Red Bull Company’s Global Marketing Strategy

Background of the study

Red Bull is one of the leading global energy drink companies that have its headquarters in Thailand. Founded in 1987 in Thailand by an Austrian businessman, Dietrich Mateschitz, this firm has grown to become one of the most successful beverage companies in the world. According to Gelder (2014), the success of Red Bull in the international market has largely been attributed to its unique market positioning, the ability of the firm to understand the local needs in different markets, and its aggressive marketing campaigns. When it started its operations in Thailand, it registered impressive performance within a very short while. It then spread its operations to other regional countries in Asia before moving to Europe and the Americas. Like Coca Cola Company, Red Bull did not ignore the African markets.

Red Bull made a successful entry into this rapidly expanding market and currently, it can be found in major urban centers in almost all African countries. The brand, though not as powerful as Coca Cola, is one of the widely known brands globally in the energy drink segment of the beverages. The management has been keen to understand the changing tastes and preferences of its clients in the global market to know how to adjust its products offering.

Zimmerman (2013) says that this firm treats each region as unique by providing flavors that are most relevant to the target market. The emerging technology trends are redefining the marketing strategies that firms are using in the market, and a time has come for this firm to reevaluate the current strategies that it is using. In this paper, the researcher seeks to find effective marketing strategies that this firm can use to find effective ways of achieving growth in the global market.

Significance of the study

In this study, the focus will be to help Red Bull come up with new global marketing strategies that are based on the emerging trends in the market. The new strategy, which will be primarily based on the social media platforms, will try to change the current strategy that heavily relies on mass media to a new approach that emphasizes on the social media. Red Bull has a clearly defined market segment that its production targets in terms of age and social class. This targeted market is the current heavy users of the social media. It is justified for the firm to come up with ways of advertising that are relevant to the target market. This study will give this firm a new focus.

Statement of the problem

The emerging technologies have redefined marketing strategies that firms are using in the market today. For a long time, firms have heavily relied on mass media marketing as the most appropriate way of reaching out to their clients. Mass media platforms such as television, radio, and newspapers have been very popular among the advertisers. However, the trend is changing thanks to the emergence of social media.

Youths no longer have time to read newspapers because they can follow the trending news through the social media. The readership of newspapers has drastically dropped both in the developing and developed nations as news is now readily available in various online platforms.

The number of people who follow the emerging events through television or radio platforms is also going down. This is a clear indication that the traditional social media marketing platforms that were popular in the past are no longer the most appropriate ways of reaching out to the masses, especially when targeting the youths. It is, therefore, necessary for Red Bull to come up with new marketing strategies based on social media. Social media offers this firm the best opportunity to reach out to its target market in the most efficient way and without struggle. Its past strategies are no longer effective in the modern-day marketplace.

Purpose of the study

The primary purpose of this study is to evaluate the current marketing strategies that Red Bull is using in the global market and propose new methods that it can use to achieve greater performance as it seeks to expand its market share. It has revealed that this company still relies heavily on mass media marketing. However, recent studies have indicated that social media marketing is becoming a very powerful force in the marketing arena (Rendle, 2011). Some of the top global brands such as Coca Cola and Apple have moved swiftly to the social media marketing platforms, although they still use mass media marketing. As such, it is important for this firm to also develop an effective social media marketing strategies to supplement its current mass media marketing strategies.

Research question and hypotheses

When conducting research, it is important to come up with effective research questions that will help in data collection and subsequent analysis. Gelder (2014) says that when conducting a research project that requires the collection of both primary and secondary data, it is very easy for the researcher to sway away from the point of focus if there is no clear guide that shows that kind of data needed and how that data should be mined. It is possible to come up with primary data that does not focus on the same thing as the secondary data. As such, it is important to come up with specific research questions that can be used specifically in collecting data. The following are the research questions that guided the process of data collection.

  1. What are the changing trends in the global marketing strategies?
  2. What are the weaknesses of the current global marketing strategies at Red Bull?
  3. How can these weaknesses be addressed to enhance the effectiveness of Red Bull’s marketing strategies?
  4. How can Red Bull embrace the emerging marketing platforms in the modern market?

The researcher will use both primary and secondary data sources to come up with answers to the above questions. The following research hypotheses were developed based on the above research questions.

