Safety concerns not hurting energy-drink consumption
Despite widely known concerns about the safety of certain ingredients, energy drinks and shots are expected to remain popular with American consumers, primarily older millennials (consumers age 27-37), who might be transitioning to parenthood. In fact, new research from global market research firm Mintel found that the percentage of U.S. millennials consuming energy drinks increased from 55 percent in 2014 to 61 percent in 2015, despite the fact that 74 percent of older millennials express concerns about product safety (compared to 65 percent of consumers overall).
In an effort to counter these concerns, 81 percent of U.S. consumers agree that companies should include recommended daily consumption limits on energy drink/shot packaging. But data show that safety concerns have had little impact on consumers, Mintel noted. Only half of consumers drinking fewer energy drinks/shots agree they are concerned, compared to 68 percent who are drinking the same amount and 41 percent who are drinking more. In fact, consumption overall has diversified, with many consumers (27 percent) drinking both "regular" and natural energy drinks/shots. This diversification points to the growing popularity of natural claims in the category, with 30 percent of users consuming natural energy drinks/shots.
“While there has been a movement, especially among millennials, toward more natural ingredients, the energy drinks and shots market remains largely unaffected by changing consumer attitudes,” said Elisabeth Sisel, beverage analyst at Mintel. “The majority, a full 90 percent, of natural energy drink consumers also drink regular energy drinks. The steady consumption of both regular and natural energy products implies that U.S. consumers may not perceive energy drinks as negatively as pop culture conveys.”
Lifestyle changes drive usage
Retailers looking to launch or augment own-brand energy-drink lineups need to understand that older millennials are the core consumers of the U.S. energy drinks/shots market, with 64 percent of them consuming energy drinks. While roughly the same percentage of 18-26 year olds also consume energy drinks, Mintel noted that older millennials are increasing their consumption. Nearly one-third of older millennials (29 percent) consumed more energy drinks within the past three months (compared to 22 percent who consumed less). Only 16 percent of consumers age 16-26 reported consuming more, and 27 percent said they drank less. Additionally, older millennials strongly agree that energy drinks/shots are good substitutes for alternative caffeine beverages, including coffee (65 percent) and carbonated soft drinks (64 percent).
“Older millennials are, more likely than not, going through a lifestyle shift such as getting married or having children, including 55 percent of those age 30-34 with kids," Sisel said. "As a result, their interests and priorities are shifting, and individuals that require more energy are turning to energy drinks and shots. However, this goes against the grain of most energy-drink advertising, which focuses primarily on young, single consumers and their active lifestyles. Our data shows the older millennial consumer segment displays more brand loyalty and potential for long-term usage.”
Similarly, consumption rates of energy drinks/shots are higher than average among U.S. parents, Mintel noted. Households with children are significantly more likely to consume energy drinks (58 percent) and shots (48 percent) than those without children (27 percent and 18 percent, respectively). Among U.S. parents, 68 percent of fathers and 38 percent of mothers consume energy drinks. Specifically, fathers increased their consumption rates by 28 percent (compared to only 21 percent who drank less). In contrast, only 34 percent of non-fathers and 22 percent of non-mothers consume energy drinks.
Men might be the heavier consumers of energy drinks and shots overall, but the presence of children drastically increases consumption and strongly impacts usage by women. Mothers are not only heavier users than men without children (38 percent versus 34 percent), but they are also significantly more likely to drink energy drinks and shots than women without kids (22 percent).