In this second assignment named „Product and Price Analysis of Red Bull in Central Europe” the goal is to analyse the “product” and “price” strategy and to give a short overview of their “place” and “promotion” strategy.
Red Bull as company was founded in 1987 with its slogan “Red Bull gives you wiiings”.
The firm developed by Dietrich Mateschitz sold more than 35 billion cans until now and is available in more than 165 countries. The product is developed from a Thai energy drink and includes caffeine, taurine, B-Vitamines, saccharose, glucose and water, what can be consumed by people in many situations for their physical and social needs and Red Bull created an emotional binding. The product is only available in six different types but because of the well established brand and its young and modern image people have a positive association with it and so buy it.
The Company has worldwide steady growth rates although it is sold at a very high price level with compared to that low production costs. In contrast to that the competitors’ products are much cheaper, but Red Bull sticks to their prices even many competitors entered the market.. But it can be said that Red Bull is aiming for an abnormal profit and concentrating on internal and marketing orientation when setting their prices. The consumers are paying for the “way of life” and the quality.
To the place and promotion strategy can be said that Red Bull is available in 165 countries (in nearly ever little shop) but produced only in Austria and Switzerland. The company is widespread represented in sports sector where they are sponsoring much sportspersons and events.
To summarize that it can be said that Red Bull is a very successful and powerful company and the world’s market leader in the energy drink sector but the challenge will be how to maintain the constant growth in revenue and market share. The authors hold the opinion that Red Bull should maintain developing their extreme sport sponsoring and should develop some new products as well as produce them from natural resources.
Table of Contents
1. Introduction
1 Marketing Mix – Theoretical approach
1.1 Definition of Marketing Mix
1.2 Product
1.2.1 Consumer Behaviour – Creating Satisfaction
1.2.2 Buying Process in Product Management
1.2.3 Product – Brand – Innovation
1.2.4 Marketing Services
1.2.5 Tools…
1.3 Price
1.3.1 The Profit Motive
1.3.2 Pricing Strategies and Differentiation
1.3.3 Pricing Methods and Buyer Reaction
1.3.4 Competitor Reaction
1.3.5 Discounts
1.3.6 Delivery and Payment Conditions
1.4 Place
1.4.1 Distribution
1.4.2 Channel Strategy
1.4.3 Logistics
1.5 Promotion
1.5.1 International Marketing Communication
1.5.2 Advertising
1.5.3 Other forms of Promotion
2 Product and Price Analysis
2.1 Product
2.1.1 Buying Process
2.1.2 Products
2.1.3 Branding
2.1.4 Tools – BCG Matrix
2.2 Price
2.2.1 Pricing Strategies
2.2.2 Pricing Methods and Discounts
2.2.3 Competitor reaction
2.3 Outlook and Overview of Promotion and Place
2.3.1 Promotion
2.3.2 Place
3 Conclusion
Objectives and Topics
The primary objective of this assignment is to conduct a critical analysis of Red Bull's product and pricing strategies within the Central European market, while also integrating findings from previous market research to understand their position in the global energy drink sector.
- Theoretical analysis of the marketing mix components (Product, Price, Place, Promotion).
- Evaluation of Red Bull's consumer buying behavior and target group characteristics.
- Examination of Red Bull's premium pricing strategy and its competitive advantages.
- Assessment of the company's product portfolio using the BCG Matrix.
- Overview of promotional activities, with a focus on sports and event sponsorship.
- Strategic recommendations for future growth and sustainable product development.
Excerpt from the book
2.1.2 Products
At the beginning of the company history only one energy drink has been put on the market and over time they developed further variants of energy drinks. All together Red Bull now offers 6 different products. Additionally they provide different sizes of their energy drinks and they come in cans or bottles with 250 ml, 350 ml, 473 ml as well as the normal energy drink and sugar free variant as shots (60 ml). Red bull distributes the shots although “foodwatch” and other organizations claimed the prohibition of energy shots. The organizations complained that the concentration of caffeine is too high and the risks of overdoses are particularly high.
