Energy drinks market in USA. Dr Pepper. CASE.

Major Energy Beverage Competitors:

Five competitors dominate the U.S. energy beverage market: Red Bull North America, Hansen Natural Corporation, Pepsi-Cola, Rockstar, Inc., and Coca-Cola. These companies, and their individual brands, account for 94 percent of dollar sales and unit volume in the United States. Exhibit J onpage 87 shows the dollar sales and unit volume market shares for the five competitors. Red Bull North Americamarkets the RedBull brand in the United States *lfough a neNvork of independent distributors. The company is a subsidiary of Red BLill GMBH headquartered in Austria. The brand was the energy beverage market pioneer when it was introduced to the United States in 1997 .Itrcmatns the market leader in dollar sales and unit yolume. However, its dollar market share has declined in recent years from 82 percent in 2000 to 43 percent in 2006. This decline has been attributed to the entry of new, aggressive competitors, and brands with lower prices. The Red Bull brand was supported by a $39.6 million U.S. media expenditure in 2OO6 and an estimated $60.9 million media expenditffe in 2007.1 Hansen Natural Corporation markets avariety of nonalcoholic beverages in the United States. Monster Energy is its most prominent energy drink. The brand was introduced tfl 2002. Monster Energy sales have benefited from recent distribution agreements. For example, Anheuser-Busch wholesalers distributed the brand to retailers in different territories in the United States in 2007. Anheuser-Busch also distributes Monster Energy to on-premise retailers including bars, nightclubs, and restaurants in territories selected by Hansen. In ear$ 20O7, Hatsen announced that PepsiCo Canada would be the exclusive master distributor of Monster Energy throughout Canada. The Monster Energy brand was supported by a $6f ,fOO U.S. media expenditure in 2006 and an estimated $ 1 53,800 media expenditure in 20O7 . Pepsi-Cola, a division of PepsiCo, markets AMP Energy and SoBe Adrenaline Rush energy beverage brands. AMP Energy was introduced in 2001. SoBe Adrenaline Rush entered the market in 2OOl. Both brands are marketed through the Pepsi-Cola distribution system in the United States. In addition, Pepsi-Cola markets a wide range of juice-based energy drinks and Mountain Dew MDX, a carbonated energy drink. Neither AMP Energy nor SoBe Adrenaline Rush was supported by signiflcant U.S. media expenditures in 2006. Rockstar, Inc. is a producer of alcoholic, juice, cola, and energy clrinks. Its Rockstar Energy brand was introduced in 2001. The brand is distributed in the United States and Canada by the Coca-Cola Company, except in the Pacific Northwest and Northern California where Rockstar retains its original distributors. U.S. media expenditures for the Rockstar brand were minimal :trir2üO6T. he estimated media expenditure inZOO7 was $41,500. The Coca-Cola Company markets the Full Tfuottle and sugar-free Tab Energy brands through its distribution network. Full Throttle was introducedrn?003' Tab nnergy nrr-2OO6.Thec ompany has been acquiring smaller energy beverage brands and pursuing licensing agfeements to distribute independent enefgy brands, such as Rockstar. Full Throttle was supported by $7.3 million in U.S. media expenditures in 2006 andan estimated $4923OA in2OOT.The Täb Energy introduction was supported by a $12.6 million U.S. media expenditure ifL 2006, which resulted tn a 2.3 percent dollar market share. The estimated media expenditure in 2007 was $20,500'