Submitted by Ranpreet Singh Luthra 08020741059 MBA 08‐10 SIOM

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Submitted by Ranpreet Singh Luthra 08020741059 MBA 08‐10 SIOM Powered By Docstoc
					Red Bull 




 

 

                                                        

                                                        

                                                        

                                     Submitted by: 

                             Ranpreet Singh Luthra 

                                       08020741059 

                                        MBA 08‐10 

                                    SIOM, Nashik 




Ranpreet Singh Luthra‐059                     Page 1
Red Bull 


INTRODUCTION & HISTORY 
   •   Red Bull originated from an energy drink from Thailand called Krating Daeng.

   •   Dietrich Mateschitz, an Austrian entrepreneur developed the Red Bull Energy Drink
       brand. Mateschitz was the international marketing director for Blendax, a toothpaste
       company, when he visited Thailand in 1982 and discovered that Krating Daeng helped to
       cure his jet lag.

   •   Red Bull entered its first foreign market (Hungary) in 1992, and the United States (via
       California) in 1997.

   •   In 2009, The 60ml Red Bull Shot was released in Australia for the first time. It was an
       answer to rivals Mother & Monster who had increased their can size to 500ml, reducing
       margins and cannibalizing the segment

   •   Red Bull contains taurine, glucuronolactone, caffeine, B vitamins, sucrose and glucose




Ranpreet Singh Luthra‐059                                                                  Page 2
Red Bull 


CUSTOMER BASED BRAND EQUITY PYRAMID 




Ranpreet Singh Luthra‐059              Page 3
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1. Salience Dimensions 
Depth of brand awareness  

Ease of recognition & recall
If a brand’s value is to be judged by the ease with which it can be recalled, then Red Bull’s
marketing campaign wins hands down as it is the first thing that comes to mind when someone
thinks of an Energy Drink.
“I was working all day and I needed something to get me going” said a young lad after sipping
the Red Bull at a party at New York Club. Heading the dance floor he said, “It really works”

Breadth of brand awareness  

Purchase consideration

In the past 15 years, this energy drink company has quietly captured more than 70% market
share in over 100 countries. Never before has any brand been covered so quickly on the Top
Selling magazine of US (Selling Power). “If you don’t create the market, it doesn’t exist” says
Dietrich Mateschitz, a former toothpaste salesman of a toothpaste company who built a $1.6
Billion energy drink company with creative selling ideas that made him incredibly rich.

Red Bull is the energy drink that doesn’t do well in the taste tests; some say it’s too sweet; others
just shake their heads saying “No”. But still it has the maximum market share in the Energy
Drink Market. Red Bull’s prime consumers are young adults, better known as kids in their 20s.
(Energy Drinks are not recommended for Children).

Consumption consideration

Red Bulls is the first thing that comes to the mind when any Energy drink is considered. Its very
famous amongst the so called Young Adults.

 




Ranpreet Singh Luthra‐059                                                                     Page 4
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2. Performance Dimensions 
Primary characteristics & supplementary features 

Quality

No brand survives long if its quality does not equal or exceed what the buyer expects. There
simply can’t compromise. That’s the essence of the contract. “It really gets you up” says 29 year
old bloke, sipping Red bull with Vodka. A Red Bull sign glows pink behind the bartender. Red
Bull is the ultimate Energy Drink which gives you a long stint without Sleep. The berry flavored
is spiked with mysterious additives like Taurine and Glucuronolactone. And at $2 for an 8.3
ounce can, Red Bull’s retail price is at least double what you’d pay for a 12-ounce can of a coke.
But it does pack some energy. Red Bull, with 80 mgs of caffine, has more than double the dose
found in larger coke serving, and it has 110 calories per serving versus Coke’s 140.

Service effectiveness, efficiency, and empathy 

Style and design 




                                                                     

Red Bull has aggressive international marketing campaign. The numerous sponsored activities
range from extreme sports like windsurfing, snowboarding, skateboarding, akeboarding, cliff-
diving, surfing, skating, freestyle motocross, rally, Formula 1 racing, and breakdancing to art
shows, music, and video games. It also hosts events like the "Red Bull Flugtag" (German for
"flight day" or "flying day") and other such contests. Red Bull is also sponsoring soccer teams, in
Salzburg, Austria; Leipzig, Germany; New York, USA and Brazil and have included their
company name in the club's names. By associating the drink's image with these activities, the
company seeks to promote a "cool" public image and raise brand power. In addition, the slender
container is used to suggest a "sexier" image than some other cola counterparts. Hence, this one
energy drink has helped create a market for over 150 related types of merchandise, like Red
Rooster (drink) and Blue lightning. British institution Advertising Standards Authority has
upheld complaints about claims made in the publicity of Red Bull in the United Kingdom since
1997.Even with all of the concerns regarding Red Bull, in 2000 the corporation earned around $1
billion in worldwide sales and Red Bull held 65% of the market share.


