Business Management practice Essay Example | Topics and Well Written Essays - 1500 words

Business Management practice - Essay Example Managing the workforce’ behavior and attitude in today’s modern times still reflects the influence of at least six major schools of management thought. These are the influences of Frederick Taylor’s Scientific Management, Henri Fayol’s Management Process School, the Human Relations School by Mayo, the Quantitative Sciences School, the General Systems Theory, and the more modern Management and Culture school of thought (Rodriguez, 2001). But the growing complexities of the modern organizations, even becoming global in character, have necessarily required the evolution and development of other perspectives to deal with people. In one article over the internet, one management consultant even declared that â€Å"classic management theory dies† (Joffinza, 2007). Modern times have brought the classic management theory into a challenge. New perspectives which emerge from the growing multi-cultural nature of organizations are borne, thus new paradigms are d eveloped either to complement or replace the classic management theory. Since an organization is composed of individuals with varying personalities converging together to achieve organizational goals, it is inevitable that conflicting interests and clashing personalities will slow down organizational momentum in achieving previously set goals. This is due to the fact that individuals have their own personal agenda that may be different from other co-workers. It is thus necessary to manage such varied behavior and attitude in the workplace in order to promote a harmonious inter-personal relationships in the workplace, thus minimizing any disruptive behavior that can affect the operations of the business. Managing the behavior and attitude of the workforce is so important in every organization that its study has already evolved as a formal discipline. Organizational behavior,

The effects of tobacco advertising on youths Research Paper - 1

The effects of tobacco advertising on youths - Research Paper Example In addition, the images in various advertisements relate tobacco smoking with accomplishment, liberty and as a way of relaxing (Farrelly et. al., 2001). Youthful age is considered as an age whereby individuals engage in experimentation process with various things. Therefore, tobacco use is depicted as alluring through the process of advertising, which is appealing to most youths. Furthermore, the media through various forms of adverting plays a role in terms of exposing the youth to tobacco use. Most advertising companies engage in the use of celebrities to promote various tobacco brands. Hence, the youth who mostly associate with celebrities are lured into smoking through advertising with this kind of advertising. Various reports have indicated the fact that the youth are considered as being more approachable to various forms of tobacco advertisements as compared to adults. The forms of advertising that are use by various companies involve print and promotional form of advertising. In addition, newspapers, magazines, and posters have been used by the tobacco industry as a media of advertising (Reddy et.al., 2006). The youthful period is regarded as a very crucial period of an individuals life. The actions of individuals during this stage greatly affect their future in terms of development and their careers. The youthful mainly illustrated by various passionate acts that can either be positive or negative in nature. During this stage, an individual engages in the process of experimentation with everything within their proximity. Tobacco smoking among the youth is considered as a vice that has far-reaching implications in terms of both the health and economic aspects. The main driving force to youth tobacco smoking is the advertisement that is mainly utilized by the tobacco industry (Pollay et. al., 1996). Therefore, advertising is considered as a powerful tool that is highly persuasive, especially among the youth. The process of advertising through

Giordanos Operation Strategy Essay Example | Topics and Well Written Essays - 750 words

Giordanos Operation Strategy - Essay Example This paper illustrates that it has been consistent in Giordano’s operation strategy and maintained its competitive pricing by having a centralized distribution center and uses outlets only for sale of garments. It extensively uses technology within its operations. Sales figures are used to forecast next day’s orders and fill the inventory at night. Keeping low inventory also helps it to react timely to changes in fashion and produce goods that meet the changing demands of the people. It, therefore, saves considerably through fast selling items and benefits are passed on to customers through quality garments that are low priced. Thus, its philosophy of ‘value for money’ has significantly contributed to its competitive success. Giordano has been quite successful with its market strategy which relies heavily on exemplary customer service and cost leadership. It has maintained its leadership position in low priced quality garments. The strategy has been very su ccessful during the financial crisis but it does not seem to be that effective when it increased its cost of garments that were trendier and catered to higher economic strata of society. Thus, in order to meet the demands of the segmented market, it introduced new label called Bluestar Exchange or BSE which were trendy and competitively priced. This has helped Giordano to be consistent with its market strategy of maintaining cost leadership. As Giordano expands its business interests into new market segment and territories, the biggest operation management challenges that it faces is that from other international brands like Zara, Gap, Espirit, Thames etc. which are already established brands in the mid and upper segment of the market. Apart from Bluestar Exchange that meets the demands of the low and mid-income group, it has introduced sister brands, Giordano Ladies and Giordano Junior that target higher end segment.

