Energy Drinks Market to Grow by USD 40.04 Billion from 2023-2027, as Hectic Lifestyles Drive Demand with AI Impact on Market Trends - Technavio

NEW YORK, Nov. 8, 2024 /PRNewswire/ -- Report on how AI is redefining market landscape - The global energy drinks market size is estimated to grow by USD 40.04 billion from 2023-2027, according to Technavio. The market is estimated to grow at a CAGR of 8% during the forecast period. Hectic lifestyle and need for instant energy is driving market growth, with a trend towards increase in demand for low-calorie energy drinks. However, stiff competition from low-cost substitutes poses a challenge.Key market players include Abbott Laboratories, Britvic plc, Cargill Inc., Decathlon SA, DyDo Group Holdings Inc., Hype Energy, Keurig Dr Pepper Inc., Monster Beverage Corp., National Beverage Corp., Otsuka Holdings Co. Ltd., PepsiCo Inc., Red Bull GmbH, Slades Beverages, Suntory Beverage and Food Europe, and The Coca Cola Co.

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Key Market Trends Fueling Growth

The Energy Drinks Market is experiencing significant growth due to increasing consumer demand for instant energy and mental stimulation. Caffeine, a key ingredient in soft drinks and carbonated beverages, is a major driver of this trend. Fruit and vegetable flavors, vitamins and minerals, and electrolytes are also popular additives in energy drinks. Rising incomes and a focus on health and wellness have led to the popularity of immunity-boosting beverages and supplements. Taurine, ginseng, and guarana are common stimulants used in energy drinks. However, there are health risks associated with excessive caffeine intake, including hypertension, nausea, restlessness, and sleep deprivation. The nonalcoholic segment, including sports drinks and beverage concentrates, dominates the market. Adults and teenagers are the primary consumers, with millennials and the younger generation showing a preference for functional ingredients like yerba mate and green tea extract. The market is expected to continue growing, with expert analysis suggesting that consumer preferences and purchasing patterns will shape future trends. Alcoholic and nonalcoholic beverages, including water, tea, coffee, and energy drinks, all play a role in the market. Sweeteners, dietary choices, and the diabetic and prediabetic segments are also important considerations. Major players in the market include Red Bull, Monster Energy, and various fruit flavors like lemon, lime, orange, berry, watermelon, and mango. 

The energy drink market has experienced significant growth due to changing consumer preferences. With increasing health awareness, there is a rising demand for low-calorie energy drinks. Obesity is a major concern, leading consumers to avoid beverages with high sugar content. In response, manufacturers like Red Bull have introduced sugar-free variants. The food and beverage industry is witnessing a trend towards healthier options. Energy drinks, once associated with high sugar content, are now shifting towards healthier alternatives. This shift is a response to consumers' increasing health consciousness and desire for beverages that support an active lifestyle without compromising their health. 

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Market Challenges

• The Energy Drinks Market faces several challenges. Caffeine is a major ingredient, raising concerns over caffeine overdose, hypertension, nausea, restlessness, and other health risks. Soft drinks and carbonated beverages are facing increasing competition from healthier options like bottled water, sports drinks, and beverage concentrates. Fruit and vegetable drinks, immunity-boosting beverages, and vitamins and minerals are gaining popularity. Rising incomes and consumer lifestyle shifts towards health and wellness are driving demand for energy drinks with functional ingredients like taurine, ginseng, guarana, and electrolytes. However, the market also faces challenges from traditional beverages like tea and coffee, which offer energy and alertness. The nonalcoholic segment, particularly among adults, is a major growth area. Consumer preferences and purchasing patterns are influenced by factors like disposable incomes, sweeteners, and dietary choices. The market also caters to specific segments like athletes and those suffering from sleep deprivation. The market is competitive with major players like Red Bull, Monster Energy, and various flavors like lemon, lime, orange, berry, watermelon, and mango. Diabetics and prediabetics present a challenge due to sugar content, while the younger generation and millennials are driving demand for innovative flavors and functional ingredients. The market also faces competition from alcoholic beverages, which offer instant energy and mood enhancement, but have depressive effects. Expert analysis suggests that the market will continue to evolve based on consumer preferences and health concerns.
• The energy drinks market experiences significant competition from more affordable alternatives such as fruit juices and soft drinks. These substitutes, which have been in the market for an extended period, offer consumers energy-providing substances like glucose, vitamins, and minerals. Despite the presence of stimulants like ginseng and guarana in energy drinks, the cost of these beverages remains higher due to marketing expenses associated with popular brands and their involvement in sports events. As a result, the affordability of substitutes continues to hinder the growth of the energy drinks market, particularly in emerging economies.

