Red Bull Business Model | Business Model Navigator

Overview:

Red Bull is an energy drink sold by Red Bull GmbH, an Austrian company created in 1987. Red Bull has the highest market share of any energy drink in the world, with 6.302 billion cans sold in a year (as of 2017). Austrian entrepreneur Dietrich Mateschitz was inspired by an existing energy drink named Krating Daeng, which was first introduced and sold in Thailand by Chaleo Yoovidhya. He took this idea, modified the ingredients to suit the tastes of Westerners, and, in partnership with Chaleo, founded Red Bull GmbH in 1987 in Chakkapong, Thailand. In Thai, daeng means red, and a krating (known in English as a gaur or Indian bison) is a large species of wild bovine native to South Asia. Yoovidhya's heirs own majority stakes in both brands, and they both use the same red bull on yellow sun logo while continuing to market the separate drinks to the respective Thai and Western markets.

Industries:

Consumer Goods

Business Model Patterns:

Experience Selling

How they do it: Associations with extreme sports (e.g. Formula One, motocross, windsurfing, BMX and snowboarding) combined with the distinctive RedBull branding enables the company to charge higher prices for its products. Customers, predominantely young males, desire the whole ”experience” associated with the RedBull lifestyle, and not simply the product or its functional value.

Reverse Innovation

How they do it: Krating Daeng is a sweetened, non-carbonated energy drink, developed in Thailand in the 1970s. It was introduced in Thailand as a refreshment for rural Thai labourers. Krating Daeng was discovered by Austrian entrepreneur Dietrich Mateschitz while working in Thailand. He subsequently introduced Red Bull in the Western market with a different formula and branding concept.

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