America’s Energy Drink Habit Is Fueling Big Profits, for Better or Worse
Tim Riley first began reviewing energy drinks in 2021, when his wife joked that his habit of tasting sugary caffeine beverages with his skillset as a sommelier could make for a good TikTok bit.
Since then, Riley has racked up millions of views as “BigSommEnergy” and tasted practically every mainstream energy drink released in the last five years. Among his biggest takeaways: The industry is in the thick of a surging renaissance, buoyed by an ever-changing slate of new drinks, and the peak is still to come.
“The proliferation is extraordinary. It’s more diverse than most people think,” Riley tells me. “I always say, ‘If you say you don’t like energy drinks, I bet you I can find something you do like.’”
The numbers seem to prove that point. The global energy drink market has grown massively in the last few years, from $45.8 billion in 2020 to nearly $62.9 billion today, according to industry analyses. In the United States, consumption of these buzzy beverages has risen considerably since a decade ago — and although the rise of the Covid pandemic disrupted a lot of consumers, they’ve flocked to energy drinks again in the years since.
The renaissance is a coup for the industry, both in terms of the independent brands trying to carve out a niche in America’s collective caffeine craving, and the corporate legacy juggernauts like Coca-Cola and PepsiCo that see broader profit margins and potential for growth in the space.
Although these companies are looking to strike new trends and hit viral gold, the contemporary boom is so much more than a fad. Even concerns about health impacts, especially for the young drinkers who have carried energy drinks into the pop-cultural zeitgeist, can’t seem to dampen the excitement around the Next Big Energy Drink.
Building on What Came Before
It all feels like an evolution of what happened in the mid- to late 2000s, when energy drinks first transitioned from being a niche product for gamers and nerds and graduated into mainstream popularity with now-household names like Red Bull and Monster. Except, this time around, there is so much more on tap, and lots of industry players vying for an edge, whether through taste, performance, or flat-out great marketing.
Given Riley’s background as a certified advanced sommelier, it’s no surprise that he points to sugar content and flavor as two of the most important shifts that have fueled the renaissance. For a long time, zero-sugar formulations lagged behind their conventional brethren, he says (“Red Bull really didn’t seem to care,” he adds). Brands like Red Bull, Monster, and Rockstar also hewed to a strategy of primarily selling a signature flavor, rather than a palette of distinctive offerings.
That’s gone out the window today, Riley says, and his TikTok is proof: Nearly every brand appears to tout a rainbow of options when it comes to flavors, acidity, and sweetness. He gives special credit to Bang Energy, which was founded in 2012 and has become one of the most popular energy drink manufacturers in America.
“The [energy drink] race really was dominated by two players, but the rise of the performance segment and the ‘better-for-you’ drinks has changed that.”
“Around the mid-2010s, we started to see research and progress on both synthetic and natural flavors that allowed people to go so much further than the O.G. Red Bull taste,” Riley says. “Bang grew on the scene with these crazy flavors like Key Lime Pie, and frankly, there was nothing like them when I started tasting and judging these drinks.”
Beyond the flavors, Bang also normalized the concept of dosing 300 milligrams of caffeine into each can — about double the average amount found in most other offerings. The consequent success proved a point: Consumers weren’t getting tired of an energy drink “fad.” They were craving new, novel ways to gain stamina while quenching thirst.
“The [energy drink] race really was dominated by two players, but the rise of the performance segment and the ‘better-for-you’ drinks has changed that,” says Duane Stanford, the editor and publisher of Beverage Digest, which chronicles news in the non-alcohol drinks trade. “So has the long-term health and functional wellness trend we’ve seen across the food and beverage industry generally.”
Familiar Names Diversify — and New Ones Innovate
Even older brands like Celsius, which debuted in 2009 but floundered with tepid sales for a decade, have found new life by repositioning their pitches. By marketing itself as a lifestyle product and touting its vitamin content, Celsius became a darling for those looking to shun the typical Monster and Red Bull offerings in favor of a sugarless beverage that could purportedly boost their workouts and even fat loss.
Stanford observes that a crucial element of that marketing was aggressively pursuing college-age consumers and young people, using TikTok and other social media platforms to reestablish an identity. Now, Celsius is one of the biggest players in the energy drink space, growing from a valuation of $280 million in 2018 to a staggering $13.4 billion today.
“Congo Brands famously will not talk about their business model, but it has become a disruptor with a new strategy that others are now trying to replicate.”
Perhaps the biggest surprise of all is the near-overnight success of an independent outfit dubbed Congo Brands, which is responsible for the biggest energy drink breakout of all. When YouTube influencer kings Logan Paul and KSI announced they had “founded” a beverage company named Prime in 2022, it drew the attention of millions of young fans. Nobody knew much about the Kentucky-based parent company that actually operated the brand, but hype grew so much that when the drinks finally arrived, kids fought over bottles in grocery aisles. One scalper was bold enough to list a 12-pack for more than $500 on eBay.
Prime debuted as a non-caffeinated sports drink, but an “energy” variant dropped this year to similar fanfare. All the while, marketing via influencers and their captive audiences has proven to be a winning formula. No surprise, then, that Congo Brands has extended the strategy to its other major brand, Alani Nu, which was “founded” by fitness influencer Katy Hearn and has leveraged Kim Kardashian as a brand ambassador. (She has her very own flavor, “Kimade,” complete with hot-pink can.)
“Congo Brands famously will not talk about their business model, but it has become a disruptor with a new strategy that others are now trying to replicate,” Stanford says. “Even if they ultimately go boom-splat in the market, you can make a lot of money in the ramp-up and fad stage.”
