Case Study Red Bull - Further Market Expansion

In today's world, the name Red Bull and the slogan "Red Bull Gives You Wings has been inscribed into the minds of consumers around the globe. The popular energy drink, which seems to have sky-rocketed in US as well as world-wide sales is no miracle drug, although it does seem that way by the overflowing demand. Known to many as a coffee substitute, Red Bull is able to give its buyers that extra push or burst of energy to keep their day going due to its increased amounts of caffeine, without the nasty aftertaste of coffee. No doubt its marketing strategies have made a massive impact on its increased sales, but at its start, it is no lie to call Red Bull a self-made success. In a time where everyone is

Red Bull targets only a particular segment of market and therefore makes its product only available at those places where the target can be reached. The energy drink can be bought at colleges, supermarkets and is mainly associated to extreme sports. In particular, the energy drink has also known a tremendous success in India, where the segment is the fastest growing in the category, due to India’s youth centric population and fast urbanization. Red Bull was actually the brand that created energy drink category in India (Docstoc, April 2012).

This document is part of the requirements of the Foundations of marketing course, the University of Newcastle. It is the first part of the marketing plan for Red Bull, the leader of energy drinks market.

This report was written to assess the company Red Bull and their energy drink Red Bull Energy Drink, in a manner in which the market/industry, environment, competitors, customers, and the brand were all analysed by using secondary research. A SWOT analysis was also conducted. Through this research and analysing, it was found that Red Bull is the dominating leader in the energy drink market and sells the most units of its product worldwide. However the company does have close competitors in Monster Energy Drink and Rock star Energy Drink. Although Red Bull has massive internal strengths in being leader in the market share and sponsorship of events, it also has weaknesses in lack of innovation and diversity. Their

If one has to analyze the profitability scheme of Red Bull Energy Drink, perhaps it can be safely said that it is in a very uncompromising situation. First and foremost, the stiff competition have paved the way for the emergence of many small time players (Helm 2005). With every bottled drink that aims to steal the limelight nowadays, Red Bull should capitalize more on its creativity and ingenuity—this is of course, in relation to advertising and marketing. The company should never disregard that Coca Cola and Pepsi are still top competitors (Helm 2005). More so, even if the two share equally different components as with Red Bull, still, it is evident that the two continue to partake into the market share. Meanwhile, the notion that energy drinks offers no variety in taste is an important marketing aspect that the company should take into full consideration (Laing 2005). In 2001, Pepsi had already released AMP Energy Drink (“Amp Energy Drink” n.d). It is the company’s maidens venture into the energy drink arena. Evidently, AMP’s raison d’ etre is to capitalize on Mountain Dew’s established image. The concept would be to introduce something new, yet very familiar (“Amp Energy Drink” n.d).

A slow growing market is a great way to characterize the energy beverage category in late 2007. This industry was increasing in profits still but was not increasing in profits as quickly due to factors such as market maturity, increasing in prices, competition and new hybrid products (Kerin & Peterson, 2010). The market was still very small but was dominated by Red Bull due to it being one of the first energy drinks, which caused it to dictate the market and have more of an advantage than the other energy beverages. So in late 2007 the market for energy drinks was still

Market share and strategy - RedBull had dominated the market of energy drinks all over the world. Its main mission is to provide an energy drink made with natural ingredients which provide energy to man, women or children in their day to day life. It provides instant energy which helps college students or working people to maintain their energy and keep doing their work with full enthusiastic way.The Red Bull brand had created a great impact on the mind of its customers by its product results and pricing strategies which make it a larger energy drink on the market.("The Top 15 Energy Drink Brands.")

In Brazil, there is not as much of a market for energy drinks as there is in places like the United States. Still, introducing 5-hour energy shots to Brazil could cause the desire for energy drinks to grow in that country. That would open up an entirely new market for energy drinks that could make millions or even billions of dollars for companies that manufacture energy drinks throughout the world. In order to clearly understand how marketing will take place in Brazil and the issues that must be addressed, there are four specific areas that will be considered here. These will be the social-cultural environment of Brazil, the economic environment, the political environment, and the technological environment. Since all of those areas play a role in how an energy drink could be marketed and how much success it might have, they all must be discussed before any decisions are made.

After seeing the success that Red Bull has got in the energy drinks market, new brands are entering this market. Hence, it is essential for Red Bull to make certain changes in its marketing, production and

Grolsch, a company with a strong history and a highly rated product, has just been purchased by SABMiller. The company is evaluating its global strategy in light of the acquisition and determining how to position and sell its beer going forward. Grolsch has positioned itself well to compete internationally and has leveraged several tools (e.g. the MABA framework, strategic analysis) to effectively expand abroad. However, they must assess whether or not the MABA framework is still useful, what type of international strategy they should pursue (i.e. developed vs. developing markets), and if their adaptation strategies will continue to be an asset in their business development. The initial conclusion, detailed below,

Red Bull as a global industry player will need to consider not only domestic political conditions but also international political conditions. Trade sanctions, embargoes, political stability and other policies created by the government will affect Red Bull operation. Red Bull will need to consider this factor carefully when expanding to new country.

Due to the fact that the industry is growing, other countries are now being emerged

Red Bull have adopted a segmentation base strategy relating to market demographics. In particular the company has targeted young active people aged 16 – 29 years. Red Bull also use geography, identifying mainly university students and urban professionals who needed an ‘energy boost’ throughout their busy schedules and activities. Mateschitz’ strategy aimed to target opinion leaders, believing that “the authority of one alpha bee can influence the buying habits of hundreds”. The Red Bull segmentation

Red Bull can be called as a pioneer in the energy drink category worldwide. In India too, Red Bull was the brand that created the energy drink category.

Red Bull has a large market share in the energy drink market and it is one of the most popular energy drinks in the world, this may help us to increase the demand for the product and maybe develop a new product within the same brand.