AN ENERGY DRINK
REPORT ON:
RED BULL
COURSE:
MARKETING
COURSE CODE:
MKT 201
SUBMITTED TO:
Ms.NAJIA BASHIR
SUBMITTED BY:
Rabail Wahab
Wasif.A.Warsi
S.M.Mohsin Ajaz
Hina Ajaz
M.Shahid
ACKNOWLEDGEMENT
First of all we wish to thank ALMIGHTY ALLAH and then our teacher Ms. NAJIA
BASHIR without whom this presentation would have been very difficult to complete.
We are grateful to all those people i.e., who provide information and helped us to
complete this difficult task and the precious time they gave us and helped in various
stages of our presentation. We have worked day and night for this presentation and
tried our best to serve you and also try to use good marketing tactics to fill the
requirements of course.
Basically the idea behind choosing RED BULL is to let people aware of its benefits
and features which it contains.
THE BIRTH OF RED BULL
Red Bull founder Dietrich Mateschitz introduced his taurine-fueled beverage to
Europe in 1987. (Coincidentally, it was the same year Howard Schultz acquired a
small, Seattle-based coffee outfit called Starbucks Corp.) Ten years later, Red Bull
charged into the United States, launching a new category of nonsoda energy drinks
aimed at burned-out high-school and college students.
Remarkably, America's hottest new brand bucked the trend of aggressive, excessive
marketing that swept through upstart companies in the late 1990s. While Pets.com
and eToys were lavishing millions on prime-time advertising, Red Bull was quietly
converting America's youth into devoted, enthusiastic customers.
Since its inception, Red Bull has shunned print advertising in its marketing strategy.
It has not created one Web-marketing campaign. And it hasn't tweaked or expanded
its product line one iota. Red Bull has, however, expanded into 50 countries,
experienced annual double-digit growth, and captured the loyalty of a notoriously
fickle consumer group: teenagers. Today, a dozen imitators like Whoop Ass and Red
Devil vie for the number-two high-voltage beverage spot, and Mateschitz is the
richest man in Austria.
So what gives? How did Red Bull come to dominate the energy-drink market through
stealth and thrift? How did it become the coolest brand since Slim Shady without a
branding blowout?
"In terms of attracting new customers and enhancing consumer loyalty, Red Bull has
a more effective branding campaign than Coke or Pepsi," says Nancy F. Koehn,
professor of business administration at Harvard Business School and author of Brand
New: How Entrepreneurs Earned Consumers' Trust from Wedgwood to Dell (Harvard
Business School Press, 2001). "Red Bull is building a beverage brand without relying
on the essential equipment of a mass-marketing campaign. Perhaps the indispensable
tools of marketing aren't so indispensable after all."
Here are some tools that Red Bull doesn't use: billboards, banner ads, taxicab
holograms, blimps, Super Bowl spots. Even its TV spots -- all of which feature the
whimsical sketches of a mysterious Austrian artist -- serve more to amuse than to
educate or entice consumers.
BULL SHIFT: MARKETING MAKES A
"YOU TURN"
Like its product, Red Bull's branding campaign is sleek and small. Its grassroots
efforts fly well beneath the radar, and they provide a startling return on investment. In
fact, its most lucrative strategies cost next to nothing.
"Grassroots marketing is enjoying a resurgence with Starbucks, Red Bull, Krispy
Kreme, and Trader Joe's -- young, successful brands built by word of mouth," Koehn
says. "Person-to-person marketing is going to be a big part of the next chapter, the
next frontier of branding competition."
The sudden shift from TV blitzes and blimps to low-key, low-cost marketing
schemes, says Koehn, follows the convergence of three trends. First, advanced
communications technology is creating a generation of consumers skeptical of every
TV ad, email message, and celebrity endorsement. If a marketing message doesn't
offer a distinct, unique benefit to the individual consumer, he or she will tune it out,
Koehn says. "As information overload becomes a time-management issue for
consumers, mass marketing is necessarily going to be less effective."
Second, people are casting votes with their credit cards. "People are using products to
provide things that they think traditional institutions no longer can, like social
progress, a sense of community, and a sense of public good," she says. "Companies
that want to claim consumers' votes will have to implement branding strategies that
represent something."
Finally, Koehn says that consumers are looking for authenticity, self-identity, and
community in the brands they endorse. And for Red Bull's target audience, being
authentic means being a bit irreverent, a bit antiestablishment, and every bit different
from your parents, says Marc Gobé, president and CEO of the desgrippes gobé group,
a New York-based branding firm with a client list that includes Godiva, Versace, and
Starbucks.
"The beauty of Red Bull is that it's the antibrand brand," says Gobé, author of
Emotional Branding: The New Paradigm for Connecting Brands to People (Allworth
Press, 2001). "Red Bull doesn't have any of the commercial trappings of a traditional,
off-the-shelf product. It's underground, even when it's above ground, and that appeals
to the young people who drink it."
