- BUS FPX 3030 Assessment 2 Place Analysis.
Place Analysis
Bearing this in mind and given the fact that Red Bull has once again come out as a clear leader in the energy drink segment, the company needs to seek new opportunities for its development. One such opportunity lies in introducing a new product line: consumption of beverages with an essence of coffee and energy boost products.
The company intends to get the taste of consumers through this new product while exploiting the market position of Redbull associated with energy-boosting drinks with flavors of coffee. After analyzing the situation in the global market, it can be concluded that the energy drink market will maintain its growth mainly due to the increased demand for products with functional and/or recreational properties accompanied by the use of familiar taste associations with coffee (Statista, 2022).
However, it is the successful implementation of this product line that requires not only an interesting taste variation but also a correct location of the product. The place strategy will guarantee that these coffee-flavored energy drinks are well and easily accessible to consumers as and when they need them.
This draws a map of Red Bull’s existing distribution channels, determines the new outlets will be exploited, and evaluates the place strategy as a contribution toward the sustainability and profitability of the new product line. Thus, it becomes apparent that enhancing the distribution approach will enable Red Bull to expand on its market share reach and remain relevant in an ever-competitive energy drink industry.
Product Selling Location
At the moment, Red Bull energy drinks are available in several outlets making it very easy to access by its target catchment. Convenience stores are one of the biggest types of locations for Red Bull energy drink consumption since most consumers prefer convenience stores since they are easily accessible by people on the go. The characteristics of these stores include high foot traffic and more often, the customers purchase on impulse (NielsenIQ, 2021).
Also, supermarkets and hypermarkets offer a great place for billboards, and large floor areas, the visibility of Red Bull products is high since it targets those customers who always drink energy drinks and those occasionally. Petrol stations are another channel of Red Bull distribution as they put staking points in those places where people, tired from long driving or commuting, would need a power boost.
BUS FPX 3030 Assessment 2 Place Analysis
Another suitable location for Red Bull is vending machines that are placed in such places as gyms, airports, or office spaces where people can afford themselves conveniently. Furthermore, today, owing to the facilities of e-commerce, Red Bull products are available on other platforms like Amazon or Walmart and directly on the Company’s website, which allows the consumer to make purchases and have the products delivered directly to their home (Grand View Research, 2022). This, coupled with Red Bull’s popularity among youths and its frequent use as a mixer with alcoholic beverages mainly in bars and nightclubs, Red Bull tightens the entrenchment of its brand with Nightlife and similar social activities.
To improve the probability that the new coffee-flavored energy drinks will be successful, Red Bull needs to offer its suppliers new outlets that correlate with the product’s novelty. It will be suitable to place the promotion in coffee shops and cafes since these locations are popular among the client base that may find appeal in a coffee with an energy boost. In the same manner, this coffee-flavored drink would be marketed under specialty grocery stores targeting consumers using gourmet products and unique beverages, setting it apart from energy drinks.
Product’s Distribution Channels
Its distribution network is one of the strengths of Red Bull since through it the brand earns its competitiveness within the over-saturated energy drink market. Widely used channel of distribution by the company includes the use of multiple channels that would cover a wider market of consumers. These led to the continuance of direct sales to retailers, collaborations with distributors as well as increasing the company’s e-commerce sales. Direct selling is one of the main ways used by Red Bull to deliver its products to customers; this is through selling products directly to large customers like supermarkets and convenience stores.
The key cooperation with these retailers guarantees the necessary shelf placement, which is the major factor of impulse purchasing, and critically important for the development of the energy drink market. This direct relationship also gives Red Bull direct control over price and promotion strategy since there is great similarity in brand image across countries and regions (Gielens & Steenkamp, 2019).
The third element in Red Bull’s distribution scheme is working with other distributors and resellers. These distributors are very important in being able to get Red Bull products to small retail stores and outlets, service stations, bars, and nightclubs. Such an approach helps Red Bull to enter every sphere of the market, including the rural one and independent stores, where it can be challenging to organize direct distribution.
Place Strategy and the Associated Impact on Economic Success
Therefore, place strategy is a vital part of Red Bull’s total marketing mix because it is closely connected with the brand’s economic effectiveness. This strategy of placing products at various outlets guarantees its accessibility while at the same time offering ensuring that its products are placed strategically within areas that suit the targeted clientele.
