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IMC project (RED BULL)

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  • 1. IMC PROJECT The Integrated Marketing Communication Plan Submitted to: Submitted by: Dr. Poonam kumar Sunil singh (2k11a35) Vijender jakhar (2k11a37) Vikas chauhan (2k11a38)
  • 2. Executive Summary Red Bull can be called as a pioneer in the energy drink category worldwide. In India too, Red Bull was the brand that created the energy drink category. The brand came into existence in 1987. Red Bull Energy Drink is a functional beverage. Thanks to unique combination of high quality ingredients Red Bull Energy Drink vitalizes body and mind. Red Bull Energy Drink has been developed for people who want to have a clear and focused mind, perform physically, are dynamic and performance-oriented whilst also balancing this with a fun and active lifestyle. In short, Red Bull gives wings to people who want to be mentally and physically active and have a zest for life. Red bull is trying to penetrate the Indian market to gain the highest market share but its facing so much competion fromother companie‟s drink. In this project we try to find out that what IMC plan red bulluses to become the number one company in beverage in India.
  • 3. Company History Red Bull took many marketing and ingredient ideas from an energy drink in Thailand called Krating Daeng (1970). Dietrich Mateschitz, an Austrian entrepreneur, developed the Red Bull Energy Drink brand. Product was launched in 1987, in a carbonated format which is not as sweet as Krating Daeng. Red Bull entered its first foreign market (Hungary) in 1992, and the United States (via California) in 1997. In 2008, Forbes magazine listed both Chaleo and Mateschitz as being the 260th richest persons in the world with an estimated net worth of $4.0 billion. Red Bull was launched in Germany in 1994 after meeting with huge success it was launched globally in 1997. In 2003 the sugar-free Red Bull was introduced into the market. Problem Statement Red Bull has recently faced Decrease in perceived value of the product due the fact that Red Bull has recently faced much controversy in regards to the health concerns associated with it. Due to the high levels of taurine and caffeine it has been banned in countries such as; Denmark, Norway, France, Uruguay and Iceland. Red bull loses out on women, teen agers and seniors as these groups won‟t pay for a drink that doesn‟t include the ingredients they needs nor branded for their life style perceived to Above-average prices with lack of innovation-reliant on small prouct base as the company only markets one branded product. In addition red bull core benefits don‟t fit into new trends, there are new trends to focus more on being natural, healthy, new trends not only towards boosting body and brain but also memory,intelliegnce, lower stree and depression accordingly Red Bull seems not to be appealing to the next generation.
  • 4. SWOT Analysis Strengths 1. Red Bull is a leader in the ever-growing niche market of energy drinks. 2. The brand has a strong footbold in major markets such as Germany and UK and more recently, (since 2002), the vast US market. 3. Red Bull has a distribution agreement with Cadbury Schweppes; this is positive for further international expansion of the brand. 4. Its network of international subsidiaries is well-developed and will aid the company to effectively move products throughout the globe. 5. Market leadership-Within the energy drinks market Red Bullis the industry leader throughout the world. 6. Marketing Efforts- alot of promotions and well targeted campaigns and sponsorship e.g.formula 1 helps to expand Redbull brand and increase consumer brand awareness. 7. Strong,fresh &fashionablebrand identity. Weaknesses 1. Since Red Bull is a private company, it has very few sources to generate capital for international growth and internal expansion in comparison with its public competition.
