Analyses the Marketing, Sales and Distribution aspects of Red Bull.

1. Red Bull
(“gives you wings”)
Submitted By: Yujata
Submitted To: Dr. Sameer Mathur

2. 1. What are red Bull's greatest strengths and risks as more companies (like
Coca-Cola, Pepsi, and Monster) enter the energy drink category and gain
market share?
2. Should Red Bull do more traditional advertising? Why or why not?
3. Discuss the effectiveness of Red Bull's sponsorship, for example, Bull
Stratos. Is this a good use of Red Bull's marketing budget? Where should
the company draw the line?
Key Research Questions

3.  Red Bull is an energy drink sold by Austrian company Red Bull GmbH, created in 1987.
 Red Bull is the highest-selling energy drink in the world, with 5.387 billion cans sold in 2013.
 Red Bull operates many other businesses aside from energy drinks. The company owns and manages
a construction company, football clubs, youth academies and TV broadcasting and recently online
clothing (Red Bull label only) sales.
 Additional media products include print magazines about football, motor racing, celebrity gossip
and lifestyle. The company has even ventured into the mobile phone service business in Austria,
Hungary, Switzerland and South Africa.
Introduction

4. Chaleo Yoovidhya, introduced a
drink called Krating Daeg in 1976
Thailand.
It means “red gaur” in English.
It is inspired by tonic Lipovitan,
whose prime ingredient is Taurine.
In 1984, Mateschitz co-founded Red Bull with
Yoovidhya.
It was founded by each partner investing
US$500,000 of savings and taking a stake in the new
company. The product was launched in Austria in
1987.
History
To date, over 30 billion cans of
Red Bull have been consumed
worldwide, in over 160
countries
Red Bull first expanded to
foreign markets in 1989 to
Singapore, 1992 to
Hungary, 1994 to
Germany, 1995 in the UK,
and finally 1997 to the
USA, starting in California

5. Growth
• 1987: Available in 1 country
• 1992: Available in 3 countries
• 1995: Available in 15 countries
• 1998: Available in 45 countries
• 2001: Available in 73 countries
• 2004: Available in 124 countries
• 2009: Available in 160 countries

7. Target Market

8. Analyze the 4Ps
A Sales and Distribution Approach

9. Red Bull Products are
available in cans of
different capacities ,
varying in their
ingregients providing
variety in taste.
Inference: Not so
diversified in terms of
product
Product Diversification
Diversification

10. Red Bull is available in cans of different capacities and flavors, thus pricing of the
product is according to its particulars.
250 ml
Rs.99.00
140 ml
Rs.140.00
1000 ml
Rs.375
Sugarfree, 250ml
Rs.99.00
Pricing
Inference: Very high cost, not for low income population

11. Sampling
Program
Word of Mouth
Event Sponsorship
Sampling Program
Point of Purchase
Athlete Endorser
Advertisement
Promotions
Word of Mouth

12. Point Of Purchase
Event Sponsorship
(Currently Red Bull is organizing Grand Pix Of Catalunya which is to be
be held on 3 Jun,2016)

13. Athlete Endorsement
Advertising
 Red Bull invests in online platforms that will give them a
better marketing
 Instead of relying on audience traditional media properties,
Red Bull is building their own audiences through business
development and inbound marketing.

14. Such cartoons are really catchy for
target market of Red Bull,Hence
Advertising through such commericals
enhance their popularity among
youngsters.
Vast Social Media Presence
Modern Channels

15. Red Bull is involved in intensive distribution, which aims to saturation coverage
of the market by using all available outlets such as:
 Supermarkets
 Gyms
 Coffee Houses
 In and Out convinence stores
Supply and Distribution
College students
as College
ambassadors for
promotion and
distribution
No e-tailing platform
Promotional Cans are distributed for free
at night clubs ,night spots.
Sometimes a direct distribution channel
is also followed in case of Red-Bull events

16. • From being seen as a “market-less” product, Red Bull managed to sell more than one million cans in 1997.
• By 1998, this number has grown to 300 million cans. The company has reported a sales record of US$1 Billion
(Sauer 2001). By 2004, the number of cans sold has increased to 1.9 billion and the profits reached US$2
Billion (Dolan 2005).
• Because of its marketing strategies, however, the sales force has grown dramatically. The company’s use of
guerrilla marketing and direct distribution was so effective that Red Bull was able to create its own market,
despite of the earlier research that it virtually did not have a market at the onset (Dolan 2005).
• Its sales force consists of agents and dealers who coordinate with retail outfits. There are also those who
distribute the product directly to consumers especially if there are sporting and other events sponsored by Red
Bull.
Sales Force

