Introduction
Red Bull is one of the leading energy drinks manufacturer and distributor in the world. The firm was started in 1987 in Thailand, and has since gained a global market coverage. According to Lehmann (2005, p. 138), this firm experienced massive success in 1990s because this industry was less competitive. The company chose a market niche that had few players.
Most of the major firms in this industry were manufacturing and distributing fizzy drinks and other beverages. Coming with the energy drinks was seen as a unique trend, and this earned this firm a lot of market share during its early stages of existence.
The firm has been able to expand to other international markets, especially in Europe and the United States. The report by Lehmann (2005, p. 140) shows that it is the world’s largest energy drinks manufacturer and distributer.
The success of Red Bull in the market can be attributed to the three elements of marketing which include people, place, and physical evidence. Red Bull has been successful because of the employees involved in the firm at various capacities.
The place element of marketing mix has also been very important in helping the firm achieve maximum success. Physical evidence has also played a major role in helping this firm to succeed. This research will analyze these factors in order to determine their relevance to the performance of this firm.
Discussion
Red Bull’s success in the market can be attributed to the three marketing elements mentioned above. According to Ewbank and Foulger (2010, p. 26), it is always important to analyze some of the specific success factors in an organization based on the marketing mix elements.
Upon a critical study of Red Bull, the researcher has been able to determine that the three elements of people, place, and physical evidence have played a major role in helping this firm achieve success in the market. It would be important to understand how individual element have helped this firm achieve success.
People Element
People form one of the most important elements of marketing mix within an organization. Success of a firm always depend on the activities of its employees. According to Ewbank and Foulger (2010, p. 27), employees form the most important resource within an organization. They carry the vision of an organization, and their skills, talents, and level of dedication would always determine success of an organization.
At Red Bull, the employees have played an important role in helping it achieve its current success. The firm has been on hiring competent employees with the capacity of meeting the demands of the dynamic market. The firm has been keen to ensure that its recruitment procedure is rigorous, and only passionate and talented employees are hired.
The company has various recruitment processes that ensure they get the right people for various responsibilities within the company.
Employees hired through such rigorous processes are nurtured by the company through in-service trainings and participation in relevant responsibilities in order to help them develop their careers. The company has put measures to monitor its sales team to ensure that they are working within the expectations of the firm.
This element has played a major role in the recent expansion of this firm (Lehmann 2005, p. 143). Red Bull has kept a team of highly motivated employees who are able to meet the changing needs of consumers.
Its marketing personnel has been actively conducting market research in order to gain understanding of the changing marketing forces. If this firm maintains this group of motivated employees, then chances are high that it is destined to greater success.
Place Element
A firm must define a clear method that it uses to make its products reach consumers in good time and in good quality. A sound choice needs to be made on whether the company would sell its products through direct representation or strategic distributors. Red Bull has been keen on selecting the right channels of distributing its products in the global market.
Red Bull started by distributing its products to small distribution outlets like health clubs and bars during its early stages of existence. However, this distribution strategy changed when the firm started experiencing market growth. The management realized that it could no longer rely on the simpler distribution strategies that it had been using within its hometown.
The management had to define a new distribution strategy that would meet the changing market demands, especially when it went global with its products. To penetrate new markets, the management of Red Bull has been targeting strategic distributors to ensure that its products reach the global market.
One of the strategies that the firm has been using in the past is strategic alliance formation with specific wholesalers, large retailers and other distributers in different markets to ensure that its products are made available in the global market.
Strategic alliances offer a viable option for this firm to make its products available in the global market without the need to have its own employees spread across the world. In situations where strategic alliances are not viable, Red Bull has rented its own warehouses and distributed its products using various transport systems.
However, it is important to note that this method has come with increased capital investment that Red Bull must incur. Although its gives this company more autonomy in distribution of its products, the costs reduces profitability. This explains why the management of Red Bull has been seeking strategic alliances with various firms in the global market.
Red Bull has considered the use of technology to enhance the place element of the marketing mix. The firm has considered using vending machines to distribute its products, especially in gyms, clubs, and universities in selected cities. Such a move increases awareness of its products to a larger market segment enabling the company to increase its market share.
These alternative distribution channels has helped this firm to increase sales. The use of the vending machines has however, met some resistance in the market. The place element has also been enhanced through the use of internet. Red Bull has used internet to market its products globally.
The firm has also been very active in the social media as a way of increasing the geographic market for its products. Most of its major adverts have been made through social media such as Facebook, YouTube, and Tweeter. The company has adopted this strategy because most of its customers are actively on social media.
Physical presence
According to Kotler (2005, p. 114), consumers in the current market have become very critical of the physical appearance of the places where they make their purchases. Initially, firms ignored the importance of the physical structure they used to deliver their products to the consumers.
For instance, many firms did not bother about the appearance of the shops as long as customers were able to get the products they desired within the right time. However, this has changed over the recent years, and Red Bull is one of the firms that have realized the importance of the beautifying the facilities they use to deliver the products to their customers.
The physical attractiveness of the exterior and interior facilities that firms use have currently been used by the customers to judge the quality of products that a firm delivers, and its commitment to the customers. When a customer is exposed to a poorly designed shopping facility, they would always make a negative judgment about the firm and all its products.
The management of Red Bull has come up with elaborate programs that have changed the physical appearance of its shopping facilities. Over the past one decade, this firm has changed the design of most of its facilities (Kotler 2005, p. 115). At its production plant, the firm has ensured that employees are provided with attractive and safe working stations that offers them motivation.
This has helped improve their performance. The firm has also restricted its stores that it uses to sell its products directly to consumers. One of the issues that has been raising a lot of concern in the market is the need to have many exists at these shopping malls for the purpose of enhancing security. The management of Red Bull has responded positively to this requirements.
The firm has also constructed beautiful outlets in a number of locations within the United States and other major markets around the world. This helps in convincing its customers that it is committed to offering them products of high quality.
Conclusion and Recommendations
It is clear from the analysis of the three elements of marketing mix that Red Bull has been using that the market is getting increasingly competitive. This firm must come up with clear systems that would enable it manage the future market in order to remain competitive in the future market.
The analysis shows that Red Bull has done performed well in managing the current market forces. The firm has tried to be dynamic in order to change with the changing market forces. However, the firm should consider the following recommendations if it expects to gain competitive advantage over its rivals in this industry.
- When dealing with people as one of the elements of marketing mix, the management should try to focus on nurturing talents among its employees. The current competitive market requires innovative minds that can enable the firm to come up with new ideas of handling various activities within the firm.
- The place element of marketing mix need to involve extensive use of the modern technologies in order to reach customers. Technology has reduced the world into a small global village. It order to maximize benefits of this village, Red Bull should use modern technologies of communication to each out to the global consumers.
- Physical evidence always portrays a firm’s commitment towards delivering value to its customers. The management should make an effort to beautify most of its physical facilities, especially at its outlets. Customers will always make a judgment of the value of products they purchase from this firm by analyzing the appearance of these physical facilities.
List of References
Ewbank, A & Foulger, T 2010, ‘Red Bull, Starbucks, and the Changing Face of Teacher Education’, The Phi Delta Kappan, vol. 92. no. 2, pp. 25-28.
Kotler, P 2005, ‘The Role Played by the Broadening of Marketing Movement in the History of Marketing Thought’, Journal of Public Policy & Marketing, vol. 24 no. 1, pp. 114-186.
Lehmann, D 2005, ‘Dimensions of Marketing’s Relationship to Society’, Journal of Public Policy & Marketing, vol. 24. no. 1, pp. 137-142.