The classic Red Bull energy drink is used by the majority of the target group, who need an energy boost or want to increase their concentration. The Red Bull Sugarfree as well as the Zero Calories variants aim for those customers who are looking for a healthier energy drink that is in accordance to their diet. For reaching another niche of customers Red Bull established the Red Bull Cola for also attracting Coca-Cola drinkers. Red Bull advertises their natural and sustainable way of producing this product even though the selling is prohibited in several Federal States in Germany as traces of cocaine have been found in the beverage.
The packaging of their energy drinks is a significant part of their marketing concept. Their cans and bottles need to be visually attractive as they are the first impression their consumers get of the products. The cylindrical and stylish design cannot be compared to similar products, the blue background with silver gray steel signifies the company colors. In the center the name Red Bull and the company logo, which is the most noticeable item on the front, are presented together with the words “Energy Drink” and their motto “With taurine. Revitalize body and mind.” Their cans have a light weight and can be fully recycled.
Summary of Chapters
1. Introduction: This chapter introduces the basis for the assignment, focusing on the marketing analysis of Red Bull in Central Europe and outlining the structure for the subsequent investigation into product and price strategies.
1 Marketing Mix – Theoretical approach: This chapter provides the theoretical foundation for the marketing mix, detailing the four P’s and key concepts like consumer behavior, pricing strategies, distribution, and promotion.
2 Product and Price Analysis: This chapter applies the previously defined theoretical marketing mix concepts directly to the Red Bull company, analyzing their specific product and pricing strategies.
3 Conclusion: This chapter summarizes the findings regarding Red Bull’s market position and provides strategic recommendations for future development, including new product categories and sustainable packaging.
Keywords
Red Bull, Marketing Mix, Energy Drink, Product Strategy, Pricing Strategy, Premium Price, Brand Equity, BCG Matrix, Sports Sponsoring, Consumer Behavior, Distribution, Market Leadership, Sustainability, Innovation, Central Europe.
Frequently Asked Questions
What is the core subject of this assignment?
The assignment focuses on a detailed analysis of the product and price strategies of the energy drink manufacturer Red Bull within the Central European market.
What are the primary thematic fields covered in the work?
The paper covers the marketing mix (Product, Price, Place, Promotion), consumer buying behavior, branding strategies, product portfolio management, and the role of sponsorship in the company's communication strategy.
What is the main goal or research question of this study?
The goal is to determine Red Bull’s market position through a marketing mix analysis and to evaluate how the company maintains its leadership through its unique premium pricing and branding strategy.
Which scientific methods were applied?
The authors utilized theoretical marketing frameworks (such as the BCG Matrix and the Four P’s) combined with an application-based analysis of internal company data and external industry information.
What content is addressed in the main body of the text?
The main body includes a theoretical introduction to marketing instruments followed by an analytical section that examines Red Bull’s specific product variants, pricing models, and promotional activities.
Which keywords characterize this analysis?
Key terms include Red Bull, Marketing Mix, Energy Drink, Premium Pricing, BCG Matrix, and Sports Sponsoring.
How does the BCG Matrix apply to Red Bull’s portfolio in the study?
The authors classify Red Bull in Central Europe between a "star" and a "cash cow," noting high market shares despite slightly decreasing growth rates, while categorizing it as a clear "star" in the Asian-Pacific market.
Why does Red Bull maintain a premium pricing strategy?
The paper argues that customers pay for the brand, the "way of life" associated with it, and the unique experience, allowing Red Bull to sustain higher prices despite low production costs.
What recommendation do the authors provide regarding Red Bull's product range?
The authors recommend that Red Bull should expand its product range into healthier categories, such as juices or drinks with natural ingredients, to reach a broader target audience.
What role does sponsorship play in Red Bull's strategy?
Sponsorship is identified as a critical part of Red Bull's marketing strategy, used to prove the drink's effectiveness and establish an emotional connection with consumers through extreme sports and events.
- Quote paper
- Julia Teigeler (Author), Ann-Katrin Hahne (Author), 2014, Product and Price Analysis of Red Bull in Central Europe, Munich, GRIN Verlag, https://www.grin.com/document/271841