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Segment Overview 

This energy drinks market report extensively covers market segmentation by

1. Product 
• 1.1 Sparkling energy drinks
• 1.2 Still energy drinks
2. Distribution Channel
• 2.1 Offline
• 2.2 Online
3. Geography 
• 3.1 APAC
• 3.2 North America
• 3.3 Europe
• 3.4 South America
• 3.5 Middle East and Africa

1.1 Sparkling energy drinks- Sparkling energy drinks, carbonated beverages with dissolved carbon dioxide, serve as popular choices among the young generation due to their reported energy-boosting properties. Vendors continue to innovate and expand their offerings, with ZOA Energy introducing White Peach and Tropical Punch flavors in January 2022, and Breville launching its carbonation system, InFizz Fusion, in April 2024, capable of carbonating various beverages. Despite this growth, potential health concerns, such as belching and heartburn, and the association with chronic diseases like diabetes and obesity due to high carbonated drink consumption, may hinder market expansion during the forecast period. Continuous product development and consumer education on responsible usage can help mitigate these concerns and contribute to the market's sustained growth.

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Research Analysis

The Energy Drinks market is a rapidly growing segment of the beverage industry, driven by consumer demand for caffeine-infused beverages that provide wakefulness, cognition enhancement, and sometimes even immunity-boosting benefits. These drinks, which can be found in both alcoholic and non-alcoholic versions, come in various forms such as soft drinks, carbonated beverages, and bottled waters. Some energy drinks contain added vitamins and minerals, while others include stimulants like taurine, ginseng, and guarana. Fruit and vegetable flavors like Lemon, Lime, Orange, and Berry are popular, as are traditional energy drink flavors. The market is fueled by rising incomes, a need for energy during long work hours or athletic activities, and a desire to counteract the depressive effects of alcohol. Sweeteners are commonly used to enhance the taste of these beverages. While some consumers drink energy drinks for their stimulant properties, others use them for cognitive enhancement or to help overcome sleep deprivation. The market caters to both adults and athletes, with major energy drink brands offering a wide range of flavors and product lines.

Market Research Overview

The Energy Drinks Market encompasses various beverage categories, including soft drinks, carbonated beverages, bottled water, sports drinks, beverage concentrates, and supplements. These beverages contain stimulants like caffeine, taurine, ginseng, and guarana, as well as vitamins, minerals, and electrolytes. Rising incomes and the growing trend towards immunity-boosting beverages are driving the market's growth. However, health risks such as caffeine overdose, hypertension, nausea, restlessness, and sleep deprivation are concerns. Consumer lifestyle, health wellness, and the younger generation's preferences for alertness, memory, mood enhancement, and cognitive function are significant factors. The market includes both alcoholic and non-alcoholic segments, with the adult segment being a major consumer. The market is also influenced by purchasing patterns, sweeteners, and functional ingredients like yerba mate, green tea extract, and traditional energy drinks like Red Bull and Monster Energy. Expert analysis suggests that consumer preferences for natural and organic ingredients, as well as dietary choices, will shape the market's future.

Table of Contents:

1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation

• Product
• Sparkling Energy Drinks
• Still Energy Drinks
• Distribution Channel
• Offline
• Online
• Geography
• APAC
• North America
• Europe
• South America
• Middle East And Africa

7 Customer Landscape
8 Geographic Landscape
9 Drivers, Challenges, and Trends
10 Company Landscape
11 Company Analysis
12 Appendix

About Technavio

Technavio is a leading global technology research and advisory company. Their research and analysis focuses on emerging market trends and provides actionable insights to help businesses identify market opportunities and develop effective strategies to optimize their market positions.

With over 500 specialized analysts, Technavio's report library consists of more than 17,000 reports and counting, covering 800 technologies, spanning across 50 countries. Their client base consists of enterprises of all sizes, including more than 100 Fortune 500 companies. This growing client base relies on Technavio's comprehensive coverage, extensive research, and actionable market insights to identify opportunities in existing and potential markets and assess their competitive positions within changing market scenarios.

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SOURCE Technavio