralded new brands are willing to jostle for shelf space against major players like Red Bull, Relentless, Rockstar and Powerade. That alone illustrates the potential of becoming a successful sports and energy brand. And still it grows, up 7.1% year-on-year. Dave Turner, Trade Communications Manager at Coca-Cola Enterprises – home to Relentless and Monster – says: “Best-selling, branded energy drinks attract consumers’ attention in-store by acting as a signpost, which can in turn help to increase sales of all products across complementary categories.” One of the main trends currently driving sales is value – and for c-stores, illustrating value most effectively is PMPs. Relentless and Monster both introduced new PMP propositions to their ranges at the start of the year, at £1 and £1.19 respectively. Turner says: “These began as only being available at specific promotional periods, but from now will be available for the rest of 2013.” Over the last four weeks, sales of Relentless in independents and symbols are up 18.8% and Monster 10.6%, which Turner says demonstrates that the PMP strategy is delivering results for retailers. New flavours and formats are also driving growth, including the launch of a 250ml can of Relentless Origin with an rrp of 79p. Since its launch CCE has also introduced a four-pack format for take-home consumption. While Rockstar still hasn’t entered the 250ml market, AG Barr’s Head of Marketing Adrian Troy does acknowledge its importance. He says: “The other key longer term trend is the growth of the 250ml format at the budget end of the market, enabling new, more price conscious consumers to enter the category. Format is also a critical component. 250ml delivers the functional impact, whereas 500ml combines the benefit of function with a long, refreshing and tasty drink.
The growth of flavours in 500ml has also supported this. Retailers should offer a combination of value tier products, price marked packs and strong promotional activity, alongside premium brands and they will see their profits grow.” New flavours On the flavour side of things, Relentless Lemon Ice, a sparkling energy lemonade drink has been introduced. CCE also kicked off 2013 with the launch of two new variants of its Monster Rehab range. Rehab Green Tea and Rehab Orangeade follow the successful launch of Monster Rehab Tea & Lemonade last June. In such a vast category, Turner advises retailer to use EPOS, where possible, to understand their best-sellers in the energy sector and adapt their range accordingly. he says: “We would recommend that retailers stock the brands that are investing in the Energy & Sports segment and will ensure its long-term health and growth.” While value is a major driver, added-value is also emerging as a key trend, as Adrian Troy, Head of Marketing for AG Barr, explains: “The category has seen incredible change over the last five years, with expansion in formats, flavours and price segments. However THE most important observation is that the market is defining a new ‘added value’ need for soft drinks amongst many consumers – that of an energy boost.”
The latest flavour to join the Rockstar range is Xdurance Tropical Orange, with Troy highlighting that Orange is the biggest flavour in sports and energy, accounting for nearly 25% of all sales. While long standing brands continue to grow the category, among the new entrants include brands all too familiar to retailers. Extreme Energy was recently launched by Vimto Soft Drinks – in collaboration with the well-known energy lifestyle brand – and it is available in 500ml Price Marked Packs of £1.39, supported by a BOGOF launch promotion within Impulse. So why launch into this new category of soft drinks? Emma Hunt, Marketing Manager of Vimto Soft Drinks says: “Energy Drinks is the only area of the soft drinks market which has seen phenomenal category growth over the last two years of +52%.
It is also the biggest soft drinks category within impulse. More drinking occasions for energy and sports drinks are emerging all the time and it is important that independent retailers are on the front foot to capitalise on the opportunities this presents.” When it comes to ranging the drink, Hunt says: “Standout on shelf is crucial if products are to catch the eye of consumers. The unique design of the Extreme bottles will ensure they achieve stand out on shelf and will catch the eye of the target market.” Sales Dew to rise One of the more recent brands to enter the energy market is Mountain Dew, having reinvented itself from a soft drink. Ian Forshew, Commercial Director Grocery, Britvic, recognises that energy drinks are well-placed to deliver the dual benefit of energy and refreshment. Recognising the importance of ingredients and the continued role these have to play in delivering functional benefits, Britvic recently launched Mountain Dew Sugar Free to complement the standard variant. Another new development from Britvic & PepsiCo, is AMP Energy powered by Mountain Dew, which contains extra caffeine, B vitamins and taurine.
Lucozade top tips
- Give the full range of bestsellers space before tertiary brands.
- Offer a choice of flavours – Consumers like to shop around but almost always have a favourite brand so are more likely to shop within that range if the choice is available.
- Keep backing new products – without NPD the Soft Drinks category would be flat.
The energy of milk
The growing interest in milk drinks as an aid to sports recovery presents an incremental profit opportunity for retailers, according to Nurishment, the nutritionally enriched milk drink. Enco Products has taken the Nurishment brand into a new, growing market sector with the launch of Nurishment Active, an enriched milk drink specially formulated to help the body recover after exercise.
Developed to help consumers ‘get back their spark’, low-fat Nurishment Active contains 35g of protein per pack plus a unique and complementary blend of 22 vitamins and minerals. It is designed for those who play sports as an aid to post-exercise recovery. “Interest in sporting activity is at a high and consumers now seek innovative, functional products specifically formulated to aid their performance,” says Nyree Chambers, Head of Marketing for Enco Products. “This includes products which help their bodies recover after exercise.There is growing interest in the use of milk as a rehydration solution as it’s a natural provider of water, sugar and electrolytes. This has led to the development of drinks such as Nurishment Active, where vitamins, minerals and protein are added to milk.” By targeting a specific usage occasion, this NPD is driving growth in the category and presents a new profit opportunity for retailers.
Sporting chance Another key trend in the sports and energy sector is offering consumers the personal touch Powerade is offering consumers the chance to claim a free, personalised sports bottle. It is also aiming to build on the high brand visibility it enjoyed during last year’s summer of sport by becoming a more accessible brand to an audience beyond its core target of active sportsmen and women. To drive awareness and trial, the brand has started using inspirational messaging under the ‘You have more power than you think’ tagline, as well launching a £1 price-marked pack.
