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Red Bull Powerpoint by Roel Kock
Red Bull Powerpoint by Roel Kock
Red Bull Powerpoint by Roel Kock
Red Bull Powerpoint by Roel Kock
Red Bull Powerpoint by Roel Kock
Red Bull Powerpoint by Roel Kock
Red Bull Powerpoint by Roel Kock
Red Bull Powerpoint by Roel Kock
Red Bull Powerpoint by Roel Kock
Red Bull Powerpoint by Roel Kock
Red Bull Powerpoint by Roel Kock
Red Bull Powerpoint by Roel Kock
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Red Bull Powerpoint by Roel Kock

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Marketing opdracht voor Executive MBA (RSM)

Marketing opdracht voor Executive MBA (RSM)

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  • interesting
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  • I am currently doing my Marketing Case study / assignment on Red Bull; this was a very interesting read! (I am not sure if you are sending to the other people, but if you could send it to me as well? shannonlehy@gmail.com ) Thanks so much! Well done on a well thought out presentation.
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  • this would really help me on my final major project, if you would email this to me please I would really appreciate it: march_lee@hotmail.co.uk
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  • I really loved your presentation! I am working on a team project about red bull, but where I live here,South Korea, is still illegal to purchase or sell so, we need to pursuade class mates why Korean market should open to red bull. soif you could send this presentation to me via e-mail, it will be extremely helpful for the better understanding!
    Thanks in advance.
    tla6654@hotmail.com
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  • It's an very interesting presentation. I am having an exercise about the energy drings. This will be very hapefull if u coud send it to me.
    Thanks in advance,
    dethisti@yahoo.com
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  • 1. ‘ s history, future challenges and its change How to survive as an energy drink? EMBA – 09 Jassar El Jabouri Atsuyo Kawaguchi-Van Mil Martijn van der Knaap Roel Kock Krzysztof Lewinski Antoinette Meys Date: 14 November 2008
  • 2. Management Summary of History History: Red Bull grew in 20 years to market leader in energy drinks. Company Red Bull faces various segmented markets in different phases of the market life cycle. Customer decrease of perceived superior added value of Red Bull. Competition energy drinks evolved into global, competition driven market. Future challenges The market that Red Bull single handedly created has fully matured in several areas throughout the world. Change Red Bull should adjust its strategy per geographic market area Urban Africa and Middle East are upcoming markets as a result of which Red Bull is able to imitate its marketing approach in the early days in Europe but it must take into account that there is low level of urbanisation and a relative low buying power. Europe should focus on maintaining its market leader position by staying in touch with its current target group but also target other under targeted niche groups with more length and depth in product mix to prevent loosing this to coming new, diverse entrants. In Asia the energy drink market is fully matured, there are many competitors with more length and depth product mix and Red Bull’s edgy image does not provide in superior perceived product benefits. So Red Bull should increase its product mix in length and depth to stay in competition and in touch with trends. The energy market of North America has characteristics of a mature market but it is still growing. Red Bull has lost its market leader position to Monster and therefore Red Bull should increase its length and depth in product mix with a focus on its lost target group but also target on new large ‘niche’ groups which are not yet specifically targeted by Monster. Red Bull created a market in the Western World but the market has outgrown them and therefore Red Bull should change their strategy in order to keep up with the different market trends around the world.
