A case study of Red Bull Company

                                       

Red bull   Industry

•      In 1982, Dietrich Mateschitz became aware of products called "tonic drinks", which enjoyed widespread popularity throughout the Far East.

•      In 1984, Mateschitz founded Red Bull. He fine-tuned the product, developed a unique marketing concept and started selling Red Bull Energy Drink on the Austrian market in 1987.

•      However ,  such energy drinks was first-time invented in Thailand.

•      Today Red Bull has become the worlds leading energy drink, selling more than 4.6 billion cans in 2011.

•      This was not only the launch of a completely new product, in fact it was the birth of a totally new product category.

Red Bull  as a BRAND

·        Marketing is not a battle of  products  ,  it is a battle of perceptions

·        The best brand change our perceptions of the world.

·        “ Don’t  define your brand by  what you make, But by what you make happen.”

·        Red Bull inspires us to explore our  limits , and achieve something more

·        A great brand’s value proposition extends beyond its products.

·        Today Red Bull is available in more than 166 countries and around 40 billion cans of Red Bull have been consumed so far.

·        In 2013 selling more than 5.3 BILLION cans.

Value Proposition

A good value proposition statement is built on the below fundamental framework:

• For ( the target customer)
• Who (specific needs, demands, buying criteria etc.)
• We provide (solution name / brand description)
• That ( specifies benefits and business values to clients)
• Unlike (the competition)
• Who ( provide solution, features, functions, benefits)
• Our company (better approach, solution, functions, benefits)
• That (offers a better customer experience)

·         The value proposition of a company is the foundation on which its marketing strategy is based on.

·         It presents all the benefits and values that the business promises to deliver to its customers.

·         For example the value proposition of Red Bull energy drink is to fight mental and physical fatigue.

·         The company brand tagline goes “It gives you wings” and surely it does!

·         With this innovative marketing strategy and value proposition, Red Bull has covered 70% of the energy drinks market share.

·          Value propositions differentiate one brand from another and are crucial to your product image among your target customers.

Red Bull’s Sources of brand equity :

Red Bull uses the non traditional ways to chive its targets and unique approaches to create the brand equity.

Right from the beginning the company makes it very clears to it all its existing and potential customer the message of its product functionality in a clear way.

 Related to the pricing of the product company positions the product above 10% of the upper segment of thecompetition in order to create the mindset of the premium brand and also influencing people by not letting them buying a sample beverage drink.

 This also helps the company from being categorized different from other beverages company because its uses word-of-mouth marketing and creating the brand awareness by this way.

 Once the brand awareness is created then it resort  ads  within the TV and other related media channels.

The company also tries to create by mystique by participating and sponsoring events within the market even before the product is not available within the market.

 Also the company places the market instance relatively strategically by trading a niche audience and trying to influences them first rather than spreading out to the whole target of customers.

Those are the main sources of brand equity based on Red Bull:-

1 . Brand awareness is one of the sources of Brand Equity.

2. A consumer’s perception that the brand is better than it really is.

3 .A consumer’s preference for a brand based on cachet or status of owning it

1.     Awareness

Initially the Red Bull’s slogan was “Red Bull gives you wings”. 

Later on as the taste changed with the change of its ingredients . Earlier it was an energy drink and later it was functional energy drink. Mateschitz  devised the brand positioning that

Red Bull “Revitalizes Body and Mind”

This phrase conveyed the tangible benefit of the product in an easy grasping manner. It meant that Red Bull can be drunk any time whether it was morning, noon, or night. Thus  Red Bulls consumption was not limited to any occasion or activities.

2) Consumer’s Perception that the brand is really good than they actually it is:

Consumers  used to drink Red Bull to get some of these properties.

•Improve physical endurance.

•Stimulates metabolism and helps eliminates waste substances.

•Improves overall feeling of well-being.

•Improves reaction, speed and concentration.

•Increase mental alertness.

Marketing  Momentum

Red Bull has a fantastic marketing momentum and it has taken the nation by storm and continues to maintain it stranglehold on the every drink market-despite an abundance of competitors. Its seems like Red Bull is omnipresent: all over TV, sponsoring every sports and utilizing every other major form of advertising. While it may seem like Red Bull is flooding every advertising arena, in fact it does not. Red Bull has an advertising strategy that separates them from competitors and it has been paying dividends
.

Marketing Strategy

Red Bull has a distinctive approach to marketing. It uses a progressive marketing strategy. This type of strategy aims to constantly evolve and develop the brand. This approach allows Red Bull to engage with consumers using new and exciting channels of communication.

 In recent years social media has become a vital marketing tool for many organisations.

 Its increasing popularity, predominantly with young audiences, has had a huge impact on modern marketing techniques. Digital and social media campaigns are integral to Red Bull’s marketing strategy.

The role of the marketing function

To meet the needs of its customers, every organisation seeks a distinctive marketing mix.

This is often referred to as the 4Ps. It involves focusing on:

 Product – the specific features and benefits of the product.

•      Red Bull is a sweet, caffeinated drink aimed to give consumers the high energy kick. Available only in rather expensive 250ml cans, 350ml bottles, with 4 packs and only two flavours  (original or sugar-free). It contains caffeine, taurine , and B vitamins.

Place – where and how the product is sold

•      RedBull are using tactic not to have official shops of their production. Instead of that, company are cooperating with local markets and exporting production by minimalizing sales cost to a minimum.

 Price – setting the right price in each market

•      Price of RedBull is premium price all over the world.

•      Highest in the market.

•      Varies from 2 to 4 dollars per can.

 Promotion – using the most suitable form of promotion to reach customers.

•      Strategy called word-of-mouth or “Buzz-Marketing”

•      “We do not take product to customer. We take customer to the product” Mr. Dietrich Mateschitz

•      Promotion job for youth

•      Promotion through lifestyle

For example, the marketing mix for Red Bull Energy Drink is based around:

 A distinctive product - the taste of the product is unlike any other, it also has a functional effect in comparison to other soft drinks

 It is easy to obtain as it is sold in a variety of places – including retail outlets and food  and drink establishments·

 Red Bull uses a premium pricing strategy. The product is priced above that of competitors’ products. Consumers will pay a premium for Red Bull due to the quality of the product and the product’s benefits. This is reflected in the fact that it is the world’s best-selling energy drink. However, perhaps the most interesting element of Red Bull’s marketing mix is its approach to promotion.

 Red Bull embraces innovation within its promotional activities and as such is able to create a lasting impression on consumers.

 The concept behind its promotional activity is to give people ‘Wings’. This translates as pushing the boundaries of what is possible and nurturing people's talent so they can achieve their goals and dreams. The aim of the promotion element of the marketing mix is to grow the business and increase market share.

Businesses develop a promotional strategy in order to encourage customers to purchase their products. Many base their approach on AIDA principles. AIDA

is an acronym that is shorthand for the stages in a sales process.

Product Categorization

Segmentation / Target Market

Direct and indirect competitors