Media Plan Part I

 

Christina Allen Danielle Dodd Laura Hadaway Hayden Harris

SC4012 Team CDLH Adver t is ing Fa l l 2012 RED BULL Media & Markets

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Table of Contents  

Executive Summary ……………………… 3

Situation Analysis

Macro Environmental Analysis …….. 4

Company Analysis …………………… 5

Product Analysis …………………….. 6

Competitive Analysis ……………….. 8

Consumer/Market Analysis ………… 10

SWOT Analysis ……………………………… 11

Problem Statement ………………………. 14

Marketing Objectives ……………………. 15

Advertising Objectives …………………... 16

Overall Media Budget …………………… 17

Bibliography ………………………………. 20

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Executive Summary The brilliant idea of a drink that keeps the consumer physically and

mentally stimulated is what gave Red Bull its unique position in the

marketplace. Red Bull is considered the pioneer of energy drinks

worldwide. Many consumers depend on the energy they get from Red

Bull, while others may not be informed of the benefits or concerned with

the risks. Red Bull wants to maintain a brand image of prestige to

differentiate them from direct competitors in the market, while also

appealing to all types of consumers.

As Red Bull competes with many energy drinks, Rockstar, NOS, and

Monster are its major direct competitors. While, these are all energy

drinks, they do not have the reputation or prestige of Red Bull. Coffee and

caffeine soft drinks are more competitors that hold a substantial role in the

market place of the energy drink industry. (Analysis of Red Bull Distribution)

Compared to its competitors, Red Bull is considered better in

effectiveness, comparable in taste however, slightly worse on price. It is

considered equally as damaging to health as competitors. (Verster 2011)

In hopes of increasing women users, Red Bull wants to maintain the

respected brand image of their product while showing women that using

Red Bull is beneficial. There is a mismatch between consumers’

perceptions of healthiness and their views of importance.

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By allowing primary and secondary research (i.e. MRI) to help find

possible solutions to the weaknesses of Red Bull, many opportunities

continue to develop to help Red Bull toward its goal of increasing sales to

women between the ages of 25-54 by showing them the benefits of Red

Bull.

Macro Environmental Analysis

In today’s economy, economic factors that could affect our brand

and company should definitely be considered. Due to the recent

recession, consumers have less of a disposable income. This results in

consumer’s spending their money on only necessities. Leading on to many

of which excluding energy drinks from the purchases. When the economy

of the consumer is low and the expense of Red Bull becomes high, the

customers will move toward a product that is lower in expense, rather

than the Red Bull product. As for the income of Red Bull’s target market,

the above-average price of the drink shows that they are targeting the

middle to upper class. This is the brand image Red Bull wants to maintain,

but needs to do so by also making their product appear beneficial and

worth the cost. (Drawert)

A political factor that Red Bull should consider is the potential of the

Government imposing strict health and safety restrictions on energy drinks.

This would limit the amount of which could be consumed. It would lead to

affect the overall amount of energy drinks that are purchased.

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Technological factors are important for Red Bull as well. The use of

Internet to advertise is a low-cost advantage we have today. It enables

Red Bull to advertise to a wide diverse audience, and to sell large

quantities of its product. The Internet is a cost-efficient way to

communicate with consumers. Red Bull needs to be on the watch for

advances in technology that would enable their company and their

competitors to produce more products at lower cost or to further improve

the appeal of the product, along with the benefits. (Market for Energy

Drinks)

Company Analysis

  The most popular energy drink in the world was born in 1987 to

Australian entrepreneur Dietrich Mateschitz and co-founder, Chaleo

Yoovladhya, whom got their big ideas from an existing energy drink in

which he tweaked to conform to the likes and expectations of those

beyond the Aussies. Yoovladhya, from Thailand, was already

independently wealthy from his pharmaceutical company. He also

invented an energy drink, Krating Daeng that was extremely popular

among truck driver and labor workers in Thailand. Mateschitz was already

a successful brand promoter for a toothpaste company, Blendax, who

was a licensee of Yooladhava’s pharmaceutical company, and was on

business in Thailand when he tried the drink. He found that it worked

wonders for his jet lag and lack of energy from traveling. (Thomas 2012)

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From that point forward, Mateschitz worked with the company to

develop a new flavor for the drink that they thought would be a hit in a

European market in addition to a marketing strategy that was sure to be a

knockout.

