Red bull

3106 Words Sep 29th, 2013 13 Pages
Marketing Case Study Assignment 1
2012

Contents
1.0 Introduction 2
2.0 SWOT Analysis of Red Bull 2
3.0 Analysis of Red Bull’s Market Structure and Control Systems 3
3.1 Market Structure 3
3.1.1 The number of players in the Energy Drink Market 3
3.1.2 The Degree of Product Differentiation in the Market 3
3.1.3 The Ease of Entry and Exit Into And Out Of the Energy Drink Market 3
3.2 Marketing Control System 4
3.2.1 Intensive Research Work 4
3.2.2 Internal Statistics 4
3.2.3 Marketing and Pricing Strategies 4
4.0 Solutions and Recommendations 4 1.0 Introduction
Red Bull is a functional beverage founded by Austrian entrepreneur, Dietrich Mateschitz, in 1984. Containing ingredients such as taurine and caffeine, Red Bull
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3.0 Analysis of Red Bull’s Market Structure and Control Systems 3.1 Market Structure
3.1.1 The number of players in the Energy Drink Market
Red Bull belongs to an oligopoly market structure where the market is dominated by a few large players. The degree of market concentration is relatively high with a large % of it taken up by Red Bull. There are currently more than 30 types of energy-drink products in the market, with Red Bull occupying the largest market share of approximately 65%. With the number of players in the market, there is therefore certain degree of interdependence between firms and it is necessary for Red Bull to take into account the likely reactions of other firms during strategy planning.
3.1.2 The Degree of Product Differentiation in the Market
Being in an oligopoly market structure, Red Bull produces branded products where advertising and marketing is an important feature of competition. The different types of energy drinks in the market serve as close substitutes to Red Bull. Hence, Red Bull presents itself as a premium product, having “a unique combination of high quality ingredients” (Red Bull, n.d.) which “vitalizes body and mind” (Red Bull, n.d.). It segments its market differently from its competitors, focusing on performance-oriented individuals who want to have a clear, focused mind and a fun and active lifestyle. This has resulted in Red Bull

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