Industry Placement Essay Example | Topics and Well Written Essays - 2000 words

Industry Placement - Essay Example The paper "Industry Placement" analyzes the structure of the international retail company "Toys R Us" and offers some suggestions how to make motivation, reporting, and organizational culture better. The values of the organization make up its culture. I have learned that the company values hard workers that represent the organization's promise of rapid, responsible and reliable service. Based on Fleishman’s interpretation of leadership in which I hold in high regard, modeling this to my staff is one of the best ways I can lead the team in the eyes of myself and Toys R Us. The idea I have of Toys R Us culture was communicated to me through a booklet informing me of what the organization was about, read on my own accord. For Toys R Us to ensure that organizational culture is well known and implemented into the work of management running a program over half a day would be recommended. Interpersonal value compatibility is necessary with the staff because motivation is most effective as an influential leader. It is here that one of many examples of the inter-relatedness of management concepts is displayed. Reward for work through remuneration is the standard return but it is motivation to get the best out of the employee. This can pose quite a challenge for a leader as different types of motivational methods would need to be used for different subordinates. Motivational issues can be found through a number of methods, one of these being reporting. Employee issues can also be found through reporting.

Through the two main characters of Rhodaand Gertrude Essay Example for Free

Through the two main characters of Rhodaand Gertrude Essay Through the two main characters of Rhoda and Gertrude the writer allows the reader to know his opinion on gender equality at the time. As well as criticising the way in which men treat women, he also states his feelings on how women treat other women and their selves. Rhoda is firstly represented as a mysterious, lonely and segregated person who has a history with the character, Farmer Lodge. This assumption can be taken from the way the fellow workers treat Rhoda and their conversations involving Farmer Lodge and his new bride. For example one milk maid says, Tis hard for she while looking at Rhoda who is described by the writer as, a thin fading woman of thirty milked somewhat apart from the rest. This description is just, because the workers speak blatantly about Rhoda and her past, even though she is in hearing distance. It is like they are aware of her presence, but choose to discount it because Rhoda, in their eyes is worthless. This leads the reader to think what Rhoda has done in order to be isolated from the group and be treated with such an obvious mix of contempt and sympathy. The initial conversation in the workplace also highlights how differently men and women are treated and how differently their roles in life really are. The reader can see that Rhoda and Farmer lodge have some kind of history and they are aware of what peoples reactions to Rhoda are, yet it is clear that the man, who has presumably participated in the same secretive affair is treated with a more positive and accepting attitude. Despite the workers still gossiping about his wedding and debating his age, there doesnt seem to be as much scandal about his past, any references made are directed about Rhoda and her involvement. The next paragraph begins with the workers leaving for home, Rhodas seclusion because of past events and her womanhood, are highlighted once more in the line, lay apart from that of others, to a lonely spot The readers also learn that she has a son as a result o a past affair with Farmer Lodge, your father brings his young wife Rhodas obsessive nature concerning her past love is also made clear. She continually asks her son for details in order to compare Gertrude with herself, If shes dark or fair, and if shes tall The writer uses Rhodas insecurities to symbolise how men drive women to desperation, how they cause women to doubt themselves and loose confidence in their own mind and body just because of a mans actions and how they choose to treat women, in this case in a disparaging way. The writer also uses Rhodas self- absorption (his mother not observing that he was cutting a notch with his pocket-knife); obsessive fixation on Gertrudes appearance and the twisted gratification she receives at hearing of Gertrudes faults (She is not tall. She is rather short. He replied. Ah! said his mother with satisfaction) to criticise how weak some women can be. The writer sympathises with Rhodas mistreatment but also pities her for allowing she to become a victim in the first place. This opinion is later confirmed when Rhoda is so consumed with envy and scorn that she dreams about Gertrude. The