Energy DrinksMorgan Plumlee and Elizabeth Monnig

Overview

Supplier in control ◦Red Bull leading brand◦Private label not common in most retailers

Retailer in control◦Target has an Archer Farms energy drink◦Only retailer with a private label

Audits

Fayetteville SpringdaleWalgreens Joyce KmartWalgreens School

Walgreens 6th Street RogersWalmart 6th Street Neighborhood MarketIGA TargetTargetHarps Garland

Depth

70 SKUs found in our auditWalgreens has the mostWalmart had fewest

Demographics

Income◦Between $30,000-$50,000

Age FH◦35-44

Household Size◦3-4 members

Education FH◦Some college

Demographics

Item Penetration

% item $ on deal

$ share # of raw buyers

Item buyers

Item $

Monster 2.9 10.2 2.0 1281 3416.8 94,656.8

Red Bull 2.8 8.5 3.7 1,227.0 3,236.4 170,066.6

Rockstar 1.4 21.4 0.6 578 1,597.6 26,430.7

Amp 1.8 14.3 0.5 726 2,081.6 20,945.8

Display Space

Display Space

Red Bull◦Premium Price◦Not found at every store◦50% display space at Walmart and 44% display

space at TargetMonster

◦Majority of display space in most retailers◦Around 34%◦Most SKUs found

SKUs

Every Store◦Monster◦Amp◦Rockstar

Market Stocking Rate◦Red Bull 56.7%◦Amp 50%◦Monster 42.8%◦Rockstar 38%

Gross Margins by Supplier

Gross Margins by Supplier

Red Bull◦Lowest gross margins because it is the leading

brandAmp

◦Highest gross marginsPrivate Label

◦Target’s private label has 66% gross marginsWalmart

◦Lowest gross margins out of all the retailers

Gross Margins by Facings

Private Labels

Energy drinks is not a popular category for Private Labels

Target is the only retailer with a Private Label energy drink

Gross Margin is around 66%

Private Label

We do not expect private labels to increase in this category.

Target is the only retailer we feel will be successful with a private label because of their previous success with the Archer Farms brand

In fall 2008, there were only 47 SKUs and no private label

Private Label

Walmart◦Increase emphasis on national brands◦Do not have very many SKUs available in

grocery section◦Not a leading retailer in this category