Theory of Goal Setting and Task Performance

Red Bull’s greatest strengths and risks as more companies (like Coca-Cola, Pepsi, and Monster) enter the energy drink category and gain market share?

Red Bull’s greatest strengths are its originality, “rebellious” image, and its linking of its brand name with extreme sports and the “alternative” youth movement. Its originality is a big factor in its success as it has been seen as something different from the major corporate sponsors of bigger events like MLB or NFL (Pepsi or Coke). It has a unique take on the beverage industry (since it hails from Europe, it traditionally serves its consumers in 250 ml silver cans as opposed to the more American size 12 oz can). Its slim, sleek packaging also makes it look sophisticated at the same time that it appeals to a market that is excited by pushing life to the limits. So it is original in the sense that it does not look or taste like the average soda: it is not — it is something new, refreshing, energizing, and, most importantly, a little goes a long way.

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2. Should Red Bull do more traditional advertising? Why or why not?

Red Bull has tapped into a non-traditional marketing campaign that has allowed it to flourish in over 100 countries: this campaign appeals to the youth movement towards anti-corporatism, anti-mainstream thinking. Thus, Red Bull has been at the fore of promoting extreme sports, music festivals, making itself known to millions of young consumers looking for a brand that is original, alternative, hip, and “into” the things they love. Plus, the fact that the beverage is more like an “upper” than a soda gives it an extra kick of appeal. Moreover, this strategy has been highly effective, so there is no reason to insist that Red Bull move towards traditional advertising. In fact, moving towards traditional advertising might kill the core market share that it has and cause it to lose its base, which finds Red Bull appealing precisely because it is non-traditional and non-mainstream. Red Bull has managed to gain tremendous traction by being “different” so for it to now abandon its base in an attempt to gain more or at least maintain its market share would be to undermine the strategy that allowed it to get where it is today. Red Bull should be careful not to alienate its consumer base by trying to appeal to and attract more traditional, mainstream clientele.

However, if traditional advertising can be executed in a way that does not offend the Generation Y base that is Red Bull’s — but can promote its product in a genuinely alternative and hip way that does not betray the company as a mainstream, corporatist entity — then traditional marketing to a limited extent may be acceptable.

3. Discuss the effectiveness of Red Bull’s sponsorships, for example, Bull Stratos. Is this a good use of Red Bull’s marketing?

By sponsoring events like Bull Stratos, Red Bull is able to put itself at the forefront of history. Never before has a human being dove from such a great height (practically outer space). Red Bull’s ability to capitalize on this event puts it front and center in the minds of millions of young fans of death-defying stunts like this. This is the type of marketing that has allowed Red Bull to rise to the top of the energy drink market. The theory behind sponsoring such events is that event links to the nature of the beverage product: the event is a high-octane, energy-fueled, completely original and historic moment — which is everything Red Bull sells itself as to consumers. Thus, by sponsoring events like this and Flugtag, Red Bull embodies its slogan which is “Red Bull gives you wiiiiings!” In a way, Red Bull embodies the spirit of “complexity theory,” which strives to evince a worldview that matches the goals and orientation of the company through a diverse set of parameters (Smith, 2004). Red Bull is certainly an entity that has taken its own way to the top and incorporated a unique vision as part of its branding experience: this alone allows Red Bull to dominate. Red Bull’s goal is thus to be what it promotes — on the edge of something new and exciting that the “next generation” can embrace and identify with (Locke, Latham, 1990).

References

Locke, E., Latham, G. (1990). A Theory of Goal Setting and Task Performance. NJ:

Prentice-Hall.

Smith, A. (2004). Complexity Theory as a Practical Management Tool. Organization Management Journal, 1(2): 91-106.


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