The two decided to each own 49 percent of the company and

give the remaining two percent to Yoovldhya’s son; however it was

agreed upon that the majority of the decision making and running of the

company would be taken care of by Mateschitz. He would be responsible

for launching the most successful energy drink in the game. The product

entered into international markets in 1992, Hungary and Slovakia, The U.S.

in 2007 and made an entrance to the Middle Eastern countries in 2008. It

goes without saying that Red Bull launched in the United Sates and was

an instant success, selling approximately 4 billion cans in over 160

countries. (Thomas 2012)

Product Analysis

Red Bull’s undeniably recognizable can and mascot is one of the

many genius ideas to promote the drink, marketing wise. The trademark

blue and silver can are just the beginning of how this brand has evolved.

The cans that are seen in the western countries are staples as the

‘stronger’ or ‘more enhanced’ version of the product. Aside from the

packaging, the signature phrase, “Red Bull gives you wiiings” is known

worldwide for its cartoon advertisements with witty ways to tell the

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consumer that when they are feeling down, tired or thirsty, they need to

grab a Red Bull. (Athletic Therapy Today 2007)

However, the makers and supporters of Red Bull have received

some concerns from health professionals about the amounts of caffeine

and other ingredients that could be harmful to its consumer. The concerns

were taken in stride and further explained: the ingredients, caffeine,

taurine, and glucuronolactone were observed, and approved for the

consumer. In face, a Red Bull is not any more caffeinated than a normal

cup of coffee, sometimes less than that. The Red Bull team also pointed

out that as long as a rational consumer’s intake was not out of the normal

intake, none of these ingredients are of harm to their health. (Howard &

Cecile 2010)

Red Bull ranks as number one in the energy drink market selling over

4 billion cans. (Kimberly) Their marketing strategies are original and

independent from any other energy drink, setting themselves apart from

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the competitors. Red Bull is very involved in sports and the action of

athletics; especially extreme sports like motocross, skateboarding, BMX

biking, snowboarding, video games plus much more. (Outdoor

Adventure)

These ads can be seen anywhere from the Internet and Twitter, to a

magazine ad in Sports Illustrated. This is right on point with their target

market of young males who are interested in these areas. The Red Bull

logo can be seen on racecars, helicopters, in nightclubs or driving around

their signature Mini Cooper with life-sized Red Bull can on top including

their famous Red Bull Girls handing out free cans to some lucky consumers.

By keeping up with social media, hot trends in nightlife and the wide world

of sports, Red Bull is continuing their target market as generations get

older, creating brand loyalty and a whole new generation of consumers.

Competitive Analysis

The introduction of Red Bull into the beverage market created a

whole new product category for beverages that would help keep the

consumer mentally and physically stimulated. According to their website,

“Red Bull was one of the first functional beverages and the very first

Energy Drink on the market.” (Red Bull) Products in the market category of

energy drinks were designed to increase performance, concentration,

reaction speed and other abilities relative to productivity.

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To determine direct and indirect competitors, it’s important to

identify the brand position of Red Bull and its competitors. According to

the Red Bull website, they are currently the worlds No. 1 energy drink. The

top three competitors of Red Bull are Monster, Rockstar and Full Throttle.

Some indirect competitors can be found in some international companies

like Coca Cola and Pepsi who have both been working on developing

energy drinks of their own. (Dolan 2005)

A major branding benefit of Red Bull is that they essentially produce

one product, even though their can be variations (example: Red Bull

Sugar Free, Red Bull Zero).

CMR DATA: Red Bull Media Mix Campaign GRPs

NETWORK TV 50% 13.2

NT E FRG/NEWS 0% 0

NT PRIME 47% 12.04

NT L FRG/OVRNT 0

NT WKND MRNING .1%

.26

NT WKND SPORTS 3.4%

.90

TOTAL 26.4

MEDIA / TOTAL UNIVERSE X 100

According to www.monsterenergy.com, “Monster is a wicked

mega hit that delivers twice the buzz of a regular energy drink.” While this

remains vague to how exactly it benefits the consumer, the brand is

appealing due to its extreme variety. It currently offers 29 different drinks in

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varieties such as fruit, tea and coffee flavors. Monster also excels in

appealing to active consumers by supporting multiple rock band tours

and over 190 extreme athletes. Rockstar’s website also focuses more on

extreme athletes than RedBull. Rockstar claims to be “the world's most

powerful energy drink”.(rockstarenergy.com) They strive to maintain the

idea that their consumer can be anyone from an athlete to a rockstar,

which draws in many hopefuls. Rockstar also excels in their assortment of

flavors, 16, and their sponsorships of extreme sports, 16. Finally, in April of

2012, Full Throttle partnered with the United Service Organization, which

provides programming for members of America’s military. This provides

them a huge advantage, there are countless Americans who want to

support an organization that supports the troops. This partnership also

gave a new image to the brand. “Full Throttle is for the every-day hard-

working men and women that need reliable energy”, says Full Throttle

director of Marketing, Eric Helms. (Full Throttle) Helms goes on to explain,

that there is no greater example of consumer than the men and women

of the military. One benefit that only Full Throttle has out of this group is

that they are the official drink of the National Hot Rod Association. Those

main points, however, seem to be the only seriously advantageous

aspects to Full Throttle, aside from the ability to energize. They only have

six flavors and do not focus on extreme athletics, like the other brands.

