porProduct Life Cycle Stage
Red-Bull
Red bull is on the peak of the introduction stage because it was available through gray
channels in Karachi since 2003 and the ad campaigns could be seen on different satellite
channels. In 2003 it already had 90% market share and its target market had a little
awareness about it because they knew this was available in other countries where they
might have gone before.
In 2004 Red-bull had its proper setup and got rid of the gray channel material. According
to our sources it was the first energy drink brand to educate the local public through the
self-educating pamphlets. Initially it was not concentrating on advertising because the ad
campaign of red-bull was already airing on star plus and other satellite channels.
Therefore, people tried and accepted red-bull as energy drink when they were informed
what is energy drink all about and it became a generic name. So, we can say that it is on
the peak of the introduction stage with 54% of market share despite the fact that new
competitors have entered into the market but it remains the pioneer. Recently they have
started their ad campaigns on GEO, ARY and Indus channels, FM89 and institutes.
Blue-Ox
Blue-Ox is in the middle of introduction stage with 23% of market share despite the fact
that it was launched after Bomba Energy. Blue-Ox was able to get immediate success
firstly because it was the only energy drink brand to educate people through electronic
media (television) as its distribution license is purchased by ARY Group of companies.
Secondly it’s the only brand being promoted with all four different variants altogether.
That is why we can say that in such a short time it has enjoyed a major chunk of the profit
and gained consumers trust.
Bomba Energy
Bomba Energy despite the fact it was launched after Red-Bull but has not contributed in
the awareness of its brand or about energy drink to its target market as it feels that this
work has already been done by Red-Bull and Blue-Ox. The only attractive feature about
this drink is its grenade shaped glass bottle available in four different flavors, which was
noticed by the target market. But, because it has not invested in lot of awareness
generation and promotional activities major chunk of the target market is still not aware
of Bomba and its flavors are also not available altogether which leads to its low sales and
low market share of 7% only. Secondly, there global campaign doesn’t match with our
Islamic culture, which indirectly hampers its image and sales.
BCG Matrix
?
Since the overall energy drink industry is growing rapidly, Red-Bull is a star in the BCG
matrix as it has the highest market share, highest growth rate and highest competitive
position than Blue-Ox and Bomba Energy. The reason being that it was the pioneer, in
the energy drink industry and has also contributed in increasing the awareness of energy
drinks to its target market (urban and upper class). Because of its availability in other
countries and its target market that travels abroad adapted to its taste very quickly.
Blue-Ox is also a star in the energy drink industry but stands at a lower position in the
BCG matrix’s-star grid because it has high growth rate and comparatively lower
competitive position than Red-Bull but higher competitive position than Bomba Energy.
Even though it was launched after Bomba Energy it gained a higher market share by
establishing its identification and importance through aggressive advertising on ARY
Digital and offering four different flavors.
Bomba Energy has a high business growth rate i.e. it has the potential to grow further in
the industry but it has a weaker competitive position than Red-Bull and Blue-Ox as it an
BUSINESS
GROWTH
RATE
RELATIVE COMPETITIVE POSITION High Low
High
LowDogCow
Star Question Mark
inactive competitor. It occupies a low market share for a number of reasons including that
it has not done aggressive advertising (because there global campaign cannot air due to
cultural issue) or awareness of its brand and thirdly it’s a Karachi based brand only. The
only appealing factor is that it is available in a grenade shaped glass bottle in four
different flavors.
Competitive Strategies
Red-Bull
Red-Bull being a market leader has a share of mind (red-bull is mostly the first energy
drink brand when asked people to recall) and has become a generic name. It uses the
following strategies to expand its total market:
1. New Users Red-bull has the potential of attracting buyers who are unaware of it
or who are resisting it because of price. So they try to cater through new-market
segment strategy (for those who have never used it e.g. distributing self-educating
pamphlets in English and Urdu and even there sampling teams go to different
institutions) and geographic expansion strategy (those who live elsewhere e.g.
after its success in Karachi know it wants to concentrate on Lahore and Islamabad
market)
2. New Uses It suggests that Red-Bull is for world class athletes, busy professionals,
active students and long distance drivers as it:
o Increases performance
o Increases concentration and reaction speed
o Improves vigilance
o Improves the emotional status
o Stimulates metabolism
3. Mobile Defense Strategy Red-bull stretches its domain over new territories that
can serve as future centers for defense and offence. It spreads through market
broadening (it has already accomplished by becoming a generic name in energy
drink market in Karachi so now it is promoting itself on the generic need i.e. its a
functional drink for extra energy supply when needed).
