Coca-Cola has cleared the final hurdle in the global release of its energy drink, following a long dispute with Monster.
An arbitration tribunal of the American Arbitration Association has informed The Coca-Cola Company and Monster Beverage Corporation that the introduction and sale of Coca-Cola Energy is allowed under the terms of a contract between the companies.
Monster took issue with the launch of the energy drink, saying it was in direct competition with their products and violated a distribution agreement between the two companies.
The companies issued a statement yesterday saying they respected the arbitrators’ decision and appreciated that the dispute was resolved amicably. While there was a disagreement between Coca-Cola and Monster over contractual language, the companies valued their relationship and looked forward to their continued partnership.
Coca-Cola and Monster mutually agreed to submit their dispute to arbitration before the American Arbitration Association in October 2018.
The arbitrators ruled that Coca-Cola Energy products fall within an exception to a non-compete provision relating to beverages marketed or positioned under the Coca-Cola brand.
Under the ruling, Coca-Cola can continue to sell and distribute Coca-Cola Energy, including in markets where it has already been launched. Coca-Cola is also free to launch the product in additional markets globally.
Coca-Cola Energy launches in Australia
Coca-Cola Energy launched in Australia last month and features Coca-Cola mixed with additional caffeine and guarana.
The 250ml cans come in a sugar and sugar-free option, priced from $2.70 up to $4 at convenience stores, petrol stations and supermarkets.
It’s targeted at the 18-39 year old market and was launched earlier in the year in Spain, Hungary and the UK. It will roll out in more countries throughout 2019.
Coca-Cola Marketing Manager Josh Gonski told News Corp: “The energy drink marketing is growing and more consumers looking for an energy hit to be able to compliment their busy lifestyle.
“We feel consumers are looking not just for great tasting product but a functional benefit.”
Featuring a distinctive design, Coca-Cola Energy is aimed at young adults (18-39) and will be supported by an integrated marketing campaign. Coca-Cola Australia noted that it will not directly market Coca-Cola Energy to anyone under the age of 18 or promote it to be mixed with alcohol.
Mintel reports sales of energy drinks are expected to reach about $16.9 billion by 2022.
“Energy drinks remain the controversial, yet undeniably successful, wild child of the soft drinks family,” said Alex Beckett, Global Food and Drink Analyst at Mintel.