RUNNING OF THE BULL: HOW THE
BRAND GOT HOT
Red Bull sets its grassroots ethic into motion with a simple, yet masterful marketing
force: student brand managers. In Europe, collegiate buzz junkies have been
successfully addicting friends and classmates for years thanks to a foolproof branding
plan: Red Bull provides the student representatives with free cases of its energy drink
and then encourages the kids to throw a party. (Needless to say, it didn't take long for
coeds to discover the benefits of Red Bull and vodka, now a staple at hip bars around
the globe.)
Hardly a new marketing device, these brand evangelists spread the good word about
Red Bull quickly and cheaply. Above all, Gobé says, the student advocates offer
credibility to a product that is competing in an increasingly crowded beverage market
-- a market that became even more competitive in August when PepsiCo was given
the FTC's okay for its plan to purchase Quaker Oats and take control of the Gatorade
brand.
"Generation Y no longer responds to commercial messages from big-business
America," Gobé says. "Cool college students have become Red Bull's best
ambassadors because they carry the most credibility with cynical consumers. It's
almost as if brands have to be elected to be part of the culture now."
Red Bull's second grassroots branding strategy involves "consumer educators" -folks who drive around in shiny silver off-roaders with giant, phallic cans of Red Bull
strapped to the back. Their mission: to find people who need energy and give 'em a
free can of Red Bull. Sounds too corny and pedestrian to actually work, right?!
Wrong. This ploy, as old as Heinz and Tupperware, is introducing Red Bull to the
masses -- building an image for next to nothing. On the other hand, the free sporting
events that Red Bull organizes do not aim to influence the public at all. Many of Red
Bull's extreme events -- cliff diving in Hawaii and skateboarding in San Francisco -are for athletes only, designed "to support a community of athletes and to bring
credibility to the sports they compete in," says Emmy Cortes, director of
communications for Red Bull.
CAN IT: PACKAGING BECOMES
PARAMOUNT
It's all in the can. Gobé says that the sleek, silver can is Red Bull's "anti-Pepsi
statement." He calls it slim, sexy, and powerful, and says that its diminutive size only
bolsters Red Bull's reputation as a concentrated experience.
"Packaging is critical," Koehn agrees. "Red Bull really looks like a product from a
global economy. It doesn't look like a traditional American soft drink -- it's not in a
12-ounce can, it's not sold in a bottle, and it doesn't have script lettering like Pepsi or
Coke. It looks European. That matters."
The most remarkable thing about Red Bull's 8.3-ounce can is not its size or sex
appeal but the fact that it's the company's only offering. One size. One color. One
sticky, sweet taste. That's all, folks. At a time when Starbucks is hawking ice cream,
bottled Frappuccino, and airplane coffee, it's shocking to hear of a successful
company not exploring brand extensions left and right. "We are one of few
companies around the world that can stay focused on one product," Cortes says in
defense of Red Bull's narrow strategy. "We do what we do best."
A private company with a hands-off founder, Red Bull doesn't feel financial pressure
from investors and board members. It can take its time with the brand, and Koehn
says that it should. "Red Bull is establishing itself as a very powerful mover in a
relatively new and evolving category," she says. "To do that, they are trying to get
their knitting exactly right before they start weaving."
But if Red Bull continues to amass consumers and increase its profits every year,
Koehn predicts that the company will introduce related products "carefully, tightly
linked to Red Bull's core offering." In the meantime, Red Bull is simply working to
keep tabs on all the rumors circulating about its beverage. Some reports claim that
Red Bull is unsafe for minors. Others link the drink to the deaths of various teenagers
around the world. France has banned the sale of Red Bull altogether.
Consumers don't appear concerned. In clubs and dorm rooms everywhere, Red Bull
remains a popular drink among popular kids. Gobé says that the rumors only
contribute to the brand's mystique. "Red Bull is not about safety," he says. "The
brand's emotion is over the edge; it's pushing the envelope. Danger is part of the deal.
If you can survive Red Bull, you are cool."
The question, however, is not whether consumers can survive Red Bull but whether
the major soda manufacturers can. Regardless of whether the Austrian beverage
disappears in five years or steals the market out from under Gatorade, Red Bull has
tapped into an authentic branding strategy that will redefine product marketing in the
next decade -- again.
"The game of marketing sports drinks is going to be the game of connecting with
people in certain kinds of contexts," Koehn says. "Pepsi's not going to be able to
market Gatorade strictly with slick print campaigns and good television. Pepsi and
Coca-Cola could learn a lot from Red Bull."
ENERGY DRINK BUILD THEIR BUZZ
How do you convince teens to buy your highly caffeinated, $2-a-can soft drink, when
hundreds of other brands are jockeying for shelf space? Skip normal TV ads, for
starters. In a field continually littered with new entries, each trying to out-extreme the
other, small energy-drink companies is pursuing increasingly audacious marketing
tactics
Bridge jumping, a rocket launch, and even skydiving without parachutes have
become the norm in this guerrilla-marketing street fight -- all in the attempt to garner
attention and enough of a following to dominate a niche within a niche. A game of
one-upmanship has broken out, which extends even to the brand names (Go Fast!
recently lost
its
exclamatory supremacy to
newcomer
Crunk!!!).
