Swot Red Bull

STRENGTH – Leadership position The company “Red Bull” is considered like the “leader” of the energy drinks market in the world with 70% of market share in 2012. – Marketing strategy * A lot of sports events, promotions and campaigns (like street marketing) * Sponsorship (F1 Red Bull Team, Felix Baumgartner, Shaun White…) * Original communication strategy and efficient (http://www. redbull. fr/cs/Satellite/fr_FR/Video/Le-nouveau-clip-du-Monde-de-Red-Bull-au-cinema-021243076490242) -Innovation * Innovating recipe of energy drink containing “Taurine” – Loyal customers * The creation of an universe encouraged customer loyalty Strong Brand identity and trendy brand – Strong financial position * Turnover of 3,27 Billion of Euros. – Single product Weaknesses – Average price – Lack of product innovation Nowadays, there are a lot of competitors in the market owned by famous brands like Coca-Cola (Burn) or Pepsi (Dark Dog) – Lack of patent on Red Bull’s recipe means anyone can copy it – High logistics costs – Profits linked to exchange rates – High sunk cost (marketing, Advertising) Opportunities – Red bull has opportunities to expanding the target markets as well as product lines extension * Extension of product line can help to retain market share Increase market share with increased opportunities in emerging markets through being trendy * Sunk cost can provide future growth in emerging markets due to a trendy image – Consumer recognition through sponsorship of sports events so can expand product with a loyal customer base * Overcome higher prices than competitors with product expansion and diversification – New ventures like partnership with Facebook – Product and services expansion – International manufacturing opportunities * Manufacturing Internationally can decrease exchange rate risks Keep substantial market share with international operations * High logistics costs can be decreased with decentralized production in emerging markets Threats – Competition * Major competitors such as Coca Cola (burn) and Pepsi (dark dog) are continually seeking to regain market share of Red Bull – Negative publicity * Various media reported that Red Bull is harmful for one’s health * The caffeine levels in Red Bull can be dangerous if consumed by children/teenagers * Red Bull has gone to the extremes of seeking scientific proof that its product is safe for consumption (cost of scientific research) Inability to move forward with the product * The product could be in danger of becoming stale by shunning conventional advertising methods * Large investment in extreme sport events the question is what will be their next step to keep on being innovating and attracting – Ability to gain new customers and retain current customer loyalty * Red Bull’s target market currently aimed at youngsters: so this generation will continue to drink ‘energy drink? * the next upcoming generation accept this product ?