  • 3. History: Red Bull grew in 20 years to market leader in energy drinks. What is ? <ul><li>Customers: high perceived value </li></ul><ul><li>Excellent product benefit </li></ul><ul><ul><li>First company to offer taurine and caffeine in Europe which boosts mind and body. The core benefit is ‘energy’. The company has no width, length or depth in its product mix (characteristic of introduction product life cycle). </li></ul></ul><ul><li>Strong image benefit </li></ul><ul><ul><li>The relatively high pricing and the sponsoring of a.o. extreme sports gives Red Bull a high added edgy perceived value. Red Bull established a distinctive image for its brand. </li></ul></ul><ul><ul><li>In 2007 it was 3 rd in Brandz “ones to watch” list and 7 th in the “beverages” section by Brand Finance 3.1. </li></ul></ul><ul><ul><li>Selective distribution channels gave the product exclusiveness (characteristic of introduction product life cycle). </li></ul></ul><ul><li>High quality service benefit </li></ul><ul><ul><li>First class service in hospitality areas designed by Red Bull at their sponsored events made the services and image more tangible. .3.3. (high flyer lounge 5-star service, race club top sound and beverages and business club more exclusive than the ‘normal’ race club). </li></ul></ul><ul><li>Committed personnel benefit </li></ul><ul><ul><li>First sales promotion team were alpha bees, very committed team with a passion for Red Bull . 3.4. </li></ul></ul><ul><li>Competition: from zero to multiple </li></ul><ul><li>More potential entrants </li></ul><ul><ul><li>Low entry bar for competition. Entering capital requirement is low. Abundant mainstream distribution channels. </li></ul></ul><ul><ul><li>Red Bull’s successful branding and image forced potential entrants to invest substantially in the branding of their product which raises the entry bar. </li></ul></ul><ul><li>Increasing amount of substitutes </li></ul><ul><ul><li>Initially: Coffee, sports and soft drinks. </li></ul></ul><ul><ul><li>Now: e.g. ginko, ginseng and guarana. </li></ul></ul><ul><li>Not many suppliers in the beginning </li></ul><ul><ul><li>During the introduction it was more difficult for Red Bull to switch because there were not may producers of their cans and /or of their ingredients. </li></ul></ul><ul><li>Buyers can switch easily </li></ul><ul><ul><li>Buyers do not have switching costs to another product. Yet customers are loyal due to Red Bull’s marketing approach to market the product as being something special and superior to others. </li></ul></ul><ul><li>Growing segment rivalry </li></ul><ul><ul><li>Initially hardly any competition due to differentiated image but Coca Cola’s Full Throttle and Hansen’s Monster are becoming a threat. </li></ul></ul><ul><li>Company: successful in international expansion </li></ul><ul><li>Launch in Europe </li></ul><ul><li>Red Bull was introduced in the new market in the beginning of the 90’s in Europe. Red Bull was introduced in Japan (mature market) quite late. </li></ul><ul><ul><li>1987: Austria 3.5. (not mature market) </li></ul></ul><ul><ul><li>1994: UK, Germany and Eastern Europe 3.6. </li></ul></ul><ul><ul><li>1997: US and South Africa 3.5. 3.6. </li></ul></ul><ul><ul><li>2006: Japan 3.7. (very mature market) </li></ul></ul><ul><li>Red Bull introduced the “energy drink market” in Europe and became a market leader in terms of volume and value. After 10 years Red Bull, entered the USA (phase between introduction and growth) and South Africa (phase introduction). Red Bull was on time in these two areas and could reap the benefits from the growing market. Almost 10 years after the start Red Bull entered the Asia market which was already mature. </li></ul><ul><li>Red Bull as a product is in a growing phase but entering into a mature phase. The growth rate has topped 45% past few years. 3.8. </li></ul><ul><li>Annual sales in: </li></ul><ul><ul><li>2002: $1.32 billion 3.9. </li></ul></ul><ul><ul><li>2008: approx $4.4 billion 3.12. </li></ul></ul><ul><li>These sales have led to a profit of EUR 450 million over 2007. Red Bull can use the profit to invest in diversification strategies. </li></ul><ul><li>Red Bull only has 1800 3.13. employees. The product is not produced by Red Bull. Red Bull is thus purely a branding company that uses/creates distribution channels to sell the product like Nike. </li></ul>
