The Rise of Energy Drinks in Restaurants
Following Dunkin' and Sonic, Starbucks is entering the fray, highlighting growing mainstream restaurant adoption of energy drinks.
Chains like Jersey Mike's are partnering with brands like Celsius.
This trend is driven by the success of energy-drink-focused chains like Dutch Bros.
Why Restaurants are Betting on Energy
Huge Market: Energy drinks are a massive category for convenience stores, with over $14 billion in sales annually.
Panera's misstep hasn't deterred others – the overall demand is strong.
Incremental Sales Opportunity: Energy drinks could generate additional sales for restaurants, especially with a decline in fountain beverage orders from delivery.
Dutch Bros' Success: Their afternoon sales surge (60% after noon) is largely fueled by energy drinks.
Factors Fueling the Trend
Consumer Demand: A younger audience seems to crave the afternoon energy boost.
Increased Beverage Focus: Restaurants are looking for ways to recapture lost beverage sales, especially from delivery channels.
Starbucks' Move
Facing sales headwinds, Starbucks sees energy drinks as a potential growth avenue.
Key Takeaways
Despite Panera's Charged Lemonade issue, the overall energy drink market is too big for restaurants to ignore.
This trend signifies a shift toward restaurants catering to specific consumer needs (e.g., afternoon energy pick-me-up), beyond traditional meal occasions.
As beverage sales from delivery become a challenge, energy drinks offer a way to drive incremental sales.
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