The rapidly growing fitness and sports sector is the prime impetus for the growth of South America Sports and Energy Drinks Market. With rising health awareness among the people of this region, there is increasing popularity for fitness activities, games, and sports such as yoga, aerobics, jogging, soccer, gym, and many more. Loss of energy, electrolytes and carbohydrates in the form of water is common phenomena during physical activities. Thus, the person engaged in these activities is advised to consume food products that provide instant nutritional and energy boost. Energy and sports drinks do the needful, as they are rich in electrolytes, sodium salts, potassium salts, vitamins, glucose, essential nutrients, sugar, and carbohydrates. Moreover, these drinks help in hydrating the body while performing physical activities. Thus, the sports and energy drinks market is gaining high growth on this factor. According to the latest report by “International Health, Racquet and Sportsclub Association (IHRSA),” the health and fitness industry in Latin America generates $6 billion in a year, from more than 65,000 clubs, and there are nearly 20 million Latin American health club members. These findings are an attenuated representation of the ubiquity of the fitness industry growth in South America. Therefore, the South American sports and energy drink market is expected to witness a significant growth on account of growing fitness and sports industry in the region. In 2018, the South American sports and energy drinks market size increased up to $2 billion, and the market is projected to grow at a CAGR of 8.4%, during the forecast period 2019-2025.
Moreover, the growing purchasing power among consumers of South America is boosting the consumption of energy drinks and sports drinks. The growing purchasing power in South America can be easily fathomed from the statistics by “The World Bank,” according to which the annual GDP growth rate of Latin America and Caribbean in 2017 was 1.7%. The increasing disposable income is supporting the increased expenditure on health and luxury that facilitate the growth in demand of sports and energy drinks to stay fit and energetic. Therefore, this factor is fuelling the demand for sports and energy drinks and thereby supporting the growth of South America sports and energy drinks market.
Presence of Large Consumer Base in Brazil: A Boon for South America Sports and Energy Drinks Market—
Geographically, Brazil accounted for maximum market share in the South America sports and energy drinks market in 2018, generating a demand share of 27.59%, and is anticipated to maintain its dominance, throughout the forecast period. This is attributed to the availability of a large consumer base in this region. According to the Central Intelligence Agency (U.S.), the total population in Brazil was estimated as 208.8 million in 2018, which makes it the most populous country in South America and fifth most populous in the world. Moreover, the growth in Brazil sports and energy drinks market perceived by increasing trade of beverages across Brazil. According to the International Trade Centre (ITC), the trade value of beverages, spirits, and vinegar in Brazil was evaluated as $1.3 billion in 2018. The trade had witnessed a substantial growth at a growth rate of 17% p.a. from 2014 to 2018. Hence, the propitious boom trade in beverages industry is creating opportunities in the sports and energy drinks market in this region.
The Sports Drinks Segment to Create Revenue Avenues for South America Sports and Energy Drinks Market—
Based on product type, the sports and energy drinks market is segmented into sports drinks and energy drinks. Among these, sports drinks is considered to be the key application segment, that is rendering the maximum market shares. Owing to increasing demand from athletes, sportsmen, and millennial generation. Sports drinks are gaining unprecedented endorsement from athletes and players who are involved in vigorous physical activities. Athletes, sportspersons, fitness enthusiasts who are actively engaged in fitness activities, lose electrolytes by sweating and expending energy. To regain the lost electrolytes and energy, the intake of nutritional drinks such as sports drinks boost energy level, and enhance the performance. Thus, the key application segment is poised to propel at a CAGR of 8.6%, during the forecast period.
Increasing Consumer Focus on Health and Wellness to Propel Growth of South America Sports and Energy Drinks Market—
The increasing incidence and prevalence of lifestyle-related diseases is rising among the aging population, and moreover the healthcare service is getting expensive with the time. This is compelling individuals to look for affordable means to maintain their health and wellbeing. Consequently, people are spending more on health and wellness products such as energy drinks, as these products provide essential nutrients, improves alertness, and enhances energy. Thus, the increased spending by consumers on health and wellness products is a primary factor fueling the growth of the South America sports and energy drinks market.
Trending Sugar-Free Energy Drinks Disrupt the South American Sports and Energy Drinks Market—
On the back of urbanization, consumers are becoming more cautious about the health issues caused by regular consumption of non-organic energy and sports drinks. Energy drinks consist of a significant amount of sugar, which act as a major barrier in adoption of the product by its consumer base. Thus, market vendors are launching sugar-free drinks that contain the same amount of nutrients, but use natural ingredients such as stevia, organic guarana and raw green coffee bean extracts. This has paved the way for increased sales, eventually leading to the growth of the sports and energy drinks market. Market players are also launching tailor-made flavors and limited-edition products, for instance, Monster Beverage Corporation launched, Valentino Rossi special edition citrus-flavored energy drink for a specific consumer-base. This is thus disrupting the growth of the market.
South America Sports and Energy Drinks Market: Major Players
Major players striving to gain grounds in the South America Sports and Energy Drinks market include Abbott Nutrition Co., AJE Group, Arctico Beverage Company International Inc., Arizona Beverage Company, Britvic PLC, Champion Nutrition Inc., Cloud 9, Coca-Cola, D'angelo, Extreme Drinks Co., Fraser & Neave Holdings BHD, GlaxoSmithKline Plc, Living Essentials, Monster Beverage Co., and PepsiCo. These companies are continuously developing innovative products by using varied ingredients and different packaging techniques like pill-shaped bottles. Apart from this, companies are investing in innovative marketing and advertising strategies to widen the scope of their product portfolio.
· Energy drinks companies consider themes that reflect power and endurance while designing their logos. Red Bull, in their logo, use an image of two bulls fighting head on, which is symbolic of strength, and power. These type of intellectual logos will lead to an increase in sales of the product.
· In 2017, the board of Britvic PLC, announced that it has agreed in principle to acquire Bela Ischia, a juices and liquid concentrates producer in Brazil. This acquisition is intended to expand Britvic’s presence in Brazil, in soft drinks market.
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