HomeA Story of FoodTaking the bull by its horn: Journey of Energizing Red Bull

Taking the bull by its horn: Journey of Energizing Red Bull

Red Bull has been a global success since its inception in 1987, with over 100 billion cans sold to date, with an estimated 9.8 billion in 2021 alone. The Austrian firm Red Bull GmbH produces the Red Bull brand of energy drinks. As of this year, it has captured 38 per cent of the energy drink industry. 

Austrian businessman Dietrich Mateschitz created the Red Bull brand.

FunFact: The concept was first implemented by Mr Chaleo Yoovidhya when he launched the popular Thai energy drink Krating Daeng.

Red Bull’s parent company, Red Bull Gesellschaft mit Beschränkter Haftung (GMBH), is wholly owned by him and his family and is responsible for international distribution and promotion of the product. Red Bull’s market share in the global energy drink industry is the largest, with over 6.3 billion cans sold in 2017.

Red Bull Energy Drink was originally only available in a single, unremarkable flavour packaged in a tall, skinny, silver-blue can; but, as time progressed, several other flavours were introduced. One of the most well-known and memorable advertising slogans in the United States is “Red Bull Gives You Wings.”

However, Red Bull has had its journey. The company has experienced its fair share of peaks and troughs to reach its present state. Let’s walk down the memory lane and revisit the evolution of marketing strategies. 

The Start

In 1976, Red Bull’s founder, Mr. Chaleo Yoovidhya, introduced the “Krating Daeng” energy drink to the Thai market. Red ‘gaur’ (Indian Bison), a species found in Thailand, is the inspiration for this expression. In its early days, the drink’s primary audience was blue-collar workers like truck drivers and construction crews.

In 1982, businessman Mr. Chaleo of T. C. Pharmaceuticals met Mr. Dietrich Mateschitz, who was working for German firm Blendax, in Thailand. After trying the “Krating Daeng” energy drink, Mr. Mateschitz was astonished to discover that it helped him overcome jet lag.

He approached Yoovidhya with a commercial proposition to introduce his homegrown energy drink to the European and American markets, and Yoovidhya recognised his innovative business acumen. Investing $500,000 apiece, Mr. Yoovidhya and Mr Mateschitz established Red Bull GMBH in 1984. They each have 49% ownership in the business, with Mr. Yoovidhya’s son holding the remaining 2%.

Mateschitz has been named CEO of the newly formed firm. Mr. Mateschitz’s native Austria introduced the repackaged product to its many ski areas in 1987. To appeal to affluent customers, the energy drink was rebranded as a premium offering at a higher price point.

Tough Part

Unfortunately, the journey into entrepreneurship has not been as easy as Dietr had hoped. Dietrich spent three years and numerous sales call trying to secure a licence to market the high-energy drink in Austria.

What’s more, the preliminary findings of the marketing study are not encouraging. Many drinkers found the beverage to be sickeningly sweet and therefore unpleasant. He still had faith in his business despite losing a million dollars in two years. Dietrich paid for everything himself, with no help from other investors.

After much consideration, he concluded that Austria was not a viable market for expansion. This prompted him to plan a rollout in three new European markets: Hungary, Germany, and the United Kingdom.

Steps Along The Path To Fame And Fortune

Customers quickly took a liking to the distinctive blue and silver tall cans that Red Bull was sold in. Taurine, caffeine, vitamins, simple sugars, and artificial tastes were all included in the product for a synergistic effect that gives you more pep in your step. Caffeine in the beverage is responsible for the user’s increased vivacity, alertness, and activity.

While there had been other health beverages available before Red Bull, its distinctive flavour and classy packaging won over consumers. Its debut into the foreign markets of Hungary and Slovenia in 1992 was aided by widespread and popular media promotion.

At the turn of the millennium, the traditionally conservative Middle East was conquered, and in 1997, the immense potential of the American market was unlocked. Though the Chinese market had been supplied with Red Bull-branded Krating Daeng since 1995, the international Austrian version didn’t make its debut there until 2014.

Both of these goods are available in the markets of many other South East Asian nations, albeit the international product is more commonly seen because of its distinctive silver-gold packaging, while Krating Daeng is sold in a smaller, gold can.

Manufacturing of Red Bull’s signature flavour remains centralised in Bangkok, Thailand, and then exported to other production facilities across the world. In 2008, Mr. Chaleo and Mr. Mateschitz were estimated to have a net worth of nearly $4 billion, placing them at No. 250 on Forbes’ list of the world’s richest individuals.

Marketing Strategies

Red Bull’s success can be ascribed in large part to the company’s viral marketing initiatives. The slogan “Red Bull gives you wings” is so widely recognised that it is often mistaken for the product’s actual name. The advertisements conveying this message are hip, creative, and entertaining, generating the desired attention and a positive response from viewers.

Aside from being entertaining, advertising based on caricatures or cartoons help get the word through that Red Bull is, in fact, an invigorating beverage. In addition to its ubiquitous media presence, Red Bull is widely associated with action and extreme sports.

As a result, the firm has sponsored some of the most well-known athletes in the sports of skateboarding, surfing, kayaking, mountain biking, BMX biking, snowboarding, rowing, and related pursuits. Red Bull owns their own Formula 1 team, Red Bull Racing, as well as sponsorship ties with several other F1 and NASCAR teams. From 2010–2013, Sebastian Vettel, a four-time Formula One world champion, drove the company’s vehicles.

Red Bull also dominated the racing industry by dominating the World Constructors’ Championship for the same amount of years. A number of professional football clubs in Austria, Brazil, the United States, and Germany all receive financial support from the company.

Red Bull GMBH owns the German Bundesliga (football league) club RB Leipzig and sponsors the Austrian club FC Red Bull Salzburg and the American club FC New York Red Bulls. As a means of promoting its product as a stimulating and performance-enhancing energy drink among the populace, the corporation sponsors a number of extreme sports teams.

A number of well-known people in the dance and music industries have also been supporting the brand. Artists like Eminem, who competes in the Emcee Battle Rap Championships, have sponsored the product. Red Bull GMBH also backs the internationally renowned airshow known as the “Red Bull Flugtag” (airshow in German), where pilots show off their home-built aircraft and perform tricks for the spectators.

As part of its “Red Bull House of Art” fellowship programme, the firm provides living and working space for up-and-coming artists and designers for three months, during which time they work on a body of work that will be shown at the end of the residency.

There is no denying Red Bull’s prominence in the gaming industry. In games like League of Legends and Dota 2, which feature professional players and teams, it has sponsorship arrangements with numerous organisations.

Conclusion

Thus, Red Bull GMBH is a prototypical “east meets west” business success story. Within three decades of its international debut, the Thai energy drink “Krating Daeng,” which initially targeted the local working class population, had become the market leader in its category thanks to the promotion and savvy business decisions of Western investors.

Red Bull is poised to maintain its position as the market leader in the energy drink category for the foreseeable future because to the over twenty unique formulations of its flagship product.

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