  • H1o. Social media marketing has not become very relevant in the modern society
  • H1a. Social media marketing has become very relevant in the modern society
  • H2o. Red Bull cannot achieve greater success by integrating both social and mass media marketing strategies
  • H2a. Red Bull can achieve greater success by integrating both social and mass media marketing strategies

Definition of terms

  • Advertising- promoting products or brand of a firm.
  • Brand loyalty- the enthusiasm of customers towards a given brand.
  • Competitive pricing- setting price that is appealing compared to the price of other products.
  • Sales promotion- creating awareness of a given product with a view of increasing its sales.
  • Market segment- part of the larger market with customers having similar characteristics.
  • Social class- people with similar demographical factors.

Review of the Literature

According to a report by Rendle (2011), global marketing strategies are systematically shifting from mass media platforms to social media platforms because of the increasing number of people using social media in the current society. Facebook, Twitter, and YouTube have become a force to reckon with as the number of their users continues to surge. Gelder (2014) says that this does not mean mass media marketing has become irrelevant.

Firms still find mass media marketing to be very important. However, social media marketing is becoming very popular, especially because of its geographic coverage, when targeting a global audience. For Red Bull, it has been demonstrated that it’s mass media strategies are effective. It is, therefore, necessary to look at the social media platforms to see how it is relevant to its global strategies.

Social media platform

The emergence of digital technology has had a significant effect on the way people communicate in the current global society. This is specifically so following the emergence of social media as a means through which people can share information. According to Zimmerman (2013), social media has become a formidable force in the communication sector over the recent past. Levinson and Gibson (2010) define social media as “a group of internet-based applications that are built on the ideological and technological functions of the web that facilitates creation and exchange of user-generated content” (78).

The scholar says that social media has democratized communication in the corporate world in a manner that had not been expected. The power of communication has been handed over to individuals to share their thoughts through various online communities. In such settings, before consumers can decide to buy a given product, they can engage their family and friends in the online communities such as Facebook, YouTube, and Tweeter to help them in making informed choices. They can even watch the functionality of the products they desire through YouTube to be certain about what they are purchasing.

According to Zimmerman (2013), marketers have also benefited a lot from the emergence of interactive online media. In the past, firms were able to share their messages on their website to reach their targeted audience, but not in the manner they do it today. Such websites were not as interactive as they are currently. It meant that it only facilitated a one-way communication system. Consumers could not give their views or respond to the issues raised by a company.

It made it difficult to collect relevant information from the clients about products delivered to them or the manner of delivery. In most of the cases, firms were forced to send marketers to the field to gather views of the clients. This was the only approach that a company would engage its clients when designing appropriate products. The social media has effectively solved this problem (Dahlén & Lange, 2008). Firms can now engage their clients in various forums over an issue of concern or when developing a new concept. Clients can ask questions and a company’s representatives will be able to respond to them in good time.

Bodner (2011) says that online communities such as Instagram and YouTube have made it possible for customers to demonstrate what they like or not about a given product. It is possible to record a short video on how a given product offers a superior value or not. The video can easily be uploaded on YouTube for the online community. Such moves can have a very powerful impact on the decisions that customers make after viewing the clip (Levinson & Gibson 2010).

It is a clear demonstration that social media has given customers the power to share their ideas with manufacturers to influence the type of products delivered to them. Customers can also influence the decision of their fellow consumers by advising them on what to buy and what to avoid based on their past experiences and perceptions. The relevance of social media in global marketing emerged in the literature and academic journals over half a decade ago as it became apparent that firms preferred to use social media to reach out to their target audience. At that time, some corporate leaders believed that social media did not hold much potential in the field of marketing because it was only used by teenagers and young adults.

However, the events that have taken place in the last seven years have convinced the marketing community that social media holds the future of marketing (Dahlén & Lange, 2008).

According to Zimmerman (2013), there are a number of social media platforms that are in active use today. Those that are popularly used by the global audience are Facebook, Twitter, YouTube, LinkedIn, and Instagram. Research by Zimmerman (2013) says that social media cal is classified into various subgroups. The subgroups include social bookmarking sites, review and rating sites, social media submission sites, podcasts, wikis, media sharing sites, social networking sites, blogs, and micro-blogging. Each of these subgroups has unique characteristics on how they facilitate online sharing.

