Redbull Case Study

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Examine and analyze the role and impact of strategic thinking for the competitive options of a business of your choice. Business Used in a case study: Red Bull

There are many energy drink manufacturers around the world and currently it is one of the most competitive beverage markets. It is a very accessible category, because energy drinks are not that difficult to manufacture and is very popular within the younger age group. Energy drinks can be used to make cocktails or simply as a means to revitalize one’s body and mind, or so the advertisements lead us to believe. The number one selling energy drink brand is Redbull, and there is a multitude of reasons as to why they are number one. One of which is their progressive marketing strategy and as their mission statements implies, customer satisfaction as well as continuous innovation. Redbull now sponsors a multitude of various sports teams, which range from motorsports to skateboarders and air-racing, as well as surfers. Redbull is not only seen as a global leader in their energy drink sales, but also in their advertisement campaigns, because they just seem a cut above the rest, which needless to say is a key to their massive success.

Business strategies often shape the success of a business, because in today’s competitive markets it is no longer enough to create a product. Products can be easily copied and/or improved upon. As in the case of Redbull which founded the market for energy drinks, in 1984 when it was founded. It quickly became a success because it was in a niche market. However, nowadays competition is everywhere and this market is no longer a niche. Redbull’s main energy drink competitors are: Power House, RockStar, Bison, Monster, Burn and Effect. All of which are also popular and have an advantage in their pricing, because Redbull only has one factory, located in Austria. You may be wondering how Redbull has remained number one, well it’s simple their brand has established itself and sponsors and hosts events regularly, which is their key to success. Redbull’s Mission statement:

"We are dedicated to upholding Red Bull standards, while maintaining the leadership position in the energy drinks category when delivering superior customer service in a highly efficient and profitable manner. We create a culture where employees share best practices dedicated to coaching and developing our organization as an employer of choice." This is an excellent summary of their objectives, because it truly has been their single and most important goal from the start. Brand awareness is better than any form of copyright, as seen in this beverage category, because new energy drink manufacturers emerge every day, the ingredients are relatively cheap to procure and the manufacturing process is relatively simple. This creates a very competitive market in which brand image is the single most important factor, followed by pricing. However, most people forget that there are many other external factors that usually inhibit production, marketing and sales of many products in the market. Energy drinks are no exception, to better understand what I mean I will use a PEST analysis. Political * Ban on energy drinks in EU countries * Regulation of labeling on such drinks * Age limits to be set * Health risks affecting government medical bodies: NHS, etc.| Economic * PDI (personal disposable income) and consumer expenditure limitations * Recession hindering PDI levels * Global soft drink giants getting attracted to this market by the premium and profit margins| Social * Health risks and negative publicity * longer work days, traffic etc, the need for energy boosts * increase in concern regarding diet and personal health| Technological * improvement in manufacturing process, could lead to lower costs * market innovation and various solutions to existing problems- hangovers, etc.|

Albeit some more than others, these are all external factors that hinder...
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