  • 5. 2. Red Bull has a lack of diversification in its drinks, although it did release its sugar-free version in 2003. Hence, the company is „missing out‟ on potential profits that exist in other soft-drink sub sectors. 3. Red Bull firm focus on energy drinks, and hence, if there were to be a drop in demand in the future, it would be left highly vulnerable 4. Above-average prices. 5. Lack of innovation-Relianton small product base- The company onlymarkets one branded product 6. Lack of patenton Red Bull„s recipe means anyone can copy it. 7. Red bullloses outon women, teenagers and seniors as these groups won‟t pay for a drink thatdoesn‟t include the ingredients they needs nor branded for their life style 8. Decrease in perceived value of the product due the fact that Red Bull hasrecently faced much controversy in regards to the health concerns associatedwith it. 9. RedBull core benefits don‟tfit into new trends , there are new trends to focus more onbeing natural, healthy ,new trends not only towards boosting body and brain but also memory, intelligence, lowers stress and depression accordingly RedBull seemsnotto be appealing to thenext generation
  • 6. Opportunities 1. Marketing researches shows that Middle East and Africa shows the largest growth of energy drinks consumption 255% 2007 – 2011, mainly by young customers who may choose not to drink alcohols dueto social and religious reasons in café‟s and music venues 2. The new cultural shift towards weight loosing and having in shape bodies would be an opportunity if, Red Bull. Red Bull introduced alow calorie product/Sugar freeproduct. 3. The new cultural shift especially of guys towards body building and going to the gyms. 4. The Indian consumers are price sensitive; introducing a high quality product compared to competitors with slightly lower prices would be very effective. 5. The Indian consumers are size sensitive ,introducing a larger pack relative tocompetitors with lower prices would bea very effective 6. Red Bull is still quite a new product in the growing functional drinks market, which leaves a lot of room for development in major markets (eg: UK and US) 7. The development of a functional drink is a possibility. Since Red Bull is normally consumed before participation in a sporting event, the company could create an apre-sport, hydrating drink that also replenished vitamis and minerals lost from physical exertion. 8. Continuation of its tradition of entering new markets through the process of on-trade has potential on an international level.
  • 7. Threats 1. Health concerns- expected tougher rules fromgovernment on high caffeine content. 2. Consumer awareness of health and wellbeing-people may start to drink other alternatives as it is associated with healthier lifestyle. 3. Organic energy drinks might steal RedBull‟s market share. 4. Numerous substitutes 5. Low capital requirements to enter the industry 6. High levelof intensive competition with energy drinks and other carbonated softdrinks producers as well as Pepsi, Coke etc. 7. Increasing health and hygiene awareness among Indians has greatly increased sales of fruit juiceproducts forhealth watchers as well as bottled water and sparkling water 8. Easy entrance to themarket dueto easy access to distribution channels 9. Low switching costs by buyers 10. Many „copycat‟ energy drinks such as Mad Bull and Red Devil threaten to take brand share from Red Bull. Although the company has won most lawsuits, litigation is expensive and the damages remain undisclosed. 11. Many small operators also act as a threat because they have a high „cool‟ value amongst younger consumers with whom energy drinks are popular.
  • 8. Consumer behavior and Market analysis Controversies Seen as addictive, drug-infused beverages with negative health implications. Red Bull has recently faced much controversy in regards to the health concerns associated with it. Due to the high levels of taurine and caffeine it has beenbanned in countries such as; Denmark, Norway, France, Uruguay and Iceland. It has been proven that caffeine can be deadly when consumed in massive doses, but the amount estimated to prove fatal is 10 grams, which would require 125 cans of the drink. A study conducted in 2007 by American researchers found that although consumption of Red Bull could increase both blood pressure and heartrates it was only dangerous for those people with heart disease. Most claimsabout the dangers of Red Bull and other energy drinks have been proven to benothing more than urban myths. Current customers are: 1. Young people are especially open to determined exhaustion and insufficient energy. 2. More specifically male teenagers & people in their 20s are also most likely tobelieve in the authenticity of the energy drinks‟. As a result, the majority of energy drinks are developed for and advertised to this younger generation.Appealto very specialized groups, such as gamers, extreme sports enthusiasts, and thehip-hop crowd.
  • 9. The power of consumers is decreasing due to: 1. Low loyalty to red bull 2. Low switching cost 3. Health issues 4. Low valur perceived 5. Many subsitutes 6. Over average price 7. More price sensitivity due to economic situation Consumer Evaluation  RED BULL with sugar: Demographics Men and women aged 16-29 Geographics Mainly people who are situated in the city, as they are likely to be really busy and tired. Red Bull seems to have a cooler in most bars and clubs in the city as well as in convenient stores. Psychographics People who are tired / stressed and want to relax and have fun.
  • 10. Behavioural Students and young professionals to boost energy during work long day at work.  RED BULL sugar-free: Demographics Women aged 16-29 Geographics Mainly in the city where there are many young professional women. Psychographics Drivers who are tired and need and increase in concentration. Women who want energy boost but are on a diet. Behavioural Women who own a car and use it often for long journeys or are always stuck in traffic after work as well as tired health.
