ABOUT RED BULL. recipe, cured his jet lag. After expanding into other countries, Red Bull entered the U.S. in 1997 and experienced

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2 EXECUTIVE SUMMARY Red Bull is one of the fast growing energy drinks in the world. A fast growing company that is looking for a fast growing market, sports drinks are growing in East Asia and Red Bull is looking to take advantage of that in China, Japan, and South Korea. Red Bull is seeking expansion in a brand new market, according to that, The Blue Man Group has developed two strategies with a target audience in each country. Red Bull is faced with some critical factors in each country, economic, government, and industry factors. China s government has banned foreign-produced animation to improve views of local produced animations. The term energy drink is banned in China. Japan s GDP has been decreasing by 1.6% each year adding to that the sales tax is very high, which discourage people from spending. Bacchus is an energy drink that is ranked number one in sales in South Korea. The Blue Man Group has developed two strategies, standardization and localization. Standardization strategy will introduce the product to the audience with two universal values, Freedom and Knowledge. Localization strategy will introduce the product to China with long term orientation, to Japan with masculinity, and to South Korea with Uncertainty Avoidance. The Blue Man Group came to the conclusion that the localization strategy is the better option to appeal more to our target audience and to the new market.

3 CRITICAL FACTORS

4 ABOUT RED BULL A Brief History Red Bull was originally launched in Austria in Entrepreneur Dietrich Mateschitz founded Red Bull after discovering that Krating Daeng, a Thai drink with a similar recipe, cured his jet lag. After expanding into other countries, Red Bull entered the U.S. in 1997 and experienced rapid growth. Red Bull is now available in more than 160 countries, where 40 billion cans have been consumed so far (5.3 billion of which were sold in 2013). Current Advertising -Slogan: Red Bull Gives You Wings -Alternative buzz marketing: gave free samples to college students and encourages them to throw big parties where cases of Red Bull were provided -Commercials are cartoons (Red Bull website features a cartoon archive) -Sponsors extreme sporting events (adventure sports, aerial sports, ball sports, motor sports, bike sports, skate sports, water sports, winter sports) -Red Bull Stratos: Felix Baumgartner was the first man to break the speed of sound in freefall, jumping from the stratosphere

5 STRENGTHS Highest selling energy drink in the world (5 billion cans sold in 2013) First of its kind: entry from Austria into the U.S. seen as one of the first and classic uses of alternative and buzz marketing Fast growth in U.S. introduced in 1997 (only 17 years ago) Held 60% to 70% of the U.S. energy drink market share in 2010 The brand recently expanded to China, and consumers seem receptive 3.1% increase in sales in 2013 (32% increase in Japan) WEAKNESSES Price of a single can is expensive Health concerns have risen over energy drinks Low brand awareness in foreign countries Current advertisements do not resonate with foreign countries OPPORTUNITIES Targets a young adult audience: those seeking unordinary lifestyles, pulling all-nighters (for school, work or partying), as well as those engaged in extreme sports Currently successful among the U.S. urban market, and several densely populated cities are located in the Asian region THREATS Lawsuit over false advertising because the drink doesn t actually give you wings ($13 million settlement) May be hard to distinguish in China because the phrase energy drink is prohibited for describing beverages must be classified as drink with other special functions

6 MARKETING Problem The problem that the Blue Man Group faces is the introduction of Red Bull into three different international markets. The new advertising campaign must take into account different media and restrictions, as well as different local tastes and cultural dimensions.

7 CHINA Target Audience Age: Average HH Income: $17,000-34,000 Cultural Factors: Culture: China is deeply rooted in their heritage and ancestry. The country carries one of the oldest cultures in the entire world. China contains 56 different ethnic groups and generally values Confucianism and Taoism. Confucianism is a religion based on the philosophical teachings of Confucius. Its based off of humanistic which consists of worldly awareness and respect for the earth. The culture of China today has been impacted by the internet as young millennials are shifting over to social media and websites. China s internet is censored, which has caused Chinese internet users to be more savvy and aware of censorship. Chinese web users tend to be interested in games, entertainment, chatting, and shopping.

