Given the below information about Red bull, please answer the question at the bo

Question

Given the below information about Red bull, please answer the question at the bottom.

"Broadly speaking, Red Bull segmented the market based on demographics, psychographics, and behavior. Within each of these segments, Red Bull’s targeting strategy was as the following:

Demographics:

Age: mostly millennials (from teens to 40 year old)

Gender: male and female.

Income: average income to high income consumers.

Occupation: athletes and students.

Psychographics:

Social class: middle and upper class.

Lifestyle: adventurers, outgoing millennials, physically active consumers.

Behavior:

Brand Loyalty: pursuing consumers with high loyalty to the product.

As a matter of fact, all of these segments are identifiable, large enough, easily reachable, and profitable. In order to support its concentrated targeting strategy, Red Bull decided to use two dimensions in positioning itself in the market; the first is price/quality (the perceived idea that a higher price reflects a premium and high-quality product), and the second is product benefits (by emphasizing on the amount of energy gained by drinking Red Bull). In doing so, Red Bull constantly looks into product differentiation (offering various flavors/editions) and brand image (the most popular and frequent sponsor of biggest sports events, as perceived by the consumers).

Sponsoring of extreme sports events and parties:

The company sponsors various events such as climbing sports, BMX race, Formula 1, Rally races, night clubs, university festivals, musical concerts, and much more. This confirms the validity of their targeting and positioning strategy; since the audience in all of these events are mostly middle to high income class millennials, who are filled with energy, socially active and outgoing.

Type of decision making for the consumers:

The consumers who are buying an energy drink would face a “routinized” problem solving situation. In a routinized problem solving, consumers don’t need set of established criteria to evaluate the product, because they already had an experience with the product and are aware of the quality/outcome of the product. In Red Bull’s case, the consumers already know how the drink tastes, and what do they get after drinking it; they feel energized and active.

Learning behavior (classical conditioning):

Red Bull uses classical conditioning in reaching to their consumers; by repeated exposure and reinforcement, the consumers will develop a learning behavior towards the product. Through decades of constant advertisements, sponsorship of global events, Red Bull made it easy for consumers to always remember and relate to the product, especially when attending outdoor extreme sport events. Furthermore, Red Bull uses classical conditioning by placing its logo on the jerseys of major football teams, airplanes, formula 1 cars, or even on the outfit of sport celebrities when they perform an extreme sport live on TV. In all of these cases, the consumers go through a rehearsal process in which they develop a learning behavior based on constant repetition and appearance of the Red Bull logo. In this way, the company is somehow forcing millions of consumers to constantly see the Red Bull logo and relate the product with the sport that is being presented on the TV, without the need of dedicating a separate ad to promote the energy drink.

Perceived quality:

Though intrinsic cues (such as physical attributes, size or flavor) are far more important than extrinsic cues, consumers of energy drinks tend to heavily depend on extrinsic ques (such as taste) in judging the quality of the product. Many Red Bull consumers claim that the drink has a unique taste, however, a few other companies have recently marketed their energy drinks, and their taste is very close to Red Bull. The consumers of Red Bull also see a price/quality relationship in the energy drink; by paying additional premium for the price, the consumers are likely to feel that they are unique, and their product is differentiated.

Observational learning:

Many consumers of energy drinks are also engaged into observational learning, in which they develop a learning behavior based on their observation of what others are doing, and based on what others might say about the product (through reviews or group of friends). When millennials watch ads that depict the power of Red Bull or how the drink could boost their energy, they want to have it. Also, when millennials see their cool friends drinking the energy drink and giving positive feedback about it, then they are enticed to give it a try.

Brand personality:

In delivering its emotional identity to the consumers, Red Bull personifies itself in the advertisements through messages such as “giving wings to people and ideas”, “Red Bull gives you wings”, “always diving in head first”, “explore the world behind the can”, and “vitalizes your body and mind”. And therefore, from the consumer’s perspective, the brand personality of Red Bull would be a combination of these characteristics:

Maslow’s hierarchy:

Within Maslow’s hierarchy of needs, Red Bull’s energy drink falls under the “social needs”. People don’t drink Red Bull to fill their ego, or to brag about their social status; the consumption is driven by lifestyle and interest, they buy the energy drinks because they favor Red Bull over Pepsi. They also feel like they belong to a certain group of society that is perceived to be cool, trendy, full of energy, active, and sporty.

Product line extension:

Through product line extension, Red Bull is effectively using stimulus generalization with its consumers, a concept in which consumers use their knowledge about current product lines, and apply them to future products, thinking that the new products are likely to be as good as the previous drinks. Red Bull initially produced their original energy drink, and subsequently offered various choices such as sugar free, yellow edition, cherry edition, cola, orange edition, blue edition, and much more.

Marketing Channels:

Red Bull uses various channels to strengthen their brand awareness through global event sponsorships (mostly sport-related), TV advertisements, celebrity endorsements, and general campaigns at universities and social clubs. By integrating all marketing communication channels, Red Bull ensures that the message is delivered to all potential target consumers.

Use of celebrities:

Red Bull uses celebrity testimonials in promoting its energy drink in the market. Almost all of the celebrities who are promoting Red Bull can be seen drinking the product during their match or event, so it is not considered just a mere endorsement, but rather an actual or live experiment. This gives more confidence to the consumers and makes the promotion more believable".

Question: From the information given above, provide in details an evaluation on the effictiveness of red bull's strategy and marketing tactics in the context of consumer behavior concepts and theories. you should focus on the positive and negative aspects. Include a critique of these strategies and recommendations for improves alignment with consumer behavior concepts and applications. (book: Consumer Behavior 11th edition)

Explanation / Answer

Answer: This description clearly indicates the effectiveness of the effectiveness of the red bull’s strategy and the market tactics in context of the consumer behaviours. The organization understands its target segments well and has right marketing strategies aimed at directly targeting at the target audiences. The target audiences of the company are the middle and upper class individuals who like physical activities and want energy. The company has a product which well suits the needs of this group. The company has a strong promotional strategy in which the organization targets the customers by sponsoring the adventure sports. The strategy of constant conditioning is also well suited as the purchase decision by the customers is a routine one. But at the same time the strategy of the company is focussed only on its routine customers. There can be other customer segments also who need energy and which the company can target. For example the students who wake up late for studies and the individuals who require energy during fun activities like during picnics and dance parties. The marketing strategies of red bull should therefore extend its promotional strategies to create an appeal to such additional groups also.    

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