Without a dominating presence by either Coca-Cola (KO ) or Pepsi (PEP ), makers
of so-called energy drinks -- lightly carbonated beverages often loaded with caffeine
and herbal extracts -- are all hoping they can become the next major brand. So far,
only one leader has emerged: Austria-based Red Bull, a private company with
roughly 60% market share and at least $150 million in annual revenue, according to
Information Resources, a Chicago-based retail research firm.
MOVING TARGET
Inspired by the success of Red Bull, which began as a startup itself 18 years ago,
more than 1,000 smaller players have entered the market, according to BevNET, a
Boston-based beverage-industry trade Web site that reviews new products.
All the newcomers are trying to steal the spotlight, staging publicity stunts that are as
jaw-dropping as they are risky, financially and otherwise. For many, clever marketing
remains as much -- more, in some cases -- of a focus as the nuts and bolts of actually
manufacturing and distributing the product.
The target market for energy drinks is mostly male teenagers and twenty something’s,
a notoriously fickle bunch. So unlike the cola market, where Coke and Pepsi push
their offerings to all soda-drinkers, most of the smaller power-drink players have
decided that their best hope of gaining traction is by appealing to very specialized
market segments.
"Right now there's an ability to get a toehold more quickly if you can build loyalty
with a niche of the market," says Kelly O'Keefe, CEO of brand-consulting firm
Emergence, based in Atlanta. "The margins are high enough that you can make
money on a small run of the product."
SOMETHING FOR EVERYONE
Drinks have been aimed at consumers interested in extreme sports (Red Bull, Go
Fast!), video games (Bawls Guarana, which sponsors gaming tournaments and
encourages players to pull all-nighters), hip-hop (Crunk!!!, Pimp Juice, and DefCon
3), and even marijuana, courtesy of Merrillville (Ind.)-based brand Bong Water.
But even the tiniest of sub niches have seen several competitors rise up, forcing
companies to prove that their particular brands are "authentic" and "not corporate,"
says Go Fast! Founder Troy Widgery, a former professional skydiver. That means
one-upping the competition. Go Fast! Sponsors an annual jumping event at a bridge
in Colorado, so Red Bull struck back last June, backing a jumper who parachuted off
France's
Millau
Bridge,
the
tallest
in
the
world.
Not to be outdone, Go Fast! is now funding the development of a winged jumpsuit
that will allow the wearer to glide out of a plane without a parachute. The company
also funded construction of the first unmanned civilian rocket designed to be
launched into space, which took off in May, 2004.
MR.RELEVENT
In the so-called Wing Suit Mission, project leader Jeb Corliss plans to land on his
stomach, skidding to a halt after hitting the ground with a forward speed of over 80
miles per hour. "The guys at Pepsi haven't even been near a plane with the door off,"
says Widgery of Go Fast!, who adds, "same with Red Bull."
Within the hip-hop niche, rappers Nelly (Pimp Juice) and Fat Joe (Stinger) and
megamogul Russell Simmons (DefCon 3) have built brands around their own, largerthan-life personalities. Jon Crecy, vice-president for sales and marketing at Crunk!!!,
says each celebrity brand is out to prove it's "hipper" and "edgier" than the others.
And of course, he claims his Crunk!!! label, promoted by rap star Lil Jon, reigns
supreme.
"Let's face it, you can't get more relevant to a consumer than Lil Jon," Crecy says.
"His music is rowdier, and he's got more energy." Thus far, Lil Jon appears to have at
least mastered the art of cross promotion -- the bombastic performer named his latest
album Crunk Juice and carries a bejeweled grail filled with the concoction to award
shows
and
other
public
events.
"That makes my drink and my brand bigger than any of those other drink brands," Lil
Jon says. "I'm more of an integral part in the brand." Crunk!!! is primarily owned by
liquor importer Sidney Frank, who started Grey Goose (until he sold the brand to
Bacardi), and holds the U.S. licenses for Jagermeister and Corazon tequila.
GETTING THE DRINKS OUT
But edgy marketing means little in the beverage industry without solid distribution.
"None of these companies will be able to go [nationwide] overnight," says John
Craven, editor-in-chief of BevNet.com. A company that wants to sell its product in all
50 states
needs
between 250
and
300 distributors, he says.
Building those relationships remains a challenge for small companies: Go Fast!
currently has about 25 distributors, and Crunk!!!, which started less than a year ago,
has
only
six,
mostly
in
the
South
and
New
York.