  • 4. <ul><li>Decrease in product benefits: </li></ul><ul><li>Red Bull hasn’t increased its width, length nor its depth of product mix to meet the needs of different potential customers and therefore perceived added value is decreasing. </li></ul><ul><li>Red Bull’s core benefits do not fit in the new trends (depth of mix). </li></ul><ul><ul><li>There are trends to focus more </li></ul></ul><ul><ul><li>on (i) natural, healthy products that </li></ul></ul><ul><ul><li>provide energy as well as (ii) deve- </li></ul></ul><ul><ul><li>loping more extreme products. </li></ul></ul><ul><ul><li>Including e.g. nicotine 4.1. </li></ul></ul><ul><li>The range of product benefits that Red Bull offers is too little in lenght and depth of mix. </li></ul><ul><ul><li>There is an increasing wider variety of products that boosts more than only the body and mind. These products increase the (i) memory, (ii) attention span, (iii) intelligence or they minimise stress levels, reduce mood swings , increase stamina and/or tackle depression. 4.2. </li></ul></ul><ul><li>Red Bull looses out on women, tweenagers and seniors; these groups will not pay for a drink that does not include ingredients which matches their needs nor is branded for their lifestyle. </li></ul><ul><ul><li>The initital target group is getting older. It might lose its intitial (now) grown up target group that has gradually accepted another lifestyle. The product of Red Bull is not perceived as high value by target groups like career driven women who may wish more brainpower. </li></ul></ul><ul><li>Change in image benefits: </li></ul><ul><li>The strong edgy image of Red Bull is under pressure and therefore the perceived added value is decreasing. </li></ul><ul><li>New young generation does not identify with Red Bull image. </li></ul><ul><li>It will be difficult for Red Bull to target the new generation with its current image positioning. Red Bull’s ‘extreme’ sports are evolving into more and more mainstream. They are not considered edgy anymore. Besides this, the overal wish for healthier energy products in addition to the bad publicity that Red Bull is receiving may not be perceived as appealing to the next generation target group. </li></ul><ul><li>Competition is decreasing Red Bull’s edgy image </li></ul><ul><li>Red Bull is not the only company who markets its product in a certain way and it is thus loosing its added value. </li></ul><ul><ul><li>Full Throttle of Coke and Monster of Hansen are pursuing the same edge image through the same marketing strategy as Red Bull. </li></ul></ul><ul><ul><li>Several upcoming labels mock an institutionalised brand and what is sexy must be edgy. Hansen takes a piss out of Red Bull through a cartoon and promotes Monster through sexy ladies (see figure 1). 4.3. </li></ul></ul><ul><li>New images are available </li></ul><ul><li>The customer is able to drink an energy drink with different images and with different tastes. </li></ul><ul><ul><li>Competitors such as Coke and Hansen have different product lines which provide the customer with more choice, unlike Red Bull. </li></ul></ul><ul><li>Lack of ample service benefits and distribution channels are decreasing Red Bull’s added value. </li></ul><ul><li>Red Bull dumped its Australian strategic distribution partner Cadbury Schweppes . 4.4. As a result it does not have any major distribution channel. Coca Cola and Hansen agreed on a distribution plan where Coca Cola will distribute Monster in six European countries, Canada en US. Monster will be more available than Red Bull and this will save a customer buying time. 4.5. </li></ul><ul><li>In addition, Coca Cola provides refrigerators with its products which is covered with the logo of Coca Cola. As a result, Coca Cola makes its brand more visible and tangible as well as providing the service to the customer who wants that a drink is very cold. </li></ul><ul><li>Jones is entering the energy drink market and is making their brand tangible to their customers by allowing customers to send in pictures of themselves and have their pictures be placed on the energy drinks. </li></ul>Customer: decrease of perceived superior added value of Red Bull. What is facing ? Figure 1 : Advertisements of Monster Energy Drink. 4.3.
