Coca-Cola Europacific Partners (CCEP), a leader in the global soft drinks sector, is poised to introduce an array of energy and sports drinks new product developments (NPD) across multiple markets. This move comes as the functional beverage category continues to yield strong and growing profits for the company.
In the upcoming year, several new launches from Monster and Powerade will hit retail shelves in CCEP’s 31 global markets, according to Oliver Crick, the group’s commercial development director.
The functional drinks segment has now become one of CCEP’s fastest-growing categories, with energy and sports drinks contributing significantly to profitability.
“The functional category as a whole has significant household penetration and is growing,” Crick states. “Energy, aside from water, is adding more growth than any other soft drinks.”
Crick further explains, “We still see lots of growth in traditional sparkling and soft drinks — like Coke and Fanta — but sports and energy have added more value than water, for example.”
To inform their investment and NPD strategies, CCEP is drawing insights from the North American market, where functional and energy drinks have reached nearly 70% penetration, compared to just 25% in Europe.
Energy drinks have undergone a significant transformation globally, evolving from a few dominant players like Red Bull to a highly competitive market filled with innovative flavors and products that would have seemed unfamiliar just a decade ago, according to Crick.
Monster and Burger King Partnership
Flavor innovation will remain a critical driver in the energy segment. Moreover, there will be an increased emphasis on clean-label energy offerings, which crick notes, “is small and niche now, but we can see headroom for no artificial and plant-based energy.”
There will be a shift toward additional sugar-free and new flavor variants within the Monster portfolio, he adds. “This follows our Monster Ultra launch, which is the biggest sugar-free energy drink across most of our markets.”
Moreover, Foodservice is emerging as a growing focus area for Monster, which recently secured a listing with Burger King in Spain, featuring its Green and Mango Loco variants.
New product launches will make their debut first in the UK and German markets, where Monster typically sees stronger performance, Crick points out.
Despite the mature nature of the sports drinks segment, Crick believes that growth potential remains robust. “In Europe, household penetration is at 18%, but it’s 45% in Spain and only 3% in Italy, so there’s a considerable gap and a need for educational initiatives,” he explains.
Crick further observes that consumers often lack awareness regarding the appropriate contexts for consuming sports drinks. “One of the main reasons people buy into the segment is for refreshment, but in Australia, consumers look for the electrolyte element.”
“We need to educate consumers in more markets about the category to grow it as a whole; we can all benefit from that,” he asserts.
Innovation stands as a viable pathway to steer consumers toward the segment, which can be particularly effective. For instance, during the Paris Olympics, CCEP launched and promoted Powerade Golden Mango, resulting in an impressive sales increase of over 40%.
New One-Litre Powerade Bottles
In Germany, CCEP is exploring different pack formats for Powerade, including the introduction of a one-litre bottle. This decision was driven by consumer insights revealing that gym-goers were purchasing two 500ml bottles; the one-litre format aims to address this need.
Powerade is already available in one-litre bottles via the Australian supermarket chain Coles.
Additional Powerade innovations will encompass new flavor introductions and varied pack formats across several regions. While specifics regarding these variants and launch timelines were not disclosed, Crick noted that successful products in strong markets like Australia would be introduced to other territories.
New introductions are likely to be centered in Germany, which Crick identifies as “our market for Powerade innovation launches.”
“However, if you look at the sports market, APAC is really strong with Powerade, Zero-Sugar, and Active Water, so you can anticipate those appearing in other markets,” adds Crick.
Furthermore, CCEP intends to support its NPD launches and sales growth with increased factory investments, particularly in production lines. “As we expand rapidly, production lines can reach capacity, which we need to address,” explains Crick.
“We are investing in production in APAC, enhancing manufacturing capabilities, and driving innovation,” he elaborates. “Additionally, we’re increasing our marketing spend to support brands like Powerade during the Olympics and Monster within Formula 1.”
CCEP has already committed to €1 billion in capital expenditure, with a significant portion allocated to line upgrades, logistics, and other networks, ensuring that the company remains at the forefront of food and beverage industry trends.