While Coke's KMX and Pepsi's SoBe Adrenaline Rush lag behind Red Bull, with
market shares in the low single digits, that could change very quickly. "If you were to
look 10 years back at bottled water, you wouldn't see [Coke-owned] Dasani and
[Pepsi-owned] Aquafina" on the Top 10 list, says Emergence's Kelly O'Keefe.
"There's still a lot of shaking out to be done."
BUYOUT BAIT?
The small guys may be making a lot of noise now, but observers say the energydrink market will likely follow the familiar path of bottled water, meaning now is the
time for the edgiest of startups to make their money or position themselves for an
eventual buyout.
"As the big boys [move] into this market," says O'Keefe, "you'll see them acquire
some of the strong brands. It's rare that you're going to see an independent rise
without getting into bed with one of these companies." If teenagers are adequately
wowed by the stunts, maybe industry executives will be too.
THE MARKETING OF RED BULL
The day was so perfect, it looked just like a commercial. The skies were blue, the
sand was white, and the temperature was in the low seventies. Among a handful of
people milling around on a broad stretch of Miami Beach shorefront, three guys were
fussing with kiteboards — contraptions that consist of large, crescent-shaped
parachutes rigged atop miniature surfboards. Two members of the party wielded
video cameras, and from a distance it all looked like a bunch of college kids in the
process of documenting some silly and pointless stunt.
In fact, they were preparing to ride these wind-powered kite boards 88 miles from
Key West to to Varadero, Cuba — a distance that would set a new world record for
the emerging sport. They were not, however, college kids.
Several clutched little silver cans of Red Bull, the European "energy drink" that has
become a phenomenon in the United States at least partly on the strength of
incredibly shrewd marketing. Introduced here in 1997, Red Bull has spawned an
entirely new category in the U.S. beverage business: Energy drinks accounted for
$275 million in wholesale revenues last year, a whopping 65 percent of which went to
Red Bull. Owners of the privately held Austrian company won't talk about its
financials, but annual sales reportedly top $1 billion worldwide.
Red Bull is popular with college kids and nightclubbers, whom the company
aggressively targets. But its most public tactic has been to wrap the drink in the
sweaty mantle of extreme sports. To that end, Red Bull sponsors its own stunts and
competitions in relatively obscure disciplines like street luge, waterfall kayaking, and
freeskiing. The Red Bull Snowthrill of Alaska, for instance—held March 21-28 this
year in Haines — gathers 12 freeskiers in the Chugach Mountains, pairing each with
a photographer and offering cash prizes for the hairiest images. The point is that Red
Bull associates itself with sports that are not just extreme, but Extreme!
Like kite-boarding to Cuba. Kiteboarding blends elements of windsurfing and
wakeboarding, and lately has gained a sort of critical mass as the equipment becomes
more affordable. The rider stands on a four- to six-foot board, secured by footstraps
or boots; he's propelled by a billowing "kite" (the big parachute thing), which is
controlled by manipulating a handbar that guides 100-foot-long tethers. When the
wind is right, people who know what they're doing can pull off astonishing 40-foothigh jumps and butter-smooth landings. Competitions usually involve tricks, so the
Cuba venture is unusual in pushing the limit of how far, literally, a kite-boarder can
go.
As I joined the beach crew, Kent Marinkovic, one of the kiteboarders, was talking to
the cameras. Marinkovic is national sales manager for Adventure Sports, a Miami
extreme-sports equipment retailer. He's 33, preppie-looking and very tan. He
explained his equipment — he had a 150-centimeter (about five-foot) board and
planned to use boots — and his state of mind. "I’m super-motivated," he said. "I don’t
get nervous." He held a can of Red Bull.
Nearby was another kiteboarder, Neil Hutchinson, who co-owns a Fort Lauderdalebased watersports outfit called Kitesurf U.S.A., scorns vegetables of any kind, and
smokes Marlboro Reds. He's British, 31, and looks like a leather-hided Peter O'Toole.
When he took his turn explaining his equipment and tactics to the lens, he was
immediately heckled by Oliver "Mowgli" Butsch, the third kiteboarder.
"Neil has tactics!" Butsch bellowed in mock disgust. "Buddy, I'm going over. I'm
arriving.
Butsch is Austrian, so it was hard not to think of Arnold Schwarzenegger when he
spoke, which was often. He's a 38-year-old model with long hair, shades, and a tan
even more stupendous than Hutchinson's. He charmed us all, and ignored his
constantly trilling cell phone: "The more you pick it up, the less people will call you.
If you never answer — they want you!"
I took a seat under a beach umbrella and opened my first-ever can of Red Bull. You
don't drink this stuff for the flavor — it's been described, accurately, as tasting like
liquid Sweetarts — but for the effect. It’s supposed to give you a boost — it "vitalizes
body and mind," as the can puts it. Presumably this explains why Red Bull associates
itself with fringe athletics. Marinkovic joined me by my umbrella. I asked him about
the drink, and he stared at the Red Bull can in his hand. But he didn’t say anything
about the various promises printed on the back ("Increases endurance," "Stimulates
the metabolism," and so on). "It makes a good mixer with Vodka," he said. "And it’s
kind of a hangover cure."
