Red Bull Drink in the UK Market - Assignment Example

Answer Strategic marketing plans are crucial part of promoting products and services of an organization. Segmentation of market therefore, becomes one of the most important criteria of developing appropriate strategy for introducing and marketing products. Segmentation basically refers to group of people with certain homogenous characteristics who could have the potential of becoming future buyers of the product. This becomes the first step for broadly defining market imperatives, especially for new products that are to be introduced. Red Bull needs to launch its cola drinks in the UK market and within the UK market it needs to identify the segment that would best help to create a market position. The fast changing socio-economic paradigms and advancing technology has tremendously changed the dynamics of market strategies. In the contemporary times, the customer has become much more informed and technology has provided him with more options within the similar product lines, but produced by different companies. UK market is one such market where the companies face cut throat competition. In such a highly competitive environment, Red Bull needs to base the market segmentation according to psycho-demographic pattern so as to maximise the initial impact and create a creditable position within the UK market. Psycho-demographic is chosen as the focus area primarily because of the fact that the competition within the industry demands a creation of a niche market for Red Bull cola to become a success. Red Bull cola faces stiff competition from the already established brands like Pepsi and Cola Cola. Psychographic or lifestyle pattern categorises the market according to which people exhibit a well defined way of living, maintaining a set of standard and displaying a typical purchasing behaviour. Since Red Bull has already a dominant market position in the energy drinks, launching of its Cola version would become easier within this particular market segment as it has many differentiating elements in its cola product which can be easily promoted within this group. Demographic segmentation would further split the market and Provide better tool to develop strategies and make significant inroad into the UK market for non alcoholic Red Bull Cola. Of the various demographic characteristics, the most useful would be the income and age-wise identification of the group that could be targeted through intense media blitz and other market techniques to attract them and make them a committed user and purchaser. The mixed segmentation is hugely popular in the contemporary times and gives a big leverage to the companies to plan its market strategy in a more flexible manner and successfully introduce their products in a new market. Answer 2 When the new product is introduced in the market, it is important to focus on the target market which is normally decided as per the demands of the consumer behaviour. Red Bull is introducing non alcoholic cola drink in UK market and the best segment to target would the children and the youngsters who can be easily convinced to try the drink. Identification of the target customers is vital to create an effective marketing strategy. In the case of Red Bull, since it is introducing non alcoholic cola drink in UK market where Pepsi and Coca Cola already have a considerable presence, the company too has targeted students and the young people as their major customers, as is evident by their advertising strategy. The younger generation is more inclined towards cola drinks and this particular segment could be persuaded to change their behavioural pattern through market techniques of differentiation that would add value to the Red Bull cola. Previous advertisements of energy drinks of Red Bull advertisements are focused towards sports promoting an image of daredevil which has great capacity to attract the teenagers and the youth. The advertisements through various media had conveyed the message of superior drink with aggressive marketing. This time around, Red Bull Cola has been introduced as a Cola drink with all natural ingredients so as to capture a significant market share in the aerated non alcoholic drink segment, where Pepsi and Coca Cola are already major players but have artificial flavours and colour. In the fast changing scenario of environmental degradation and ill effects of fast food culture, the Red Bull Cola has great potential to emerge as a ‘100% natural drink’ that would not only satiate the palette but would also promote healthy living and drinking! In the contemporary time, the parents as well as the schools are putting more emphasis on healthy living and introduction of Red Bull Cola has great potential to create a niche market in the lifestyle segment, targeting youth and the young professional initially. As the advertisement says ‘only cola brand to contain real Kola nut and coca leaf’, the Red Cola drink has potential that could be successfully exploited through creative marketing. Another very important feature of the Red Bull Cola is its claim of being 100% natural ingredients that are ‘Strong and Natural’. This might prove t be the key to the success of the drink in UK market which is presently undergoing a deluge of artificial aerated drinks that are creating huge health related problems for the younger generation. The target market of Red Bull Cola is therefore critical for its market strategy and long term aims and objectives of making significant presence in the UK market. Answer 3 Red Bull is vastly different from its major rivals in the UK market. While Red Bull energy drink was the first energy drink to enter into the UK market, its non alcoholic Cola drink is being promoted by its ingredients which are 100% natural. The changing social values and the imperatives of the times have necessitated the social scientists and medical experts to declare the need for people to move towards