Critically evaluate the approaches taken by Red Bull in order to build strong customer relationships and loyal customers in the face of fierce
competition.
Topics Covered
Consumer
Behaviour
Associated Models or concepts
The MASLOW model illustrates how Red Bull built strong consumer relationships by using reference groups
to influence the choice criteria of the market segment:
Consumer
Market
segmentation /
targeting
Red Bull’s market segment consisted of students/young people and extreme sportsmen who had similar behavioural and
psychographic (personality, attitudes, lifestyle etc) characteristics. In this context, Red bull strategically targeted certain reference
groups within the segment which consisted of young trendsetters such as ‘DJ’s, bartenders, break dancers’ who had strong social
influence over the segment’s norm beliefs ‘ the scheme targets trendsetters to be brand mangers: individual, non-conformist ppl’..
This certainly had a differential advantage above the competition as the segment were filling a social need (esteem and
belonging) by drinking the product and hence Red Bull tapped into these motives by linking the brand to social events.
However, Red Bull may try to reach new customer segments such as long distance drivers, older people or health conscious
consumers. However, it may be at risk of loosing its brand image in the current minds of its market segment who perceive the
brand as a beverage to be ‘mixed with vodka or other spirits’ (Marc Logman) “in trying to attract new customer segments its
packaging and design may need to be adjusted to the needs of the new market segment.
Product / Brand
Management
Brand Building:
Red Bull was the first pioneering brand in the energy drinks market. ‘Being the first gives a brand the opportunity to create a clear
position in the minds of target consumers before the competition enters the market’ (Jobber page 317)
The augmented model illustrates how Red Bull built a counter-culture brand which attracted its target
consumers:
At the heart of Red Bull was the core product: An alcohol free carbonated energy drink containing the same amount of caffeine
found in one cup of coffee. The initial marketing results illustrated that 50% of the test group thought the taste was ‘terrible’ whilst
the other 50% ‘was crazy about Red Bull.’ This conflicting consumer outcome enhances the controversy of the product hence
drawing attention from consumers to try the product and see which group they are in.
Augmented product known as the brand which constitutes the brand image, quality, design, packaging etc. Red Bull created a
differential advantage by augmenting its brand through its image and design. The image was based on exclusivity, creativity,
euphoria and unconformity. These image attributes increased the brand awareness and its popularity amongst the ‘Generation Yers (18-29 year olds) who were heavily into pop culture and extreme sports and saw Red Bull as an ‘anti-brand’. Aligning with the
brand image was the brand design a logo with ‘two thing necked crimson bulls in opposing charge’ and established slogan ‘Red
Bull gives you wings’ which reinforces its aphrodisiac and adrenaline fuelled properties associated the with the brand and its link
to extreme sports such as ‘BMX biking, kite-boarding, extreme snowboarding’ which are non traditional adventure sports, which
was indirect competition with other competitive energy drinks such as Lucozade or Gatrorade.
Promotional Mix
Advertising /
Promotion
Personal Selling; was through unconventional outlets such as bars and clubs which enhanced the products exclusivity as it was
not within the consumer reach in a regular supermarket. Therefore, consumers are more likely to cherish the product than if its
readily accessible.
Advertising: The product it self is a low involvement purchase and so consumers are likely to consider a wide range of brands
before purchase. Therefore to retain loyal customers and build new customer relations ships Red Bull applied a WTOA
(Awareness Trial, Reinforcement) by arousing interest and awareness via product sampling within test groups and reinforcing the
brands exclusivity via word-of-mouth or “buzz” marketing which enhanced the mystique of the brand. Red Bull relied on this
instead of using traditional advertising as seen with other competitive brands
Sponsorship: of extreme sport events and pop culture events such as ‘RMBA’ – creates a social network of users increasing
brand loyalty
Promotion: The use of sports personalities to promote the brand by being seen with it in the context of extreme sports events
reinforces the energy message