It’s not often that a new product category comes along that’s ideal for your trading sector but that’s exactly what’s happened with energy shots. They’re the little brother to energy drinks smaller and easier to consume and ideal for placing next to the till. For consumers they offer instant energy and, for retailers, instant profits.
Another plus point is the fact that shots don’t need to be chilled, hence their recommended positioning at the till point or next to key categories such as confectionery and newspapers/magazines.
Three of the big energy drinks’ brands have a presence in the shots market (Red Bull, Relentless and Lucozade) but there are loads of others to choose from too.
The Red Bull Energy Shot and the Red Bull Sugarfree Shot were launched in the UK last autumn. The 60ml shots contain the same amount of energy as a 250ml can of the Red Bull drinks.
Tom Smith, trade communications manager at the Red Bull Company, comments: "Being non-carbonated, having less liquid and the fact they don’t need to be chilled, brings in a host of new usage occasions, giving consumers all the functional benefits of Red Bull in a handy little shot. Whether it is in the pocket or handbag, at the gym or on a plane, Red Bull Energy Shots will give wings to consumers at more times and in more places than ever before."
However, he says for Energy Shots to be a real success, the merchandising has to be right.
"Forecourt retailers should stock energy shots at the till point to give them the best possible chance of increased profits. They should always be stocked in ambient impulse locations and out of the chiller so as not to confuse consumers, but instead add incremental value."
Last summer Coca-Cola Enterprises launched Relentless Shots. This 50ml product is said to provide the same amount of energy as 250ml of regular Relentless, with each shot containing 80mg of caffeine as well as vitamins B6 and B12.
Dave Leslie, brand manager for Relentless, comments: "Essentially, the functional nature of shots has a much wider appeal to a bigger audience. Following the huge success of energy shots in the US, we are confident that the launch of Relentless Shots will drive penetration and the overall result should be increased sales and value driven into the energy sector. In fact, the latest four weeks sales data shows shots now represent 1.5% of total energy value sales and this was 0.02% in the first year of sales in the US."
GlaxoSmithKline (GSK) launched Lucozade Alert Plus last autumn. The company reckons the product "will be instrumental in building a £114m energy shots category in the UK by 2013". It’s doing its bit by investing millions in this emerging category.
The orange-flavoured shot comes in a 60ml pocket-sized format in shelf-ready packaging of 12 bottles. Recommended retail price is £1.49.
GSK says it has been developed specifically for the UK market to help mental performance, focus, concentration and alertness. It contains energy-releasing B-vitamins and caffeine. It contains no added sugar and has only two calories per shot.
Alert Plus brand manager James Coupland comments: "We’re committed to growing this category through heavyweight above-the-line investment. Our £5m advertising spend, which will use TV and outdoor advertising, will focus on the product and its benefits."
He reckons that so far there’s no indication that shots cannibalise the energy drinks market. "Energy drinks are more of an everyday purchase," he says. "Shots are more for different occasions. They’re ideal for a portable mental boost and so will bring in new consumers and new drinking occasions and this will drive incremental growth."
He expects Alert Plus to appeal more to the mass market than energy drinks and more to women.
"In store there is a lot of potential for the product. The key location is the till point but also next to confectionery and newspapers and magazines."
To help retailers easily site the product in these departments, GSK offers a parasite unit, which can be clipped to a shelf in key hot spots. It holds 12 shots. There is also a pre-filled clip strip each outer contains two pre-filled strips each holding 12 shots.
Big in the US
In the US, the biggest brand is 5-Hour Energy; it arrived in the UK in February.
It’s definitely a brand worth considering as Nielsen data reveals that it accounts for around 70% of shot sales in US c-stores.
Rob McCormack, director international business development at 5-Hour, says the shot has gone down well with 24- to 42-year-olds who are looking for a boost in their day. "Typically these customers haven’t been in the demographic that energy drinks have focused on," he says.
He reckons consumers choose the shots because they contain vitamins, amino acids, no sugar and just four calories. They are sold in packs of 12 and recommended retail price is £1.99 to £2.29. Retailer margins are between 40-50%.
Meanwhile, Kris Yule, UK director of Go Fast! Sports says the independent petrol and convenience channels are very important channels for energy shots.
The Go Fast! shot has been test marketed in Scotland where it’s going well. Like McCormack, Yule says that whereas energy drinks tend to appeal mostly to young men, energy shots with natural benefits appeal more to older age groups. Yule continues: "Shots shouldn’t be a substitute for energy drinks they should be viewed as incremental business. If they are priced well and displayed well, then retailers can do well with them.