  • 5. Company: Red Bull faces various segmented markets in different phases of the market life cycle. Asia Pacific is the largest and most mature market (stable growth). The future average market will grow in total with 29% between 2007 - 2012. Manufactures seek ‘new’ audience to target with focus on mental energy (marketing characteristic of mature market) 3.1. Diversify brands and items models (in length and depth of the product mix) already exist; the difference between sport- soft en energy drinks is getting more ‘blurry’ and therefore many energy drinks do not carry premium prices. 5.2. The Asian market has a large number of competitors and producers of energy drinks. Red Bull does not have the ‘first movers’ advantage. North America will grow to the second largest market and is a mature market (increasing growth). The future average market will grow to 2075m (26.5% of the world consumption) liters in 2012. A growth of 129% in total from 2007 to 2012. Innovation in length and depth of the product mix is increasing in the North American market. Future developments will be limited by the dominance of the leading brands as Pepsi, Coke and Red Bull. 5.1. Prices of Pepsi Energy Drinks have dropped with 10% in one year (price characteristic of growth and mature market). Hansen Natural (Monster) has increased sales volumes with 40% in one year time (Red Bull only 18%) which makes Hansen a serious competitor of Red Bull which has the first movers advantage. Hansen is in direct competition with Red Bull on their main target group; young, male cash-rich, time poor urban professional. Hansen is encouraging brand switching for the ‘new young generation’ (promotion characteristic of mature market ). Western Europe is declining in world market share and is a mature market (declining growth). Western Europe is getting mature and the future market will grow to 800m (10.2% of the world consumption) liters in 2012. A growth of 66% in total from 2007 to 2012. 5.1. Western Europe is growing but not as fast as other continents and therefore its world consumption energy drinks market share is declining. Future developments in the energy drinks market will be lead by stronger branding, targeting more specific consumer groups lead by a trend in host of ingredient innovations (length and depth of product mix). Increase in competition but fewer diversified brands and item models, so more competition (including private supermarket labels) on plain vanilla energy drink with focus on price. 5.3. The beverages market is not ‘blurry’ like in Asia. Early adopters of Red Bull have grown up and the new young generation has a lower perceived product value of Red Bull. An increase to encourage brand switching can be expected (promotion characteristic of mature market) . Middle East and Africa will show the largest (%) growth as it evolves into a growing market (increasing growth). Forecasting the strongest growth in consumption in the world, a huge opportunity for energy drinks. A future market growth of 255% (from 2007 to 2012) will result in a forecasted consumption of 972m liters in 2012 (12.4% of the world consumption). 5.1. Energy drinks will grow in popularity with consumers who choose not to consume alcohol due to their personal or religious beliefs, particularly among young adults and in cafés and music venues. Currently Red Bull has only a few competitors in the area. What is facing ? Figure 2 : Growth in Energy drinks (in million litters). 5.1.
  • 6. <ul><li>Increase of number and size of entrants which increase competition. </li></ul><ul><ul><li>Low entrance barriers for plain vanilla energy drinks (e.g. EuroShopper) but energy drinks who wish to be perceived with a superior image have high entrance barrier. 6.1. </li></ul></ul><ul><ul><li>500 new products were launched in 2006. 6.3. </li></ul></ul><ul><ul><li>The large corporates are succesfully increasing length and depth of the product mix e.g. Coca Cola </li></ul></ul><ul><ul><li>has several energy drinks per continent </li></ul></ul><ul><ul><li>(including a rehab drink 6.5. ) area and they </li></ul></ul><ul><ul><li>are looking at adding energy to the regular Coca Cola. </li></ul></ul><ul><ul><li>Red Bull lost its market leader position to Monster in the USA in terms of volume (25.2% vs. 29.2%) 6.8. </li></ul></ul><ul><ul><li>Red Bull (see figure 3) is small compared to the gigants </li></ul></ul><ul><ul><li>Also ‘rare’ new players are entering the market like clothing companies with a cool image e.g. Diesel and Von Dutch 6.6. </li></ul></ul><ul><ul><li>Segmented markets are getting more blurry. Competitors of different markets are entering the market; sport- and softdrink such as “ready to go” snack producers as well as pharmaceutical companies. 6.1. </li></ul></ul><ul><li>The power of consumers increases due to decreasing perceived added value image. </li></ul><ul><li>The power is increasing because of various reasons: </li></ul><ul><ul><li>The new young generation has less loyalty to Red Bull due to mismatch in image and what is perceived as edgy. </li></ul></ul><ul><ul><li>More substitutes are available so the consumer can easier switch. </li></ul></ul><ul><ul><li>The percieved value is decreasing because energy drinks are getting more and more common. It is not an innovative product which is provided only by one company anymore and therefore easier to switch. </li></ul></ul><ul><ul><li>The distribution is widely spread so there is easy access and thus easier to switch. </li></ul></ul><ul><ul><li>More and more consumers are getting more price sensitive because of economic situation. 6.2. </li></ul></ul>Competition: energy drinks evolved into global, competition driven market. What is facing ? <ul><li>More substitutes are available which increases competition. </li></ul><ul><ul><li>More substitutes within the energy drinks market are available that have various (i) product benefits (Arrow Root boots the femalehormone system 6.4. ), (ii) pricesstrategies (e.g. Euroshopper for € 0.80) and (iii) promotional activitities (e.g. Energy drink as company promotion 6.7. ). </li></ul></ul><ul><ul><li>The energy drinks also face competition from other products like fruit, coffee, energy bars, energy gum and more recently energy rehab trips. </li></ul></ul>As the number of material substitutes and suppliers have increased, it has become a “buyers market” where suppliers negotiating power has decreased. The energy drinks market is getting more and more mature. There are more suppliers available for the ingredients and the cans. Due to this ample number of ingredients, suppliers will have to compete for CRM (customer relationship management) competence and will thus cooperate more with their customers. Figure 3: Beverage market share in the US. 6.9.
