MARCO BALTAZAR BCom Candidate 2019

marco.baltazar@ryerson.ca 647-818-7515 https://ca.linkedin.com/in/baltazarm

4 Raymore Drive, Toronto, ON M9P 1W5

First and last page of a five page consumer behaviour paper I wrote on Red Bull which included
a strategic product line extension my professor used as an example in class. Grade: 90%.

Red Bull Energy Drink was sold for the first time on April 1, 1987 in Austria and would

be the start of an origin story for a new product category (Red Bull, 2016). Over 28 years later,

Red Bull has sold around 60 billion cans and is available in 169 countries around the world (Red

Bull, 2016). Hence, the Red Bull brand has successfully grown astronomically since its inception

by having such a globalized presence. Two reasons for this success is because of how simple the

current positioning strategy of Red Bull is coupled with the broad nature of their target market.

Product positioning refers to the manner in which a product is communicated to consumers who

perceive it (Babin, Harris & Murray, 2014). Red Bull has used the slogan Red Bull gives you

wings for over twenty years as an analogy for presenting the message of what they offer (ABC7

Eyewitness News, 2015). Red Bull gives consumers energy and is the way it is perceived by said

consumer. Target market refers to a group of identified people that something caters to (Babin et

al., 2014). Looking at what Red Bull provides with their beverages, it gives consumers energy to

vitalize the body and mind (Red Bull2, 2016). Since energy is something that potentially copious

amounts of people can attest to experiencing low and needing more of in their lives, Red Bull has

possible applications for numerous people. The only factor preventing it from being applicable to

anyone is that Red Bull contains caffeine; in fact, one 250ml can contains 80mg of caffeine, or

roughly the same amount of caffeine found in a cup of coffee (Red Bull3, 2016). Health Canada,

for example, has recommended max caffeine intake levels for kids like 62.5 mg/day for ages

seven to nine and 85 mg/day for ages ten to twelve (Health Canada, 2012). Thus, theoretically,

Red Bulls target market ranges from as low as ten year olds to as high as someone who can...

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 MARCO BALTAZAR BCom Candidate 2019
marco.baltazar@ryerson.ca 647-818-7515 https://ca.linkedin.com/in/baltazarm
4 Raymore Drive, Toronto, ON M9P 1W5
... Reason being, anyone who finds themselves needing energy could also find themselves

needing a lot at times. As previously mentioned, the Red Bull website states examples of usages

like students, workers or for just going out (Red Bull1, 2016). A student could need to stay up

extra-long for a paper, workers may have extra-long days during busy periods or someone may

just have an extra-long day or night ahead of them. Whatever the case, if that consumer in less

extreme conditions turns to a regular Red Bull for energy, this team would expect them to buy

the new product for that extra energy. As for consumers to actually respond to the new line

extension, the just noticeable difference (JND) needs to be palpable, particularly in terms of the

quality aspect. JND refers to there being an adequate difference between two stimuli to notice

they are not the same (Babin et al., 2014). Increasing the original caffeine content of 80mg in a

250ml can (Red Bull3, 2016) to 85mg might be too small of an improvement in quality to impact

consumers. However, increasing it to 160mg would be twice as much and will be significant

enough to create a substantial difference. To aid the comprehension of consumers to the new

line, physical characters, referring to the tangible components of the product that can be detected,

would be utilized (Babin et al., 2014). In particular, the physical characteristics that could aid

effectively communicating the new line most would be front and numbers. If the new line were

called Red Bull EXTRA 2.0, for example, both features would make for effective

communication. Seeing how the actual font of a message sends significant signals (Babin et al.,

2014), the word extra in large capitals would send indications of a large amount of energy in the

can. In addition, seeing how names with numbers often are a signal of advancements in

technology (Babin et al., 2014), the 2.0 would both represent the doubling amount of caffeine in

the product and send an indication of such an innovation. Thus, this is the line extension the

group proposes for the Red Bull brand and why it would be a successful one.