"The beauty of energy shots over energy drinks is that you don’t have to refrigerate them so retailers can place them right next to the till or next to the confectionery or magazines. If they put them in the fridge then they risk consumers choosing a drink instead of a shot or vice versa."
Go Fast! contains ginseng, guarana and ginkgo biloba all natural ingredients that have a proven energy benefit as well as fruit sugars, B vitamins, amino acids and caffeine.
"Evidence from the US shows that the energy shot has the potential to reach a much wider consumer demographic than a typical canned energy drink.
"People who have been turned off by the taste, name or image of an energy drink and health-conscious individuals who are watching their calorie intake, particularly women, are all receptive to the shot proposition."
The Go Fast! energy shot is positioned as a premium quality but value-priced product. Recommended retail price is £1.29 but some retailers are selling it on promotion at 99p. "I feel the category should start at this price point to get people on board," says Yule.
Go Fast! comes in packs of 12x50ml bottles. The packaging communicates the natural ingredients inside with a green cap with a "bio energy" message.
"When the packs were designed we went for as natural a look as possible, using ingredients people would be familiar with, that they’d recognise from their last visit to the health food shop," explains Yule.
Meanwhile, the Voltz brand is bound to appeal to young men as it has teamed up with Max Power to give away a Subaru Impreza worth more than £15,000.
Rob Arnold, chief executive officer of Voltz, says: "We are all about energy and our competition with Max Power to win the 380bhp Impreza P1 is an amazing opportunity for Voltz energy shot fans."
The free-to-enter competition will see participants complete a full army assault course. The fastest 15 competitors go through to the final where they’ll battle head-to-head. The overall winner takes home the Voltz Subaru Impreza.
Another shot brand is X8 Exhilarate, a 60ml liquid energy shot made from a vitamin-based formula just two sips are said to provide a sustained energy boost.
It is sugar free and contains about as much caffeine as a large mug of instant coffee. The energy blend uses B vitamins to increase alertness, focus and endurance prompting the body to release a sustained boost of energy already stored in the muscles.
It comes in two flavours orange and berry in a 12-bottle counter-top display. It is supported by point-of-sale material as well as space-saving merchandising items such as clip strips.
Other ’plus’ points for X8 are its three-year shelf life, competitive price point of £1.49 and the generous retail margins.
X8 Exhilarate is doing well in Sectorsure sites across the south east. Managing director Andrew MacDonald says: "Energy shots hold their own in terms of sales, so long as they are located in keys areas within the store. Having a till-side display for example, drives impulse purchase and enables the cashier to educate consumers about the category. X8 Exhilarate is doing very well in our sites. Customers like the point of difference from the leading brands like Red Bull and Lucozade because it has a vitamin-based sugar-free energy blend and is a more sports-orientated brand."
Meanwhile, Halewood International is taking its Red Alert brand into the shots market with the launch of the Red Alert Power Pack.
The company reckons the launch of this triple energy 60ml shot will give it a chance to increase its presence in the impulse purchase channel particularly in garage forecourts and motorway services stations.
Boost Drinks has launched a 99p stimulation shot, which it says is the lowest-priced shot on the market. It is a concentrated blend of caffeine and natural extracts of ginseng and guarana to give consumers an instant, portable Boost with only 0.3 calories.
And All Day Energy is using this month’s Convenience Retailing Show in Birmingham to launch its iShot.
Using a scientifically-developed combination of B vitamins, amino acids, anti-oxidants and herbs, the iShot comes in a 60ml bottle. One bottle is said to provide "sustained, healthy energy, increased focus and improved emotional status" all day long without the extra calories and ’crash’ caused by the sugar you get from some canned energy drinks.
Two iShots are available: iShot All Day and iShot Decaf. Both contain zero sugar, zero sodium and are low in calories.
The iShot All Day comes in original and orange flavours but more flavours will be added during the year.
The iShot Decaff with acai berry is designed for people who are sensitive to caffeine.
Final word on shots goes to Gary Roethenbaugh, market development director at Zenith International: "It is still early days for the energy shots market. Rapid growth has come from a low base and the consumer has engaged with the shots concept, particularly where it is distributed via petrol stations and other impulse outlets.
With continued support, we expect this category to build further momentum."
Shot hot spots
l At the till point many impulse shoppers head straight for the till
l At the confectionery display shoppers go to confectionery for an energy boost
l At the newspaper and magazine display according to HIM’s Convenience Tracking Programme, 27% of shoppers go into a c-store to purchase newspapers and magazines
l At the soft drinks display as, according to AC Nielsen convenience data, one in four soft drinks sold are energy drinks
Source: GSK
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