  • 7. What should do ? What should Red Bull do ? ..... in Urban Africa and Middle East … in Europe … . in Asia ... in North America History History: Red Bull grew in 20 years to market leader in energy drinks. Company Red Bull faces various segmented markets in different phases of the market life cycle. Customer decrease of perceived superior added value of Red Bull. Competition energy drinks evolved into global, competition driven market. Future challenges The market that Red Bull single handedly created has fully matured in several areas throughout the world.
  • 8. In Asia the energy drink market is fully matured, there are many competitors with more length and depth product mix and Red Bull’s edgy image does not provide in superior perceived product benefits. So Red Bull should increase its product mix in length and depth to stay in competition and in touch with trends. What should do ? Marketing Positioning by increase its depth and length of the product mix. Red Bull’s brand and image does not have a superior value in Asia. Widening its product mix is therefore not advisable. Due to high competition of local brands, Red Bull should try to find a new target group which has not yet been targeted and invest in that so that it positions itself in that group. For example, the two target groups below. The Asian market remains attractive to Red Bull because even with a smalller market share, large amounts of cans can be sold and new trends for other continents can be spotted in an early stage. Young studious (“nerdy”) generation need Brain Energy (depth of product mix) Young children in Asia who are ambitious. Marketing through more depth in its product mix. This target group does not yet have entirely sole purchasing power to buy the product. Promotion through sampling or personal selling to the mothers of these young children or personnel of daycare centers where the personnel can explain the difference between the traditional Red Bull and this new product as well as sponsoring events such as knowledge bowls. Make use of new distribution channels: school cafeteria’s and/or modern communication channels, e.g. Mobile internet. Logo and tagline must remain in place but promote this product with a different logo colour (e.g. yellow or grey which are the colours of concentration and intellect) 8.1 . (see figure 4.) Price must be set in line with competing products. Wealthy retired men need energy to change from their pressured working life (length in product mix) Red Bull should increase its length in marketing mix with a new drink that provides energy with a twist to ensure a good mood (e.g. ingredients such as cacao, brewer’s yeast, cargamon, natural sweetner and soda 8.3) . Promotion through sampling to first class cruiseships, airlines and yacht trips that give these samples during the end of the trip overseas or yachting trips. Personal selling to men but also to wifes of these men (V3)? Eruit?. Use distribution channels such as travel agencies to e.g. Europe and yacht clubs 8.4 . Price may be set high to give an exclusive image. Different name, tagline and logo must be used to give it a new association and image. Target Marketing should be on specific psychographic target areas. Because of the many types of energy drinks in Asia, Red Bull should focus on specific target markets. These markets must be filled with ambitious people because they have high resources. Red Bull should look closely at trends and produce a product if the market is big enough to monitor the trends which in turn is useful information for other geographical areas. Market Segmentation: Asia has high urbanisation, wealth and getting more 65+ men. High rate of of urbanisation in Asian countries 8.5 . Approximately 2.8 million people in Asia held US$1 million or more in financial assets in 2007. This is an 8.7 percent gain from 2006 and more than the global 6 percent increase 8.6. Birth rate is falling in Asia 8.7. Percentage of 65 years and older in Japan is one in five and in three decades one in three 8.8 . The divorce rate of retired men who were fully devoted to their work has increased by 26% over the last 10 years 8.2 . Figure 4: EMBA-09 Design of Brain Energy
