Red Bull Marketing Strategy - Assignment Example

Red Bull Marketing Strategy al Affiliation) TABLE OF CONTENTS Executive summary…………………………………………………………….3 2. Situational Analysis…………………………………………………………….3 2.1. Market summary……………………………………………………………3 2.2. SWOT analysis 2.2.1. Strength………………………………………………………………3 2.2.2. Weakness…………………………………………………………….4 2.2.3. Opportunity…………………………………………………………..4 2.2.4. Threat…………………………………………………………………4 2.3. Competitor analysis…………………………………………………………..5 2.4. Keys to success……………………………………………………………….5 2.5. Critical issues…………………………………………………………………6 2.6. Pricing………………………………………………………………………...6 3. Marketing strategy………………………………………………………………...6 3.1 Mission………………………………………………………………………...6 3.2 Marketing objectives…………………………………………………………..6 3.3 Product positioning……………………………………………………………8 3.4 Marketing mix…………………………………………………………………8 3.5 Marketing research…………………………………………………………….8 4. Financials………………………………………………………………………………..8 5. Controls…………………………………………………………………………………9 1. EXECUTIVE SUMMARY Red bull emerges as the world’s leading energy drink. The main aim of this marketing plan is to increase the lead that Red Bull has in the energy drink market. Rising competition has resulted in the need for a change in strategy so as to maintain the lead that the product has on the market (Stapleton, 2007). The marketing strategy will therefore look at all the factors that influence the market and design a plan that if implemented will enable the brand maintain its position as a global brand. 2. SITUATIONAL ANALYSIS 2.1. Market Summary The sales of soft drinks has been declining over the years, On the other hand, the energy drink market is one of the fastest growing in the world. This is due to increased demand from young adults across the globe. 2.2. SWOT analysis 2.2.1 Strength Red bull has obvious advantage in the energy markets. Abundant experience in the energy drink market, red bull was founded in Austria in 1987 and since then has grown to be the world’s most popular energy drink. The red bull brand is known all over and the high energy it represents is a hit with consumers Experienced in global market area – red bull products are available in all the continents around the world, over 165 nations in the world. The environmental concept of the Body Shop happens to have the same view of the demand of the target group in China. 2.2.2 Weakness Recently there has been issues raised about the health effects of consuming energy drink and this might impact consumer purchases. People take keen interest in health and such news are received by alarm by the masses 2.2.3 Opportunities The emerging markets – there are developing countries in the world such as those in Africa and these provide a ready market for red bull products. There is an increase in purchasing power in these nations and the people are readily adopting global brands. A potential large target group – the target consumers for red bull are young people and young adults. This represents majority of the population and given that these numbers are growing the future looks positive for red bull. The use of energy drinks is gaining favour-in the past some people thought that energy drinks were alcoholic. But this is fast changing and the use of energy drinks is gaining favour among the general population. 2.2.4 Threats Pressure from competing products. in the recent past there has been an increase in the number of new entrants into the energy drink field who are competing for the same market with Red Bull. 2.3 Competitor analysis Below is a table showing the competitors of Red Bull and their market shares. Red Bull still has a lead in global market share but Monster is closely behind. In this regard, there should be a massive campaign so as to increase this lead (Ferrell, 2011). 2.4 Keys to success The key to success is offering customers a quality product that reflects a true value for their money. The Red Bull gives you wings are a popular phrase around the world and this should be used to maintain brand loyalty. 2.5 Critical issues The use of red bull has raised some controversy over the years. This is due to the caffeine content that is in the drink. Some countries have certain restrictions on the amount of caffeine which is allowed in the drinks sold to consumers (Luther, 2001). It is feared that caffeine may affect the health of individual’s particularly cardiovascular health. When taken in excess, the drinkers may experience caffeine intoxication, but if taken moderately as required, it has been proven that Red Bull is safe. 2.6 Pricing The price of red bull is averagely the same as that of its competitors and as such there is little advantage gained on the prices side. The products can therefore gain massive advantage due to its quality. 3. MARKETING STRATEGY 3.1 Mission The mission of the campaign was to remove doubts in the minds of consumers that Red Bull is the market leader when it comes to the energy drinks market and is the drink of choice. 