Maybe it was the Red Bull, but the beach scene struck me as odd. It wasn't the
apparent incongruity of a drink postures as an aid to sporting achievement but is also
widely used as a party potion. Nor was it the maddening uncooperativeness of Red
Bull's PR flacks, which I'd experienced from the moment I first contacted the
company. (I'd originally been invited to ride
in one of the boats escorting the kite boarders to Cuba. Then I was disinvited. Then
the trip was postponed and I was invited again. But it was postponed again; from
there I entered an information-free loop of shifting dates and contingencies. I finally
compromised and decided I would accompany the crew only as far as Key West.)
No, what seemed weird was that this was a marketing event no one knew about.
There was no advance press release. There was no Red Bull tent set up to attract local
news crews to cover this zany enterprise, or hand out free samples to curious
onlookers. For that matter there were no curious onlookers. (One white guy with
dreadlocks wandered up to ask if we’re giving lessons; that was it.) There were no
carefully recruited cool hunters to pass along the news through the Great American
Secret Marketing Underground Network that Red Bull was presiding over a privately
funded effort to kite board to the shores of a nation that is the subject of a United
States trade embargo. This was one of the most outrageous publicity stunts I'd ever
heard of. And it seemed to be happening in a vacuum. How could this possibly make
sense?
Now, to be taken seriously as having a distinct theory of marketing to explain the
method to this murkiness that surrounds Red Bull, I should probably clutter the
language with an invented word to summarize my thinking. So here it is: Marketing.
Murketing, as you might guess, derives from murky. Usually the wizards of branding
want to be extremely clear about what their product is for and who's supposed to buy
it. Red Bull does just the opposite. Everything about the company and its sole product
is intentionally vague, even evasive. While the drink appears to be targeted
specifically at someone — extreme athletes, ravers, cosmopolitan students — the
brand identity is actually pretty nebulous. You could argue that what Red Bull
drinkers have in common is a taste for the edgy and faintly dangerous. But what does
this really mean? Obviously any attempt to articulate such a thing would immediately
destroy it. The great thing about a murky brand is that you can let your customers fill
in all the blanks.
I was certainly puzzled the first time I came across a can of Red Bull. It was in a bar
in the French Quarter of New Orleans, the city I live in. The cans are small (8.3
ounces), usually cost $2 or more, and feature a silver-and-blue pattern and two red
bulls about to head-butt each other. "With Taurine," it says on the front. On the back
was that series of vague promises, beginning with "Improves performance, especially
during times of increased stress or strain." Red Bull turned out to be fairly easy to buy
in the Quarter, which didn't make much sense, given that the Quarter is arguably the
most unathletic neighborhood in the world. So how did an energy drink find its way
into the company of such good-time classics as the Hurricane and the Hand Grenade?
For that matter, what's "taurine," and why is it touted on the front of the can? Why is
the can itself so puny, while costing three or four times more than a 12-ounce
Mountain Dew? And what's with those rumors about what else is in Red Bull?
BACKGROUND
The company is headquartered in Fuschl, Austria, a lakeside village outside of
Salzburg. The official corporate creation saga says it was invented by a Fuschl
resident and entrepreneur named Dietrich Mateschitz. Traveling in Asia in the 1980s,
Mateschitz supposedly came across a syrupy tonic favored by ricksha drivers, and
discovered that its key ingredient was an amino acid called taurine, which occurs
naturally in human and animal bile. He adapted it to a palatable drink and launched
Red Bull in his home country in 1987.
Not much else is known about Mateschitz. Red Bull gets its share of bad publicity
because there have been deaths allegedly associated with its use as an alcohol mixer
at raves and other party settings. Mateschitz avoids such nagging issues by almost
never being interviewed, and my requests to speak with him were turned down flat.
"He doesn't like the media," offered Emmy Cortes, Red Bull's U.S. spokeswoman.
But she assured me he is "a very charismatic gentleman" in his "midfifties," single,
and "kind of a playboy." Here she added an impish laugh, which seemed a little
practiced. "Not even that many people in the company have met — or even seen a
picture of — Dietrich. He's almost like a myth within the company." Again with the
laugh. Cortes also told me I would not be able to speak with Red Bull’s marketing
and strategic planning chiefs for North America, where the drink first appeared in
1997. This coyness, she explained, was of a piece with "the mystique of the brand."
"Mystique" comes up a lot when Red Bull is discussed by marketing experts, who
seem to adore it. "We live in an emotional society," purrs Marc Gobé, president and
CEO of the New York- based branding firm Desgrippes Gobé Group (which does not
work with Red Bull) and author of a book called Emotional Branding. "Extreme
sports deliver on that need to, to... vibrate, in a way. Red Bull is one of the first
products I've seen that delivers on that energy." He’s especially taken with the
packaging. The can is "sexy," he says, and its small portion of liquid implies that it
packs an extra wallop. Perhaps most crucially, he argues, Red Bull has earned its way
into the culture, as an "anti-brand."