Rendle (2011) says that not most scholars agree with the classification given above. Others have come up with classifications of six subgroups of social media. They include collaborative projects, social network sites, virtual game worlds, blogs, the virtual social worlds, and content communities. Although there is a difference in classification, it is important to note that the two have a number of similarities when classifying various forms of social media based on the manner in which the information is shared. At Red Bull, it will be important for the management to understand the relevance of the major social media platforms in its new global marketing strategies

Facebook, YouTube, and Twitter Platforms

Facebook has become one of the major social media marketing platforms with about 1.3 billion active users spread all over the world. Large firms have realized that Facebook has a huge potential in terms of promoting their brands and products. It allows firms to create their own Facebook page. Customers who follow these pages can then have access to all posts from the firm. It allows companies to advertise their products to the followers or keep them updated about existing products.

The companies can easily track their followers’ online activities and understand their demographics. This is helpful when developing new products. Levinson and Gibson (2010) say that Facebook has also enabled firms to reach out to specific target audiences in the market based on their demographical factors. A firm can also develop a message and send it to the customers, especially when it is planning to launch new products in the market.

According to Zimmerman (2013), companies such as Coca Cola and Apple are now using actively Facebook to reach out to their audience. Bodner (2011) says that many researchers now agree that social media will eclipse mass media in terms of popularity in advertising in the near future. The wide geographical coverage, ease of use, and availability in different languages has pushed the social media to the top of the ladder when it comes to advertising.

Zimmerman (2013) says that Facebook has developed software that can translate messages from one language to the other. It means that a message written in English can be translated to Mandarin, French, Spanish, or any other relevant language. This has made Facebook a very reliable medium for advertisement for multinational companies targeting a global audience. Twitter, with a following of about 800 million people from all over the world, is also a credible social media marketing platform that firms are currently using to promote their products. It is used in almost the same manner as Facebook. However, YouTube works differently from these other two social media platforms discussed above.

YouTube allows users to record and upload videos or audio that is then shared in the global online community. It is a perfect replacement of the television and radio commercials. Firms can design their promotional campaigns and upload it on YouTube. When a person goes to the site to listen to popular music or watch movies, they have to watch the adverts first before moving on to their desired sites (Passiak, 2013).

The relevance of social media in global marketing

Wilson (2012) says that many scholars have been conducting studies to determine whether social media has a significant impact on employees’ buyer behavior. Those who have conducted empirical studies on this issue agree that social media has a significant impact on consumers’ purchasing behavior. Other scholars have determined that there is a close correlation between a company’s financial performance and its engagement in the social media.

Zimmerman (2013) says that brands that invest in social media have gained massive popularity in the global market, leading to higher sales of their product. Through the maintenance of their presence in the social media frequented by over 1.5 billion people, the brands become memorable to the customers. Firms are now keen to identify the most appropriate social media platform which can be used to reach out to their target audience.

There are firms that spent over 20 million dollars in online advertisement alone in the recent World Cup games (Dougall, 2013). The report showed that companies that invest in social media experienced rapid growth than those who avoided it. It also found out that the more a firm engages with its target consumers in the social platforms, the more it gained loyalty and popularity from the customers. This would result in higher incomes through increased sales.

Bodner (2011) says that anyone who has doubts about the fact that social media can have a significant impact on consumer buying behavior can make reference to an incident that occurred at Domino’s Pizza recently. Employees of these firms filmed themselves handling food in the most unhygienic manner possible and went ahead to upload the video which also showed them serving a customer the dirtily handled pizza.

The incident caused an uproar in the social media and this firm was almost brought to a halt. Currently, Emirates Airline is also in the spotlight for complaints that its clients have made in the social media about being overworked. These complaints have affected the image of the firm in the global market. As such, firms must realize that social media is a very strong force that can build but also destroy depending on how it is used.

When developing a social media marketing strategies, Dougall (2013) says that a firm should understand its target audience properly. Customer buying behavior differs based on their socio-cultural and economic backgrounds. A firm must understand that the way a given social group views a given message also differs based on these demographical factors. What is comical in the United States or France may be viewed as offensive in the United Arab Emirates or Egypt. It means that although these social media marketing platforms offer firm global market coverage, it is necessary to design promotional messages that target a specific target market.