3.2 Marketing Objectives To maintain the product lead in the market Increase brand awareness Maintain brand loyalty 3.3 Product positioning The product is positioned as an energy drink that increases performance and awareness. To match this branding, the company sponsors several high energy events and this is what makes the product stand out in the market. 3.4 Marketing mix (4 P’s) Place Before the decisions of what types of products are suitable for the global market particularly developing countries we have to analyse the characteristics of these markets. African countries are the new frontier markets and the people there are very receptive for new products. These countries want to be matched together with global brands and this represents a very promising market. Product After analysing the chosen place, the products options should be the next. Red bull has developed a series of products that are aimed at capturing the various tastes of people around the globe. Because of the nature of the emerging markets, the middle and high income groups would readily accept foreign culture and global products such as Red Bull are bound to be a hit in these markets (Cohen, 2006). Price The price of the product is not sensitive and plays a very small role. The target group has a high affinity for quality products and as long as the quality is maintained people will still pay the high prices for the product. High prices are also considered to represent quality therefore they should be maintained Promotion The product should be promoted using a high pitched strategy,. Whichever strategy that is chosen should be persistent and be able to maintain visibility of the product. Promotion should be through various ways (Parmerlee, 2000). This will be by making use of product promotions, advertising on billboards, television commercials and use of brand ambassadors. The aim of these activities is to increase awareness about the product. 3.5 Marketing research This will be done on a regular basis using random sampling to try and found out the market share that is held by the product (McDonald, 2002). The research should also focus on the needs on the consumers and what they would expect from the product in future. 4. FINANCIALS The table below shows all the financial information in regards to the product. It includes the following: Profit targets Sales Forecast Estimated costs ‘000 ($) Number of units Sold(sales forecast) (Millions) Total Target sales Millions($) Profit targets Millions ($) Percentage Profits (%) 2014 1200 41000 3500 2,300 35 2015 600 44250 3750 3,150 40 2016 500 45000 4000 3,500 42 2017 400 47510 4500 4,000 45 2018 400 48520 4800 4,400 48 5. CONTROLS The forecasts in the above section will be reviewed on a quarterly basis to find the effect of the marketing strategy and locate any areas that need to be changed. If performance measures are not met in any region, the sales manager in charge of the region will be called in to give a detailed explanation and come up with a sales strategy to protect the brand. Month Activities involved (milestones to be met) Performance benchmarks January Selection of brand ambassadors Must be popular individuals in the target countries February Introduction of new commercials In all major television stations March Launching of billboards IN hotspots in the target regions April Trade shows and product introduction in Southern Africa Enhance awareness to 1000000 potential consumers May Trade shows and product introduction in Eastern Africa Enhance awareness to 1000000 potential consumers June Trade shows and product introduction in Western Africa Enhance awareness to 1000000 potential consumers July Trade shows and product introduction in Northern Africa Enhance awareness to 1000000 potential consumers August Trade shows and product introduction in Asia Enhance awareness to 1000000 potential consumers September Review of product performance around the new markets To find out if the targets have been met October Follow up activities To establish product uptake November Seeking for sponsorship opportunities To increase brand loyalty December End year promotions Increase sales References Cohen, W. A. (2006). The marketing plan. Hoboken, New Jersey: J. Wiley. Ferrell, O. C. (2011). Marketing strategy. Australia: South-Western Cengage Learning. Stapleton, J. (2007). How to prepare a marketing plan: A guide to researching the consumer market. Hampshire: Gower. Luther, W. M. (2001). The marketing plan: How to prepare and implement it. New York: AMACOM. McDonald, M. (2002). Marketing plans that work: Targeting growth and profitability. Parmerlee, D. (2000). Analyzing the market. Lincolnwood, Ill: NTC Business Books. Boston: Butterworth-Heinemann. Westwood, J., & Institute Of Directors. IOD. (2002). The marketing plan: A step-by-step guide. London: Kogan Page. Read More