Red Bull SWOT Analysis
Detailed SWOT Analysis of Red Bull which is a famous energy drink around the world. it was introduced in 1987 at Thailand and introduce in the same market.
Strengths
• Strong leadership, the company has maintained a strong global image across the world. Red Bull is considered to be equivalent to energy drinks in many countries.
• The company‘s marketing strategy has been successfully implemented through promotional activities like sports sponsorship which brings along a strong identity of the brand and as a result creates a customer loyalty for the brand.
• Red Bull has a strong geographic presence which leads to a positive long term growth for the company while the other markets can reach to a maturity stage.
• Strong market share as the company has managed to prevail itself as a power drink market.’
• The company’s alliance with Cadbury Schweppes has helped to expand the market distribution by reaching to segments like food court, vending machines, hospitals and other travelling facilities ensuring an increased customer base.
• Strong brand equity.
• The target market of Red Bull follows them blindly.
• Advertising campaigns of Red Bull are found to be very appealing for its consumers.
Weaknesses
• The company lacks in producing innovative products as they rely mainly on one single product i.e. red bull energy drink unlike its competitors who have a huge product line in the market.
• Change in the consumer’s taste can also weaken the company’s market revenue as more consumers have become more health conscious and may reduce the consumption of caffeine which is the basic ingredient of Red Bull energy drinks.
• Extensive marketing expense is required for the company.
• Higher prices than other competitors.
• The use of high caffeine in the Red Bull drinks has made the brand exposed to regulatory control.
• The company has a limited product portfolio.
• The recipe of Red Bull’s product does not provide any patent.
Opportunities
• The company needs to adapt a product extension strategy in order to retain the market share.
• The company’s initiative of vending can help to increase the sales. The use of vending may represent the company’s commitment to diversify its distribution network.
• Expansion into geographical markets, the new emerging markets hold a promising growth for Red Bull.
• Red bull has a new production facility in Brazil which aims to make retail prices more competitive than other imported product prices.
Threats
• Tough competition in the market. Competitors like Monsters, Pepsi and Coca Cola are constantly seeking to regain the highest market share by introducing energy drinks to compete directly with Red Bull.
• In many parts of the world like France, the product of the company has not been approved and publicized as a negative brand image .The negative brand perception is based on the use of caffeine in the energy drink as unhealthy for consumers.
• The company can face a huge threat of becoming stale in the market. As the company’s market becomes saturated it will be harder to attract the core consumers further on.
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