Monster Beverage SWOT and PESTLE Analysis

Strength

1. Continuous expansion of existing portfolio: Monster Beverage continuously expands their existing portfolio of drinks both in the line of carbonated energy drinks and non-carbonated drinks. They introduce additional products, flavors and types of beverages to complement our existing product lines. They’ve added dietary ingredients in their Monster Energy Drinks line to appeal to the health-conscious individuals. Monster Beverage has also launched dairy based coffee energy drinks and energy shakes in 2018. They have also started offering affordable energy drinks under the Mutant Energy Product line. They introduce additional types of consumer products that are complementary to their existing products and/or to which their brand names are able to add value.

2. Wide Geographic presence: Monster Energy drinks are sold in 142 countries and territories globally. Their strategic brands that were bought by The Coca Cola Company (TCCC) are sold in around 96 countries. A total of 153 countries receive one or more monster energy brands worldwide. Monster Energy® brand is part of the premium category of energy drinks across several countries as do the Strategic Brands from their stable. The affordable energy brand, notably Predator®, participates in the affordable segment of the energy drink category internationally where it is distributed in 16 countries worldwide. With such an extensive distribution system they are able to capture the growing demand in both developed and developing countries. The availability of a variety of flavors across geographies allows it to gain dominance in a majority of markets.

3. Production closer to market: Both domestically and internationally their products are packaged in a number of locations, which enables them to produce products closer to the target markets where they are sold. The objective is to reduce freight costs as well as transportation-related product damages. As distribution volumes increase in the domestic and international markets, they continue sourcing additional packing arrangements closer to such markets to further reduce freight costs.

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Weakness

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Opportunity

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Threat

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Political

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Economic

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Social

1. Changing consumer preferences to healthier alternatives: The beverage industry is subject to changing consumer preferences, and changes in consumer preferences can adversely affect the demand for Monster Beverage Corporation. There is increasing awareness and concern about the health consequences of obesity. This may reduce the demand for their non-diet drinks, which could adversely affect sales and impact their operating performance. Recently, issues have arisen with regard to diet sodas and, in particular, aspartame, which is included in some of the Strategic Brands Energy Drinks. If such articles and reports are published frequently and brought to the public notice, the sales and brand image of the Monster Energy Beverages could take a hit.

2. Age Restrictions on consumption of energy drinks: Proposals to limit or restrict the sale and/or advertisement of energy drinks to minors and/or individuals under the age specified, and/or to restrict the places where energy drinks may be sold, and/or to restrict the use of the Supplemental Nutrition Assistance Program (formerly food stamps) to buy energy drinks have been introduced in many countries. For example, Latvia, Lithuania and Turkey prohibit the sale of 19 energy drinks to persons under the age of 18; Canada prohibits the marketing of energy drinks to children under the age of 12; Latvia and Scotland prohibit the sale of energy drinks to educational establishments; and Turkey prohibits the sale or advertisement of energy drinks in' collective consumption areas.' These restrictions impact the sale of Monster Beverage Corporation negatively.

3. Restraints on caffeinated content: With growing awareness about the harmful effects of using increased amounts of caffeine in beverages, legislations are being proposed to limit the amount of caffeine. For example, in Canada the amount of caffeine in a single serving can or bottle has to be less than 180mg. Such restrictions are also introduced in Turkey, India and Pakistan. Such restrictions require reformulation of products to address these regulations. Over the years these restrictions have been increasing.

Technological

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Legal

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Environmental

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