Ranpreet Singh Luthra‐059                                                                   Page 5
Red Bull 


Price 




And at $2 for an 8.3 ounce can, Red Bull’s retail price is at least double what you’d pay for a 12-
ounce can of a coke. But it does pack some energy. Red Bull, with 80 mgs of caffine, has more
than double the dose found in larger coke serving, and it has 110 calories per serving versus
Coke’s 140.

 

 




Ranpreet Singh Luthra‐059                                                                   Page 6
Red Bull 


3. Imagery Dimensions 
Since introducing Red Bull in 1987, Mateschitz has invested heavily in building the brand. Last
year he spent $600 million, or 30% of revenue, on marketing. (Coca Cola spends 9%). But unlike
rivals who pay millions of dollars for superstars like Britney Spears, Mateschitz relies on cheaper
talents: Hip youngsters, students and a legion of fringe athletes. Red Bull sponsors some 500
athletes around the world, the type who will surf in Nova Scotia in January or jump out of a
plane to “fly” across the English Channel. Every year the company stages dozens of extreme
sporting events like the climbing of iced-down silos in Iowa or kite sailing in Hawaii, as well as
cultural events like break-dancing contests and rock music jam sessions. Then there is a Hangar-
7, an eye popping structure of glass that Mateschitz erected next to the airport in Salzburg,
Austria. The building serves the chic eatery for club crawlers and provides shelter for the flying
bulls, a fleet of 15 show planes that appear at Air show around the world. Mateschitz latest
indulgence: The purchase of formula one racing tea006D, an extravagance that will absorb $ 100
million an year to keep on the track while generating only $70 million for revenue.

All these activities are geared to one objective: to expand Red Bull’s presence amid a deluge of
new energy drinks being introduced and beverage behemoths like Pepsi and Coke.

Declares Mateschitz “We created the market. If you appreciate the product, you want the real
one, the original” Nobody wants to have a Rolex made in Taiwan or Hong Kong.”

So far, Mateschitz has been cautious about extending the Red Bull Brand. In Los Angeles the
company is test marketing an herbal drink brand called Carpe Diem that’s suppose to boost the
immune system and improve metabolism. It’s been sold in European Countries for a few years
but so far doesn’t look set to repeat Red Bull’s success. Mateschitz also intends to employ the
Carpe Diem banner for a chain of fast food outlets offering Austrian and International food
packaged in edible crunchy containers made out of potato. And he plans to launch a quarterly
magazine in Europe filled with pictures and stories evoking the Red Bull world: Music, Extreme
Sports, Night Life, and Social Trends. He bought an Island in Fiji from the Forbes Family for an
undisclosed fund and plans to turn it into a Resort.




Ranpreet Singh Luthra‐059                                                                   Page 7
Red Bull 




4. Judgment Dimensions 

       Brand quality
          o Fun
          o Energizing
          o Good to taste
       Brand credibility
          o Expertise
          o High Energy
          o Likeability
       Brand consideration
          o Stands strong in the Energy drink industry.
          o High recall when compared to its competitors
          o High recommendations by category intenders and category users.
       Brand superiority
          o Different from Conventional Colas
          o Better to taste when compared to Gatorade & Power Horse
          o Can be used to make a Cocktail with Vodka
          o Masculine Brand


5. Feelings Dimensions 

            Sexy
            Fun
            Excitement
            Hip
            Youth
            Sporty
            Trendy
            Energetic




Ranpreet Singh Luthra‐059                                                    Page 8
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6. Resonance Dimensions 

       Behavioral loyalty
          o Frequency and amount of repeat purchases.
          o People purchasing Red Bull will never substitute it with any other energy drink
             like power horse or Gatorade.

       Attitudinal attachment
           o The brand represents strength and vigor because of which consumers purchasing
               it stick to it.

       Sense of community
          o A brand representing Kinship as it is a party drink as well. Evolves as group
              brand.
          o Lots of youngsters affiliate themselves with the brand as it a symbol of
              masculinity.

       Active engagement
          o Resorts
          o Sports club
          o Web site
          o Chat rooms
          o Health Clubs
          o Gym
          o Swimming Pools
          o Music & Entertainment




Ranpreet Singh Luthra‐059                                                               Page 9

				
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