Burning-Out On Energy Drinks
Dec 2007
As the nation gears up for the annual excess of Christmas and the guilty resolutions sure to follow, drinks companies hope to capitalise on the temporary zeal for exercise in early 2008 - but are they running out of ideas? Beverages aimed at nursing the thirst of the health-conscious are nothing new - but the number of energy drinks launching into the market and claiming to improve exercise endurance etc. does seem to be growing day by day. In the past few months, Pearlfinders has covered a number of new brands looking to launch in the UK. Almost without exception, decision-makers have told us they will be supporting their new product launches with a tripartite combination of viral, experiential and sponsorship activity.
The champion of the UK sector, Red Bull, has actively pursued a successful strategy rooted in experiential marketing. Events such as the FlugTag and the drink’s high profile in a wide range of extreme sports have served to elevate the brand to an extraordinary level of equity – a model that many competitors are keen to emulate. When we recently spoke to the company’s Marketing Director (see Pearlfinders UK 17.12.07) we were told that Red Bull would continue its strategy of a heavy sports association for the brand in 2008, particularly in F1 racing.
Rockstar, well known in the US for its sponsorship of a number of sporting teams and events such as the recent Hatton/Mayweather WBC fight, is endeavouring to break into the UK by employing a similar game plan (see Pearlfinders UK 15.10.07). Pearlfinders spoke to a Brand Manager at AG Barr, handling distribution for Rockstar on this side of the Atlantic, who told us the brand will continue to leverage relationships with sports events, but will be localizing the brand appropriately by tying up deals with events and teams closer to the British public’s heart.
When we spoke to the Co-Founder & Co-Director of Buzz Development at DD Beverage Company (see Pearlfinders UK 05.11.07) he told us that he’d be favouring a similar strategy when bringing the company’s main product offering to these shores. Known as Beaver Buzz in Canada, the drink has been rebranded as Bulldog Buzz for British consumption. The company will seek to gain an appropriate position for the product through sampling, but is open to suggestions as to how to gain additional recognition.
The Monster Beverage Company is another North American company hoping to penetrate the UK market (see Pearlfinders UK 13.11.07). The company relies on an association with extreme sports such as skateboarding, BMX and snowboarding in the US, and is likely to practise this strategy in the UK. The company was founded by a former Brand Director of Red Bull and is looking to topple Red Bull off the number one spot.
Carlsberg-owned Battery (see Pearlfinders UK 19.10.07) has been rumoured to be considering a push into the UK. In the Scandinavian markets in which it currently operates, Battery promotes itself via the sponsorship of an F1 team and alignment with a variety of extreme sporting events including BMX, snowboarding and BASE-jumping.
The connection between energy drinks and the demographic for energetic sporting events is obvious, but with such a high number of brands all playing the same hand, and with more looking to enter this market all the time, brand differentiation becomes all important. It’s no longer enough to have your own skate team or your brand’s name written on the half pipe at the X-Games: consumers are getting extreme fatigue from extreme sports sponsorship. It’s clear that the energy drink market is ripe for the next big thing.
Already a few brands are showing signs of moving away from the sports-association model. We recently spoke to the Marketing Director of German drinks specialist Bionade (see Pearlfinders UK 13.12.07) who outlined his plans for bringing the product to the UK. The non-alcoholic, fruit-flavoured drink has experienced runaway success in its native country, largely down to an innovative strategy of low-cost viral marketing. Despite popularity across the board, the company has a firm understanding of its target demographic – one of its tactics has been to sponsor university parties in order to generate buzz. Do you remember when Red Bull was the clubber’s best friend?
The Bionade example suggests that brands that have the courage to strike out on their own, as Red Bull did when it launched, will be rewarded with buzz and loyalty. It might be too late to grab the attention spans of the January gym-goers, but as 2008 progresses, drinks makers are going to have to deal with churn one way or another. If you’re targeting the sector, we’d suggest you engage in lateral thinking about how these brands can differentiate rather than just following the crowd.