When the campaign is targeting an audience in the Middle East, the firm should first understand the socio-economic forces to know how the audience will react. The message must also reflect the current events within the region it targets. Wilson (2012) advises that to ensure that an advert is relevant to the targeted audience a firm should make a commitment to avoid controversies as much as possible because it may affect its image.

Research Methods

When conducting research, it is important to come up with an effective method of collecting, analyzing, and presenting data in a way that is in line with the research objectives. According to Dougall (2013), in order to choose an effective method of data analysis, it is important to first understand the nature of the study. A researcher must understand what is expected in the study in order to determine whether qualitative or quantitative methods will be appropriate. In this research, data were collected from both primary and secondary sources. Secondary sources of research were collected books, journal articles, and other reliable online sources.

According to Wit and Meyer (2015), secondary sources of data are often very important in informing a given study. They help in guiding the researcher about what has been found out in a given field and the existing gaps. That is why the researcher considered the secondary sources of data to be very important. These sources particularly paid an important role in enhancing an understanding of the current status in the use of social media in advertising.

They enabled the researcher to understand the level of acceptability of social media marketing in the corporate platform. Through the review done above, the researcher was able to determine how relevant these platforms are for Red Bull as it seeks to develop a global marketing strategy. It was also important to collect data from a sample of respondents who would help in gathering information that is specific to Red Bull and its global marketing strategies.

Participants

As stated above, primary data was collected from a sample of participants who were willing to take part in the study. The researcher was interested in collecting data from two groups of people. The first group included the current or past employees of Red Bull who are or have worked for the firm at its Dubai Airport Free Zone or in any other part of the world.

The second group of participants included marketing experts who understand the global market trends and effective marketing strategies that a firm can use to gain a competitive edge over its rivals in the international community. To ensure that data was reliably collected from the two groups, the researcher used a stratified sampling strategy. The two strata, in this case, were the marketing experts and the firm’s employees. All the participants who took part in the study were residents of Dubai at the time the data was collected.

The researcher called the management of Red Bull at Dubai International Airport Free Zone to book an appointment and to sample a few respondents to participate in this study. Given that the employees at this firm with the relevant knowledge about the global marketing strategies at Red Bull were few, the researcher sampled only five of them. They included the top manager at this branch and a team of marketing executives who are based in Dubai.

The researcher also collected data from marketing experts operating within the city of Dubai. The experts were chosen based on their popularity in the market. All the respondents were duly consulted and provided with a detailed explanation about this research, its relevance, and the audience. They were informed that this was a purely academic study and that the confidentiality of their identity will be respected.

Data collection procedures

Primary data was collected through an interview using questionnaires. Given that most of the participants could easily be reached in one location, it was decided that a face-to-face interview was the most appropriate one. The researcher informed all the participants about the time of the interview and the duration it would take. This form of survey was very appropriate because through the interaction the researcher was able to capture finer details about the issue under investigation. The respondents delved more information that would have been the case if the questionnaires were to be sent to the respondents through e-mail.

Data analysis

After collecting data from the respondents, the next important stage was the data analysis part. The researcher used both open-ended and closed-ended questions to facilitate mixed research methods. Qualitative data was important in explaining why Red Bull needs to embrace social media marketing when developing its global marketing strategies and the possible results that may be achieved if this method is embraced. Quantitative data was important in providing empirical figures to explain the impact of social media on firms and the magnitude of the benefit that a firm can get by embracing this marketing strategy. Statistical methods were used to analyze the quantitative data while a descriptive approach was used in the qualitative analysis.

Reliability and validity

Reliability and validity of the data was assured in various ways. First, the researcher avoided all forms of bias that could make the research be subjective instead of being objective. The respondents were chosen based on their expertise and the knowledge they had on the issue under investigation and not on any other issue. The extensive use of secondary sources of data to support primary findings also enhanced the validity of the study.