8 CHINA Media Digital: China is one of 12 countries that will have a larger digital market than TV market this year. Social Media China has 597 million social media users. Social media ad spending will grow faster than any of the digital segments, at 67.6% compound annual growth rate (CAGR) through The average social media user follows eight brands, and 38% of Chinese people make shopping decisions based on social network recommendations. The popular site Renren is similar to Facebook, and Tencent Weibo and Sina Weibo are similar to Twitter. Mobile Mobile advertising will grow by nearly 100% CAGR and will make up more than 10% of total digital market in China by Mobile advertising is 10% digital ad revenues and 3.5% total ad revenues in China. It s growing strongly mobile devices are becoming a common way to access the Web and the popular microblogging sites. China s top app is WeChat (similar to Whatsapp).

9 CHINA Television:TV-CCTV (China Central Television) which is the only national television network in China. Stations include: CCTV-1 (General Channel), CCTV-5 (Sports Channel), CCTV-5 (Sports Events Channel), CCTV-8 Television Series Channel), CCTV-10 (Science and Education Channel), CCTV-13 (Chinese News Channel), CCTV-15 (Music Channel) Popular series: We Get Married, Noble Bride Regrets Love, Female Prime Minister, Hot Mom, When Naive Meets Reality, A Happy Life, Phoenix Nirvana, Swordsman, Second Life of My Husband, Little Daddy Print: Popular newspapers: Bejing Evening News (1 million circulation), Mirror (350 thousand), Oriental Morning Post (400 thousand), Shanghai daily, Southern Metropolitan Daily Magazine: Duzhe (Translated as Reader is China s most popular magazine, Rayli-is a Chinese female`s fashion magazine, Chinese National Geography (Chinese: 中国国家地理) is a monthly magazine similar to the National Geographic Magazine. Started in 1949, Radio Guangdong Radio Station, Radio Guangdon Voice of the City; Lanzhou Radio Station; Shanghai Media Group (Eastern China Regional News, Popular Music, Love Music and Comedy Channel)

10 CHINA Economic China is expected to have the larget digital market by Despite China s programmatic market share being only 5 percent and increasing to 23 percent by 2017, it will still be the third largest programmatic market globally in 2017 due to the massive size of the Chinese digital market. Industry Energy drinks in China have experienced a surge in popularity. The product launches have brought attention to the energy drinks and spurred the products rapid growth. In some cities, there has been an increase of mah-jong rooms for people to play the game. Mah-jong fans have become a focus for some energy drink brands. In regions like Sichuan Province, local residents have played mahjong for many years, so Red Bull has launched promotional sales within this area. Government In 2006 the Chinese government banned foreign-produced animation between the hours of 5:00 p.m. to 8:00 p.m. on state-run television to protect struggling Chinese animation studios. Additionally, the term energy drink is banned in China. The beverages must be referred to as drinks with other special functions. Competitors Hi Tiger Qi Li Energy Drink

11 JAPAN Target Audience Age: Population: 127,103,338 GDP: $4,729,000 GDP per capita: $37,100 HH annual Income: $19,974 Culture Japanese culture has led to a hard working population of people. In their free time, Japanese people enjoy listening to music, reading manga and playing video games. The society doesn t perpetuate inequalities between different classes (Power Distance: 54). They are a very collective society, so relationships are very important (Individual: 46). With a slightly less masculine society, men can have similar roles to women (Masculinity: 95). They accept uncertainty and opinions from others, so the introduction of a new product could be well received (Uncertainty Aversion: 92). A slightly less long-term oriented society means they don t need to keep long-standing traditions (uncertainty: 92).

12 JAPAN Media Digital Internet: 79% of Japanese people use a computer at home to access the Internet. There are few censorship laws, and the laws that exist mostly apply to government elections. Social Media: Line is the biggest social media network in Japan as of 2013, with 300 million users world wide, 50 million of which live in Japan. The next social media network in terms of number of users is Twitter. Overall, Japan s social media has increased since the surge in usage after the 2011 earthquake, because traditional media went down. Mobile: About 75 percent of 15 to 19 year olds and about 70 percent of 20 to 29 year olds owned a smartphone in Traditional TV: With mostly free media, there are several public and cable TV networks, as well as access to international channels. The five key stations that create news and entertainment stories all have offices in Tokyo. They are Nippon News Network, Japan News Network, Fuji News Network, All-Nippon News Network, and TV Tokyo Network. Print: Japan has monthly and weekly magazines, and has newspapers published nationally, regionally, and locally. The magazine Metropolis, is an English language magazine. Radio: Japan has both AM and FM radio stations.

