Giving Red Bull Chinese Wings

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Giving Red Bull Chinese Wings

Following a slow birth to their inception in 1984, Red Bull (RB) went back to the drawing board and through ‘out of the box’ ingenuity and innovative marketing strategies by 2003 RB captured not only the American but many European markets (Buchholz 2008). However, now in a deeply saturated market, RB must try and differentiate themselves once more against their competitors in order to remain dominant in the energy drink market.

The most critical marketing issue we have identified with RB during this period was their untapped potential to strategically market themselves in the large and economically growing Asian markets. One particular market we believe should be exhausted is China. We aim to advertise and increase the sale of RB and thereby ensuring more financial profit and increasing RB’s overall global brand recognition and image.

The rationale behind choosing China as our market is twofold. Firstly, it has been recorded that the total population for mainland China was 1,265 million with 70.2% of the population aged between 15-59 (National Bureau of Statistics of China, 2000). This indicator displays that the Chinese market has a potential large untapped consumer group which would align themselves coherently with RB’s product. Secondly, the reason why we chose China was due to their alarmingly high GDP which was RMB 13.7 trillion in 2004, whilst also encompassing the world's fastest-growing major economy, with growth rates averaging 10% over the past 30 years we believe RB market entry to China would be fruitful and worthwhile (National Bureau of Statistics of China, 2005). In addition, specific to the beverage industry, it is estimated that China will become the world largest beverage market. However, RB only occupy 0.2% market share in 2004 (Euromonitor International).

This report is concerned with creating a viable marketing strategy for RB to penetrate the Chinese market in hope of generating new business and exposure by exploring the opportunity of one of RB´s most underutilized markets, China (Sursuk 2008).

In an attempt to go forward, it is vital for RB to target one pressing issue. Currently, RB’s products have been appreciated by a select group of individuals – those in need and use of energy excessively for activities such as sports and nightlife (Chadwick et al., 2009, p.4). By broadening the target-market, it will not only tackle the issue of Chinese consumers not engaging in “extreme” and outgoing activities in a similar way as is done in the west (Sursuk, 2008, p.3), but also help RB compete with the main players in the Chinese beverage market. Research indicates that Coca Cola has been the major player in China other than local brands. With correct positioning, first mover advantage and innovative strategies RB can create a gateway to become an impenetrable alternative.

Our long-term strategy consists on trying to capture the working population and promote RB as an energy drink in work space, thus ensuring we cater to the large consumer base in which China exudes, so that we can penetrate the beverage market and increase market presence.

Customer Relation Management encompasses a great emphasis towards our long-term strategy to achieving success in the Chinese Market. We will focus on consumer emotion, participation and involvement with product affairs. Through shared experiences we believe we will have the power to create long-term emotional relationships with our consumers. We aim to achieve this goal through the sponsorship of a variety of events (music, sporting, fashion etc) which has been successful model for this market as it is very favourable method with Chinese consumers (Kumar et al., 2005). An emphasis at these events should be to constantly monitor the response of the end consumers. This can be achieved by questionnaires, testing of proposed products and feedback forms which would help RB improve customer service and...
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