(Full Throttle)

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Consumer/Market Analysis

Red Bull’s current target market for energy drinks is focused more on

college students 18 to 24 years old. 18-24 year olds are 145 percent more

likely to consume Red Bull then the average Red Bull user with an index of

245. Red Bull needs to refocus our target market more toward women

between the ages of 25-54. They are the lowest market of consumers of

Red Bull, rating (Index of 76) 24 percent less likely then the average energy

drink user to purchase Red Bull. (Energy Drink User MRI)

We feel as if we can market Red Bull to 25-54 year old women and

increase consumption in that demographic through media vehicles of

their interest. Our product is easy to find and has good result when

targeted efficiently, for example, males (index of 122) and college

students (128). Red Bull is found at most convenient stores and grocery

stores, where most women shop. Red Bull is appealing to health-conscious

women because there is a lower calorie option for people who want

and/or need that sugar free option in a product. What people want from

Red Bull is energy to keep them going and to get them through what they

need to get done. Women are no different. People take how well the

product works, price, and the after effect of Red Bull into consideration

when looking at purchasing our product. Red Bull is more popular in the

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southern parts of the United States; this could be because coffee is more

popular in the north. (Bull Market)

Problems and Opportunities Analysis (SWOT)

Red Bull has many STRENGTHS that aids in being the most successful brand

in the business:

• Red Bull has a prestigious reputation for delivering a quality product

to its consumers that has continued to satisfy over the years and

remain a staple product, not just a trend.

• Red Bull also satisfies dietary needs by offering a Sugarfree option in

addition to their Regular Red Bull drink. This gives the consumer

choices and shows each consumer that the Red Bull team is

aware of different needs and nutrition facts.

• Another strength of Red Bull is the varieties of packaging that the

product can be purchased in. The availability to buy the drink in

singles, four packs, or large flats increase the consumers desire for

more. Which, in turn, create more overall sales in general.

• The physical packaging is appealing to the consumer. The sleek

look draw attention to the drink, which is half of the battle of

creating awareness and buzz about the product.

• Because Red Bull has sponsored and been part of so many sporting

events in the public, this has created top-of-mind awareness in

which the consumer will automatically recognize the logo, can,

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catch-phrase or commercial and will know what product is being

advertised without having to be told what the product is.

However, WEAKNESSES of Red Bull are as follows:

• The health risks and concerns that are associated with energy drinks

could stray customers away from the market in general, decreasing

sales.

• Another weakness is the lack of marketing to the female

demographic, which could boost sales if acted upon.

• Red Bull is one of the higher priced energy drinks, which make it

unavailable to all demographics of consumers.

• The large variety of energy drink companies make it hard for Red

Bull to remain a constant staple when there are constantly “new”

and “better” energy drinks that appear in the market.

Many OPPORTUNITIES present themselves for improvement for Red Bull:

• Because Red Bull is involved in the athletic market but lacking in the

female demographic, they could market to viewers and female

athletic participants to engage that specific audience.

• Enforcing a small price cut could increase sales in the lower-class

market.

• Increasing the advertisement and reach to college students could

increase sales significantly.

Some outside factors pose THREATS to Red Bull:

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• If the government were to impose stricter rules on high caffeine

content, health concerns would become a main threat to Red Bull.

• As consumers become more aware of their health and self-being,

they may shift toward other drinks that are healthier for them and

are associated with a healthier lifestyle, hurting Red Bull’s market.

• Another threat is the fact that the market is very large and growing,

while also staying extremely competitive. This makes it easy for

competitors to enter the marketplace. However, this can be

managed with strong brand equity.

• It’s easy for competitors to enter the market because Red Bull is

more expensive, making these competitors (often cheaper) a

threat to Red Bull.