  • 9. The energy market of North America has characteristics of a mature market but it is still growing. Red Bull has lost its market leader position to Monster in terms of volume and therefore Red Bull should increase its length and depth in product mix with a focus on its lost target group but also target on new large ‘niche’ groups which are not yet specifically targeted by Monster. What should do ? Marketing Positioning in depth and width to win back their market leader position. Lost young generation (depth in product mix): Red Bull has lost the new young generation to Monster which is exactly copying the price but offering more drink for it as well as the promotion of Red Bull, yet with a product mix with more depth. Red Bull has gotten a more mainstream character and Monster has the new ‘edgy’ image. Red Bull should go face-to-face with Monster with a product mix with more depth. The focus should be on the same target group as it initially had like students. However, things have changed in 10 years time so Red Bull should offer a ‘slim making’ energy drink, a coffee energy drink, a extreme energy drink (see figure 5). Promotion must be widely spread to face the competition with Monster and it must be appealing to new generation (e.g youtube and new edgy sport events). Invest a lot in marketing to increase user rate. Same name, logo and tagline may be used to use brand strength. Price must remain the same as it is percieved as an quality and status indicator. 9.6. Hispanic (salsa dancers) population (length in product mix): Produce healthy energy drinks product line with different (tropical) flavours that correspond to different age so that is becomes a brand that will appeal to a person for a lifetime and promotion should be primarily to salsa dancers to give it a tropical fun swinging feel to it. Promotion should go through family members with respect to the energy drinks for young dancers. Initially via sampling and personnel selling as well as ads with a latin celebrity promotion such as Ricky Martin. Distribution channels should be Latin dancing locations and bars in the Southern states. Distribution channels could be created by concluding an agreement that a large distributor distributes the different types of drinks to dancing locations and bars. Price must be set in line with other drinks for the Latino community. Same name but different logo and tagline. Target Marketing should be the young edgy generation and in Hispanic community. Target young generation who enjoy extreme events agressively to regain market leadership in volume by using offering new innovative drinks. Due to a large differentiation in product and very segmented market, target very large niche groups such as Latins which are not yet specifically targeted. Because the number of Latin people in the United States is increasing and their income is rising, Red Bull should make a product line that covers different ages within e.g. the Latin community such as the salsa and/or merengue dancers and target mainly the Southern states. There is competition already in this target group but the competition focuses on the Latino sporty men market by an unkown brand as well as Coca Cola who focusses on blue collar latinos’s 9.1.B No competition in targeted group. Marketing Segmentation through demographic and psychographic segments, North America has large ‘niche’ groups. A lot of people like surfing, skiing, paragliding, motorcrossing, and skating well as backpacking; these are extreme sports. There is a big group of people that like to dance latin dances. This is becoming more and more popular. California (36,5 mio),Texas (23 mio) and Florida (18 mio) are among the most populated states with high income. 9.2. 9.3. Hispanic population rising to 21 milion in 2025. In California, Texas and Florida reside most of the hispanics. Their income is expected to grow 4.8% per year up to 2020, 0.4% ahead of a non Hispanic 9.4. and 9.5. The latino population in the United States consume 27% of the energy drink volume in the United States 9.1` Figure 5: EMBA-09 Design of Kryptonite
  • 10. Europe should focus on maintaining its market leader position by staying in touch with its current target group but also target other under targeted niche groups with more length and depth in product mix to prevent loosing this to coming new, diverse entrants. What should do ? Market Segmentation: Europe’s population is stable but getting older. High amount of urban population (73% - 72%) vs. rural population (27% - 28%) between 2005 and 2015. Total population of 731 mio – 720 mio 30% of population is below 25 years of age (44% worldwide). Life expectancy 74 year (67 years world). Median age is 39 and rising. 20% of population is of 60 years and over (and rising) . 