Mcdonalds Energy Drink Research Report Essay

The purpose of this report is to investigate past trends and forecasts of the energy drink market. Included in this report, is information on market size, target population and statistical data on growth history and growth projections.

The aim is to determine if adding energy drinks to McDonalds offerings will create a profitable segment for their menu. The market research collected and contained in this report consists of secondary data. This research was authorized by: McDonalds Corporation.

Current market research shows that the energy drink market has grown into a multi-billion dollar business, which has been reported as being the fastest growing segment in the beverage industry since bottled water. The US energy drink industry is expected to more than double in the 5 years preceding 2013. (Comprehensive Reviews) Eighteen to twenty-four year olds or college students are the largest segment of energy drink consumers. (NutritionJ) The conclusion of this report suggests that the growth of the energy drink market has been greater than most other liquid refreshment beverage sectors in the US in the past five years and that this trend will continue. It is recommended that McDonalds Corporation add energy drinks to their offerings and target college-aged students.

Introduction Fast food consumption in the US has declined during the recent economic crisis. To stay profitable, many fast food chains have introduced low-cost or value items too keep sales up. Along with low-cost items, many fast food chains have added specialized items or niche items to attract customers that can more conveniently buy these at a fast food store. McEnergy 3 Energy drinks have continued to gain popularity since Red Bull was launched in 1997. More than 500 new energy drinks were launched worldwide in 2006 and beverage companies are reaping the rewards of the exploding energy drink industry.

This report examines the energy drink market and its potential to become a niche item in a fast food chain along with the population to target. Methods. This report was conducted using a secondary statistical data and secondary research that was gathered using a focus group and survey of college age participants. The statistical data was obtained from New York City-based Beverage Marketing Corporation which is the leading research firm dedicated to the global beverage industry. The statistical data regarding the previous growth patterns and growth forecasts will be discussed in the results.

The focus group and survey were done by Nutrition Journal and focuses on energy drink consumption patterns among college students. The survey was based on responses from a 32-member college student focus group and a field test, a 19-item survey was used to energy drink consumption patterns of 496 randomly surveyed college students. (nutritionj) The population was defined as undergraduate students at a state university located in the Central Atlantic Region of the United States. 85% of the undergraduates were 18-24 years of age, 12% were 25-40 years of age and 3% 41 years of age or older.

Sixty two percent of the entire student body is female. The sampling units were individual college students that were generated with a McEnergy 4 non-probability method of asking students around campus if they would like to participate. (Nutritionj) Results Fifty one percent of participants reported consuming at least one, energy drinks a month. Thirty four percent of participant reported consuming at least two energy drinks a month. Table 1 % of college energy drink users reporting amount and frequency of energy drink consumption by situation in an average month Energy drinks consumed Days/month ________________________________________________ Situation n 1 2 >2 1-4 5-10 >10 Insufficient Sleep 169 64 22 14 74 18 almost eight.

Need basic energy 165 63 21 16 74 18 almost 8 Studying or perhaps project 125 50 thirty eight 14 85 10 your five Driving extended distance 114 63 twenty three 14 eighty six 9 5 With liquor 136 28 24 forty-nine 73 18 9 Handle hangover forty two 74 12 16 74 14 12 N= 253 college strength drink users (nutritionj) The US refreshment beverage market grew by 1 . 2% in 2010The regarding the energy drinks market is up 5. 4% in the past season. (beveragemarketing) Via 2004 to 2009 the McEnergy 5 overall growth of the energy companies are up more than 240% (Wiley) The shift from consumption of sports drinks such as Gatorade and Powerade towards energy beverages should continue. In the last year, soft soft drinks remain the largest the liquid refreshment beverages category but their volume slipped 0. 8% from 13.

9 billion gallons last season to 13. 8 billion gallons in 2010, which resulted in their business decreasing. (beveragemarketing) Table two U. S Liquid Refreshment Beverage Market Change in Quantity by Portion 2009-2010 Percent Change Segments 2009-2010 RTD Tea 12. 5% Athletics Drinks being unfaithful.

4% RTD Coffee almost 8. 1% Strength Drinks your five. 4% Water in bottles 3. five per cent Value-Added Drinking water 0. 2% Fruit Refreshments -2. 0% Carbonated Soft Drinks -0.

8% Total LRB 1 . 2% Source: Beverage Marketing Organization (BeverageMarketing) McEnergy 6 Conclusion The energy beverage market is growing into a multi-billion dollar organization, which has been reported as being the fastest growing part in the refreshment industry since bottled water. Having grown 240% in the past five years, the only beverage industries to expand faster that energy beverages last year were ready-to-drink tea, ready-to-drink coffee and sports drinks. Burger king already redirects these other three beverages and would benefit by adding the subsequent fastest growing beverage sector, energy drinks.

Despite the huge market share that carbonated refreshments owns, there is also a demand and shift to other drink sectors while evidenced by a decrease in soft beverage business last year. A big segment of energy drink customers is the college-aged consumer. With over fifty percent of college students drinking by least one particular energy drink a month and 34% in least two a month, this would be a good inhabitants to target.

Recommendations Include energy drinks for the offerings in McDonalds fast food restaurants. Focus on college-aged learners with primary locations and marketing strategies. McEnergy 7 Referrals: Gonzalez de Mejia, E. & Heckman, M. A. & Sherry, E. (2010). Energy Drinks: A great Assessment with their Market Size, Consumer Demographics, Ingredient Profile, Functionality, and Regulations in the usa.

Comprehensive Reviews in Food Science and Food Security. Retrieved by: http://onlinelibrary. wiley. com/doi/10. 1111/j. 1541-4337. 2010. 00111. x/pdf Western world, T. (2011). The Energy Companies are Still Full of Growth Potential Reports. Wholesale News. Recovered from: http://web. ebscohost. com. lib. kaplan. edu/ehost/pdfviewer/pdfviewer? vid=12&hid=123&sid=eeec713f-80bc-4ca6-b6ce-02c68e0f1f50%40sessionmgr112 The US Liquid Refreshment Beverage Market Increased by simply 1 . 2% in 2010. (March 2011). Drink Marketing Corporation Reports. Gathered from: http://www. beveragemarketing. com/? section=pressreleases Aeby, V. G. & Barber-Heidal, K. & Carpenter-Aeby, T & Malinauskas, W. M, & Overton, L. F. (2007). A Review of Energy Drink Consumption Patterns Among Students. Nutrition Journal.

Retrieved by: http://www. nutritionj. com/content/6/1/35.