(Congo Brands did not reply to multiple requests for comment from VinePair.)
Legacy soft-drink brands have taken note, scrambling to invest in, and even outright acquire, energy drink companies with potential for growth. Sales of soda and other sugary soft drinks have been steadily declining for more than a decade, according to experts. Buying up the energy drink market appears to be an acknowledgement that they need to diversify, and it’s largely unfolded in the last three years.
PepsiCo acquired Rockstar in 2020, then doubled down by forging a distribution deal with Celsius for half a billion dollars in 2022. Keurig Dr Pepper threw nearly $900 million for a big stake in Nutrabolt, the parent company of the popular C4 energy drink brand. This year, Monster bought out Bang Energy, which was struggling with internal leadership and too much litigation despite the market success of its products. Beer giant Molson Coors also recently announced a major reinvestment into Zoa, the energy drink repped by Dwayne “The Rock” Johnson, claiming it will “double” its planned media budget for 2024.
In other words, energy drinks are set to gain even more momentum in years to come. It is a daunting situation for public health experts, who continue to stress that energy drinks can have harmful impacts on health, especially for younger bodies that are still developing.
Does Anyone Know What These Drinks Really Do?
It would be an understatement to call the debate over the risks of consuming so many high-caffeine, supplement-infused drinks “contentious.” Over the last decade, industry lobbyists and brand reps have suggested that energy drinks are harmless when consumed in moderation; a common defense is that a drink like Prime Energy is equivalent to a large coffee from Starbucks. Others point to evidence that energy drinks provide real benefits to cognitive and physical performance.
But critics from the world of medicine and health research say that the issues are twofold: Many people consume far more than the suggested serving size, and it’s unclear what kind of long-term effect the swirl of caffeine and stimulating (and oft-unregulated) supplements can have on the body.
The risks multiply when it is a child or adolescent, and although a number of energy drink companies have denied marketing directly to youth, real-world practice shows otherwise, according to Jennifer Harris, a researcher at UConn’s Rudd Center for Food Policy and Health.
She testified in Congress over problematic practices in the energy drink industry in 2013. A decade later, Harris says not much has changed. “The issues are the same, but the consumption is just up,” she says.
While there is little medical consensus on exactly how harmful energy drink consumption can be, research has shed light on the way it can affect sleep patterns, mood, caffeine dependency, and even risk-taking. Then there are the seemingly freak accidents, in which people suffer severe cardiovascular damage and even die after consuming energy drinks.
“What we hear a lot when we speak to parents about these products is that they assume that if it was a problem, it would be regulated more — they assume there’s someone who is responsible.”
One British case study found a 21-year-old man who had been consuming four cans a day (roughly 640 milligrams of caffeine, plus the supplement taurine) had suffered so much kidney and heart damage that he qualified for a double transplant. Last year, a 21-year-old woman with a pre-existing heart condition died just hours after drinking a “Charged Lemonade” energy drink from Panera Bread; the family filed a lawsuit in October, alleging negligent labeling and marketing was to blame.
Harris’s 2013 testimony came amid heavy scrutiny of the energy drink industry from legislators, some of whom were pushing companies to curtail deceptive marketing practices and make nutritional information more transparent. But behind the scenes, industry players worked hard to lobby and shift the regulatory environment, going so far as to cozy up with state attorneys general, lavishing them with contributions in the hopes they would back off, according to reporting from the The New York Times and other sources. (The lobbying has continued; Monster, for one, contributed $15,000 each to the Democrat and Republican Attorneys General Associations in 2022.)
Today, Harris says the lines are blurrier than ever. Congo Brands appears to be explicitly marketing to kids with its Prime “Hydration” product, even though critics say this is just another pipeline to the caffeinated product. (U.S. legislators have already called for Prime to be investigated.) Elsewhere, Ghost is being sued for “deceptively targeting youth” by making energy drinks with branded candy flavors and targeting the fanbase of the ultra-popular gaming group FaZe Clan.
Harris admits it is a challenge to limit the scope of advertising, which falls under broad First Amendment protections. She suggests that regulating where and how they’re sold, rather than the marketing itself, may prove more fruitful. Meanwhile, her concerns about the lack of transparency on ingredients and the habit-forming potential of the drinks remain front of mind.
“What we hear a lot when we speak to parents about these products is that they assume that if it was a problem, it would be regulated more — they assume there’s someone who is responsible,” Harris says. “But I would also say that, in the past year, I’ve heard more interest and concern about what to do than in a long time.”
America’s Love Affair With Caffeine, Continued
The appetite for energy drinks is growing, and so is the subculture of the people who love them. Online forums like Reddit are full of people debating flavors and their favorite brands, but in the margins you can see the same problems that Harris summarized: namely, thread after thread of people asking for help with their energy drink dependency, worried that their chest pains and anxiety won’t go away.
There is little doubt that a boom of so many energy-boosting products is directly inspiring a surge in consumer curiosity and experimentation. At the same time, the trend also raises the question of why millions of people continue to feel seduced by the promise of productivity and focus that energy drinks tout. Surely, the search for self-improvement is a deeply human instinct. But now more than ever before, Americans are seeking solace in a $3 can of neon-hued sugar substitutes, garnished with an ever-growing slate of additives like mind-sharpening mushrooms and nootropic “smart” drugs.
As Beverage Digest’s Stanford notes, the desire for this buzz is ever-growing and evolving — and entrepreneurs are preparing to capitalize for years to come.
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