13 JAPAN Economic The country s GDP has been decreasing at 1.6 percent per year. In addition, Japanese sales taxes have been high, which discourages spending. Industry Japanese people don t have anything against energy drinks, and the country has produced many localized energy drinks, including green-tea and vitamin enhanced caffeine shots. However, inspection standards may pose a problem for Red Bull. While in the U.S., damaged cans would just be thrown away, defective products in Japan would warrant a time-consuming investigation that may delay Red Bull s introduction. Government Japan s government is considered a constitutional monarchy. The country has an emperor, but he is mostly for ceremonial purposes. Japan is actually governed by three branches of government, executive, legislative, and judicial, and is not perceived as overbearing or intrusive.

14 SOUTH KOREA Target Audience Age: Average HH Income: $36, 757 Population: 49,039,986 GDP (millions): 1,666,000 GDP per capita: 33,200 Cultural Korean life has always centered on tightly knit families. The actions of one family member reflect on the rest of the family. In Confucian tradition, the father is the head of the family, and it is his responsibility to provide, clothing, and shelter. With this being said, family welfare is much more important than the needs of the individual. Following Confucianism, they have a strong belief in the values of duty, loyalty, honor, and sincerity. In their free time, both online games and the traditional board game Baduk have become a big part of Korean culture. When it came to clothing, Koreans used to dress differently, making clothing an important mark of social status. Sometimes, costumes were worn by the ruling class, and the royal family. Also, Korean culture would be incomplete without pottery and ceramics. Pottery is Korea s cultural emblem and it started hundreds of years ago.

15 SOUTH KOREA Media Digital Internet News in South Korea is delivered electronically. The country is leading the digital revolution (high-speed and wireless internet services). Many business use the Internet in Korea for services like news, social media, shopping, banking, games and educational content. Social Media Twitter usage has been growing in conjunction with the smartphones in South Korea. me2day and yozm are some other microblogs in South Korean media. Mobile South Korea is home to the world s largest smartphone-making company, Samsung Electronics, which is the global leader in high-speed Internet and advanced mobile technology. 98% of South Koreans own mobile phones and use them not for calling, messaging, watching live TV, viewing websites and keeping track of their online gaming statuses.

16 SOUTH KOREA Traditional TV KORCAD was the first TV station in South Korea, which launched in In South Korea, terrestrial television broadcasting is common and popular. There are 5 channels with 4 television stations: KBS 1TV, KBS 2TV, MBC, EBS, SBS. Popular TV shows are 2 days 1 night, Happy Together, We Got Married and Boys over Flowers. Print Chosun Ilbo, Dong-A Ilbo and Jung-Ang Ilbo are the newspapers with conservative ideals. Hankook Ilbo is moderate. Kyunghyang Shinmun and The Hankyoreh newspapers which hold liberal ideals. In South Korea conservative newspapers are more widely read. Magazine One of the most popular magazines is The Chosun Ilbo, an online presentation of the Korean daily The Chosun Ilbo. Other magazines are K Scene Magazine, JoongAng Daily, Korea Post, Korea Times and Yonhap News Agency. Radio MBC Radio is popular because there are several longrunning programs. MBC operates 2 channels: FM4U and Standard FM. Cho Yeong-Nam and Choi Yu-ra s Radio Golden Age is the most famous program which provides funny stories and K-pop music.

17 SOUTH KOREA Economic South Korea has a market economy that ranks 15th in the world by nominal GDP and 12th by purchasing power parity. It is still one of the fastest growing developed countries in the 2000s. Industry Created in 1961, Bacchus is a successful Korean energy drink that contains taurine. It is the number one selling energy drink in the country, and there is definitely a market for energy drinks in South Korea. Government The government of South Korea is divided into executive, judicial, and legislative branches. The executive and judicial branches operate primarily at the national level, although various ministries in the executive branch also carry out local functions. The South Korean government s structure is determined by the Constitution of the Republic of Korea.

