Red Bull Case Analysis

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Overview: Red Bull Gmbh, sells the Red Bull brand energy drink. Red Bull has driven the rapid growth and adoption in the global energy drink category, capturing approximately 80% of the global energy drink market. The Red Bull drink contains the amino acid taurine, B-Complex vitamins, caffeine and carbohydrates and is marketed in more than 100 countries. Red Bull’s growth has come through non-traditional marketing utilizing locally tailored marketing and guerilla, event-sponsored campaigns. In 2004, Red Bull continued to be the most dominating brand in the market and gained nearly 174% in sales in the review period between 2002 and 2004. The company expanded its user base through the launch of the diet variant Red Bull Sugarfree in 2003. Problem Statement: Red Bull has enjoyed tremendous growth and leads market share in every market that it sells Red Bull. Management has the option of continuing to grow the company or cash out. RT consulting has been engaged to perform an analysis on these options and make a recommendation. Process of engagement: 1. Interviews 2. Research a. Competitor Data b. Demographic Data c. Industry Data d. International Data e. Red Bull Articles Options: 1. Cash Out a. Larger players have more marketing dollars and leverage with retailers b. Over 1,000 smaller players that will erode market share c. Future of energy drinks will be lead by big manufacuters d. Number of energy drinks has increased by at least 100 every year since 1999 e. Although Red Bull’s sales continue to grow, the brand has lost market share as other energy drinks enter the segment, down to 54.5% share in 2003 from 66% in 2001 2. Growth Options: a. Defend existing markets by increasing marketing focus and improving operations b. Increase Red Bull’s product offerings by either launching new products or acquiring other companies c.

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