Report on Sports Drinks

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I shall be investigating the sports drinks market in the UK, focusing on the overall market and launching a new product. The UK sports drinks market is estimated at £1.2 billion in 2012 with a growth in sales of more than 60% by 2012 (Mintel, 2012) showing what a rapidly growing market this is. I will examine how a leading drinks manufacture can expand into this market and launch a new sports drink using Usain Bolt in promotion.

The market share for sports drinks grew by 10.7% last year with an average of around 8% growth year-on-year (Mintel, 2012). The sports drinks market in the UK is a highly competitive market with market leaders GlaxoSmithKline (GSK) taking 27% of the market share in 2011 with Lucozade energy and 12% with Lucozade sport (Mintel, 2012), therefore being the clear competitor. The market is segmented through socio-economic groups with a higher average of sales with those earning the highest incomes (BDSA, 2012). Sports drinks have also been considerably biased to the 16-24s (BDSA, 2012) leaving a gap in the market to broaden the appeal.

A key external factor that influences the popularity and growth of the sports drinks market is the increasing popularity of fitness lifestyles. The UKs fitness industry is at the highest it has been, with more consumers wanting to improve health through exercise. 11.9% of the UK population are registered members of a health and fitness club (The Leisure Database Company, 2011). This affects the demand for sports drinks as the more people that maintain a fitness lifestyle should mean a higher demand for sports drinks. A second external factor is the UK economy. With the downfall in the economy it means that consumer expenditure remains weak. This can lead to weak consumer confidence, with people wary of spending. If sports drinks are expensive it may lead to lower demand, therefore they need to be careful of their pricing strategy.

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