18 MARKETING OBJECTIVE Red Bull s marketing objective is to increase market share in Japan, South Korea and China, by 2%. Specifically, Red Bull aims to increase the market share of China by 1.5%, Japan by 2% and South Korea by 2%. The market shares of these segments will increase within the campaign period of January 2015 to January Advertising OBJECTIVE Red Bull aims to increase awareness, likeability, brand loyalty and favorability among China, Japan, and South Korea. Red Bull will be distinguished among its competitors to give it a clear position within its market.the brand will be introduced gently according each country s culture. The campaign s goal is to incorporate Red Bull into their values, and lifestyles.

19 MEDIA MIX

20 CHINA BUDGET $15 million total Digital: $3.9 million Social Media: $1.5 million Mobile: $1.4 million Internet: $1 million Traditional: $9 million TV: $8 million Print* Radio: $1 million Promotions: $2 million Evaluations: $100,000 *Chinese print media have low circulation numbers. Red Bull has not used print in the past as well JAPAN BUDGET $45 million total Digital: $18.9 million Social Media: $8 million Mobile: $5.9 million Internet: $5 million Traditional: $21 million TV: $17 million Magazines: $2 million Radio: $2 million Promotions: $5 million Evaluations: $100,000 South Korea BUDGET $40 million total Digital: $17.9 million Mobile: $7 million Internet: $7 million Social Media: $3.9 million Traditional: $22. 1 million TV: $15 million Magazines: 1.5 million Radio: $1.5 million Promotions: $4 million Evaluations: $100,000

21 Regionality China: Shenzhen, Shanghai and Beijing Japan: Osaka, Sapporo and Tokyo South Korea: Seoul, Busan and Incheon Gwangju, Incheon, and Ulsan Seasonality The Blue Man Group choose continuous scheduling for Red Bull in order to fully build brand awareness among each country.

22 Recommendations

23 Standardization This campaign will focus on universal values held by consumers in China, Japan and South Korea. The universal values that Red Bull will use as a means of introducing its product to consumers are freedom and knowledge. Our standardization strategy will be to use the same branding ideas and visuals across all three countries, but use different media vehicles to fit each country s preferred media. Commercial to be adapted for all three countries: Citizen of the country trapped in the city, feels over-crowded and uninspired. Popped open a Red Bull and the scene quickly spans out the person (with wings) hovering over a map of the country. The commercial follows the person drinking a Red Bull, as she dives in to several important landmarks of the country, representing the country s important, respected history. (i.e. The commercials ends with a wing-clad Japanese citizen sitting atop Mount Fuji drinking a Red Bull). Red Bull Gives You Wings

24 Standardization Pros -Little competition in energy drink market in Asia, standardization is a good approach -Reduces costs, no duplication of effort for each market -Less production costs because campaign is ubiquitous across all countries -More company control of brand image Cons -Language barriers when translating ads for different countries -Different legal restrictions and media regulation -Although values are considered universal, they re still going to vary between countries -Possible negative attitudes toward Austria, where Red Bull was founded, and the U.S., where Red Bull is popular Expected Outcomes Using the standardization approach, the Blue Man Group will connect with the people of Japan, China and South Korea on a more personal level by applying the universal values of freedom and knowledge. This will strengthen the brand over the three countries and will increase sales. The Blue Man Group will spend less money by using the same branding ideas and visuals across all three countries (but with different media vehicles).

25 Localization China International Promotional Mix (IMC Mix) Long Term Orientation: Chinese society appreciates long-standing traditions, hard work ethic and persistence. Traditional Ad Commercial: Transition through ancestors and their morning routines and duties holding the beverage that gave them en ergy, through today s generation holding a red bull Generations using different methods to wake up coco, green tea, now red bull Social Media Ads Instagram: picstitch of Kung Fu then and now holding Red Bull cans Sales Promotions BOGO: during first month of introduction, give one to a family Sponsorship Lantern Festival on the 15th day of the Chinese New Year (Jan. 30 to Feb. 5)