dream being a metaphor for her inner feelings. Up to this point the writer doesnt prompt much sympathy for the character of Rhoda as she is construed as bitter and slightly vindictive, yet after the event we see a softer side to her. She does worry when she meets Gertrude and notices that she does in fact have a withered arm. She is racked with guilt and remorse (Rhodas heart reproached her bitterly) and we see that she isnt just a hostile ex with a chip on her shoulder and that she does actually care as the writer shows us in the line, This innocent young thing should have her blessing not her curse. Throughout the rest of the story Rhoda does her best to help her replacement Gertrude and not because shes only feeling guilt but because she actually likes her. Gertrude at the beginning of the story is described as Rhoda Brooks opposite, (of Rhoda), there was more of the strength that endures in her well-defined features and large frame than in the soft cheeked woman before her. Gertrudes initial character is kind, cheerful and in the trend of the time was completely devoted to her husband. It was only after her husbands reaction to her withered arm did she begin to change into an irritable, superstitious woman. Instead of supporting her and showing her unconditional encouragement and affection Farmer lodge froze her out, making her feel ugly, useless and eventually causing her to take drastic measures, which were most out of her once caring and sensible character. The writer uses the lines, I shouldnt so much mind it if-if I hadnt a notion that it makes my husband dislike me-no love me less. Men think so much of personal appearance, to once again criticize both males and females of the time. Men for making women degrade themselves in order to pathetically please their man and women for allowing themselves to be so hopelessly dependant on a males approval and love. He is saying that, that kind of relationship is destructive, to a female especially since most men of the time focused solely on appearance, Yes; and he was very proud of mine at first. The writer uses the characters of Rhoda and Gertrude as a kind of before and after picture. In the beginning we see that Rhoda Brook is a lonely, poor woman who is branded a witch and thought of as highly scandalous yet we see Gertrude as an innocent and beautiful young woman, the later image is ironic because the beautiful Gertrude does transform into a Rhoda-like being, bitter and obsessive. The writer is allowing us to see the process in which vanity, reliance, obsession and the behaviour of men towards women along with the nature of the female friendship enables the downfall of a person.

Tesco PESTEL Framework

Tesco PESTEL Framework Introduction Tesco is the largest organization in the UK and one of the biggest supermarket chains in the world. Tesco is one of the top three supermarkets in the world, Tesco operating over 3700 stores globally and employing over 440,000 people. The company operates in 13 countries outside the UK. There are many factors which contribute directly to the success of this leading super market chain. Business Strategy plays a pivotal role in the success of Tesco. Tescos History Tesco was founded in 1920s by Sir Jack Cohen, to setup high street grocery stores in and around London. Tesco name used for the first time in Edgeware London in 1929. The name was drawn from the initials of the companys tea supplier (T.E Stockwell), and Cohens own name. In 1930s when Mr. Cohen built a headquarters and warehouse in North London, its brand continually rises. In 1932 Tesco formally established as a private limited company. In 1947 Tesco stores (holdings) ltd floated on the stock exchange with a share price of 25p. In 1990s the company introduce a slogan Every Little Help, they also introduce Club card scheme in 1995. Tesco personal Finance was introduced in 1997, in order to provide its customers with a wide array of financial services, including visa card, and Tesco saving account in stores bank branches. Today it reported that group sales were  £51.8bn in the year to February 23 2008. Pre-tax profit rose to  £2.8bn. Company Analysis: PESTEL Framework Political Factors Tesco is operating in different countries, so due to its globalised operation its performance is highly affected by the Political and legislative conditions of these countries. According to Balchin, 1994 the Govt encourages the retailers to provide mix job from flexible and locally based jobs to highly skilled, higher-paid and centrally located jobs. (Balchin, 1994) Economical Factors Tesco is also affected by economical factors, such as costs, demand, prices and profits. Unemployment is the most important influential factor which decreases the effective demand for many goods. Basically Tesco is affected indirectly by the economic factor, but their affect on performance and the marketing mix can