Marketing Excellence Red Bull
Red Bull’s integrated marketing communications mix has been so successful that the
company has created an entirely new billion-dollar drink category—energy drinks. In
addition, Red Bull has become a multibillion-dollar beverage brand among fierce
competition from beverage kings like Coca-Cola, Pepsi, and Anheuser-Busch. To date,
the company has sold more than 40 billion cans of energy drinks across 166 countries.
How? Red Bull became the energy drink market leader by skillfully connecting with
youth around the globe and doing it differently than anyone else.
Dietrich Mateschitz founded Red Bull with a single product in Austria in 1987. By 1997,
the slender silver-and-blue can was available in 25 markets globally, including Western
and Eastern Europe, New Zealand, and South Africa. Its size and style immediately
signaled to consumers that its contents were different from traditional soft drinks. Red
Bull’s ingredients—amino acid taurine, B-complex vitamins, caffeine, and
carbohydrates—were specifically formulated to make the drink highly caffeinated and
energizing. In fact, some users have referred to it as “liquid cocaine” or “speed in a
can.” Over the past decade, the company introduced other products and flavors, many
of which did not succeed. Today, Red Bull offers the original Red Bull Energy Drink,
Red Bull Total Zero, Red Bull Sugar Free, and special editions infused with berry, lime,
and cranberry flavors.
As the company continued to expand worldwide, it developed an integrated marketing
communications plan that reached its target audience on many different levels and
built its brand image of authenticity, originality, and community. First, Red Bull focused
on pre-marketing, sponsoring events like the Red Bull Snowthrill of Chamonix ski
contest in France to help build word-of-mouth excitement around the brand. Once the
company entered a new market, it built buzz through its “seeding program,” microtargeting
trendy shops, clubs, bars, and stores. This enabled the cultural elite to
access Red Bull’s product first and influence other consumers. As one Red Bull
executive explained, “We go to on-premise accounts first, because the product gets a
lot of visibility and attention. It goes faster to deal with individual accounts, not big
chains and their authorization process.” The company also targeted opinion leaders
likely to influence consumers’ purchases, including action sports athletes and
entertainment celebrities.
Once Red Bull gained some momentum in bars, it moved into gyms, health food
stores, restaurants, convenience stores near colleges, and eventually supermarkets.
The company’s primary point-of-purchase tool has always been its refrigerated sales
units, prominently displaying the Red Bull logo. These set the brand apart from other
beverages and ensure a prominent location in every retail environment. To guarantee
consistency and quality in its point-of-purchase displays, the company hired teams of
delivery van drivers whose sole responsibility was stocking Red Bull.
Another essential aspect of Red Bull’s marketing communication mix is product trial.
Whereas traditional beverage marketers attempt to reach the maximum number of
consumers with sampling, the company seeks to reach consumers only in ideal usage
occasions, namely when they feel fatigue and need a boost of energy. As a result, its
sampling campaigns take place at concerts, parties, festivals, sporting events,
beaches, highway rest areas (for tired drivers), and college libraries and in limos before
award shows.
Red Bull also aligns itself with a wide variety of extreme sports, athletes, and teams
and artists in music, dance, and film. From motor sports to mountain biking,
snowboarding to surfing, rock concerts to extreme sailing, there is no limit to the
craziness of a Red Bull event or sponsorship. A few company-sponsored events are
notorious for taking originality and extreme sporting to the limit. For example, at the
annual Flugtag, contestants build homemade flying machines that must weigh less
than 450 pounds, including the pilot. Teams launch their contraptions off a specially
designed Red Bull–branded ramp, 30 feet above a body of water. Crowds of as many
as 300,000 young consumers cheer as the contestants and their craft try to stay true to
the brand’s slogan: “Red Bull gives you wings!”
Red Bull uses traditional advertising once the market has grown mature and the
company needs to reinforce the brand to its consumers. As one executive explained,
“Media is not a tool that we use to establish the market. It is a critical part. It’s just later
in the development.”
Red Bull’s “anti-marketing” marketing communications strategy has been extremely
successful connecting with its young consumers. It falls directly in line with the
company’s mission to be seen as unique, original, and rebellious—just as its
Generation Y consumers want to be viewed.
Questions
1. What are Red Bull’s greatest strengths as more companies (like Coca-Cola, Pepsi, and
Monster) enter the energy drink category and gain market share? What are the risks of
competing against such powerhouses?
2. Discuss the pros and cons of Red Bull’s nontraditional marketing tactics. Should the
company do more traditional advertising? Why or why not?
3. Discuss the effectiveness of Red Bull’s sponsorships. Where should the company draw
the line in terms of novelty and risk?
4. Recommend the next steps for Red Bull with respect to their marketing and advertising
strategies.
Sources: .Kevin Lane Keller, “Red Bull: Managing a High-Growth Brand,” Best Practice Cases in Branding,
3rd ed. (Upper Saddle River, NJ: Prentice Hall, 2008); Peter Ha, “Red Bull Stratos: Man Will Freefall from
Earth’s Stratosphere,” Time, January 22, 2010; “Red Bull to Go on Sale in U.S. with Fruity
Flavors,” Businessweek, October 8, 2012; www.redbull.com..