RED BULL
A Marketing
Strategy
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Worthy of
Investment or
not?
Pakistan has 18th largest middle
class in the world.
58% of the population falls in age group 18-
35
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Customer
Lifetime Value
Total Cost = Cost incurred for all customers*expected relationship
Total Cost = 4,105,677,859*9 = 36,951,100,731
If the number of customers acquired = 60,036,226
Cost per customer acquired for one year = 36,951,100,731/60,036,226 =
Rs 615
Cost per customer acquired for 9 years (average) = 615*9 = 5535
Cost per customer acquired for 17 years (maximum) = 615*17 = 10544
Revenue = Price*frequency*Usage per year*expected average relationship
life
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= 150*4*12*9 = 64,800
Positioning
“Red Bull aims to unleash the energy in
our hard working, adventurous, sporty,
and joyful youth at affordable prices”.
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Brand Awareness
Effectiveness
Marketing
Mix
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Product
Addressing a market need
╺ Previous sources of energy
boosts aren’t preferred by
newer generations
Competing Products
╺ Lower Priced competitors take
the lead
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Strategy
Addressing health concerns
╺ Through endorsement of famous
fitness
trainers and health nutritionists, Red
Bull can
pass on reassurance to its audience
about the
safety of consuming the energy drink
Diversifying the Product Line
╺ Offer different international flavors for a
limited time, and then select the most
liked and popular one for its permanent
product line.
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Expanding the Product
Range
We suggest that through product range expansion,
Red Bull should introduce new products that fall
under the energy boosting category
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Price
Premium Pricing
╺ Massive brand awareness, unquestionable
quality and it’s creative, widely acclaimed
marketing
campaigns, all come together to justify the
high price
Red Bull charges for its products.
Suggested Strategy
╺ lowering the price of the drink is the best way to
go
╺ Red Bull can introduce a new, smaller sized can, which
due to its reduced quantity, will be offered at a lower
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price
250 ml 175 ml
Rs. 220 Rs. 150
. A simple calculation indicates that the price for each ml offered is Rs. 0.88. The new proposed
size of the can is 175 ml, which means that according to Red Bull’s pricing, it should be
charged Rs. 156. This number can be rounded off to a more attractive price of Rs. 150
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Promotion
Pull strategy- free samples.
Objective:
╺ Increase product awareness
╺ Increase product sales
Tactics:
╺ Publishing tremendous content
╺ Publicity stunts
╺ Sponsoring events
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Promotion
Timing and frequency:
╺ major- holiday period
╺ minor- all around the year
Promotional budget expenditure
╺ major- sponsoring events and adventures.
╺ minor- billboards, TV/radio/print
advertisement.
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Place
╺ Intermediaries involved:
distributors, whole sellers, retailers.
╺ Mainly selective distribution.
╺ Combination of direct and indirect
distribution both.
╺ Placement in stores next to its
competitive products. In exclusive
catchy Red Bull chillers.
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Marketing
Financials
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Production Cost
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Sales
Projection
Total Costs for first 12 months = 4,105,677,859
Number of sales to be made in 12 months =
4105677859/150 = 27,371,186 cans
Number of sales to be made every month =
27,371,186 /12 = 2,280,932 cans
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Number of people in age group 18-45= 120,072,452.
120,072,452*50% = 60,036,226
Actual purchases for one month
60,036,226*5% = 3,001,811.3
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Portion of TV Viewers
THIS IS A SLIDE
TITLE
╺ Here you have a list of items
╺ And some text
╺ But remember not to overload your slides
with content
Your audience will listen to you or read the
content, but won’t do both.
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Primetime Hourly Rates
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Advertising
through Social Media
Twitter
╺ Depends on the type of advertisement and the level of your budget.
Facebook
╺ Main factors that affect Ad cost are the type of your industry, audience,
bidding amount, quality and objective.
Instagram
╺ Cost more, but it also has a far greater interaction than Facebook Ad.
YouTube
╺ A normal video advertisement keeps running somewhere in the range
of $.10 and $.30 per see, relevant to your video quality, your target
market, and your general objective.
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Advertisement
Through
Social Media
Red Bull Social M
edia Video
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Cost of
Marketing
• Amount spent on TVC in 1 year = 1,896,307.35*4
• = 7585229.4*30 = 227556882*12= 2730682584
• Amount spent on billboards, hoardings = 328000*12=
3,936,000
• Total Costs for first 12 months =
2,730,682,584+3,936,000+2,000,000+500,000+1368559275
= 4,105,677,859
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Marketing Expenses
Cost of Hiring Muhammad Amir: PKR 2-3 million
Cost of Hiring Samina Baig: PKR 500,000
Amount spent on billboards, hoardings in 1 year = 328000*12=
3,936,000
Amount spent on advertising on TVC in 1 year = 1,896,307.35*4 =
7,585,229.4*30 = 227,556,882*12= 2,730,682,584
Total marketing costs in one year =
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2730682584+3,936,000+500,000+2,000,000 = 2,737,118,584
Monitoring
and Control
╺ Financial Statements
╺ Customer Satisfaction
╺ Number of Customers
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Contingency
Plan
╺ Responsibility of Regional Head
Product Range Expansion
╺ Electrolyte-infused water and
Energy Bars
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Competitor’s
Response
Competitors will Reduce Price
Price Wars
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