It has been more than 25 years since Red Bull hit the market and introduced caffeinated energy drinks to the United States. While the company claimed its beverage would “give you wings,” it never said it was actually good for people.
Yet as the energy drink market continues to grow rapidly, companies both new and old are trying to attract health-conscious customers with a wave of no-sugar, low-calorie drinks that claim to boost energy as well as replenish fluids with electrolytes and other ingredients.
The offerings include drinks from the popular brand Celsius, which has an investment from PepsiCo and uses the marketing line “Celsius Live Fit.” It claims to be made with “healthier ingredients” like ginger, green tea and vitamins. Likewise, the influencer-backed Prime Energy is sugar-free and has electrolytes, a main ingredient in most sports drinks.
“All of them are zero sugar or zero calories,” said Jim Watson, a beverage analyst at Rabobank, a bank based in the Netherlands with a focus on food and agriculture. He added that energy drink consumption had increased partly because of the decades-long move away from sugary soda. “They’re going for the healthy image.” Even Gatorade, which has long marketed beverages to athletes hoping to replenish lost fluids or electrolytes after strenuous exercise, is jumping into the caffeine arms race. This year, Gatorade released Fast Twitch, a sugar-free beverage in flavors like Strawberry Watermelon and Cool Blue — with caffeine levels equivalent to more than two cups of coffee.
This new focus has helped the energy drink market grow, with sales in the United States surging to $19 billion from $12 billion over the last five years, according to Circana, a market research firm.
Last year, PepsiCo paid $550 million for an 8.5 per cent stake in Celsius. In May, Celsius said revenues were $260 million in the first quarter of this year, double what they were a year earlier. At that ferocious pace, revenues could cross $1 billion this year, increasing from $314 million just two years ago. Shares of Celsius have shot up to $144 a share from $69 a year ago. Likewise, the stock of beverage company Monster Energy has increased 31 per cent in the past year.
But there are concerns that drinks being pitched as healthy are resulting in children and teenagers consuming caffeine in unhealthy amounts.
Some schools in Britain and Australia have already banned the beverages. In the United States, federal regulations say schools cannot sell or provide caffeinated drinks to elementary or middle school students, although many schools do not restrict what students can bring from home.
A 12-ounce can of Red Bull contains about 114 milligrams of caffeine — more than three times the amount in a 12-ounce can of Coca-Cola. Prime Energy has more: 200 milligrams in each 12-ounce can. A 16-ounce can of Bang Energy Drink, the size typically sold in convenience stores, has 300 milligrams of caffeine.
“Everybody thought Red Bull was the peak of caffeine in energy drinks,” said Dr. Ryan Stanton, an emergency physician in Lexington, Kentucky, who said he saw patients, especially around finals weeks at local colleges, come in complaining about feeling anxious and experiencing racing heartbeats after consuming too much caffeine. “Now, some of these drinks have two or three times the level of caffeine as Red Bull.” Studies have shown that consuming caffeine may have health benefits, but that too much could result in cardiovascular and gastric issues. The Food and Drug Administration has investigated a handful of reports over the years involving people dying shortly after consuming energy drinks or five-hour energy shots. But the agency has never established a link between the two, a spokesperson for the FDA said in a response to emailed questions.
Adults are recommended to have no more than 400 milligrams of caffeine per day. Pediatricians recommend that youths ages 12 to 18 should not consume more than 100 milligrams of caffeine per day and that children younger than 12 should avoid caffeine completely.
Over the years, there have been efforts to increase government regulation of energy drinks and limit the caffeine allowed in beverages. Lawmakers in several states, including Indiana and Connecticut, have considered banning the sale of energy drinks to minors. But the industry has successfully pushed back, in part by arguing that young people can get caffeine from myriad sources, including soda and coffee. A 16-ounce cinnamon-caramel-cream cold brew from Starbucks, for instance, contains 265 milligrams of caffeine (and 260 calories).
About a decade ago, the energy drink industry, through its lobbying arm, the American Beverage Association, voluntarily adopted a set of principles, including labeling the amount of caffeine in products and noting on packaging that the beverages were not recommended for children. The industry also agreed not to sell or market its products in schools.
But critics say some energy drinks are clearly marketed toward younger customers. Last year, the consumer advocacy group Truth in Advertising said companies like C4 Energy, which sells drinks in flavors like Starburst and Skittles, and Ghost Energy, which sells Sour Patch Kids and Swedish Fish-flavored drinks that contain more caffeine than two cups of coffee, were trying to appeal to minors.
Dan Lourenco, the CEO and co-founder of Ghost, said in an email that the company’s products were geared toward millennials seeking the nostalgic flavors of their youth. C4 Energy, which is owned by Nutrabolt, did not respond to an email seeking comment.
The US Department of Agriculture, whose Smart Snacks program creates the nutritional standards for foods and beverages sold in schools, said any products sold in elementary and middle schools must be caffeine-free. But for beverages sold in high schools, there are restrictions on the number of calories but none on the level of caffeine.
Moreover, the FDA does not have specific regulations around “energy drinks,” deeming it a marketing term. A spokesperson for the agency added in an email that companies were still responsible for including a safe amount of caffeine in beverages. — The New York Times.