Red Bull Strategic Analysis Research Paper

Only available on StudyMode
  • Download(s) : 318
  • Published : December 17, 2012
Open Document
Text Preview
1. Introduction

Red bull is a leading energy drink company in the world, with global sales of 4.631billion cans in 2011 accounting for 70% market share of the world energy drinks market. Since its foundation in 1984, Red Bull has made a significant expansion in international markets to over 161 countries and generated over 4.25 billion euros in turnover throughout the world employing 8,294 employees globally by end of 2011. According to, the trend of energy drinks has rapidly growing in a global market and growth faster than a big brand of soft drinks So, Red Bull has many excellent strategies and makes the competitive advantage branding in a global one. A thorough analysis of energy drink producer Red Bull concludes that the company was set up to market just one product, Red Bull. Eventually it started marketing a variety of slightly modified energy drinks. Now Red Bull is energizing people around the globe, touching down in over a hundred countries worldwide.

3.Current Situation
3.1Current Performance:
As we are all well aware, Red Bull is the number one energy drink producer worldwide with sales resulting in 4.253 billion dollars in 2011. (www.redbull.com). As the market starts to mature Red Bull is no longer enjoying the benefits of being the only player in the market. In fact Red Bull is seeing competitors entering the energy drink arena who are changing the landscape of the playing field and gaining substantial market share. Red Bull currently holds approximately 38% of the US energy drink market while its nearest competitors Monster holds 35% and Rockstar holds 11.5%. (http://www.cspnet.com/sites/default/files/magazine/article/pdf/CMH12-bevs-specialty.pdf) Nielson data shows that roughly 72% of the energy drink market is dominated by two main competitors, Red Bull GMBH, and Monster Beverage Corp. Red Bull’s primary competitors are found in the energy drink segment, but they have recently acquired some formidable indirect competitors located in the soft drinks market when they recently released their Cola. This market is dominated by the huge companies of Pepsi-Co and Coca-Cola.

Globally Red Bull sold a total of 4.631 billion cans of their energy drink products in 2011, showing an increase in sales of 11.4% compared to 2010. However, despite the fact that Red Bull enjoyed a 17.5% (www.cspnet.com) rise in revenue since the previous year based on C-store sales in the US market; they actually lost market share to Monster who experienced a 23.4% increase from a year ago. (www.cspnet.com)

(http://www.cspnet.com/sites/default/files/magazine/article/pdf/CMH12-bevs-specialty.pdf)

(http://www.cspnet.com/sites/default/files/magazine/article/pdf/CMH12-bevs-specialty.pdf) Through their global sales the company’s revenue turnover had increased from 4.894 billion dollars by 12.4% to 5.50 billion dollars (http://investing.businessweek.com) even though they are feeling the heavy effects of competition in the US market Outstanding sales companywide drove up profitability numbers in 2011, largely generated from key markets such as the US and Germany. Other increases in sales were seen in developing markets such as Turkey at +86%, Japan +62%, France +35%, and Scandinavia at +34% (www.redbull.com). Concentration on these key growth markets combined with excellent cost management and ongoing brand investments are the main contributors to Red Bull’s ability to stay in the fore front of the energy drink market. At the end of 2011, Red Bull employed 8,294 people in 164 countries which was a considerable increase from 2010 which had the company at 7,758 people in 161 countries. Red Bull is currently operating at $512,700.00 revenue generated per employee. Red Bull continues to expand its operation globally taking its products into new and emerging markets. (www.redbull.com) Revenues:

Red Bull generated 4.253 billion dollars in revenue in 2012. (www.redbull.com) The primary source of income is through...
tracking img