Red Bull operate within the energy drinks sector of the soft drinks market. The product is an example of a 'functional' drink. Functional foods respond to consumer interest in well-being and performance. The major multinational soft drinks companies are investing in the area of functional drinks, developing their own brands and buying up existing ones. This is seen as being important, given that their traditional soft drinks markets are at the maturity stage in many countries. For these multinationals, new functional drinks offer opportunities for renewed business growth. (Can talk about Cash cow and stars)
What are their main products?
The company was set up to market just one product, Red Bull Energy Drink. Since 2003, though, the company has also produced a low sugar version of the drink. As a single product firm, Red Bull have to ensure that sales of the drink are maintained, through effective marketing or product extension strategies. What are their main brands?
The Red Bull brand is associated with a designer image, energy-giving properties and glamorous lifestyles. These brand qualities have been developed through company sponsorship of sporting activities such as: motorsports, wintersports, base jumping, mountain biking; and cultural events such as the Red Bull Music Academy.
When did the company start?
Dietrich Mateschitz founded the company Red Bull GmbH in 1984. GmbH is the German equivalent of a limited liability company. It stands for 'Gesellshaft mit beschrankter Haftung'. The company's origins, though, lie in the owner's time spent in Asia. He came across products known as 'tonic drinks' and saw the chance to market functional drinks outside Asia. One of these tonics, which came from Thailand and was used by workers to stay awake during their shifts, was called Krating Daeng or 'Red Bull'. Mateschitz approached the manufacturers of the drink and bought the foreign licensing rights in exchange for a 51% stake in his company. When Mateschitz launched the drink in his native Austria, he decided to target young professionals, rather than factory workers, as this younger segment of the population were more affluent and more appreciative of a trendy marketing campaign. Who are their major competitors?
In the functional drinks market in the UK, Red Bull reckon that in 2001 a total of 23 new energy drinks were introduced. As can be seen from the later section on market analysis, the company faces competition from a large number of firms, some multinationals. As the original innovator of the health and energy drinks market, though, Red Bull has the advantage of being the market leader.
A look at a key feature of Red Bull's business
Some observers say that Red Bull's branding is revolutionary, calling it an 'anti-brand' strategy.The company faced additional problems in the UK where there was already an established drink that was specifically taken as a post-illness beverage. Generations of young Britons had drunk Lucozade as they recovered from colds or flu, so Red Bull had to promote its brand differently. The firm avoided usual methods of marketing, relying more on what is called 'buzz marketing' or word-of-mouth. A brand image was created and cultivated which associated the drink with youth culture and extreme and adventure-related sports, such as motor sports, mountain biking, snowboarding and dance music. Red Bull's target consumer segment began to adopt nicknames for the product such as 'liquid cocaine' or 'speed in a can', thus spreading its 'left-field' appeal. Red Bull then worked to ensure that their brand was visible on the street: * Using pick-up trucks as mobile displays, painted blue and silver with a giant can of the drink mounted on top of the vehicle * Designed to be eye-catching, these devices were aimed at promoting the red bull brand as youthful and slightly 'off-the-wall' * Cans of the drink were also given out free to people on the street...