be learned. Social/Cultural Factors Due to the rapid change in trends, the company expand the amount of non food items available for sale. The UK customers have moved towards one stop and huge shopping, due to the variety of social changes. It also affected by Demographic changes such as population, female worker are increased, so the company will have to focusing added- value products and services. Technological Factors Technology factors are affected the development of many of the Tesco products. Both customers and company are capitalized from the Technology, because customer satisfaction mount for goods readily available, services becomes more quick and shopping more convenient. The lunch of the efficient Consumer Response initiative provided the shift that is now apparent in management of food supply chains. (Data monitor Report, 2003) The company uses the following technologies: Wireless Devices Intelligent scale Electronic shelf labelling Self check-out machine Radio Frequency identification (RFID) Companys Analysis: Porters Five Forces Threat of New Entrants The UK grocery market is primary henpecked by few competitors, including four major brands of Tesco, Asda, Sainsburys and Morisons that process a market share of 70% and small chain of Somerfield, Waitrose, and lidle with further 10%. However, due to the large operation they built their power to operating efficiency, one-stop shopping and major marketing mix expenditure. Hence, nowadays it possesses a strong barrier for new companies who crave to enter the grocery market. To become a market leader Tesco invest huge money in large chain, advance technology for checkout and stock control system that impact the new entrants and existing ones. Bargaining Power of Customers According to Michael Porter, the more products that become standardised or undifferentiated, the lower the switching cost, and hence more power is yielded to buyers. Porters M. (1980). Tescos famous loyalty card Club card keep the most successful customer holding strategy that tremendously increases the profitability of Tescos business. To fulfil customers needs, custom-make service, ensure low prices, better choices, constant flow of in store promotions enables brands like Tesco to control and hold their customer base. Bargaining Power of Supplier Tesco has negotiating better promotional prices from supplier that small individual chains are unable to match. And this is company policy and company main approach to have unparallel relationships with suppliers. Threat of Substitutes According to the Porters theory, General substitution is able to reduce demand for a particular product, as there is a threat of consumers switching to the alternatives (Porter M1980). However in the grocery market this can be seen in the form of product for product, new trends such as the way of small and convenient stores are emerging in the market. Bargaining Power of Competitors Tesco is operating in mature market, where growth is difficult, and consumer are extend demanding and advanced, large chains as company take place large amounts of consumer information that can be used to communicate with consumer. Therefore the preponderant market leaders have responded refocusing on price and value, whilst reinforcing the added value elements of their service. Analysis of Resources, Competence and Culture For the company, customer is first priorities, by the time of recession, a research shows that price are ranked as the most important margins not seen in twodecades. Therefore the company believe that their job is to help the customer with less spending. So the company launched value line, the famous blue stripes, the company would be able to provide the cheapest grocery shop in the country discounter included. The company maintain its position through a clear focus, well targeted product offer and excellent record both in product and format design. Core Competence Core competence is the processes that critically underpin the companys competitive advantage. Tesco primary target is to recognise that competition between businesses is as much a race for competence as it is for market position and market power. Hence, the Company have to focus the attending on competencies that really influence competitive advantage. Core competence is basically the process to develop the key area of a business in which the company expert, which bring a distinctive advantage over the competitors, and also critically connected with company long term growth. However, it will be important for Tesco to look at the generic level. Therefore in this case, Tescos expertise are most likely to mature central area of business where the most value added to its services and its devilries. For example, trust on Tesco brand prevarication at the heart of these services In addition, Core competencies of a Tesco have rather rigid, but a research shows that