Blue-Ox
Blue-Ox aims its attack towards the market leader. This is a high risk and potentially high
payoff strategy but it’s worth it. Blue-Ox uses combination of following competitive
strategies:
1. Flank Attack i.e. it serves not just the urban cities Karachi, Lahore and
Islamabad but has also spread out its distribution in the sub-urban cities where
Red-Bull and Bomba have not concentrated as yet. Hence, expanding its target
market, increased sales and developing share of mind in the sub-urban cities.
2. Product Proliferation Blue-Ox has attacked Red-Bull by launching a larger
product variety_ Blue-Ox Original, Blue-Ox Orange Rush, Blue-Ox Citrus Max
and Blue-Ox Black Cherry.Thus giving buyers more choice.
Bomba Energy
Fine foods of the world have just imported Bomba Energy and distributed the product in
Posh areas of Karachi and has not used any competitive strategy as yet it is still inactive.
The reason being that Bomba Energy has only one global image, which contradicts our
Culture so; it can’t use its thorough global image strategy. That is why the management is
still waiting to launch its global campaign until the market gets mature and is able to
broaden its perception. It is not very active as Red-Bull or Blue-Ox in promotional
activities as they think profit margins are low for imported products. Basically it wants to
sell the product as much as they can without adhering additional expenses. The only
strategy it is using is:
1. Prestige Goods Bomba Energy has introduced grenade like glass bottle to attract
its consumers charging a premium price of Rs.85/=and is also available in slim
cans worth Rs. 75/=. With innovative packaging it has been able to get a little
chunk of the market.
Segmentation
Red-Bull
GeographicWorld Region PAKISTAN City Karachi, Lahore, IslamabadDensity Urban DemographicAge 18-30
Gender BothIncome Rs. 40,000Occupation Athletes, Doctors, Drivers, StudentsPsychographicsSocial Class Upper ClassLifestyle Workaholics, Partygoers, Adventurous, Status-orientedBehavioral
Occasion RegularBenefits Improves performance, concentration, metabolism and
vigilance
Blue-Ox
GeographicWorld Region PAKISTAN City Karachi, Lahore, Islamabad, Multan, Hyderabad,
Quetta, Peshawar etc.Density Urban and Sub-Urban
DemographicAge 15-25
Gender BothIncome Rs. 40,000Occupation All professionalsPsychographicsSocial Class Upper Class and Middle ClassLifestyle Workaholics, Partygoers, AdventurousBehavioralOccasion RegularBenefits Improves mental and physical functionality.
Bomba Energy
GeographicWorld Region PAKISTAN City KarachiDensity UrbanDemographicAge 16-35
Gender Both
Income Rs. 40,000+Occupation All professionalsPsychographicsSocial Class Upper Class Lifestyle Partygoers, Workaholics, Westernized and thrill
lovingBehavioralOccasion RegularBenefits Instant energy supply
TOWS
WT STRATEGIES
It should develop itself as a bigger
name (image and SKUs).
Should maintain close relations with
retailers.
ST STRATEGIES
Secrecy should be increased in the
management decisions to counter the
smuggled and imitating brands.
Advertising awareness should be
created to clarify extremist
propagation of it being Haram.
THREATS (T)
Limited consumer base.
Counterfeited products.
Smuggled products.
Extremist’s propagation.
Addiction may lead to increase
in mortality rate.
WO STRATEGIES
Overcome inconsistency in retail price
by setting a standard price level.