17. Segmentation Yes, mostly to Sportsmen and teenagers
Promotion
Communication
strategy
Brand extensions
Brand
ambassadors
Sold for free in Clubs, night spots, sports events.
Tag lines such as “gives you wings” clearly communicates it as an Energy drink
Yes, but not significant. Mostly focuses on health factor-”sugar free”; “zero
calorie”
No prominent Brand ambassador. However advertises in race car logos,
F-1 Racing
Packaging
Aluminum cans, cause waste management issues. Available in different
volumes
Marketing Strategies
Advertisement
Television, Digital Channels. However frequency is less, mostly focuses
on direct marketing
Personal Selling
Hire college students to deliver its products and finally, hiring hip locals ‘who
embody the spirit of Red Bull’ in target areas to drive around in a Red Bull logoed
car
Social Media
Presence
Massive (Facebook, Twitter, Google, Pinterest)
Overall Summarizing
Follows a
Grassroots
marketing
strategy

18. Grassroots strategy has been quite successful for Red Bull. However due to increased competition,
changing market demands and low product diversification, along with grassroots strategy, lately it
can be seen from our analysis that Red Bull has been moving towards traditional advertising.
Red Bull has taken measures to ensure the general public that drinking their product is safe and not
harmful for human health. This was evident from the launch of “sugar-free” variant. Thus more
traditional advertising is required to promote the health benefits of the dirnk
Outcomes from the above analysis
RQ-2

19. Financial Analysis
 Red Bull reported exceptionally strong net
sales growth in South Africa (+52%), Japan
(+51%), Saudi Arabia (+38%), France
(+21%), the US (+17%) and Germany
(+14%). Red Bull cited efficient cost
management and ongoing brand investment
as underpinning its growing profitability.

20.  In value terms, the company’s performance was stronger in recent years
although even in value terms the company’s performance fell below that of the
energy drinks market overall.
 The energy drinks market has attracted a number of other players including
Monster Beverage Co, and The Coca-Cola Co (TCCC)

21. Top 10 players in soft drinks by
value share
 Red Bull GmbH however with its relatively
premium but small serving size Red Bull brand
ranks seventh in 2012. The company’s narrow
focus in soft drinks, being almost exclusively
based on energy drinks, continues to keep the
company out of the top five in soft drinks.
 TCCC and PepsiCo capture a stronger share in
value than in volume terms chiefly due to their
products, particularly carbonates, being priced
higher than local brands and private label,
benefiting from strong brand equity and extensive
distribution networks

22. SWOT ANALYSIS
STRENGTH
WEAKNESS
OPPORTUNITIES
THREATS

23. STRENGTH WEAKNESSS
 CATEGORY LEADER :
Red Bull has established a strong, consistent
brand image (an independent, edgy brand)
globally. Red Bull is synonymous with energy
drinks in many countries.
 GLOBAL PRESSENCE :
Red Bull has a broad geographic presence,
which should ensure positive long-term
growth even if certain markets reach
maturity.
 MARKETTING STRATEGY:
The promotional activities engaged by Red
Bull throughout extreme sports sponsorships
have helped the brand to build a strong
identity and consumer base
 CATEGORY LIMITATIONS :
Red Bull has a limited product portfolio
compared to the rising number of rivals with
a plethora of flavour variants and categories.
 PRICING:
Red Bull products are above the energy drinks
average price,consumers tend to think twice
at the time of purchase.
 CONTROVERSIAL :
The relatively high caffeine content of Red
Bull makes the brand highly vulnerable to
regulatory control

24. OPPORTUNITIES THREATS
 EMERGING MARKETS:
Emerging markets represent newer geographies for
Red Bull’s expansion. Accelerating the marketing
and sponsorships in these markets is a wise move.
 NEW PRODUCTS:
Red Bull is building a new production facility in
Brazil which is likely to make its retail price more
competitive than imported product prices. Building
a site in Asia should also be considered.
 PRODUCT LINE EXTENSION:
Offering new flavours and formats will help Red Bull
to improve its market shares.
 COMPETITION:
Monster represents the biggest threat to
Red Bull as it contains natural
ingredients, which seem more desirable
than Red Bull for some consumers.
 NEGATIVE PUBLICITY:
Media reports that ,Red Bull is harmful
for health,recent reports claim that Red
Bull drinks comprises of bull
semen,though all this is rumour,but it
influence company’s image.

25. Summary
Red Bull is consider as pioneer of energy drinks throughout world.
Red Bull has encountered a lot of trials and tribulations in order to build a brand, for
which it is known today.
It has followed brilliant strategies which worked for it and helped it to build a brand
image.
According to current scenario, it is leading among all the competitors in energy
drink market,though theres a tough competition but it has maintained its leading
position.

26. DISCLAIMER
 http://www.redbull.com/in/en
 https://en.wikipedia.org/wiki/Red_Bull
 http://www.nytimes.com/2003/10/06/nyregion/flights-of-fancy-but-flopsin-reality.html
 https://images.google.com/
 https://www.facebook.com/redbull