But the word most commonly used about Red Bull is "stealth." When the company
came to the United States five years ago, it did not roll out a big, flashy ad campaign
or buy massive, coast-to-coast distribution. Instead Red Bull's operatives slunk from
city to city, using "street teams" to murmur the good word to all-important,
trendsetting Gen Y types. According to Nancy Koehn, a Harvard Business School
professor and author of the book Brand New, these "cosmopolitan" young people
view Red Bull as a product of the "global village." Carefully winning over these hip
influentials to the cause set off a "grass-roots" marketing wave ("building an image
for next to nothing," Fast Company enthused not long ago), and before you know it
the stuff is outselling everything else at the 7-11. A fuddy duddy brand like Coke, the
experts conclude, could learn a few things from Red Bull.
DIFFERENT VIEWS
There's some truth in all this, but I had to wonder: Are these experts describing the
mystique of Red Bull, or are they creating it? Because Red Bull's street vibe didn't
just materialize. According to Brandweek, in 2000 the company spent $100 million
marketing its "stealth" brand in the United States alone — bankrolling events,
installing displays in nightclubs, and so on. (Cortes disputes that figure, but concedes
that, "the perception that these events don’t cost much to produce is good for us. We
don’t want to be seen as having lots of money to spend. But it’s not as easy and
inexpensive as people think.")
Red Bull stokes demand through a network of what it calls "mobile energy teams,"
which hand out free samples. In New Orleans, the local team tools around in a supermodified Suzuki Vitara, all done up with the company logo and a big silver can
mounted on the back. Cortes said these teams show up at places where people might
"need a boost," like gyms, office buildings, and construction sites.
"It's rare for them to hit a bar," she assured me. She also claimed that less than 10
percent of the company's sales come from bars and nightclubs — though she admits
that the first place in New Orleans to sell Red Bull, a year and a half ago, was a bar
on Bourbon Street.
Since college students are seen as being crucial to the marketing equation these days,
I conducted a random survey, quizzing a few Tulane University students about Red
Bull. They all (surprise!) thought of Red Bull only as a bar drink. One typical
consumer was Kaytie Pickett, a dormitory resident assistant who heard about Red
Bull from sorority girls. The essence of their message: "It's legal speed."
"It's really a kind of fashionable drink," she said. "You see the fashionable sorority
girls buying their can of Red Bull with their Marlboro Lights. It's like: 'Look, I can
afford to pay $3 for this ridiculous drink.'"
Red Bull has supposedly crafted a strong identity for a specific target audience; the
truth is that its identity is purposefully indistinct. Reticence, you see, is the first rule
of murketing: Stay silent about what it is that makes you different, and eventually
someone else will supply the answers.
And actually, that’s why college students are the perfect target for murketing
campaigns like Red Bull’s — not because they’re such sophisticated consumers, as
the gurus of consumption theory are always saying, but because they’ll essentially
believe anything. They don't have a clearly defined world view that guides all their
purchases — they're looking for one. Kaytie Pickett's rationale for drinking the stuff
is zen statement on young-adult ambivalence. "Maybe I think it works just because
they say it works," she says. "I’m a slave to peer pressure." Then she laughs, just a
little.
EXPERIENCES
The organizer of the "Cuba crossing" was Gilles d'Andrieux, a dashing 32-year-old
Frenchman who looked very much at ease in neatly pressed pants, a powder-blue
dress shirt, and suede shoes as he strolled across the sands of Miami Beach to greet
his team. He'd brought chicken and tuna sandwiches for everyone. Neil Hutchinson
diligently picked all the olives and avocado off his as Gilles explained his plan for
arriving in Key West before sunset. As it turned out, the sun was almost down before
Gilles had finished rounding up his 22-person crew and getting us on the road.
The crew's fabulousness quotient was high. There was Gabriela Marques, 25, a
Brazilian nutritionist who looked like a model. There was Fabrice Collard, a 28-yearold Frenchman who would serve as the expedition meteorologist — and who also
would be one of the kiteboarders. There was Delio Gonzalez, one of the boat
captains, who seemed to speak about four languages. And there were a lot of French
people in roles I didn’t always grasp.
On the trip down I’d been thinking that if some anti-corporate band of culturejammers had plotted an event as an absurd parody of market culture, they could
hardly have come up with a better scheme than a sponsored extreme-sport race to
Cuba. What a viciously satiric reversal of the more familiar idea of Cubans trying to
cross the water to America by way of terrifying, frequently fatal, raft journeys — a
kiteboard venture from the land of freedom to the last bastion of Communism, all for
the sake of thrill-seeking and brand-building.