core competencies have to elastic, and it should be change in response to change in companys environment over the time. Therefore the company need to accommodate and create new idea and also new opportunity in the market. For example, Tesco launched its loyalty card and went into banking. Tesco able to enter into retailing of food and non food products was a clear distinctive brand proposition that had a focus on a properly define market section. The company also provide a strong and efficient customer service, based on a good customer relationship. Tesco Strategic Options: Generic Strategies Introduction: According to Porter (1985), competitive advantage arises from selection of the generic strategy that best fits the organisations competitive environment and then organizing activities to support the chosen strategy. These strategies are characterised by the company in response to their structure and environment of the organization. However to obtain a competitive advantage Tesco should follow one of the three strategies, which is developed by Porter. Cost Leadership Tesco accommodate the first strategy of cost leadership in which can endeavour the lowest costs in the market and offer its products and services to broad market at the lowest prices. The company are more focusing on the effective saving programme call Step-Change. By this programme the company delivered  £540 million of productivity and other saving in the year, which mostly reinvested in improving the shopping trip for customers. To reducing the amount of energy the company introduce better ways of working to improve the efficiency by making things better for customers, simpler for stop and cheaper for company. For example, according to a report, in the last year the company saved 52,000 deliveries to companys stores by using larger-fill-double-decked vehicles, which in turn have also 12 million road miles. Some other example of these projects which delivered substantial savings in the year includes: Saving in the Supply Chain-the company using more shelf-ready packaging and reconfiguring the depot network to increased vehicle utilisation and more productive work methods in depots and stores. For example the distribution cost more held in cash terms and reduced in percentage of sales terms. By this method the company achieved despite higher fuel costs. Installed Energy Saving-the company significantly invest in energy-saving projects across the business- such as new refrigeration, store lobbies and lighting, its helping the company to absorb utility costs. From the energy consumption the company fell by 8% last year despite business growth. Low wage employees- the company have around 31000 employees working in India as Global Support Centre, which provides IT and administrative support to UK and International operationsfrom software development to management accounting and payroll. If the company use another strategy of differentiation, the company then tries to offer a good services and product with unequal features that customers value. With the differentiation strategy the company created a brand loyalty for their offering, and price inelasticity on the parts of buyers. For example to achieve a better and more efficient service provide by the company to checkouts, many more customers didnt have to queue last year and customer continue to rank the company for speed of services at the checkout. Another example of this approach, the company have different brand product according to their feature, speciality, and reliability. Such as Tesco value, Finest, Organic etc Value Chain Primary Activities Inbound logistics According to Alex Laffey, we choose G-Logs logistics and transportation technology because their solution will support and enhance our low-cost, high quality approach to growth in the retail market. Major factors in our decision to select G-Log were the close and demonstrable fit of their software to our requirements, and their ability to rapidly deploy the solution in phases to meet our aggressive project time frame. G-log is providing visibility, optimization, and execution will enable the company to integrate their supplier, partners and logistics service providers, delivering real-time visibility of in transit orders, whilst optimising the transportation resources by both consolidating loads and selecting the most cost effective carrier. The G-log continues to shows to deliver significant result, and to provide value to its customers, in terms of improved customer services, reduced costs and enhanced competitive advantage. Outbound Logistics Outbound logistics is concerned with the delivering the product to the customer. The company adds value to its home delivery services. Tesco also trying to improve other tangible that have to be improved, such as parking facilities, trolley collectors, staff on self service checkout, and also to saying to