Business Plan for Red Bull

...

SWOT Analysis

The company’s SWOT analysis makes it easier to identify the strength of the company and the areas where the company can improve to enhance its performance in the global market (Chambers, 2008).

Strengths

- Red Bull offers high quality products and services

- It has a major market which it focuses in which is the energy drinks market. This has enabled the company to enhance its products quality and service provision.

- Red Bull has a unique brand that offers unique taste making it become the most preferred energy drink

- The Red Bull brand has a global appeal. Thus it has a huge market base for its products and services.

Weaknesses

- Red Bull does not offer adequate variety of energy or soft drinks.

- The company is not well versed in other categories of the beverage industry

- The company is not extensively engaged in online marketing.

- The company is not extensively integrated with low-income entrepreneurs, suppliers, distributers, and retailers.

- Has no mechanism to engage with their consumers.

Opportunities

- Opportunity to diversify products and target a wider market base to increase market share further.

- There is a growing market for energy drink consumption.

- Multiple options for channels of distribution to expand its business while developing individuals and the economy at the same time.

Threats

- Stiff competition from substitute products.

- Rapid developments of technology affect the business operations and interaction with consumers

- Increased focus on business benefits making the company gradually loose touch with the consumers and its goal of developing individuals and the economy.

Market analysis

Target market

The target market Red Bull in their marketing initiatives includes a variety of individuals and groups. The main targets are the individuals and teams that are engaged in sporting activities. The company extensively advertises to this group. Doing so significantly increases the profitability of the company in the market (Sadler, 2010). Other than that target market, the company targets individuals who are looking to have a good time in entertainment spots without necessarily consuming alcoholic beverages. Because of this the products is made available in bars, clubs, and hotels and restaurants. From an overall perspective, the company targets individuals who are looking to having a good time whether relaxing or engaging in activities (Pinson, 2008). It is intended to meet the needs of people who want to revitalize themselves and offers good energy substitute for drinks such as coffee. The main target age group is individuals between 18 years to 45 years old as they are the most active.

Targeted share

Red Bull intends to target an increased market base through directly integrating low-income entrepreneurs, suppliers, distributors, retailers, employees and consumers (Sadler, 2010). This is a move intended to ensure that its brand is made visible and that more consumers consume the products (Viaggi, 2013). In the process, adopting this business model will ensure that the company provides more employment opportunities. Therefore the company will be uplifting people in the regions that it has its operations and decreasing poverty (Viaggi, 2013). Red Bull intends to upgrade and integrate into broader production networks and value chains to improve production and distributions and uplift the economy. The company also intends to use the manual distribution center to increase its market share so that it can become the leading beverages company in the soft drinks market.

Market trends

The beverage industry is very competitive. This is because it is highly profitable. With increased globalization more businesses especially the more established ones are seeking ways of increasing their market share (Viaggi, 2013). As a result Red Bull is faced with stiff competition. It is however worth noting that there is an increased trend in the preference of energy drinks for individuals who do not want to consume alcoholic drinks (Chambers, 2008). This trend may shift the main focus of the company from active individuals especially those engaged in sports to this new market of active individuals looking to have a good time and feeling energized.

Competitors

There are several competitors in the various markets that Red Bull operates in. Some of the most significant competition comes from companies that offer alternatives to soft drinks (Bewayo, 2010). This includes Coca Cola, Pepsi, and even companies such as Starbucks which offers the consumers with quality coffee drinks and assorted products (Pinson, 2008). These competitors reduce considerably the consumption of energy drinks, specifically Red Bull. In the overall non- alcoholic beverages industry, the three mentioned competitors make up close to 35% of the global market share which a very significant amount is considering that there are many players in that industry.

Competitive advantage

Red Bull derives its competitive advantages from the uniqueness of the brand. The company offers quality products and services which are quite affordable to a majority of the target market. This has enabled the company to curve a niche for itself in the market (Pinson, 2008). Upgrading and integrating into broader production networks and value chains and using the manual distribution center business model will ensure that the company enjoys more competitive advantages. Adopting such business model will enable the company to significantly contribute to the private sector. Moreover, it will ensure that the company engages in the development process of the market and economy where it operates (McKeever, 2012). This model will in the long run enhance the brand image of Red Bull and increase its presence and awareness (McKeever, 2012). Hence it will record increased sales.

Benefits