  • 11. Brand Positioning Brand positioning starategy Clear, engaging, unique and relevant to thetarget audience Delivering a positive emotion to the audience rather than just good through providing the benefits needed by every single target audience
  • 12. Delivering high perceived value as the customer is ready to pay for the drinkwhich meet his changing needs through changes in our products. Able to adapt changing market Consistent across multiple marketing and advertising medium (print,online presence etc) Echoed within business internally and externally Positioning Statement “A high perceived value products offering all benefits you need, health energ, multiflavored, slim making ,brain energy bundle of products ,we clear ,engaging andunique seeking more than sales ,we are seeking loyalty through convenience” Marketing Mix Strategies The marketing mix strategy is made up of the 4ps 1. Product 2. Price 3. Place 4. Promotion Product 1 . Brainergy Young ambitious nerdy students who need brain energy, theydon‟t have purchasing power yet, accordingly their mothers are targeted through personal selling sampling, thepersonalselling should illustrate thedifference between
  • 13. regular Red Bull and Red Bull Brainergy, distribution channels include the regular ones in addition to school cafeterias, design should be in different color fordifferentiation 2 . Kryptonite Young generation who always need differentiation with a slim making coffeeenergydrink (Black color) called Kryptonite (Buzz marketing – vending machines –college cafeterias) 3 . Red Bull Female Career driven fashionablefemales looking for other benefits as vitamins , slimmaking and longer period energy, thetraditional Red Bull has a male image, accordingly a new package with a softer image or a name flower with a new berry flavor 4 . Red Bull Sugar Free Health watchers through launching sugar free Red Bull and focusing on other ingredients in the original Red Bull as vitamins. 5 . Regular Red Bull Product Info On package Flavor logo Slogan “"gives you wings” Ingredients European origin product 250 ml Can Nutritional Details (High lighting vitamins ingredients) Sweetened or Diet
  • 14. Price Pricing In the second „P‟ pricing we have observed that Red Bull is continuously increasing its prices as compared to its competitors mostly in other products which anumber of customers use rarely so some times he feel uncomfortable when he comparesthe prices which weresometime before. There are two main types of price setting: 1. Penetration 2. Skimming Penetration is used It‟s an approach in which we set firstly low and then as demand increases we increase the price .We are following this strategy for competition based pricing to achieve high customer loyalty after encouraging customers use the original and new products. Place Distribution startegy Intensivedistribution aims to provide saturation coverage of themarket by using all available market outlets such as: Super market Gyms Coffee houses In and out convenience store Pizza outlets etc.
  • 15. Promotion (Marketing) - Promise & Support:All benefits you need fromBody health to brain health - Slogan:“gives you wings” - Theme: Red Bull Forevery One CoreBenefit:- Fulfillment - Functional Benefit:- Makes Energy - Push VS Pull: push strategy is applied as benefits and values areannounced expecting demand in response - Value Preposition: Best valuefor money. - Marketing Strategy Used:- Penetration strategy supported byproduct differentiation Media Strategy TV: Ad campaign on prime TV channelsuch as NDTV, Good Times, MTV, Channel V, VH1, Star World and afew more. - TV communicates with sight, sound and motion, which is needed for Red Bull. It is theonly media that can reach 99% of thehomes at once. - RB has thebudget to cover the high costs of this media. - Television allows a demonstration of the advantages of Red Bull Good reachand proven impact - Female oriented TVprograms and channels are approached Radio: Ads on different FM stations, which has higher listners.