customer hello hey and thank you with smiling face. The company making small improvements in everything with Every Little Help is about the company work together on the little things, its amount to a great deal. It keeps the focused on what matters most to customers. The company do not sacrifice all the other things that are so important to customers, such as not having to queue and being able to get everything that they want. Support Activities Company Infrastructure The company introduce software Real Time Integrator (RTI) which provides retailer with faster access to critical business information, through the provision and use of accurate, detailed, point-of-sale (POS) information. Sale data from individual store database will be routed to head office in XML to Microsoft server and Microsoft SQL. The solution handles 1500 sales transactions a second at peak times, which each have an average of between 50 and 100 items. To reduce the number not the on file items the first application for RTI will pilot for 120 stores, which improve the customer experience. Human Resources Management Tesco introduce a high commitment model which offers training and development to all employees. In addition the company extend their logo through their culture to prove their commitment to employees as well as to customers. The company continue to invest in customer services where training is also directly linked to pay, therefore the staff is motivated to learn and encourage their approach to customers and services and the provision of qualities. Conclusion With the research carried out, the company shows how the branding and effective service delivery can come in moving beyond splashing ones logo on billboard. The company made their market leader due to their successful and dynamic strategies. The company also made a powerful brand and powerful identities making their retailing concept into various and spending it out into the culture via a variety of channels. Such culture sponsorship, political controversy, consumer experience and brand extensions. The company change their culture and business environment very rapidly due to the high competitors pressure. The company also have to diversify the product and expand their strategies in order to sustain in its leading market position. This is already established by the company. Tesco need to make sure, to have the combination of good customer services, competitive pricing and efficiency when they launching a new product. Tesco has definitely has the potential and can compete with other store if the company get the above combination right. REFERENCES http://www.guardian.co.uk/business/2007/nov/09/supermarkets.tesco1 Tesco history from. http://www.telegraph.co.uk http://www.cn.tesco.com/en/aboutus/aboutus_history.htm http://www.independent.co.uk/news/business/analysis-and-features/tesco-thinks-small-to-be-big-in-america-394385.html Datamonitor Report (2003) Food retail industry profile: United Kingdom, January; Datamonitor Report (2003) SWOT Analysis Tesco PLC, July; Datamonitor Report (2003) Company Profile: Tesco PLC Analysis, October; Tesco Annual Report and Financial Statement 2009, To find out more go towww.tesco.com/annualreport09 De Toni A. and Tonchia S. (2003) Strategic planning and firms competencies: Traditional approaches and new perspectives, International Journal of Operations Production Management, Vol. 23 Issue 9, pp.947-976; http://findarticles.com/p/articles/mi_m0FNP/is_4_44/ai_n13248624/ http://www.tesco.com/talkingtesco/oldDefault.asp Drejer A. (2000) Organisational learning and competence development, The Learning Organization: An International Journal, Vol. 7 Issue 4, pp.206-220; Finch P. (2004) Supply chain risk management, Supply Chain Management: An International Journal, Vol. 9 Issue 2, pp.183-196; Graiser A. and Scott T. (2004) Understanding the Dynamics of the Supermarket Sector, The Secured Lender, Vol. 60 Issue 6, November/December, pp.10-14; Johnson G. and Scholes K. (2003) Exploring Corporate Strategy, 6th ed.,Prentice Hill: London; Lindgreen A. and Hingley M. (2003) The impact of food safety and animal welfare policies on supply chain management: The case of the Tesco meat supply chain, British Food Journal, Vol. 105 Issue 6, pp.328-349; MarketWatch (2004) Company Spotlight: Tesco, Datamonitor, September; Mintel Report (2004) Food Retailing -UK, Retail Intelligence, Nobember; Myers H. (2004) Trends in the food retail sector across Europe, European Retail Digest, Spring, Issue 41, pp.1-3; Palmer M. (2004) International retail restructuring and divestment: the experience of Tesco, Journal of Marketing Management, November, Vol. 20 Issue 9/10, pp.1075-1101; Porter M. (1980) How Competitive Forces Shape Strategy, The McKinsey Quartely, Spring 1980, pp.34-50; Ritz (2005) Store wars, Business Review, Vol. 11, April, pp.22-23; Veliyath R. and Fitzgerald E. (2000) Firm