Gilles is based in Miami, where he operates as a freelance extreme athlete and event
organizer. Over a period of two months he had lined up the support boats and crews,
monitored the weather, dealt with U.S. Customs (there was endless red tape, which
ended with the team promising not to spend any money in Cuba), made arrangements
with a Cuban marina, and generally kept all the moving parts in sync. After the
traffic-delayed, five-hour drive to Key West, I caught a ride with him and some filmcrew guys to a bar called Finnegan's Wake, where everyone was supposed to gather
for dinner around 9:30. But we were late, we hadn't found the bar, and Gilles, who
was behind the wheel, was starting to seem like that rarest of things: a tense
Frenchman.
"Excuse me," he asked passersby on the street. "Do you live in Key West? Where is
Grinnell Street?"
RESEARCHES
As we searched, he squinted through the windshield at flags and other wind
indicators. The latest round of weather data had suggested that the wind might not be
strong enough for a launch the next day. But now Gilles was guessing it would gust at
15 knots in the morning — good enough. "If that flag is blowing straight out, we
should go," he said.
When we finally made it to Finnegan's Wake, everyone was there, including the crew,
Red Bull marketing reps, and 35-year-old Paul Menta, the fifth and final kiteboarder
and owner of a company that offers kitesurfing lessons in Florida, Maui, and
Venezuela. Menta had kite-surfed in 93 locations around the world in the past year,
most recently in Venezuela, where he'd suffered severe stomach flu. "I’ve been at the
hospital," he said. "They’ve been giving me three liters of IV a day." Three months
earlier he'd been bitten by a shark. We shook hands. I asked him how he felt. "Ah, I'm
fine," he said, looking tired. "I'll be fine tomorrow." Extreme!
Ultimately, the Red Bull reps decided to postpone the launch for one more day. The
next morning, the little breakfast room of the Key West Comfort Inn was made over
into Command Central, with a laminated map taped to the wall. Gilles arrived and led
everyone through the basics. The 88-mile trip was expected to last eight hours,
touching down on the coast 100 miles east of Havana. Winds on launch morning
would likely gust to 20 knots or better. He went over elaborate safety procedures
concerning support boats, flares, life vests, two-way radios, and the like. Just in case
these didn't help, Red Bull covered its bases on the liability front, giving everyone
forms to sign that said things like: "I agree that upon my transport to any medical
facility or hospital, Red Bull shall not have any further responsibility for me."
Jen Klaassen, a Red Bull rep, added that if the athletes wanted to drink a can of Red
Bull now and then as they crossed, that was just fine, but they should balance it with
equal amounts of water to avoid dehydration, since Red Bull's caffeine is a diuretic.
"Red Bull, water, Red Bull, water," she said.
To which Neil, the heavy-smoking Brit, added: "And on the way back, it's Red Bull,
vodker, Red Bull, vodker." A lot of people laughed, but the Red Bull contingent only
smiled.
SUCCESS OF RED BULL
Red Bull's success in the U.S. seems more remarkable when you consider that it
immediately attracted a swarm of shameless knockoffs backed by beverage giants.
Anheuser-Busch has a drink called 180, Coca-Cola has one called KMX, and Pepsi
now has two: SoBe's Adrenaline Rush and a Mountain Dew spinoff called Amp. All
come in skinny silver cans. Adrenaline Rush is Red Bull's nearest competitor, lagging
far behind with just 12 percent of the American market. In the end the
undifferentiated swarm of knockoffs only cements the "authenticity" of the original.
Red Bull's rise has also come against a backdrop of strange rumors and sinister
speculation. Pretty much from the beginning, health officials in other countries have
had questions about it. In Norway, Denmark, and France, Red Bull's sale is currently
limited to pharmacies, and it has not gained approval for sale in Canada.
The controversy stems from a handful of deaths in which an overload of Red Bull
(sometimes in concert with alcohol) allegedly played a role. In March 2001, a
Swedish woman collapsed and died on a dance floor after reportedly slamming down
a couple of cans that were spiked with alcohol. Hers is one of three cases under
investigation in Sweden that feature accidental deaths possibly linked to Red Bull —
two involving alcohol, one not. What's the problem? One theory is that Red Bull with
liquor acts like a poor man's speedball — a dangerous mix of upper and downer.
"What most concerns me is the alcohol," says Gregory Stewart, co-medical director
of the Institute of Sports Medicine at Tulane. "If you're mixing it with vodka, it keeps
you awake and alert" — counteracting the depressive effects of the liquor — "and
you run the risk of alcohol poisoning."
Red Bull's Emmy Cortes has heard all this before, and has a ready, multipronged
response: The company doesn't market Red Bull as an alcohol mixer; "individuals
should exercise common sense"; and no one has ever proven the drink to be harmful.
In the United States, an FDA spokeswoman says the agency is aware of Red Bull, but
there's currently no lurking prospect of federal regulation — most of the reported
problems have more to do with using the product unwisely, she says, than with Red
Bull itself.