(Alford & Wescott 2001)

Problem Statement

There is a problem in the drastic difference between men and

women users of Red Bull. That problem specifically is the fact that women

are less likely to consume Red Bull then men, more specifically, women

between the ages of 25 and 54. Currently, men are approximately 22

percent more likely then the average Red Bull user to consume Red Bull,

where women are 21 percent less likely then the average Red Bull user to

consume Red Bull. (Red Bull User MRI Data) There are many possible

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factors contributing to this problem, among which are health concerns,

advertisements geared toward men, or general lack of information of the

benefits for women.

Marketing Objective

Based on the research done on our product, Red Bull, we have

decided we need to market our product toward women ages 25-54

because they are the lowest market of consumers, according to MRI

data. The majority of the marketing is geared toward men and younger

adults. Through various extreme sporting events, musical productions and

the need for college students to have an extra boost, these areas are well

covered. Women, however, have received less than half of the marketing

attention necessary to make them a priority consumer. Marketing can be

maximized through magazines that are read by a female audience,

commercials on television that are in the prime time for women watching

T.V., and websites that are frequently visited by women. Red Bull has

many options that would be appealing to women, however, they don’t

know about them because of the lack of information provided by our

company. By increasing the marketing through these vehicles our female

demographic consumption will increase dramatically

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Advertising Objective

Our advertising objective is to increase product knowledge in

women ages 25-54 by 30 percent within the next twelve months. There are

many advertising options that come with a marketing objective of

increasing sales in female consumers. It’s possible that many people view

Red Bull strictly as a form of energy when it fact it has much more to offer.

The human body, especially in reference to women, has three

general needs; physical needs, social needs and individual needs. No one

woman has the same schedule weather it is focused around a career or

family, Red Bull could provide what she needs to persevere through the

day. “Red Bull improves concentration, reaction speed and vigilance.”

(Red Bull) These enhanced qualities are what make the difference when

working in the office, at home or even traveling.

In the months January through June we would like to increase

our product knowledge among non-user women. In the months June

through December, we would like the attitude of our product among

non-user women to change completely increasing consumption

comparable to males. In these months we would like to see more brand

loyalty and increased top-of-mind awareness of the women.

If the advertising is focused on these objectives is no doubt that the

targeted audience will not only have a greater awareness of Red Bull, but

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will also understand brand benefits, see how Red Bull is worth their money

and have an increased brand loyalty.

Overall Media Budget

Red Bull’s prices are more than the other competitors. (Red Bull) This

shows us what they think about their specific target market. The high-

price shows that the target market considers Red Bull as a product that

signifies prominence and status in the industry. This puts Red Bull at a

major advantage by building customer loyalty and ensuring purchases,

and also by holding the product to the reputation of being superior in

quality, compared to its competitors. Consumers will associate the price

to the quality of the product and become loyal customers. However,

women are rarely loyal customers of the brand due to the lack of

knowledge of brand awareness. We need to appeal more to the women

demographic to show them our product is beneficial to their lifestyle.

The Red Bull advertising campaign has certain seasons throughout

the calendar year that deserve the focus of our media budget. It is

important to tailor our budget by season in order to maximize our sales

potential and to meet all of our advertising objectives. We must focus on

certain seasons in which we should heavily advertise our product. By

providing the audience with more tailored opportunities to be exposed to

our advertisements, it is more likely that they will purchase our product.

We will utilize all of our mediums throughout the year as we have done in

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the past, but heavily emphasizing in the areas of magazines and radio

usage. This will be a new approach, because according to CMR data,

Red Bull has spent most of their budget in TV (network $42,498,000 and

$16,324,000 cable), and some in newspapers ($582,000). The areas of

radio (50,000) and magazines ($218,000) have room for the most

improvement and in hopes to target more women.

Because our target audience tends to use our product during times

of stress, tiredness and performing daunting tasks, we will predict the

major causes and increase our advertisements during these times.

We will take advantage of continuity and pulsing because it will be

beneficial to our company/product. Continuity will help maintain the top

of mind awareness we strive for as a company. We want our brand to be

the first thing on a consumer’s mind when they are tired, stressed or just

need a boost of energy. Pulsing will be useful during times when people

need energy. It will be useful during times when women are experiencing

low-energy and high-stress levels because these are the times that our

product is being used the most. Therefore, it is essential that we advertise

heavily during this time in order to maximize sales and outshine our

competitors.

Our outdoor and Internet advertising will be most effective if we

relate it to the activities and season. We should change the

advertisements in order to appeal to the consumer’s activities and

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attitudes during that certain season. Our advertisements will be more

readily available during the summer when women are more likely to be at

home with their children in hopes that it will persuade the target audience

to use our product over our competitors to help them get through the

long days of summer. Hopefully by utilizing the increase of advertisements

during summer month’s nation wide, we will see an increase in sales.

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