Capabilities, Business Strategies, Customer Preferences, and Hypercompetitive Arenas: The Sustainability of Competitive Advantages with Implications for Firm Competitiveness, Competitiveness Review, Vol. 10 Issue 1, pp.56-82; Bibliography Anon (2004) Case Study IV: Tesco implements the business engine network to gain full control of it IT Project Portfolio, Journal of Database Marketing Customer Strategy Management Vol.12. Tesco business strategy, 2008 available at http://www.bized.co.uk/ Tesco business strategy 2008 available at www.tescocorporate.com/images/TescocsrReview02_0.pdf Datamonitor Report (2003) Company Profile: Tesco PLc Analysis, http://university-essays.tripod.com/porters_generic_strategies.html Palmer, M. (2005), Retail multinational learning: a case study of Tesco, International Journal of Retail Distribution Management, Vol. 33 No. 1

Marketing Essays Red Bull

Marketing Essays Red Bull Table of Contents Introduction Red Bull and Marketing Theory Introduction Market Entry Market Strategy Marketing Communications Company Analysis Analytical Methods Company Sales and Diversification Strengths Weaknesses Opportunities Threats Conclusions Future of Red Bull and Recommendations References Introduction Red Bull has created a strong brand image, using colourful icon with two bulls in opposition and a memorable tag line; ‘Red Bull gives you wings’. Through creative marketing and sponsorship it has linked itself with extreme sports, innovative music and art, all aimed squarely at the youth market (Dahlen, Lange and Smith, 2010). This brief examines brand development, which strategies have helped it to success and where the brand goes from here as it faces the prospect of losing its cutting-edge image while continuing largely with only one product. Red Bull is a European success story. The product was launched in 1987 in Austria. It faced opposition from the Food and Drink Administration (FDA), who refused to clear it for distribution but despite this it became an underground success through clubbers and snowboarders. This anti-establishment stance found synergy with consumers, even after it was cleared for sale. It quickly spread into neighbouring countries and into the US market (Franzen and Moriarty, 2009). Dahlen, Lange and Smith (2010) note that by 2004, it had gained 40% share of its market sector and 70% in Europe. However, the brand still faced problems; it was banned in Denmark and France following unsubstantiated rumours that people had died from drinking the product in Sweden and Ireland (Mail Online, 2001). The European market was stagnating, and it faced distribution problems from companies supporting their own-brand products. The ever-present competition from Pepsi and Coca-Cola limited the scope for expansion. With these pressures, the company developed a marketing strategy that avoided mainstream advertising, instead focusing on grass-roots promotion. The product was sold in trendy nightclubs and bars, and the credibility of those held in high regard by the young target audience, such as DJs (Boswijk, Thijssen and Peelen, 2007). Brand education was provided by high-profile visits to places where the company felt people ‘might need a lift’. Examples include offices, building sites and garages. Self-styled Red Bull distributors exploited their local knowledge to help sell the brand and its products. It terms of higher profile marketing, Red Bull has primarily focused on maintaining its links with extreme sports. It sponsors two Formula One teams (Red Bull and Toro Rosso), as well as snowboarding, kite-boarding, surfing and aircraft racing. All of these underline its commitment to its youthful, energetic target audience. The next part of the brief examines how its marketing strategy fits into contemporary marketing theory. Red Bull and Marketing Theory Introduction Red Bull is essentially a one-product brand, offered at a premium price in its market sector. Having started in Austria, it quickly spread to other markets including the USA and has become the market leader in its sector. It uses a novel approach to marketing, which is discussed later in this section. In terms of the traditional 4Ps of marketing, therefore, the company is easy to categorise. However, the 4P method has received criticism as being somewhat limited (Lee, 2001), and therefore the company is examined from a number of perspectives in this section, starting with market entry. Market Entry Any new company has to determine how they intend to enter a new market. This will be predicated by a number of factors such as the available resources, the sales objectives, product offered and existing competition (Fifield, 1998). In the case of Red Bull, the launch of the new product established a new category of product; that of energy drinks. Derived from a concept found by Dietrich Mateschitz in the Far East, the formula developed included