- Keurig will distribute Black Rifle’s new energy drinks nationwide
- Energy drinks are set to lead U.S. soft drinks growth in 2024 with 4.2% sales rise
- Coffee brands are diving into the lucrative energy drink market
In a surprising move, Black Rifle Coffee Company (BRCC) has struck a distribution deal with Keurig Dr. Pepper (KDP) for its line of energy drinks.
The veteran-founded, pro-military Black Rifle is known for its strong brews and even stronger branding, positioning itself as the coffee of choice for patriots and gym-goers alike.
But why is a coffee company dabbling in energy drinks? And what’s in it for Keurig?
It’s an intriguing move, especially given Black Rifle’s strong political positioning. The partnership is a long-term sales and distribution agreement with KDP for BRCC’s new line of ready-to-drink Black Rifle Energy beverages.
On the surface, it could look like BRCC simply outsourcing its ready-to-drink (RTD) energy ambitions to a well-established bottling and distribution giant. It could also be a play for KDP to tap into a loyal, niche audience that Black Rifle has cultivated—one that is predominantly conservative, pro-military, and made up of “hardcore” coffee drinkers who value the brand’s patriotic messaging.
However, KDP’s simultaneous partnership with Kahawa 1893, a brand with a more progressive and social justice-oriented image, suggests a broader, more strategic play.
Keurig has a wide-reaching distribution network and a history of scaling beverage brands. By associating with brands across the political spectrum, the company is diversifying its portfolio to reach consumers on all sides and maintain market share, demonstrating that its primary focus is capturing market segments, not taking political stances.
It’s a strategy that signals Keurig’s desire to be ubiquitous in the beverage space, where political alignment is secondary to market reach.
“The deal with Keurig, as I see it, seems all upside to them because it’s non-exclusive,” says Joel Silverstein, Managing Partner at Canyon Springs Advisors LLC, a global hospitality and retail advisory firm.
“They can sell other brand energy drinks as well as Black Rifle, so it appeals to a very significant minority segment in the US – so why not do it?”
Keurig’s involvement seems like more than a one-off. The company is keen to expand its non-coffee beverage portfolio, and this partnership offers both brands a chance to tap into the fast-growing energy drink market—projected to be the fastest-growing segment of the U.S. soft drinks sector in 2024, with a predicted 4.2% increase in sales volumes.
By leveraging Keurig’s distribution clout and BRCC’s niche but fervent customer base – it made almost $100 million more in revenue from 2022 to 2023 – the collaboration could deliver noticeable results for both stakeholders.
Why energy drinks, and who’s drinking them?
So, why would Black Rifle—an upstart coffee brand with a fiercely loyal audience—venture into energy drinks? And why would Keurig, best known for its K-cups and coffee machines, be interested in backing them?
The gym-going, pre-workout crowd—the same audience Black Rifle has attracted through its “all-American” and “hardcore” branding—is also a prime consumer of energy drinks. The Venn diagramme of Black Rifle drinkers and energy drink fans likely overlaps significantly, particularly among the fitness-conscious, “go-getter” demographic that thrives on high-octane branding and quick, convenient fuel.
Black Rifle has already established itself as more than just a coffee company—it’s a lifestyle brand. Their customer base, dominated by military veterans, fitness enthusiasts, and those who align with their no-nonsense, rugged identity, is exactly the kind of market that energy drinks target.
“Black Rifle’s appeal is straightforward,” says Joel. “They connect with a sizeable group of US men who value the Second Amendment and lean Republican, from young males to veterans—a clear but underrepresented market in consumer products.”
For KDP, which has a significant share of the RTD market but seeks to tap into more niche segments, Black Rifle represents a strategic partnership. It’s a cultural fit for a product category long dominated by high-energy, adrenaline-fueled marketing campaigns.
