Market Trends of South America Energy Drink Industry
Foodservice and E-commerce Channels Significantly Creating Shelf Space to Energy Drinks
Energy drinks have changed from being an aspirational commodity sold generally in retail stores and gas stations to becoming relevant in daily life. The most common morning purchases in the South American market are energy drinks, chips, and beef. The drinks are sold directly to customers looking for a way to get through the workdays by street sellers at traffic junctions. Energy drinks have been popular due to the concept of a beverage that may provide both refreshment and an energy boost, enabling individuals to stay alert and increase productivity for longer.
Energy drink is consumed in South America as it is an exciting option with wellness attributes. Cosumer-led health and wellness trends are also taking a toll on the continued growth of the energy drink segment among other beverages. Modern grocery supermarkets and significant US/European hypermarket chains are continuously expanding their operations in the region to ensure the availability of beverages. This, in turn, has led to increased consumption of the products in the region. For instance, Campbell Soup Company generated around 22% of consolidated net sales from continuing operations in 2022 through Wal-Mart Stores Inc. and its affiliates. Moreover, with the desire for new flavor experiences among consumers, energy drinks are considered an alternative to soft drinks. It has also found its space in nightclubs as a social drink or beverage mixer.
Growing Consumer Preference Towards Healthy Drinks in the Region
In the past few years, the consumption of energy drinks has drastically increased, especially among adolescents and young people. Energy drinks are aggressively advertised with the claim that they would offer you more energy and raise your mental and physical performance. Recently, manufacturers have shifted their attention away from athletes to millennials or the gen z population. Advertising for energy drinks is strong in locations where teens and young adults congregate. The average age of energy drink drinkers is between 13 and 35 years. Energy drinks are the second most popular dietary supplement used by teenagers. This is the result of consumers' increased attention to fitness and health. Energy drinks are marketed as an alternative to carbonated drinks. Thus, there has been a significant rise in the number of consumers switching from carbonated beverages to energy drinks in recent years, thus, boosting sales in the region. According to the Brazilian Association of Soft Drinks and Non-Alcoholic Beverages (ABIR), in 2021, consumption of energy drinks in Brazil amounted to approximately 0.87 liters per person, slightly up from 0.71 liters per person a year earlier