A good example of proven retail management by Red Bull is avoiding overcrowding: Instead of flooding the market with its products, the company has adopted a niche approach to the choice of retail environments, which combined with the multiline, multichannel distribution strategy, allows Red Bull to penetrate more markets and guarantee high sales and improved, or at least unchanged, profit margins.
BUS FPX 3030 Assessment 2 Place Analysis
Hence, the place strategy for Red Bull majorly depends on the company’s ability to position its product where its target customer base is likely to frequently to find energy drinks. This involves convenience store outlets, supermarket outlets, gasoline stations, gymnasiums, and other spots of entertainment.
Selecting the zones with the highest traffic frequency and places correlated to the dynamic active life setting of the customers, Red Bull links its product placement with consumers’ inclinations toward a purchase on impulse. It is for this reason, that the strategic placement is even more effective as a way of catching the eye of the consumers during moments of optimum vulnerability such as during or after, before or during workouts, long drives, during the night while at night clubs or bars among others (Chandon et al., 2020).
Conclusion
Therefore, it can be summarized that Red Bull’s place strategy is one of the significant parts of Red Bull’s marketing mix that played a major role in continuously maintaining market and economic dominance. Red Bull also establishes that its products must be easily available to target consumers through the following ways: placing the products in strategic positions in food stores, supermarkets, and other retail stores; offering the products through a multiple channel distribution system and introducing attractive items in the e-commerce sector. The distribution strategy must be holistic to ensure that sales, brand recall, and consumer loyalty are enhanced.
Here, Red Bull has the potential to go even further with its place strategy, which includes testing different non-store retail approaches and building its direct consumer experience. These could assist the brand in getting out to new customer segments and thus develop better consumer touch points that would add incremental values resulting in more revenues to its bottom line and thus greater competitive advantage. By integrating new place strategies the new consumer behavior and the trends in the marketplace, Red Bull can remain at the fore of the energy drink producers while unveiling new product ranges like the coffee-tasting energy drink.
References
AlJaberi, O. A., Hussain, M., & Drake, P. R. (2019). A framework for measuring sustainability in healthcare systems. International Journal of Healthcare Management, 13(4), 1–10.
https://doi.org/10.1080/20479700.2017.1404710
Ng, J. H. Y., & Luk, B. H. K. (2019). Patient satisfaction: Concept analysis in the healthcare context. Patient Education and Counseling, 102(4), 790–796.
https://doi.org/10.1016/j.pec.2018.11.013
Pekkaya, M., Pulat İmamoğlu, Ö., & Koca, H. (2019). Evaluation of healthcare service quality via servqual scale: An application on a hospital. International Journal of Healthcare Management, 12(4), 340–347.
https://doi.org/10.1080/20479700.2017.1389474
Reibling, N., Ariaans, M., & Wendt, C. (2019). Worlds of healthcare: A healthcare system typology of OECD countries. Health Policy, 123(7), 611–620.
https://doi.org/10.1016/j.healthpol.2019.05.001
Ryan, B. L., Judith Belle Brown, & Thorpe, C. (2019). Moving from space to place: Reimagining the challenges of physical space in primary health care teams in Ontario. Canadian Family Physician, 65(9), e405–e410.
https://www.cfp.ca/content/65/9/e405.short
Tortorella, G. L., Fogliatto, F. S., Mac Cawley Vergara, A., Vassolo, R., & Sawhney, R. (2019). Healthcare 4.0: Trends, challenges, and research directions. Production Planning & Control, 31(15), 1–16.
https://doi.org/10.1080/09537287.2019.1702226
Wang, S., Bolling, K., Mao, W., Reichstadt, J., Jeste, D., Kim, H.-C., & Nebeker, C. (2019). Technology to support aging in place: Older adults’ perspectives. Healthcare, 7(2), 60.
https://doi.org/10.3390/healthcare7020060
Weiss, D. J., Nelson, A., Vargas-Ruiz, C. A., Gligorić, K., Bavadekar, S., Gabrilovich, E., Bertozzi-Villa, A., Rozier, J., Gibson, H. S., Shekel, T., Kamath, C., Lieber, A., Schulman, K., Shao, Y., Qarkaxhija, V., Nandi, A. K., Keddie, S. H., Rumisha, S., Amratia, P., & Arambepola, R. (2020). Global maps of travel time to healthcare facilities. Nature Medicine, 26(12), 1835–1838.