History and Background
Just another day in the life of a hard-charging college student—the alarm goes off, you get out of bed, shower, dress, and head out the door for your 9:00 A.M. international business class. Yet again, after another long night of studying and socializing, you’re a bit groggy. As you move through the Student Union, checking out options, you realize that you need something a bit stronger than coffee today. Looking around, wondering what will help jumpstart your day, you reach for an energy drink.
Today, in just the United States alone, one in three college students regularly consume energy drinks.1While there are many options, one stands out—Red Bull. Moreover, this is not unique to the United States. Red Bull is a powerful brand, relying upon a cool image, great endorsements, slick media, and a powerhouse product to take on the world. Indeed, more than 7.5 billion cans of Red Bull sold worldwide in 2019.2
Like many product innovations, the idea for Red Bull energy drink came along innocently. In 1982 Austrian businessman Dietrich Mateschitz, who was selling cosmetics at the time, was on a business trip to Thailand. While there, struggling to get through another bout of jet lag, Mateschitz drank a local tonic, a drink with medicinal properties that promised one a feeling of vigor and well-being. The tonic’s ability to help him overcome the sluggishness of jet lag surprised him. Similarly, two years later while on a business trip to Hong Kong, Mateschitz came across another maker of tonics. Like the one he had in Thailand, this particular product was ridiculously successful, earning its Japanese owner so much money he was the top corporate taxpayer in Japan. Besides the vitality he got from the drink, Mateschitz saw the tremendous potential in a simple energy drink.
Inspired to capitalize on his experience, Mateschitz returned to Thailand. There, he negotiated a partnership with the tonic maker whose drink would radically change his life. Seeing immense opportunity in the West, he decided to start marketing the tonic there. Launching in 1987 and making its way to the United States in 1997, it was the first drink of its kind in many markets. Effectively, Red Bull created the “energy drink” product category—today, pretty ordinary, but then, an amazing insight.3
The Present
Today, Red Bull sells billions of cans of energy drinks worldwide. Each can contains a combination of caffeine, sweetener, vitamins, and an amino acid called taurine. What separates Red Bull from its many rivals is its extreme messages that each can of energy drink “Gives You Wiiings” and “Vitalizes Body and Mind.” Effectively, besides a refreshing drink, Red Bull sells the idea and image of an exciting, cool, enviable, action-packed lifestyle.
Reinforcing that message has led the company to develop a portfolio of activities that exemplify the spirit of Red Bull. It owns several soccer teams throughout the world, with teams in Brazil, Austria, Germany, and the United States. Each of these teams sports the Red Bull logo on their uniform and provides exposure for the brand to the millions of loyal fans. Red Bull has a YouTube channel with nearly 10 million subscribers; there, they can catch the spirit by watching hundreds of videos related to e-sports and extreme sports.4Likewise, one sees Red Bull’s logo blazing at all sorts of high-energy sporting events, including Formula 1 racing, motorcycle racing, and snow skiing competitions.Finally, Red Bull promotes its drink and lifestyle through a series of high-profile athlete endorsements, including NBA superstar Blake Griffin, Pro Bowl quarterback Jared Goff, and baseball World Series champion Kris Bryant.
Worldwide, billions of cans of Red Bull are sold annually; one easily finds it in kiosks, stands, stalls, and stores spanning 167 countries. No matter whether you are a college student in the United States, France, Japan, or anyplace in between, and your morning is off to a slow start, Red Bull is there to jumpstart your day. Recent sales growth comes from large markets, such as India and Japan.5
Red Bull aims to make and market a standardized product across all markets. The flavors and ingredients are the same no matter where you buy and drink it. Likewise, Red Bull aspired to use the same global branding, logo, and messaging worldwide. Simple adaptations are made in some Asian markets, most notably in Thailand. There, responding to local cultural outlooks and orientations leads to minor packaging adjustments. Instead of the standard blue and white color palette for its packaging, Red Bull uses yellow and red. Doing so helps to respect some cultures’ dislike of white-themed food packaging.6
Despite its worldwide popularity, it’s not all roses for Red Bull. Critics, citing news reports and research studies, point out that Red Bull increase blood pressure, accelerates heart rate, and negatively impacts kidney functions.7Going forward, especially for Red Bull’s health-minded consumers living active lives, these nagging concerns may diminish its appeal. They are also seeing the immense growth of rival energy drinks, notably the Coca-Cola Company’s Monster, which increasingly challenges Red Bull’s market position. For now, though, Red Bull continues turning a simple Thai tonic into a powerhouse product and high-profile global brand.
1Amy J. Jeffers, Katherine E. Vatalaro Hill & Eric G. Benotsch XXXXXXXXXXEnergy Drinks, Weight Loss, and Disordered Eating Behaviors, Journal of American College Health, 62:5, XXXXXXXXXX, DOI: XXXXXXXXXX/ XXXXXXXXXX
2https://www.redbull.com/int-en/energydrink/company-profile
3https://www.redbull.com/us-en/energydrink/history-of-red-bull
4https://www.youtube.com/c/redbullgivesyouwings/videos
5https://www.investopedia.com/articles/investing/022315/energy-drinks-industry.asp#:~:text=Global%20energy%20drink%20sales%20reached,according%20to%20Allied%20Market%20Research
6https://www.swedbrand-group.com/blog/dove-and-red-bull-adapting-their-products
7https://www.healthline.com/nutrition/red-bull-side-effects#side-effects
Questions:
Red Bull currently has a standardized approach for its energy drink. Provide an example of a way Red Bull could adapt its product to a country of your choice and make an argument for that adaptation.
It has been noted that Red Bull sells a lifestyle more than an energy drink. Describe that lifestyle and who Red Bull is attempting to reach.