Energy Drink Overview

History of the Industry• Fastest growing segment of the

beverage industry in the USA, over US$1 billion (IRI data) of the US$60 billion soft drink industry

• The category has emerged since 1997 – grew from US$100 million four years ago to over $250 million two years later.

• Market growing at 30% per year right now.

• Future of the market is seen as replacing other caffeine delivery categories (coffee declining).

History of XS• Developed by a nutrition company with a focus

on low glycemic products – forefront of Atkins-type diets

• Launched in traditional distribution with mixed success:– Huge success when sampled at

grocery/Costcos– Need guerilla marketing and sales (lacking

$70 million required to hit beverage market).• Looking for niche channel that would allow for

successful distribution without street war.

Success via Quixtar-Amway to Date

• Launched September 13, 2002 by IBOs to IBOs (could not even find XS on Quixtar site for first two weeks of launch)

• Six months of back orders and catch up -- first major success in a beverage category, lessons for Australia

• Biggest selling product on Quixtar• Called “the future of Quixtar” by Steve Van Andel at

his IBOA address and at Quixtar Live (National Convention) in the spring of 2003.

• Listed among four products Doug DeVos quoted as being responsible for North American growth in 2002.

• Largest energy drink manufactured in North American in a 250ml can – BevNet.com industry review.

XS Energy Drink

Grape-Berry Blast

Citrus Blast

What’s in the Drinks• Flavors and masking taste of herbs and

vitamins – why we chose cranberry and citrus• Artificial Sweetners (0 sugar, 0 carbs, 8

calories from amino acids – proteins)– Acesulfame Potassium (Ace-K): an inert

salt, it passes through the body without change or effect, is 150-200 times sweeter than sugar, has had over 90 clinical trials, launched to the world market in 1988, approved for use in drinks in 1997.

– Sucralose: unique for launch as both sugar derivative and most broadly approved. 600 times sweeter than sugar, yet inert. Tested for over 20 years and sold in over 100 countries.

What’s in the Drinks• Caffeine: 60 mg of synthetic caffeine (not like

caffeine bound to organics in coffee and tea), helps deliver vitamins faster. Caffeine Advantage.

• Herbs: Adaptogenic Blend:– Soviet formula used to sweep Lillihammer– Tom Jones runs 120 maratons in 120 days– Stress recovery

• Vitamins– Not a replacement for Nutriway B Complex,

more like a Boracca tablet– Metabolism benefits and diabetic testimony– Recommended serves per day vs. US blend

Objectives• Implement an exciting, Full

PV/BV, exclusive Energy Drink

• Leverage the excitement and momentum created from the United States success with XS Energy Drink

• Capitalize on the exceptional growth of the energy drink market.

Target Audience• Males and females age 18-30, or people who think

they are 18-30• Mothers (someone who buys a diet coke and a red

bull in the same shopping cart).• Active IBO’s and consumers• Retail customers • People currently drinking stimulant drinks to

obtain some type of boost.• People who are concerned with the amount of

sugar, caffeine, and calories contained in a majority of popular drinks.

Marketing• XS as a sponsoring

tool– Lead with a product– Younger market– Door opening

• Sampling events– Sports events– Health clubs– Energy breaks( see

rules of conduct for specific information)

Profitability• High consumability

makes it one of the most profitable products.

• Full PV/BV

• XS Consumer requirements and profitability based upon being an XS Consumer.

Future of XS• Forecast of energy drink

and beverage market

• Come back next year as a New Diamond

• IBO potential to be number one drink in Australia.