Breaking News on Food & Beverage Development - North America

Red Bull cans energy shots and Cola in US (but not Europe)

By Shane Starling, 22-Jul-2011

Related topics: Suppliers

Global energy drink leader Red Bull has taken a rare step back by withdrawing Red Bull Cola and Red Bull Energy Shots from the US market – but says it has no plans to withdraw the products from the other 20 markets where they are sold.

Speaking with NutraIngredients, Red Bull Communications officer Tina Deutner refused to expand on the reasons for the US discontinuation, but affirmed the Austrian company’s commitment to the brand extensions elsewhere, including Canada.

 “Red Bull Energy Shot is available in over 20 countries around the world, from Canada to Russia,” Deutner said. “We have no plans to withdraw them from the market.”
 
 

The same, by the way, holds true for Red Bull Cola which is doing particularly well in Germany and Austria. Red Bull Cola was never launched broadly, we focused first and foremost on the Germanic markets, and added selective distribution in additional countries like the US, Belgium or Russia.”

Dynamic category

Market intelligence director at Zenith International Gary Roethenbaugh said the move was “interesting” given Red Bull’s marketing strength.

“It’s interesting to see Red Bull take this decision but energy shots in particular are a very dynamic category and maybe Red Bull foresaw a cooling in it. They are a company that is very good at focusing on their core offerings so perhaps the decision is to go back to the core SKUs in the US.”

Of Red Bull Cola, he said its natural positioning hadn’t won favour with US consumers, just as Pepsi’s ‘Raw’ had not, as non-diet cola remains “a treat-indulgence”.

Red Bull launched energy shots and Red Bull Cola in Europe in 2009, following 2008 launches in the US and other countries.

Focus

"Moving forward, Red Bull North America will sell through existing inventories of Red Bull Cola and Red Bull Energy Shot," the company said in a statement, "but will not proceed with additional production."
 
 "Red Bull has ambitious plans for growth and is well-positioned to continue the momentum that has led to the brand's dominance of dollar share within the category. Energy is the fastest-growing category within beverage, and Red Bull is delivering the most incremental dollar sales to the energy-drink category, and investing the most into the category than any other player. With that said, Red Bull North America will focus efforts against our core brand--Red Bull Energy Drink."

Red Bull Energy Shot was the No. 3 best-selling energy shot in convenience stores behind market leader 5-Hour Energy Shot in the €500m+ category, according to IRI/Symphony figures in December 2010, with sales growing.