Case Study Solution

Background of Key Problem

The success of Red Bull majorly lies behind their unique marketing strategy which is usually called guerilla marketing, buzz marketing or in simpler words, marketing based completely on Below-the-line activities, word of mouth, endorsements etc. This unconventional marketing has been applied in Pakistan also where instead of executing Above-the-line promotions (which usually work very well in Pakistan and communicate to a larger audience), they have stuck to their unusual styles of marketing and have up till now sustained their position. But whether or not these unconventional strategies can carry on being effective with competitors like Sting and Speed emerging and keeping in mind the behaviors of the Pakistani consumers, is yet to be answered. The difference of Red Bull customers outside Pakistan and Pakistani consumers is vast and hence those extreme sports, club partying do not entirely relate to them. This needs to be addressed any marketing activities should be planned keeping in mind the different nature of the Pakistani consumer who are usually more susceptible to what they see on television, print and radio. The emergence of competitors like Sting and Speed means that Red Bull can now face a problem if they do not start extensive marketing campaign through not just BTL but also ATL methods too, just like its competitors are currently doing. If Red Bull remains in myopia, its downfall may soon be inevitable at the hands of big brands like Sting who are backed up by Pepsi and Speed who comes from the house of Shezan.

Introduction of Red Bull in Pakistan

Born in Thailand, developed in Austria and sold throughout the world, Red Bull is now a global and leading brand for the energy drink category with a 70% share in the world market to date.  The Red Bull story started in 1982 where an Austrian by the name of Dietrich Mateschitz tried and tested the idea of an energy drink and transformed that idea in a phenomenon now known as Red Bull. Red Bull now produces the world's most selling energy drink with more than a billion cans being sold every year in nearly 100 countries. Red Bull holds a substantial share of the world market for energy drinks, a category it was largely responsible for building. Its dominant position in the fastest-growing segment of the soft drink market in a number of countries has drawn a number of imitators.

With unmatched success around the globe, Red Bull was finally launched in Pakistan in 2001 and it has ever since been the market leader in a market with relatively lesser competition than around the world and where the concept of energy drink is yet to be completely absorbed. Red Bull is currently being operated in Karachi, Lahore and Islamabad with the Asian head office being in the United Arab Emirates. It has set up its premises in all three cities where distribution and marketing operations are executed.

Target Market Description

Target Market:  The primary target market of Red Bull consists of teenagers and young adults who are sporty, funky, with a larger than life attitude. Red Bull’s target market is concentrated on youth groups who have activities in sports and nightlife. The youth market primarily belongs to the generation Y, who are people born after 1981 and who are believed to be cynical to tradition marketing strategies.

Market Demographics: Red Bull’s customer base in Pakistan is identified on the basis of following geographic, demographic, behavior and life style characteristics:

  1. Geographic Variables

Country: Pakistan                                            Cities: Karachi, Lahore, Islamabad

Provinces: Sindh, Punjab                                              Density: Urban        

  1. Demographic Variables

Gender: Males and females both consume Red Bull with the latter, includes a percentage of females who do not like the taste of Red Bull.

Age: Red Bull is a drink for people aged between 18 and 35. Children below that age are not recommended to have Red Bull and working adults aging 40 reduce consumption when they reach that age bracket and prefer tea and coffee more.

Income group: Being a high priced luxury product, it can be afforded by upper-middle and the upper class of the society.

Social class: The consumption of Red Bull has become a symbol of high class and status.

  1. Behavioral Variables

Usage Rate: It is high in places of functionality of energy i.e. sports events, parties, concerts etc. Also high at cafes where Red Bull consumption in Sheesha has become a huge attraction for Sheesha lovers.

Use Situation: Most popularly used at parties, concerts, gigs, sports events, university events and at cafes. It is also consumed at times of increased mental and physical strain.

Market Need

In our Pakistani culture where body and mind revitalizers are usually tea and coffee, Red Bull aims to provide a different option to people who do not consume tea or coffee. It is a beverage that is solely for energy revitalization. Red Bull primarily aims to provide energy boosters at times of increased mental and physical strain. For instance, the hectic traffic in Pakistan is never an easy thing to go through and a Red Bull after that helps energize you. Other instances are consumption during intensive working days, sports activities and also for students before and after exams. The need for energy revitalization is already there in the Pakistani market and which is popularly being fulfilled by tea or coffee. However, Red Bull aims to provide an option to all those who are not tea or coffee lovers. Depicted as a cool, trendy drink it wants to be an effective option for people in need of an energy boost.

Market Growth

The concept of an energy drink is still new and is in the process of yet being absorbed in the market. Red Bull has been in the market for almost ten years and it has led remarkably because of the lack of performance by its competitors. The potential of growth in this market is yet to be achieved since the best out of any product category only comes out when there is stiff competition. Names like Blue Ox, Gatorade came and disappeared because they could not compete with Red Bull’s strong brand name. However, new entrants like Pepsi’s Sting and also Speed understand the potential of growth in the market and have started aggressive marketing campaign to over power Red Bull. The market for beverage energy drinks is growing and with increases competition, it is only expected to keep elevating.

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Market Players

The main market competitors at the moment are Red Bull, Sting and Speed. Other brands like Blue Ox, Gatorade, Bomb etc. launched themselves but couldn’t survive in the market. The market currently is very much in the growth stage and international brands may look to launch themselves in Pakistan in order to get hold of a market that is yet to absorb the concept of energy drink. Hence, the opportunity is there to be taken and many more market entrants in the energy drinks industry would not be a surprise.

Operations and Departments:

Red Bull’s working ...

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