Results

In this section, the focus will be to conduct an analysis of the primary data collected from the sampled respondents. The aim will be to determine if the primary data is in agreement with the secondary data that was reviewed in chapter two of this report. It will help in determining whether it is true that this firm will need to embrace social media marketing in its global marketing strategies or if it will have to continue using mass media as its primary platform of marketing.

Demographic characteristics of the sample

According to Passiak (2013), when collecting data, it is important to appreciate that people of different demographical factors often respond differently to various questions posed to them based on their level of knowledge, experience, understanding of the specific issue, and such other related factors. All the respondents who were interviewed in this study are college graduates. The researcher was interested in collecting data from individuals who have a strong understanding of global marketing and the relevance of the mass and social media when developing a global marketing strategy.

At Red Bull’s offices in Dubai International Airport Free Zone, the researcher collected data specifically from respondents who have been working in the marketing department of this firm. The marketing experts who participated in the study are individuals with post-graduate degrees in marketing. There were six male and four female participants. At the time of conducting this study, all the respondents were staying within the city of Dubai.

Results of the test of hypotheses

The collected data was analyzed quantitatively to determine whether or not they accept the set hypotheses. In this section, the researcher will analyze the data to determine the outcome based on the set hypotheses. The first hypothesis was focused on determining the relevance of social media marketing to the corporate society, especially in global marketing. The question was posed to the respondents and their response was as shown in the graph below.

  • H1o. Social media marketing has not become very relevant in the modern society
Relevance of social media marketing in the modern society.
Figure 1: Relevance of social media marketing in the modern society.

As shown in the figure above, over 70% of the respondents stated that social media marketing is highly significant in the modern society. Another 20% stated that it was significant. It was only 10% of the sampled population had a contrary opinion, saying that mass media marketing is still the main platform that this firm cannot afford to withdraw from even at the international levels. It means that the above null hypothesis was rejected, confirming the alternative hypothesis below.

  • H1a. Social media marketing has become very relevant in the modern society

The hypothesis below focused on the ability of Red Bull to achieve greater success if it embraced both social media and mass media in its global marketing strategies. The question was posed to the respondents and their views are as shown in the graph below.

  • H2o. Red Bull cannot achieve greater success by integrating both social and mass media marketing strategies

Red Bull cannot achieve greater success by integrating both social and mass media marketing strategies

As shown in the figure above, an overwhelming majority (90%) were of the opinion that Red Bull is likely to be very successful if its marketing strategies integrated both mass and social media marketing. Only one participant felt that he was not certain about the ability of this firm to be successful. However, even this dissenting voice stated that there are chances of this firm is more successful if it was able to embrace social media marketing. It means that the above null hypothesis has been rejected. The alternative hypothesis below was accepted.

  • H2a. Red Bull can achieve greater success by integrating both social and mass media marketing strategies

The respondents stated that the biggest problem that Red Bull, and many other firms in the global market, faces is the inability to effectively integrate mass and social media marketing. There is still a lack of knowledge on how this firm should balance expenditure on mass media and on social media. Mass media still continue to take the bigger part of the budget despite the knowledge that most of the marketing executives have that social media is becoming more relevant. The participants stated that in this new global marketing strategy, Red Bull must integrate both mass and social media marketing.

Discussion

The findings made from the analysis show that Red Bull will need to find a way of balancing its marketing expenses between mass and social media platforms. The firm may start to be selective in its mass media marketing. According to Zimmerman (2013), in modern society firms must learn about the most appropriate marketing platforms that can effectively reach out to the target audience.

For instance, the firm should significantly reduce or even eliminate marketing expenses on newspapers, magazines, and journals, unless it is very necessary. Recent studies have shown that readership among the young adults aged below 35 years is dropping very fast. These people rarely have time to read the newspapers or magazines because everything that they need is available in the online platform. As such, expenses in such platforms will yield very little fruit.

The management may continue its advertisements on radios and televisions, but not as heavy as was the case in the past when these were the only marketing platforms that existed. The marketing department should start moving systematically towards social media marketing. Facebook should be given priority over the other social media marketing platforms because it has the highest number of regular users, currently estimated to be 1.3 billion people all over the world. In fact, Facebook marketing should account for 50% of the firm’s online marketing budget. YouTube should take 30% of the online marketing budget because of its increasing popularity in the global market.