In 2023, Keurig expanded its portfolio into the fast-growing ready-to-drink coffee and sports hydration markets through strategic partnerships with Chobani (La Colombe) and Grupo PiSA (Electrolit). Its successful collaboration with Nutrabolt (C4 Energy) further underscores the rationale behind partnering with Black Rifle Energy Drinks.
For coffee brands like Starbucks, Dutch Bros, and now Black Rifle, entering the energy drink space is less about cannibalising their existing offerings and more about product diversification and tapping into different consumer behaviours.
Coffee has traditionally been marketed as a daily ritual, a reliable companion for routine tasks. Energy drinks, however, are marketed as emergency fuel—high-octane solutions for moments of need. This distinction allows coffee brands to expand into new territory without eroding their core business.
Moreover, the margins in energy drinks are significant, thanks to their premium pricing and often low production costs.
“Why do non-energy drink brands want in? Look at Prime by Logan Paul and KSI,” says an anonymous food and beverage consultant.
“They aren’t traditional businesses, but it’s a way to monetise their audience. Energy drinks are relatively cheap to produce, though fiercely competitive—unless you’ve already got a built-in fanbase.”
By diversifying into energy drinks, coffee brands can capture both markets—catering to those who want a routine pick-me-up and those seeking a more immediate, intense boost.
This is despite energy drinks being a global public health concern, particularly among adolescents and young adults, raising ethical questions about targeting these products to underage consumers.
A step towards F&B conglomeration for coffee brands
For brands like Black Rifle, Starbucks, or Dutch Bros, venturing into energy drinks is a clear sign of their ambitions to become full-fledged food and beverage conglomerates.
These companies are looking to create product ecosystems where they own not just one aspect of the caffeine market but the entire spectrum—be it coffee, energy drinks, or ready-to-drink beverages. Coca-Cola, PepsiCo, and Nestlé have long understood this formula: the more diverse your offerings, the bigger your market share.
Energy drinks are a logical extension for any large beverage brand looking to grow its footprint, especially in a market where health-conscious consumers are looking for drinks with less sugar and more functional benefits (like extra caffeine or added vitamins).
This diversification also mitigates risk, allowing brands to hedge against shifting consumer preferences. If the coffee market slows, they’ve already established a foothold in the high-growth energy drink category.
In the end, the attraction to energy drinks is simple: it’s a rapidly expanding market with high profit margins. For brands aspiring to scale, like Black Rifle, getting into energy drinks is a key move on the path toward becoming a beverage behemoth.
“In the United States it became a big thing with Red Bull, and I think Dutch Bros was the first coffee chain in the US to recognise the appeal of energy drinks, with the launch of their “Blue Rebel” energy drink line in 2012, which now represents around 25% of their menu offerings,” says Joel.
“Even boba tea companies are jumping in, making it clear that this is a fast-growing beverage segment attracting a wide range of brands.”
But isn’t coffee the complete opposite of energy drinks? After all, coffee has long been positioned as the healthy, more “natural” alternative to sugary energy drinks. It’s a morning ritual, an afternoon pick-me-up, a companion through daily tasks.
Energy drinks, by contrast, are marketed as an instant jolt—a quick hit of caffeine when you’re running on empty. Think Red Bull giving you wings, or Monster’s aggressive, rebel-fueled campaigns.
But the high margins and rapid growth in this sector are impossible to ignore. It makes sense for coffee brands, already in the caffeine business, to branch into energy drinks. The consumers are there, the demand is skyrocketing, and it provides a lucrative avenue for product diversification.
Keurig’s US coffee segment had net sales of $4.3billion for 2023, up 5.2%. However, its income from operations for US coffee was down 7% at $1.2billion. This shows its operational and production costs are eating into its margins, and energy drinks offer a nice solution to that problem.
In the long run, if brands can scale enough, the final stage may well be F&B conglomeration. Selling energy drinks is no longer just an extension of the coffee business; it’s becoming a part of the portfolio.
Coffee Intelligence
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