They should give incentives to
retailers.
As it’s a growing market so risk can
be taken to launch a new SKU.
SO STRATEGIES
Become what it preaches.
Should develop brand equity as the
market is growing and it has become
a generic name.
It can increase its customer base by
going into different institutes.
OPPORTUNITIES (O)
Industry attractiveness is high in
Pakistan.
Growing and futuristic market.
Nutritional value product
Sugar free version available
worldwide.
WEAKNESSES (W)
Limited flavors and SKUs (small
product line).
Inconsistent retail price.
STRENGTHS (S)
Pioneer in the category.
Practically has become a generic
name.
TV advertising support via satellite
channels.
Organized and well managed.
Transit promotion through Chevrolet
cars going in different institutes.
Certified by Aga Khan Hospital.
IFA
EFA
Red-Bull
WT STRATEGIES
Increase sales force in other areas of
Pakistan where red-bull and Bomba
and others are not active.
Build each variant according to its
USP.
ST STRATEGIES
Conduct seminar with high profile
medical professionals.
Increase social awareness against
smuggling via promotional
activities.
Aware people about max intake.
consumtion
THREATS (T)
Limited consumer base.
Counterfeited products.
Smuggled products.
Extremist’s propagation.
Addiction may lead to increase
in mortality rate.
WO STRATEGIES
Engage in direct marketing campaigns
to increase interest in the market from
the growth angle.
Create proper brand portfolio
architectures for its product line.
SO STRATEGIES
Should enhance the image of being
an international brand.
Create more usage.
Promote itself on more than one
channel to increase awareness and its
customer base.
It can increase its customer base by
going into different institutes.
OPPORTUNITIES (O)
Industry attractiveness is high in
Pakistan.
Growing and futuristic market.
Nutritional value product
Sugar free version available
worldwide.
WEAKNESSES (W)
Although has four variants but is not a
market leader.
Management of four variants is not
efficient.
STRENGTHS (S)
ARY Network is its sole distributor
in Pakistan.
Only drink with four different
flavors available in the market.
It was first to promote itself through
electronic media (ARY Digital).
Transit promotion through foxy cars
in different institutes.
Affiliated with Hilton Pharma.
IFA
EFA
Blue-Ox
WT STRATEGIES
Should indulge in promotional
activities according to culture to
establish its identification.
Should develop its brand in Karachi
so that it helps in leading to
geographical expansion.
ST STRATEGIES
Should co-brand with other branded
stores.
Increase social awareness firstly
through functional benefits rather
than emotional appeal.
THREATS (T)
Limited consumer base.
Counterfeited products.
Smuggled products.
Extremist’s propagation.
Addiction may lead to increase
in mortality rate.
WO STRATEGIES
It needs to promote its brand so that it
can increase its customer base.
Inconsistent in meeting the retailer’s
order demand.
Grenade shaped glass bottle requires
more shelf space so they should
encourage sales via slim cans and
introduce pet bottles.
SO STRATEGIES
Create more usage.
Should include brand activator
(strategic implementer) in their team.
Build public relations & direct
marketing programs to increase
customer base.
OPPORTUNITIES (O)
Industry attractiveness is high in
Pakistan.
Growing and futuristic market.
Nutritional value product
Sugar free version available
worldwide.
Pet bottle available worldwide.
WEAKNESSES (W)
Unknown brand in Pakistan as its
Karachi based only.
Believes not spending on much on
promotional activities, as profit
margin is low.
Has not been able to promote its
global image in Pakistan.
Shortage of supply of its different
variants.
STRENGTHS (S)
Organized operational structure
leading to wider distribution
coverage.
Attractive grenade shaped glass
bottle with a ring.
Partnership marketing with Hang
Ten.
IFA
EFA
Bomba Energy
Critical Success Factors
Following are critical success factors for all the players if they want to survive in a very
competitive enviroment as the energy drink industry is a new born industry with high
industry attractiveness and market oppurtunity:
o Close relationship with the retailers.
o Aggressive promotional activities.
o Effective distribution network.
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