6.2. More women are entering universities and receiving higher level education as a result of which the number of career driven women is increasing while still having a familly life. Target Marketing in three market areas. Reconnect with the young generation by making Red Bull appealing. Imitate Monster in Europe by the way they advertise but use different examples. Promote increase of user rate. The European market is not yet as segmented as North Amerika. Red Bull has the first movers advantage in new niche groups. Make use of this leadership position.Target groups that are not yet targeted such as career driven women/mothers. This number is increasing and there is no real energy drink for this group In addition due to the aging of population , there is an increase in number of senior workers which market is under targeted. It is advisable to target these three groups. Marketing Positioning by increasing depth and length to stay ahead of competition. Stay in touch with the new young generation: To connect with the current young generation, Red Bull should increase length and depth of its brand by offering more product benefits (e.g. Rehab, brain energy and healtier energy). This target group must be reached through new channels like vendor machines, cafeteria’s, etc. For promotion more or less the same buzz marketing for the new products can be done with a focus on schools and sports. Because of an increase in demand of ‘brain energy’ a promotion around the exam period would give several advantages. Also other variants of energy can be offered e.g. energy bars, energy gum. Same tagline, name and logo may be used. Get in touch with career driven, fashionable females: This new target group is looking for products with other benefits such as vitamines, slim making and energy for longer period of time. Because of the male, edgy image of Red Bull this new target group should be reached with a more softer image or name Flower (see Figure 6.), logo and tag line. Promotion should be by articles and advertisements in target magazines (e.g. Elle). Edgy promotion can be done by sampling around primary schools in the afternoon to help these females with two jobs (mother and career). Get in touch with more senior workers: Energy drinks are known by these senior workers but they do not link with Red Bull’s image and benefits. A product with different benefits (a energy drink which slowly releases its energy throughout the whole day, vitamines and focus on health and brains) and a different image should attract this target. A new name, tagline and logo is required (e.g. Florence, Tuscany). The benefits should be positioned as a ‘feeling, good mood and enjoyment’ drink with energy. Energy is not the key benefit. This target group should be reached through upper class hotel, romantic lodges, sailing trips and golfing courses. Figure 6: EMBA-09 Design of Flower
  • 11. Urban Africa and Middle East are upcoming markets as a result of which Red Bull is able to imitate its marketing approach in the early days in Europe but it must take into account that there is low level of urbanisation and a relative low buying power. What should do ? Market Segmentation: Africa and Middle East have low urbanisation, low wealth and a low life expectancy. 34 out of 53 African countries are counted among the world’s “least developed countries”. South Africa has the largest population of white people. Lowest amount of urban population (38% - 42%) vs. rural population (72% - 68%) between 2005 and 2015. Population will grow 905 mio – 1114 mio. 60% of population is below 25 years of age (44% worldwide). Life expectancy 52 year (67 years world). 11.2. A lot of men spend their leisure time in bars where they do not consume alcohol but other types of beverages. Target Marketing in urban areas. Due to distribution complexity, diversity in income and large urbanistion, the main marketing focus for Africa should be on urban area’s in South Africa , Lagos (11 mio) and Cairo (12 mio). 11.1. Due to the big number of young people, the target group should be young people with relatively high resources. More or less the same approach as in Europe can be repeated in Africa yet the focus should be on leisure time and not in extreme sports. With focus on young men who spend their leisure time in bars, cafe’s and venues. Marketing Positioning with little depth and width in the product mix and focus on two core products. New young generation with new healtier Red Bull: Red Bull can more or less repeats its strategy for Africa and the Middle East as they approached the European market but with some differences. The main focus should be on urban area’s. The price for Red Bull should support its superior image but not out-price it, to attrack the largest population as possible. The product should be made healthier because health is a large issue in Africa. The promotion can be done via the same buzz marketing as in Europe through leaving cans at bars and get a promotion team at universities and schools. Logo and name may remain the same but tagline must be different as the focus is not on energy but on relaxation.
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