nature. The concept of nurturing the nature through changing consumption habits and promoting goods that are ‘green’, which is increasingly becoming popular amongst the people, may prove to be highly beneficial for the company when it introduces Red Bull Cola as 100% natural. The Red Bull Cola displays all the ingredients that are used to produce the drink and its claims of not even using artificial flavour or colouring is a significant factor in its favour. All the non alcoholic drinks, including Pepsi and Coca Cola have artificial flavour and colouring, which would give Red Bull, a big advantage to cash on its slogan of ‘strong and natural’. This is a huge differentiating factor that would certainly provide a beneficial leverage to Red Bull Cola for the niche market that it is targeting at the present. Answer 4 The Red Bull energy drink was launched in 1987 in the European markets which had become an instant success. In the next ten years, it had become a major international player in the non alcoholic drinks segment. ‘By 2004, the worldwide energy drinks market was worth an estimated £1.6 billion; Red Bull had achieved a clear market leading position, with a 70% market share’ (bized.co.uk). In the year 2006, according to an article, it had presence in more than 130 countries, sold over three billion cans and generating revenue of more than 2.6 million Euros! The success story of Red Bull energy drink could be contributed to the ambitious vision of its owners and promoters who had pursued their goals with determination and innovative market strategy. The market strategy for Red Bull energy drink had predominantly depicted sportspersons as favouring and drinking Red Bull. The various marketing strategies, viral as well as media advertisements had subtly associated Red Bull energy drink with the stamina of the sportsmen, thus making Red Bull as the iconic drink and motivating the target group to become strong like sportspersons. It had also helped create a definite image amongst the youth, which had gone beyond the concept of pricing. Apart from this, it was also the first energy drink that was introduced in the European market and the aggressive market strategy of the company had become a critical factor for its success. The Red Bull Cola, on the other hand is the latest entrant in the UK market which is supposed to give stiff competition to its rivals, Pepsi and Coca Cola. While the target segment, to a great extent, may be same for both the Red Bull products, the fundamental conceptualization of the market strategy is different. Previous Red Bull product was promoted as an energy drink and all its strategy was designed to impress the psyche of the youth which was supposed to emulate the sportsmen and drink Red Bull as energising drink. Red Bull Cola is an attempt by the company to change the consumer behaviour and motivate them to cultivate consumption habits towards drinks that have more natural ingredients. Red Bull Cola is designed to convert the committed Cola drinkers (read Pepsi and Coca Cola) to Red Bull Cola. Answer 5 Red Bull has made spectacular inroads into the European market in a short time via its energy drink. The niche market for the Red bull energy drink has committed consumers. The proven credibility of the Red Bull would be a great asset when it introduces another of its non alcoholic drink Cola in the UK market. Apart from the fact that the company an established credibility, there are various other factors which can convincingly contribute to its success in the UK market. The first and foremost is the most important differentiating element; the 100% natural ingredients of the drink which have the potential to give the new drink a beneficial market position. The fast food and non alcoholic aerated drinks, which are popular with the children, have now been declared by the dieticians and social scientists as unhealthy and potentially hazardous for the growing children. According to Ebbeling et al. major cause of obesity and lifestyle diseases is fast food includes ‘ingredients that are ‘saturated and trans fats, high glycemic index, high energy density, and increasingly, large portion size’ (2002). Therefore, at such a time, Red Bull Cola could be the answer for them as it has nothing artificial in its drinks and at the same time, has the tag of Cola attached to it that may swing the interest of the children to it! The Red Bull Cola has targeted that segment of the market which looks for certain defined characteristics which add value not only to the product but also to the lifestyle of the consumers. The ‘100% natural’ drink is a winning combination that can convincingly lure more customers to it. Yet another factor for its success may be its target market of youth and young professionals who may be looking for alternative to Pepsi and Coke. The Red Bull Cola thus has a vast scope of establishing itself in the UK market and also make a significant position in the overall market in the non alcoholic market segment. Marketers excel in influencing the self concept and personality traits and behaviour by developing market strategies of the products, keeping in mind the prevailing lifestyles of the people. Hence, different market strategy is adopted for different group of people. Advertisements are the most prolific example of segmented marketing where the contents of advertisements are decided by the target group. Red Bull has displayed extraordinary creativity in its advertisements and market strategy and one can expect the same dynamic approach in its market strategy while promoting its Cola drink. Reference Red Bull. Key Features of Red Bull. Available from: [Accessed 9 November 2008]. Ebbeling, Cara B., Dorota B. Pawlak, and David S. Ludwig. (2002). ‘Childhood obesity: Public-health crisis, common sense cure’ The Lancet, Vol. 360, No. 9331, August 10, pp. 473-482. Case Study. (28 March 2008). Red Bull to Launch Simply Cola. Available from: Read More