The rumors are more amusing. They tend to focus on the drink's caffeine and other
ingredients, especially taurine — it's bull testosterone, it's bull semen, it's bull urine,
it's an aphrodisiac, etc.
Cortes laughs off the more outlandish of these, and says the caffeine level is about 80
milligrams per can, equal to that in one "weak" cup of joe. Fine. Then what is special
about the drink, and about taurine in particular? Taurine is important, she says,
because "in times of stress and strain, your taurine levels are depleted, and Red Bull
replaces them." Dr. Stewart laughs right back at that, dismissing the idea that
boosting taurine levels has a meaningful impact on physical or mental performance.
Cortes herself concedes that "taurine alone isn't gonna give you the same kick as Red
Bull." The key to the "kick," she says, comes from the combination of caffeine,
taurine, and glucuronolactone, a "carbohydrate that rids your body of toxic
substances."
Uh-huh. There's another possibility. An interesting precedent for all this confusion
involves good ol' Coca-Cola. When it started life more than 100 years ago, it was, in
fact, a patent medicine. It famously had a "secret formula," and early on its promoters
made vague claims about the "invigorating" power of its mysterious ingredients,
touting "the wonderful Coca plant and the famous Cola nut." (The cocaine element of
the secret formula, always minuscule, was reduced to nothing by 1903.) Red Bull
might seem like the anti-Coke today, but the echo of those early, pioneering
salesmanship efforts is loud and clear. This is the second law of marketing — it’s
why dopey rumors and allegations of danger actually help sales, it’s why on a
corporate level Red Bull cultivates an aura of secrecy, and it’s why a publicity stunt
without an audience can make sense. A swirl of rumors reinforces a sense that there
must be something about the drink. But the secret is, there is no secret.
Of the five young men who eventually left Key West via kite board, three made it all
the way to Cuba: Marlboro Man Neil, affable salesman Kent, and weatherman-athlete
Fabrice. The postponement forced me to miss the launch, but I later spoke with Gilles
by phone. He said that Oliver, the model, got his kite tangled and "busted" at the
starting line. Paul "passed out" about halfway through the trip, falling off his board
facedown in the water, arms akimbo. Gilles fished him out, apparently saving his life.
I spoke to Paul, too, who said he flew back to Florida the next morning because he
was pissing blood. Extreme!
All in all it was a rough ride, Gilles said, but a clear triumph. The party arrived at
6:38 p.m., after eight hours and 38 minutes on the water. The sun had set by then, and
it was too dicey to kite board all the way to shore, so they stopped 500 feet short of
Cuban sands and took the boats in. I spoke with all five of the kite boarders and got
the same story every time: They made it near land, and for them this represented
success and the completion of a new world record. Since it was dark and getting
dangerous, they took their kites down, got into the boats, and rode them ashore. The
seas remained far too rough even for boat passage back the next day, and two people
flew back with Paul. The rest stayed an extra day, then crossed by boat back to Key
West over the still-windy waters, taking five and a half hours and slamming into 15foot waves.
"Everybody was extremely silent on the way back," Gilles said. One woman bruised
her ribs.
A few days later I got a press release from Red Bull, which recalled things
differently. It had the three kite boarders "arriving in Cuba at 5:55 p.m., one minute
before sunset." Later I got a tape of the "video news release" put together by Ocean
watch — the company responsible for documenting the event — with a few minutes
of highlights, and some comments from Neil and Kent. (Fabric’s English isn’t so
good.) This footage is what went out over the wires, and was picked up for use by
more than 40 local news broadcasts around the country.
In the video, oddly, the three kite boarders surf all the way onto the shore and
celebrate with high-fives in light that is obviously pre-sunset. The release didn't say
so, but the scenes of the boarders' "arrival" — unbeknownst to the folks who used the
footage in their evening news broadcasts—had been shot the following day.
And although I hadn’t gone on the trip itself, I also got a curious request to write a
letter, supposedly to be submitted by Red Bull to the Guinness Book of World
Records people, stating that I had "been present at some portion" of the trip, and that I
would "be covering the event to some extent." (I didn’t write the letter.) Meanwhile,
Ocean watch is cutting a longer version of its tape together for a 24-minute segment
on the Outdoor Life cable channel. I’m not sure which version of reality that
"documentary" will conform with.
All of which brings us to the final lesson of marketing, which is: Never let the truth
get in the way of your brand’s message.
Asked about this, Cortes called the video release "a huge mistake not in line with our
brand values." Yes, of course. But it doesn't really matter. Whatever the facts, the real
truth is that any Red Bull drinkers, or potential drinkers, who might be impressed by
the Cuba crossing are going to get exactly the message Red Bull wants them to get.
People who are receptive to the idea that Red Bull's involvement makes the drink
cool will decide that without additional prompting. Other Red Bull fans will never
hear about it, or just shrug when they do, and dream up some other, murky reason to
buy the next can. They won't even need to see a commercial.