Twitter, Yahoo, Google, Instagram, and other related platforms should take the remaining 20% based on the prevailing market forces. According to Levinson and Gibson (2010), an effective global marketing strategy should be dynamic. It means that if there are forces that make the global community more interested in watching televisions or in staying in a given social media platform, the firm should be swift enough to respond to such changes and focus more on those platforms that attract a wider population. It means that when budgeting, there must be part of it that is left, ready to be used when there are environmental changes that need to be addressed to help promote awareness of the firm’s brand or its products in the international market. This will enable Red Bull to become a household name like some brands such as Coca Cola.

Summary of the Findings

From the discussion above, it is clearly evident that Red Bull will need to embrace social medial marketing when developing its global marketing strategies. The firm may not suddenly pull off from the mass media marketing, but it will have to reduce its expenses in this form of marketing. At the local level, for instance, within the United Arab Emirates, the firm may use still use mass media marketing, especially television marketing.

However, at the international level, this firm will need to move fully to the social media. This is so because, at the international level, it will have access to a larger audience in a wide geographical location. Facebook, Twitter, and YouTube should be the primary areas of focus for this firm. In this global marketing strategy, there will be a balance between mass and social media marketing, but the greater emphasis will be shifting to social media marketing as time goes by and as the market dynamics continue to change.

Limitation of the study

It is important to appreciate that the study had a number of limitations which are worth noting for the purpose of guiding those who will use this report. The first limitation was in the scope of primary data collection. Red Bull is operating in the global market and its headquarters are in the Netherlands. It would be more appropriate to collect data from the top executives at the firm’s headquarters. However, this was not possible and data collection was restricted to the city of Dubai. The researcher was geographically limited to Dubai when collecting primary data. Time and financial resources were other limitations that made it impossible for the researcher to travel out of the country to various global offices of Red Bull to collect more data.

Recommendations

The analysis of both primary and secondary data has made it clear that Red Bull can no longer ignore social media marketing. Inasmuch as it may still continue using mass media marketing to target local audiences, it should find a way of moving towards social media marketing as it develops global marketing strategies. The following recommendations should be observed by the management of this firm.

  • At the global level, marketing should be primarily based on social media platforms
  • At the national or regional level, mass and social media marketing should be integrated.
  • The management will need to high experts in social media marketing to lead the process of changing from mass to social media marketing at a global level.

Implications

The findings of this study will have significant implications on the approach that this firm takes to market its products at the international level of the management considers its recommendations. The study shows that it is now time for the management to embrace social media marketing as a way of gaining a competitive edge. It should shift from heavy reliance on mass media and start investing in social media as it is the new platform that has attracted most of the clients of this firm.

Future research

Future studies will be necessary to enhance the findings of this research. It will be necessary for future scholars to find the relevance of other emerging social media platforms such as LinkedIn and Instagram in social media marketing. It will also be necessary for future studies to find effective ways that a firm can address the crisis. Damage control in the social media platform has become of great importance.

References

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Dahlén, M., & Lange, F. (2008). Marketing communications. Hoboken, N.J: Wiley.

Dougall, A. (2013). The Greatest Racing Driver: The Life and Times of Great Drivers, With a Logical Analysis Revealing the Greatest. New York: NY: Springer.

Gelder, S. (2014). Global brand strategy: Unlocking brand potential across countries, cultures & markets. London, England: Kogan Page.

Levinson, C., & Gibson, S. (2010). Guerrilla social media marketing: 100+ weapons to grow your online influence, attract customers, and drive profits. Irvine, Calif.: Entrepreneur Press.

Passiak, D. (2013). Red Bull to Buddha: Innovation and the search for wisdom. Hoboken, NJ: Wiley.

Rendle, S. (2011). Red Bull racing F1 car: An insight into the technology, engineering, maintenance and operation of Red Bull Racing. Hoboken, NJ: Haynes.

Wilson, A. (2012). Red Bull energy drink: A literature review. London, England: McMillan.

Wit, B., & Meyer, R. (2015). Strategy synthesis: Concise version; resolving strategy paradoxes to create competitive advantage. London, England: Thomson Learning.

Zimmerman, J. (2013). Social media marketing all-in-one for dummies. Hoboken, NJ: Wiley.