26 :60 Commercial

27 Tencent Weibo Ad

28 Localization Japan International Promotional Mix (IMC Mix) Masculinity: Males adhere more to traditional gender roles. This promotional mix covers all the aspects that males who follow traditional roles gravitate toward work, fatherhood and keeping up with sports in their freetime. Traditional Ad Commercial: Two sharp-dressed businessmen (enemies at the office) race each other to work, taking various shortcuts winding in and out of Tokyo. They finally meet a block away from the office it s now in sight. As they lock eyes, one man pulls a Red Bull from his blazer, takes a sip and flies away and up to his office, beating his opponent to work Red Bull Gives You Wings Social Media Ad Tweet why you need a Red Bull to perk up your day #Save MeRedBull (i.e. Stayed up all night with Kyoko...2 hours of sleep #SaveMeRedBull) Sales Promotions: Tweets with most interactions get a month s supply of Red Bull. Winners featured on Instagram with #SaveMeRedBull short story series Sponsorship Grand Sumo Tournament, place Red Bull cans in every seat of the stadium

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31 Localization South Korea International Promotional Mix (IMC Mix) Uncertainty Avoidance: South Koreans society gravitates toward information that is straightforward and structured, so this promotional mix introduces Red Bull in an obvious way. Print Ad Simple ad with Red Bull with wings on a white background. This is how you do Red Bull: (1) Drink. (2) Grow Wings. (3) Fly. Social Media Ad Sponsored Tweets It s 3:00, time for a Red Bull Sales Promotions Coupons in magazines for a free Red Bull Sponsorship Professional Chang-Gi players

32 Print Ad This is how you do Red Bull: 1. Drink 2. Grow Wings 3. Fly

33 Localization Pros -Economical because of a lack of mistargeted ads -Flexible with legal restrictions -Strategic messages more likely to resonate with the audience -Risk the chance of cultural blunders with ads targeted specifically to locals Cons -May interfere with the big picture of the Red Bull product too many approaches -Time consuming -Higher production and control costs -Focusing on universal values creates the chance of getting too specific and missing the mark with consumers Expected Outcomes Using the localization approach, The Blue Man Group can determine the effects of the society s culture on the values of the people in China, Japan, and South Korea, and how these values affect their behavior. These three different promotional mixes will effectively target the audience of the three countries to create more brand awareness, which will result in an increase of sales.

34 COnclusion/Copy test and Evaluations

35 Conclusion The Blue Man Group recommends the localization plan to introduce Red Bull into the international market. This strategy will allow us to adapt to the many differences among the three countries by taking into account different preferred media, media restrictions and censorship laws, and local competition. The three different promotional mixes for the three countries will result in the best outcome for Red Bull.

36 Copy test and Evaluations The Blue Man Group will use five focus groups in each country prior to the campaign period and after, for a total of thirty focus groups. These groups will evaluate the sentiment toward the new product and the campaign. We will also use sales tracking to determine if the introduction campaign was successful by comparing the sales figures every quarter. If the campaign is successful, it will be continued until we have reached an 80% brand awareness, moving Red Bull from introductory to growth stage.

37 References China s Media Landscape. China s Media Landscape. N.p., n.d. Web. 21 Nov Central Intelligence Agency. Central Intelligence Agency, n.d. Web. 20 Nov Red Bull Targets China for Expansion (UPDATED). Food- Navigator-USA.com. N.p., n.d. Web. 21 Nov Sports and Energy Drinks in China. Sports and Energy Drinks in China. N.p., n.d. Web. 21 Nov Japanese Social-media Scene. Japan Times RSS. N.p., n.d. Web. 21 Nov Wikipedia. Wikimedia Foundation, n.d. Web. 21 Nov Smartphone Use in Japan Makes Steady Gains - EMarketer. Smartphone Use in Japan Makes Steady Gains - EMarketer. N.p., n.d. Web. 21 Nov Central Intelligence Agency. Central Intelligence Agency, n.d. Web. 20 Nov Why Do People Buy Energy Drinks? LIVESTRONG.COM. LIVESTRONG.COM, 05 Mar Web. 20 Nov Japan. Freedom House. N.p., n.d. Web. 21 Nov

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