Energy Drinks Running Out Of Kick?

There’s a touch of irony in the news this past week, as reports have stated that energy drink sales were running out of steam. Excuses are plentiful from those who produce the beverages, but one can’t help wondering if recent studies and findings are finally bringing attention to something that some are claiming to be a danger to consumer’s health.

Controversy over the effects of energy drinks has been evident for years. With three deaths in Sweden in 2001 thought to be connected to consumption of Red Bull, and other similar events alleged over the years, one can’t help but wonder why there haven’t been any formal reports or studies associating these beverages with specific and detrimental effects on human health.

It appears to be ‘wonder no more’, as this week energy came under fire from several angles, ranging from slumping sales through to reports which allege energy drinks (in this case Red Bull once again) causing symptoms associated with cardiovascular disease. While Red Bull does have a recommended limit of two (eight ounce) cans per day, as well as warnings not to mix them with alcohol, there has not been a warning on cans that these products can potentially cause issues that are associated with major health problems such as stroke.

Following the Australian study noted above, that discourages the idea of energy drinks being “healthy” drinks, comes news that Europe’s highest court has upheld France’s decision to ban Red Bull in that country. The ruling comes as a result of the European Commission complaining that the country was inhibiting imports via this ban. Red Bull has crept into other countries after much work, such as in Canada where it became available only after new legislation for natural health products was introduced in 2004. Before this legislation was introduced, regulators would not allow it into the country, specifying that it was neither a food nor a drug.

On top of this week’s reports regarding the health issues with energy drinks comes news that consumers are beginning to tire of these beverages. While these products are still growing in sales, they are finding the rate of growth smaller as time wears on. Blame for the decrease in sales is not being accredited to health risks by everyone, however, as Gerry Khermouch, editor of Beverage Business Insights, is quoted in the above article claiming that rising gas prices is the key factor stopping people from entering stores and buying the beverages.

I find it difficult to believe that sales are slowing down due mainly to rising gasoline prices. Many of these products market strategically towards teenagers through sponsoring events such as the X-games and other adrenaline sports. Red Bull had key product placement in the teenage film ‘Superbad’ while the main characters where on their way to school. Many viewers of these productions are youth who are not yet drivers, and are more likely to follow the mentality of “monkey see, monkey do” when star athletes and movie stars are guzzling these beverages. The irony is that they, the stars and athletes, get paid to drink such beverages, while the nation at large is shelling out premium prices (two to three dollars per can) for the drinks.

Khermouch’s assumption that people are not going inside gas stations, hence not buying drinks, based on the cost of filling up alone is pure speculation. By that same mentality, one could assume that people are still going inside to pay, but buying less costly beverages after dropping so much money into filling their gas tanks. Society will not ignore its thirst because of the cost of fuel.

James Tonkin, Principal of TonkinConsulting-Healthy Brand Builders, offers another opinion. “With over 400 of these products and brands trying to get into the market the consumer is just tiring of the current offerings and false hype. Brands below the top 10 are wasting their time in my view, the category will not allow them to succeed long, let alone find a way to the retail store shelves.” Tonkin added, “$1.99 per can for 8oz of energy doesn’t warrant the same exposure as a gallon of bottled water at $.49.”

Just what is the defining issue? Is it the volume of caffeine and other stimulants they contained in a single can? If reports continue, will governments start trying to limit the amount of caffeine and other ingredients allowed in this type of product? How will that affect other product categories, such as coffee? If there were a call to place restrictions on caffeinated products, how long would it take to implement and what form would it take?

After years of work, Ontario, Canada, has only just managed to have tobacco products taken out of view in stores, attempting to use “out of sight, out of mind” to its advantage. Is this the manner in which caffeinated products would be dealt with? “The FDA may [ban energy drinks],” said Tonkin. “Especially if the US records any death attributable to energy drink over-consumption, or if numerous physician/hospital complaints are registered regarding ‘over-dosing’ of energy drinks alone.”

So what is the next likely step for energy drinks to energize their sales once again? It would appear that non-carbonated and fruit based versions may be the way to go. By removing the carbonation and adding fruit juice, the association between fruit juice and inherent health benefits may cause less thought about how bad an energy drink might be for a consumer. Some companies are already putting these new versions out onto store shelves, capitalizing on the increasingly popular fruit drink enterprise. Rockstar energy drinks have come out with their ‘Juiced’ line, offering Guava, Mango and Pomegranate flavored versions. “The addition of juice really should not have any affect on the dosage and affect of the caffeine and guarana/taurine found in energy drinks,” said Tonkin. “It may help HOPEFULLY to make the darn things taste better.”

Energy drinks have integrated themselves into our markets and minds, and despite questions about their negative impact on human health, they certainly will not be removed without a significant amount of research discrediting them. Until they are routinely found to be causing health problems, death or other, it seems they will continue restoring mental alertness while risking wearing consumers out physically.

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