MARCH – APRIL

REPORT
INTRODUCTION
Red Bull, headquartered in Fuschl am see, Austria,
manufactures energy drinks which are described as “functional
beverages providing various benefits, especially in times of
increased performance” (Red Bull, 2013). The product claims
to improve concentration, alertness and most importantly
reduces the feeling of tiredness and fatigue. As of today, over 35 billion cans
of Red Bull have been sold in 165 countries throughout the world

Costumer Behaviour

For any product, it is essential to know what factors influence the consumer behaviour.
It is defined as the study of how individuals, groups and organizations select, buy,
use and dispose of goods, services, ideas or experiences to satisfy their needs and
wants. In layman’s terms, it refers to the selection, purchase and consumption of
goods and services for the satisfaction of their wants.

According to basic marketing principles, there are 3 major factors responsible for
influencing a customer’s needs. They are as follows:

1. Cultural factors: Basically, culture is the part of every society

and is an important cause of personal wants and behaviour. The
influence of culture on buying behaviour varies from country to country
therefore marketers have to be very careful in analysing the culture of different
groups, regions or even countries. A drink like red bull does very well in countries
like USA and India for the same reason.

2. Social factors: Social factors also impact the buying

behaviour of consumers. The important social factors are: reference
groups, family, role and status. They are as follows;

 Reference Groups: Reference groups have potential in forming a person attitude

or behaviour. The impact of reference groups varies across products and brands.
A visible product such as red bull connects a certain amount of image with
consuming the drink.
 Family: Buyer behaviour is strongly influenced by the member of a family. In the
case of red bull, a father or older brother consuming red bull will influence the
younger kid to have the same drink.
 Role and Status: Each person possesses different roles and status in the society
depending upon the groups, clubs, family, organization etc. to which he belongs.
Therefore, their buying decisions will be influenced by their role and status. A
person who has a high standard of living will never settle for anything cheaper or
less known than red bull as he/she connects it to a status symbol.

3. Personal Factors: Personal factors can also affect the

consumer behaviour. Some of the important personal factors that
influence the buying behaviour are lifestyle, economic situation,
occupation, age, personality.

 Lifestyle and economic situation: When people start associating a product to their
image and reputation, it starts affecting their consumption of the same. A consumer
who has a high standard of living will prefer drinking the costly red bull over any
of its cheaper competitors.
 Occupation and age: This too is an important element of consumer behaviour. A
student or youth who is into sports would much rather buy and consume red bull
than an elderly man who is retired.

We have used a questionnaire to analyse the customer behaviour

when buying the Red Bull products. To start off we have divided the
segments of the customers in gender and age. We notice that there
are more males than females as the pie-chart tells us that 36% are
female and 64% are male. On the there hand we observe in the pie-chart the people
age mostly from the 15 to the 35 years and the least age over the 55 years.

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 DIGGING INTO THE CONCEPT
OF CONSUMERS BUYING
DECISION PROCESS,

WE CAN FIND A 5 STEP MODEL:

Need Recognition and Problem Awareness

The buying process commences with the consumer realizing that he
requires
something.
This realization later
translates into a
purchase. Red Bull is
mainly marketed to people
who feel the need for an
extra energy boost in their
lives, e.g. athletes, but also
stressed-out business
people, students, etc.

Indeed, we have noticed

that Red Bull is being used
for many reasons not only for sports, however, there are more people that use Red
Bull to party than to do sports. Therefore, this shows how the product has emerged

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from being known to be used for one reason but its used for totally another thing. We
also realise that in the advertisements it is said that “Red Bull puts you wings”

MASLOW’S
HIERARCHY OF
NEEDS

A need is
something that is
necessary for
organisms to live
a healthy life.
According to
Maslow there are
many types of
needs as shown in
his pyramid

Information Search
After realizing the problem, the consumers next step is to find potential
solutions i.e.
product/s which
might satisfy his current
need. (Ask around as to
which drink might give him
maximum satisfaction) This
is called the information
search phase. This
information can be obtained
from following sources-

We have realised that people

have got to know of the
product by mostly the
external sectors such as;

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advertisement and personal information. However, we have also had a 17% of people
who answered by their own experience this means that the good has been around
and is well known by a while.

External
a. Personal: Family, friends, neighbours etc.
b. Commercial: Advertisements, Flyers, Salespersons, Websites etc.
c. Public: Mass media, ratings etc.

Internal
d. Experiential: Contact with the product, use, feeling the product etc.

Since Red Bull is a relatively low involvement product, value is accessed primarily
through an internal search

Evaluation of alternatives

At this stage, the consumer is aware of what options because of step 2

and he now comes to the buying part. Obviously, the next difficult process
is that of making the choice. The consumer usually has in mind what exactly is he
expecting from his potential buy. So it is on the basis of a few parameters that he
evaluates and eliminates choices, coming down to a select few in order to make his
final decision. For example, a consumer will finally know what alternatives he has
apart from red bull; however, he will look into his budget and personal choices like
flavor etc and finalize the drink.
We have set up the most
common alternatives and have
asked what other products that
are in the same market that they
had heard of. As shown from the
bar graph we notice that
alternatives and out of all the
people that use Red Bull just
17% didn’t know that Monster
exists, 28% didn’t know Burn
exists and just 7% didn’t know
there where alternatives. There
has to be a reason why people
keep using Red Bull and not
these other products, however,
why?

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 Purchase decision

This is the stage where the consumer actually makes the decision! This
decision comes after consideration of factors such as brand, dealer, quantity, timing
and mode of payment. This is a stage when the marketer has to be extremely wary
of the product positioning from the point of view of perceived risks. These may be:

a. Functional risk: Product performance

b. Physical risk: Product may cause physical harm or discomfort to user
c. Financial risk: Worth of the product
d. Social risk: Using the product brings embarrassment to user
e. Psychological risk: Product affects mental well being of the user
f. Time risk: Product is not worth the time invested in it and in cases, time that
would be invested later looking for a better replacement.

There are two possible points of sale for Red Bull: The “ON” and the “OFF” sector
based on pricing strategies:

 “ON” sector: Since the product is consumed at the point of sale, the purchase
decision is very straightforward. One example is consuming Red Bull at a dance
club strictly to combat sleepiness and exhaustion. No great consideration will go
into where or when to buy the product.
 “OFF” sector: Many supermarkets will receive special display shelves from which to
sell Red Bull. This helps to differentiate Red Bull from competitors, who often share
a shelf with other energy drink brands.

So why do costumers choose Red Bull? From our research we have concluded that
out of all the people they
have answered that it is
easy to find; this shows
how well distributed the
product is. Secondly
many people have
answered that Red Bull
does gives wings
without specifying in
what occasion this
definitely shows how
advertising did make
such an impact on costumer behavior. Many people have answered that it tastes

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 good meaning that taste has lot of impact on the behavior when buying it. On the
other hands costumers do know that the product is not harmless (94% of the
people thought its not harmless) and they do think its expensive (92% thinks its
expensive), however, they keep on choosing it.

Post-purchase behavior

The behavior of a consumer post making a purchase may be termed as

post-purchase behavior.
This is based on how was his experience with the product. If the customer derive the
satisfaction he wanted or not. If the consumer is very happy with his experience, he
might end up as a repeat buyer for the product and also lead to recommendations to
potential buyers. Alternatively, if the experience of a buyer is not very good, he will
negatively publicize the product, which might affect the sales of the product.

In the end, we can conclude that the consumer’s behavior and buying patterns are
an essential part of marketing strategies employed by the producers. It is of
paramount importance for any marketer to analyze his potential buyer’s frame of mind
as it will help him sell his product better.