11-15-2011-Red Bull Case
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Transcript of 11-15-2011-Red Bull Case
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Case Analysis
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Termed as pioneer in energy drink
Came to existence in 1985
Derived from Thai Enegy drink Krafting Daeng
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Available exclusively in Austria for 5 years
Entered the foreign market in 1992 from Hungary
Entered American market via California in 1997
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Red Bull is an energy drink that really works
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Improves physical endurance
Stimulates metabolism and eliminates waste substances
Improves overall feeling of well-being
Improves reaction speed and concentration Improves mental alertness
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Caffeine
Taurine
Glucoronolactone
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Success lead to competitors producing similar drinks in
2000
Coca-Cola
Anheuser-Busch Pepsi-Co
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Strengths
Market Leader
Slow penetration to new market segments
Fresh and strong brand identity using ads. Position itself as energy drink rather to soft drinks.
Various consumption occasions
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Weakness
Priced at Premium over the other soft drinks
No discounts on purchase.
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Opportunity
Untapped market exist for Red Bull
Expansion of the brand with new products
Sponsoring of events and athletes can enhance thebrand visibility
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Threats
Caffeine in Red Bull
Bad publicity
Entry of new competitors Organic drinks.
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Product:
◦ A sweet, caffeinated drink aimed to give consumers
the high energy kick.
◦
Contains caffeine, taurine, glucuronolactone andvitamins.
◦ Available only in rather expensive 250 ml cans, 350
ml bottles with 4 packs and only two flavors (original
and sugar-free).
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Price:
◦ Red Bull has always pursued a premium pricing
strategy.
◦
Red Bull would always set a price which was 10percent greater than the most expensive competitor in
order to maintain a best of class positioning and also
stake out a unique territory in the beverage market.
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Promotion:
◦ Advertising:
Red Bull used all the available media channels, that
is, television, print and radio for its advertisement. They used an animated advertisement which clearly
communicated the product benefits and was the
main reason for its success.
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Event Marketing:
◦ Red Bull either invented the event from ground up or
brought the product to an existing event.
◦
Was also associated with many sporting events.◦ These events increased Red Bull’s visibility and also
reinforced the brand’s positioning as an independent,
stimulating beverage.
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Sampling:
◦ Red Bull sought to reach the consumers at the right
place at the right time, mainly when consumers
needed or wanted a boost.
◦ Red Bull sampling campaigns took place at concerts,
parties, festivals, sporting events, at the beach and at
campus libraries.
◦
Reached the consumers at ideal places and explainedto them product benefits and encouraged them to
drink a full can for maximum benefit.
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Point-of-Purchase Marketing:
◦ Red Bull’s primary point-of-purchase tool was the
branded refrigerated sales units.
◦
Prominently displaced the Red Bull Logo inconvenience stores, bars, clubs, sport shops,
cafeterias.
◦ Red Bull hired a team of delivery van drivers whose
sole responsibility was to stock Red Bull, so as toensure quality and consistency.
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Targeting a niche segment in the beginning and then
spreading out to the whole target makes a lot of sense.
Because the marketing program was really focused at
first as a segment of people it creates the concentration
and brings up the success.
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The product’s understanding for middle and upper agedpeople is quite different.
These segment of people tend to stay away from the
drink because of having wrong perception of the brand.
Sometimes the product is understood as a mixed for the
alcoholic drinks and breaking that perception is
necessary.
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Event Marketing Innovation
◦ Supported a local flying club in Innsburg, Austria
◦ Creation of “The Flying Bulls”
◦
Expansion of the same idea and created the “FlyingBulls Aerobatics Team”
◦ Red Bull Big Wave Africa competition
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Product Innovation
◦ Added a new product, “Red Bull Sugar Free”
◦ Was sold in a readily identifiable Red Bull Can with
two differences
Dark Blue Can was replaced with Lighter blue
The word “Sugarfree” replaced “Energy Drink”
Product was highly successful
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Line Extension
◦ They launched Redbull Sugar Free which was highly
successful
Brand Extension◦ Launched Herbal Tea in Europe and Los Angeles
◦ Planned to open a fast food chain and quarterly
magazine
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Launch of Red Bull Sugar Free was successful
Launch of herbal tea in Europe was not as successful as
Red Bull
The same product was tested in Los Angeles but didn’tseem to have a success of Red Bull
Although the brand extension was not as successful as
line extension, but it didn’t hamper the brand image of
Redbull Focus on line extension
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Red Bull’s Sources of Brand Equity ◦ Uses non-traditional ways to achieve its target and
unique approach to create brand Equity .
◦ Right from the beginning the company makes it very
clear to it all its existing and potential customers the
message of its product functionality in a clearway.
Eg: pricing 10% of upper segment of competition to
create mindset of Premium brand.
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It uses word of mouth marketing to create brand
awareness.
Once brand awareness is created it restores to
TV ads and other communication media. The company tries to create mystique by participating
into events and sponshorship.
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The company plays the market entrancerelatively strategically …It targets a nicheaudience and influences them first ratherthan spreading out to the whole target group.
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“Thus, the overall whole brand equitymanagement is successful in case of Red Bull”
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