Red Bull’s path to a better Blue (ocean)
Austria vs. Netherlands
Strategic Analysis Red Bull
L2BV - M-Strategy & Marketing 2/02
Jason Lucas Luijckx
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.
The Red Bull consumers can be divided into three segments: athletes, clubbers and workers. Each of these using the Red Bull energy drinks to meet their personal needs. Whether these are obtaining physical edges, mental edges or just consumption for pleasure.
The ambition of Red Bull is maintaining the top-brand status in the energy drink market and clearly distinguishing themselves from their competition, who is marketing almost the same product against extremely low prices.
Red Bull uses every means of marketing to reach their target groups. Their marketing is mainly based on the “3 pillars of Red Bull; Sampling, Advertising, Sponsoring”. This means that next to normal advertisements, they drive around in Red Bull –modified cars handing out cans of red bull and sponsor big extreme sports events and competitions. In this way Red Bull is not just promoting their energy drink but is also selling a lifestyle, seemingly people are willing to be a part of this Red Bull extreme sports lifestyle.
Due to these extensive marketing efforts Red Bull obtained, and still is maintaining, the largest market share in the energy drinks market. As initiator of the energy drinks market Red Bull holds a truly unique product. In the past through exclusiveness, anno 2008 through brilliant marketing.
The strengths of Red Bull lie solely in the marketing of this truly unique product with the ‘myth’, or lifestyle, surrounding it. This creates a brand awareness of incredible value.
This strength, the truly unique product, is also their biggest threat. When competitors, with cheaper products, gain market share Red Bull has no backup activities because they are only active in the energy drink market. Also decreasing the product price would not be an option as Red Bull would severely damage its well protected exclusiveness and thereby brand image.
The most important opportunities for Red Bull are the fast growing market for energy drinks worldwide and the reach ability of some segments and thereby the big market share. The most important threats are the lack of a major competitor, when a major big competitor like Coca Cola suddenly enters the market Red Bull is likely to lose substantial market share. And increasingly important are health issues, as various food and drug administrations keep on examining Red Bull’s products.
Red Bull is clearly a Blue-Ocean company as they recognize the importance of creativity, pro activity and a clear vision. Instead of being reactive, like most of their competitors, Red Bull is behaving as a true market leader. By creating a unique product, incredible brand awareness and even a lifestyle; Red Bull is really doing the impossible. Table of Content
& International Profile
Company Analysis & Evaluation
Introduction & International Profile
In 1982 a German, Dietrich Mateschitz, learned about so-called “tonic drinks” which were highly popular in Asia. He saw the unique characteristics of these drinks and founded Red Bull GmbH. He developed a strategic marketing concept and initiated in the...
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