Strategic Analysis of Red Bull GmbH
Red Bull Gives You Wings
Arguably one of the most entrepreneurial firms of recent times, there is no denying Red Bull GmbH is a powerful force. Founded in the mid 1980’s by Austrian entrepreneur Dietrich Mateschitz created the unique formula providing millions of people with ‘wings’ on a daily basis.
Back in 1984, Mateschitz discovered the need for a coffee alternative. Alongside Mr Yoovidhya they developed Red Bull from Krating Daeng – a thai version of Red Bull – turning the beverage into a carbonated, less sweet version they believed would appeal to Western tastes. The production of Red Bull led them to create a new category within the soft drinks market – that of ‘energy’ drinks.
30 years on and their original product is as strong as ever. Due to its private ownership, financial figures on Red Bull are scarce, however it’s reported that over 40billion cans have been sold worldwide, with 2012 figures demonstrating net sales of $4.9billion and 5.2billion cans being sold, representing 15.9% and 12.8% growth respectively over 2011. (Euromonitor International). According to Marketline (2012) Red Bull holds an estimated 43% global market share of the energy drinks market by value, 21.5% by volume giving it dominant market position as its nearest competitor Monster hold 16% by value in comparison.
In this case study I aim to outline Red Bulls current strategies and sources of competitive advantage, using the SWOT framework. This helps understand the reasons for the success of Red Bull and also their strategy to go beyond the international expansion with Red Bull’s focus on lifestyle rather than the energy drink in itself. In this context I will discuss Red Bull Media House, launched in 2007, a strategic move away from purely beverage production. I will review this and determine the success of this embryonic business within Red Bull GmbH using Barney’s VRIO framework, finally analysing the strategic leadership during Red Bull’s launch of their Media House,
Arguably one of the most entrepreneurial firms of recent times, there is no denying Red Bull GmbH is a powerful force. Founded in the mid 1980’s by Austrian entrepreneur Dietrich Mateschitz created the unique formula providing millions of people with ‘wings’ on a daily basis.
Back in 1984, Mateschitz discovered the need for a coffee alternative. Alongside Mr Yoovidhya they developed Red Bull from Krating Daeng – a thai version of Red Bull – turning the beverage into a carbonated, less sweet version they believed would appeal to Western tastes. The production of Red Bull led them to create a new category within the soft drinks market – that of ‘energy’ drinks.
30 years on and their original product is as strong as ever. Due to its private ownership, financial figures on Red Bull are scarce, however it’s reported that over 40billion cans have been sold worldwide, with 2012 figures demonstrating net sales of $4.9billion and 5.2billion cans being sold, representing 15.9% and 12.8% growth respectively over 2011. (Euromonitor International). According to Marketline (2012) Red Bull holds an estimated 43% global market share of the energy drinks market by value, 21.5% by volume giving it dominant market position as its nearest competitor Monster hold 16% by value in comparison.
In this case study I aim to outline Red Bulls current strategies and sources of competitive advantage, using the SWOT framework. This helps understand the reasons for the success of Red Bull and also their strategy to go beyond the international expansion with Red Bull’s focus on lifestyle rather than the energy drink in itself. In this context I will discuss Red Bull Media House, launched in 2007, a strategic move away from purely beverage production. I will review this and determine the success of this embryonic business within Red Bull GmbH using Barney’s VRIO framework, finally analysing the strategic leadership during Red Bull’s launch of their Media House,
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