There is tremendous growth and competition in the alternative beverage industry. Both large and small marketers are launching new products and fighting for limited retail shelf. More and more consumers are moving away from traditional soft drinks to healthier alternative drinks. Demand is expected to grow worldwide as consumer purchasing power increases. PepsiCo was the worldwide leader of alternative beverages with a global market share of 26.5% and a 47.8% share of the U.S. market in 2009. Coca-Cola held a global market share of 11.5%. Although Coca-Cola was the worldwide leader in carbonated soft drink sales, they trailed PepsiCo in alternative beverage sales. Fast on the heels of the larger marketers are Red Bull, Monster, and “other” mainly consisting of privately held bottlers. Red Bull was the world’s number one seller of energy drinks which made it the third-largest producer of alternative beverages worldwide and the number two seller of alternative beverages in the U.S. and Europe. In 2009, Monster was the second-best-selling energy drink brand in the U.S. with revenues growing to more than $1.3 billion. There are hundreds of regional and specialty brands of energy drinks, sports drinks, and enhanced beverages in the U.S. and internationally. Of these, Rockstar was the most noteworthy privately held alternative beverage company.
Which of the five competitive forces is strongest?
Competitive pressure from rival sellers is high in the alternative beverage industry. The number of brands competing in sports drinks, energy drinks, and vitamin-enhanced beverage segments of the alternative beverage industry continue to grow each year. In 2009, 231 new vitamin-enhanced beverages were introduced in the U.S. PepsiCo, Coca-Cola and Red Bull are the three main competitors worldwide with “other” taking 55% if the worldwide market. PepsiCo takes the lead in the U.S.;