October 20, 2014 Leave a comment
It seems that the craze over energy shots have died down since 2012 and left 5-Hour Energy as the last company standing. That shouldn’t be a surprise since existing consumers were fiercely loyal to the brand, to the extent that offerings from energy stalwarts like Red Bull and Monster failed to sustain sales in this segment. After winning the battle for energy shot supremacy, 5-Hour Energy still faced challenges toward reaching a wider array of consumers. The energy shot manufacturer need to reach other demographics to continue growing. That spawned line extensions to reach women, as well as sampling events to reach seniors. This past summer, the company ran a “Yummification” campaign to leverage 5-Hour Energy as a mixer (BevNet’s Ray Latif has an in-depth look at the campaign here). While all companies have growth barriers, what has 5-Hour Energy done differently to overcome these growth challenges? And beyond its success, what other opportunities exist for them in the foreseeable future?
It would appear that targeting women and seniors are components of an overarching 5-Hour Energy growth plan, and the strategic objective is to increase consumption. Reach new demographics isn’t all that different from what other companies do, so catering to women and seniors are not all that unique. What is unconventional is their “Yummification” campaign. 5-Hour Energy recognized that taste was a blockage that would not be solved despite their efforts to highlight product benefits. The “Yummification” campaign leveraged fans’ creativity in a contest to create recipes for mixing 5-Hour Energy with other beverages (mainly non-alcoholic ones) to lessen the medicinal taste. As a side benefit, this contest required submissions through YouTube helped generate a lot of media exposure. Beyond media impressions, the campaign showcase new usage occasions for 5-Hour Energy. Contest submissions advertised concoctions to refresh the user during athletic training, waking up, and gaming among many others. Athletic training, waking up, and gaming are occasions typically paired with other refreshments, such as sports drinks, coffee, and juice & water. Energy drinks – let alone energy shots – seldom enter the conversation as refreshments during these times. However, it looks like that will change following the success of their “Yummification” campaign.
Beyond the campaign’s success, it seems 5-Hour Energy has uncovered business opportunities that they were previously unaware of. Serving as an ingredient as well as a standalone product gives them many more opportunities to sell itself. Beyond the regular activities to feature the product as a strong standalone product, mixing the shot with other beverages now gives 5-Hour Energy many cross-promotion and marketing opportunities. 5-Hour Energy could try securing displays in the juice aisle to forge a stronger bond with the juices that could be mixed with their product. Or secure displays in the coffee aisle to convert or steal coffee consumers. Regardless of displays or other in-store activation tools, many opportunities have emerged to continue delivering growth momentum.
Judging by the potential that this campaign could provide to 5-hour Energy, it’s a surprise it took them so long to come up with it. It may be the fact that the segment was riding a hot growth trend that nullified the need for marketing support. Or that negative media surrounding energy drinks required more immediate attention than developing a sustained growth strategy. Whatever the case, the campaign has now happened and translated fantastic success. The one downside is that the campaign won’t be repeated, as said by Brandon Bohland, a special markets manager at the company. Which means that the recipes submitted for the campaign are the only ones that will exist for the foreseeable future, until 5-Hour Energy creates other contests calling for recipe creations.
Visit 5hourenergy.com/yummification to see the videos and recipes for their Yummification contest.