Red Bull is one of the greatest success stories in the history of the beverage industry. Starting in 1987 it has gone from zero to selling over 4.6 billion cans in 2011. Its signature drink is now sold in over 164 countries and employs 8,300 people. Not only this but the average Austrian drinks 23 cans of red bull a year.
Red Bull created the idea of “Extreme Marketing”. The recent Stratos project which saw Felix Baumgartner parachute from near space, breaking the speed of sound and three Guinness records, was the latest and greatest example. While the impact of the event was huge, it was part of an overall commitment to being a purpose driven company. To help gain a deeper understanding of how Red Bull has achieved the success that it has, here are the top 10 entrepreneurial lessons from Red Bull.
1. Go Premium
A can of red bull costs approximately 3 to 6 times as much as a can of Coca Cola. In fact Red Bull is more expensive per can than any other non alcoholic drink. It is able to charge this price because of the brand that it has developed. It is also able to sell as a premium price because it is not selling a refreshing drink, it is selling an experience. People drink red bull because of the energy it can give them and the experiences it helps to fuel.
2. Change How You Think About Demographics
Red bull doesn’t target a particular gender, age group or income group. Instead it targets what it terms as a “State of mind”. Red bull drinkers might be young or old, male or female but they have a similar sense of drive, desire for action and love of staying fit and mentally alert.
3. Target Thought Leaders
Red Bull has been careful to cultivate thought leaders and those who can inspire others. The most famous example of this is Felix Baumgartner and the Stratos project, but this is actually only one of over 250 agreements that Red Bull has with extreme action athletes. Most of these relationships go beyond simple sponsorship. The athletes truly buy into the mission that Red Bull pioneers. By creating real relationships with these athletes it is able to reach its target demographic in an authentic way.
4. Focus On A Single Product
When we consider the size of Red Bull one of the things that is truly amazing is how focused they are on a single product. Unlike Coca Cola with its thousands of different products, Red Bull is primarily focused on its single can of energy drink. This laser focus has given Red Bull cans wide brand recognition.
To see the value in being so focused we only have to look at what happened when Red Bull diverted from this strategy and diversified into Simply Cola. It believed that its drink, which doesn’t contain any preservatives or artificial flavors, could go head to head with the giants Pepsi and Coca Cola. Unfortunately it was unable to compete but by pulling out of the market it was able
to concentrate on its core strengths.
5. Go Beyond What Is Thought Possible
The stratos project pushed the boundaries of what it was that companies were thought possible of achieving. Not only did Felix Baumgartner’s jump from near space capture world attention it also funded a mission which gathered valuable data for NASA. The idea of brand building and marketing that actually helps advance the space program is revolutionary.
6. Purpose is Everything
Many companies talk about having a sense of purpose but few embrace it as completely as Red Bull does. Red Bull is about pushing the envelope in both life and in business. This sense of mission inspires its employees to work harder and to be more innovative.
7. Connect With Your Customers
Red Bull has a very good understanding of who its customers are and it is constantly reaching out to them and seeking to participate in their life. One of the ways that it does this is through its event marketing. While many companies sponsor events in order to promote their brand, Red Bull actually creates events. This helps to reinforce the idea of Red Bull as an engine for change and innovation. It also allows Red Bull to become a much deeper and more integral part of the event itself.
8. Its More Than Marketing
One of the most interesting aspects of the Stratos project is that marketing and PR agencies that were involved with it have been told not to communicate with the press. Red Bull understands that when you create something truly great that having it spun as marketing actually denigrates it. Red Bull didn’t put Felix Baumgartner in space just to sell more cans of Red Bull; it did it because it truly believes in the space mission.
9. Commit To The Long Term
While Felix Baumgartner’s jump grabbed all of the attention, what we did not see was the work that went on behind it. Putting a vessel into near space took Red Bull 7 years to accomplish. There are few companies that would be willing to look so far forward and to put so many resources into a project that might never have succeeded. However by doing
so it showed that Red Bull isn’t merely talking about the being innovative and pushing boundaries, it is committed to them as well.
10. Become a Publisher
One of the buzz words in marketing over the past couple of years as been content marketing. This is the idea that companies need to become publishers of their own content. This might be a new concept to some but not to Red Bull. Since its inception it has been creating its own media by recording extreme events and freely sharing it amongst its audience. Red bull now has its own publishing division known as Red Bull Media House. Through Red Bull media house it also retains the copyright to its content which gives it control over how the footage is used. And thanks to the distribution channels it has created it can even decide how it will reach its audience.