  • 16. Magazines: - We should take advantage of the fact that magazines have become a very specialized medium.There are many consumers' magazines in India. - Good color production is also an advantage that creates strong images which isthe purposeof Red Bull. - Provides critical brand awareness as well as clear and precise demographicselectivity - Provides geographicflexibility across many urban markets Internet: Online advertising is similar to print advertising in that it offers a visual message.It also has additional advantages; it can also use the audio and Video capabilities. As we are targeting our ads to young outgoing people, sound and movement may attract more attention fromviewers and has the uniquefeature of being interactive. Interactive media would Red Bull the opportunity to reach younger of both genders, to reach consumers who have developed a preference for online communication. Initiating a campaign on facebook is very important tocreate buzz marketing and reach brand awareness we are targeting Outdoor: - On buses which is an efficient carrier reaching mass audience - Billboards in specific geographical area would allow us get a good reach and frequency. It is a low cost and flexible alternative. (Campus, malls and metrostations)
  • 17. Sales Promotional Mix Must encourage thefirst purchase of the product in store and make the newtarget market aware of theproduct and its benefits Large displays integrated into the cooler shelves that hold theproduct Freestanding units atthe point of purchase. Samples: Distributed in supermarkets, school/universities. Samples are a way to avoid product resistance as It will encourage new product purchases and it represents low risk for consumers since they get it for free. They have nothing to lose by trying it. Salespeople will try to explain the new benefits of new product versions Point-of-purchase: In supermarkets to reach the parents of nerdy teenager students seeking brainenergy, increasing product trial and provide agood product visibility. Allowances and discounts: Case allowance as the goods approach will be used so it can encourage retailers to buy more of the product to get a certain amount free .Example selling a pack of 5 cans withan additional can free. Cooperative advertising: To encourage retailers to buy our product and to maintain our high level of advertisement that consumers expect Public Relations (Getting Involved) Media relation Use technology
  • 18. Moniter the web Create public awareness Personal Selling As previously stated new target customers include Young ambitious nerdy tudents who need brain energy, they don‟thavepurchasing power yet, accordingly their mothers are targeted through personal selling sampling, the personal selling should illustrate thedifference between regular Red Bull and Red Bull Brainergy, distribution channels include the regularones in addition to school cafeterias, design should be in different colorfordifferentiation. Creative Plan To communicate that Red Bull can restoremental awareness and energize a busy, independent person,provides brain energy Communicate that Red Bull is an effective, good tasting substitutefor other caffeinated beverages (coffee, tea, pop);Diet drinks (sugar freeversion ) andit contains all natural ingredient Humor will be used to stress the advantages of Red Bull over other energy supplements and competitive brands The positive aspects of Red Bull will be presented in contrast to the negative aspects of the alternatives,demonstrated visually as well as implied a new Slogan is used instead of The previous slogan “Red Bull gives you wings” and will be replaced by: “Chargeup on Red Bull” in order to effectively presents Red Bull as a slightly different brand than in the past. Team ownerships RB Leipzig – a football team currently playing in the German Regionalliga Nord
  • 19. New York Red Bulls (officially Red Bull New York)– a soccer franchise competing in the United States' Major League Soccer Red Bull Racing – a Formula One team based in Milton Keynes, England, World Constructor's Championship winner of 2010, 2011 and 2012, and produced the car for the 2010, 2011 and 2012 F1 World Champion Sebastian Vettel. Scuderia Toro Rosso (Italian translation of Racing Team Red Bull) – Another Formula One team based in Faenza, Italy. Team Red Bull – a racing team competing in the U.S.-based stock car racing competition NASCAR Red Bull Racing Team competed in NASCAR beginning in 2007. The team ceased operations after the Sprint Cup Series' 2011 season. FC Red Bull Salzburg – an Austrian football club based in Salzburg and competing in the Austrian Bundesliga EC Red Bull Salzburg – a member of the Austrian Hockey League based in Salzburg, Austria Red Bull Brasil – a football team currently playing in the Brazilian Campeonato Paulista Série A2 based in Campinas, Brazil Triple Eight Race Engineering – from 2013, Red Bull will sponsor one of the top V8 Supercar teams. Red Bull Ghana – a Ghanaian professional football club located in Sogakope that plays in the Poly Tank Division One League. Endorsements In 2009, Red Bull added mainstream sport athletes to its roster of sports endorsements. Reggie Bush was the first NFL athlete to endorse the product. The announcement was made at the Super Bowl. Evaluation In the first month of operation Management will over view that wh ether theMarketing goals and objectives are going in right direction or not if not than whatwent wrong and what are differences
  • 20. between actual and expected performance.This may require changing the action programs or even changing the goals. Involves checking ongoing performance against the annual plan and taking corrective action when necessary. It will ensure us that the company achieves the sales, profits and other goals set out in annual plan. It also involves determining the profitability of product. It involves looking at whether the company's basic strategies are well matched to its opportunities. Marketing strategies and programs can quickly become out-dated and there will be need of periodically reassess its overall approach to the market-place. A major tool is marketing audit.