BAP 2 RED BULL

Topics: Marketing, Red Bull, Energy drink Pages: 83 (16855 words) Published: April 15, 2015
Business Analysis Project Two
Emily Kortlang
Red Bull

Word Count 11,339

1

Contents Page
Aim

4

Introduction

5

Strategic History

6-8

Current Strategy

9-11

Competitive Positioning

13-14

Environmental Analysis
Political
Economical
Social
Technological

16
17
17-20
20

Porters 5 Forces
New Entrants
Competitor Analysis
Suppliers
Buyers
Substitutes

21-22
22-24
24-26
26-28
28-29

Internal Analysis
Product Life Cycle
Value Chain

30
31-36

SWOT Analysis

37-43

Strategic Options

44-49

Chosen Strategy

50-52

Marketing Mix

53-57

Implementation

58-59

Limitations

61-63

Appendices

64-73

References

74-79

Bibliography

79-83

2

The market research results were devastating. The thin
colour of the new drink was totally unappetizing, the sticky mouth feel and taste were deemed ‘disgusting’. And the
concept of ‘stimulates mind and body’ was at best rated
irrelevant. The verdict by the research firm: “No other new product has ever failed this convincingly”

3

Aim
The aim of this report is to produce a viable marketing strategy for Red Bull in order for the company to preserve its current dominant position in the Energy Drinks market but also to pursue any opportunity for growth. An external analysis will be conducted to identify key opportunities and threats which will be supported by insights into Red Bull’s strengths and weaknesses. The fit between strengths and weaknesses and opportunities and threats will provide the basis for the strategic options considered.

4

Introduction

“Energy; Everyone wants more of it and the soft drink industry has created a seemingly endless number of beverages to provide it”(1).
The Energy Drinks market is an exciting, dynamic and innovative segment of the soft drinks industry. However, there has been considerable confusion amongst consumers and retailers over the difference between glucose drinks, energy drinks and sports drinks. This report will focus on the Red Bull which is part of the functional energy drinks market;

The functional drinks market includes those products designed to help: 

Replace lost minerals, sugars, vitamins and fluids after physical or mental exertion



Stimulate concentration or awareness

In less than a decade, the energy drinks category has established itself in almost every possible sales channel in both the on- and off-trade. In terms of volume, energy drinks fall some way behind other soft drinks categories. According to Canadean (2), global consumption per capita in the UK is just 0.4 litres per annum. However, in terms of value per litre energy drinks provide a higher cash margin than any other soft drinks (3). In the forecourt sector, cash sales are amongst the highest with cans of Red Bull outperforming every other single-serve carbonated soft drink, with the exception of Coca-Cola (4). The market for energy drinks in the UK continues to expand and is now the fastest growing segment of the soft drinks industry by value, growing by 20% from 2002 (5) (Appendix 1).

5

Strategic History

“When he launched Red Bull 15 years ago Dietrich Mateschitz wrote a new chapter in marketing history”(6)

Red Bull is a non-alcoholic drink that contains a number of active ingredients, designed to ‘stimulate body and mind’:


Taurine - acts as a metabolic transmitter and additionally has a detoxifying effect and strengthens cardiac contractility;



Glucuronolactone - accelerates the elimination of both
endogenic and exogenicnoxae (harmful substances);



Caffeine – Red Bull contains 80mg of caffeine the quivilent ot a weak cup of filter coffee.



Vitamins - B-complex vitamins to maintain physical stamina;



Carbohydrates - sucrose and glucose.

Dietrich Mateschitz founded Red Bull in Austria in1984. The company's origins, though, lie in the owner's time spent in Asia. Dietrich came across products...

References: Russo, L. (2004). Sports, Energy Drinks Makers Take On Giants, Beverage
Industry, New York, Vol 95 Iss 9, P18.
Cabadean (2003.) Global Beverage Consumption Manual.
Jobber, D. (2004) Principles and Practices of Marketing, McGraw-Hill.
Hooley, G, Saunders, J, & Piercy, N, (2004). Marketing Strategy and
Competitive Positioning, Third Edition, Prentice Hall: Financial Times.
Hooley, G, Saunders, J, & Piercy, N, (2004). Marketing Strategy and
Competitive Positioning, Third Edition, Prentice Hall: Financial Times.
Johnson, G, Scholes, K, Whittington, R. (2005) Exploring Corporate Strategy;
Text and Cases, Seventh Edition, Prentice Hall.
Jobber, D. (2004) Principles and Practices of Marketing, McGraw-Hill.
37. Czikzentmigalyi, M & Rochber-Halton, E. (1981). The Meaning of Things,
Domestic Symbols and the Self, Cambridge University Press
38. Goode, M. (2001). Consumers and brands: a study of the impact of self-image
congruence on brand preference and satisfaction, Marketing Intelligence and
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