large amounts of caffeine, sugars (glucose and sucrose) and taurine (Red Bull, 2014). Taurine is a ‘conditional amino acid’, which means it cannot be created by the body but needs to be provided in the diet. It is found in meat and fish (WebMD, 2014). It is used medically in the treatment of congestive heart failure, high blood pressure, high cholesterol and diabetes, among other conditions, and it is present in infant formulas. Taken together with the other ingredients, Red Bull claims that it provides an energy boost (Red Bull, 2014). Since no similar type of product existed on the market, there was no direct competitor. As an innovator, the company had to educate its target audience on the product’s benefits. If a mass market entry approach is used, this can be extremely expensive (Hill and Jones, 2012), since customers have to be convinced that the new product is safe, has unique benefits and is socially acceptable. Rather than attempting to do this on a large scale, Red Bull adopted a novel method based on introducing the product at a grass roots level. It is promoted as a trendy drink at events where its main target audience gathers; nightclubs, extreme sports events and even parties. In the latter, it encourages students to set up Red Bull parties and provides them with free cans to distribute to their friends. The company also uses cars in the corporate colour scheme – together with a gigantic can – which give out promotional samples (Onkvisit and Shaw, 2009). Initially, distribution is set up using small distributors. In some cases, the company has hired warehouses and set up young people to aggressively sell the product (Pride and O’Ferrell, 2006). As far as can be determined from the available literature, this approach is likely to continue to be used in addressing new markets in future. Market Strategy Its chosen strategy has led to strong word-of-mouth sales in new markets, and this provides a springboard for further success in those markets. As it grows, it invests further in creating events such as the Flugtag, in which competitors attempt to fly from a pier using homemade, unpowered aircraft – most of which are incapable of flight, and soapbox racing (Red Bull, 2014a). This draws both competitors and audiences. Most of the events the company sponsors are more professional in nature and cover an increasing range of activities, from spectacular air racing using stunt planes, to cliff diving, wingsuit racing, motorsports and adventures. The company has even moved into computer gaming and e-sports. The features that are common to all of these activities are their attraction to their target audience and their physical and mental requirements. Having identified this approach, the company appears to be keen to continue to exploit it. When considering the market positioning of the Red Bull energy drink, it almost appears that it has arisen organically from the properties of the product; it supports physical and mental exertion and therefore the market position supports this. However, this belies is underpinned by clever physical and psychological positioning. The physical positioning refers to the product’s unique characteristics (it provides energy from its unique formula) and the psychological positioning derives from its brand image as being youthful and energetic, and socially desirable to its twenty-something core audience (Lantos, 2011). From its original product offering (one product), the company has added a little to its portfolio through the introduction of Red Bull sugar-free, Red Bull zero-calories, Red Bull editions (in flavours of cranberry, lime and blueberry) and Red Bull cola. The cola is promoted as being the only cola drink made from 100% natural ingredients and makes the case that, unlike other brands that might be mentioned, it has no secret formula. The company follows the same basic branding approach for these additional products, presumably on the grounds that they will appeal to subsets of their existing target audience. Marketing Communications However impressive a brand is, it has no value unless it can communicate its unique characteristics to the consumer. On this basis, Red Bull has a highly effective marketing communications approach, it is currently recognised as the 74th most valuable brand in the world, with a value of $7.5 billion USD (Forbes, 2014). From grass roots marketing, these days the brand is more recognised through its sponsorship initiatives. This is backed up with a strong online presence that strongly reflects the brand image and provides a form of Integrated Marketing Communications (IMC). The company sees modern communications media as being critical to their success (Kotler and Keller, 2012). The reason Red Bull has achieved such success has been that it has successfully aligned its brand identity with that of its target audience in a way not achieved by its competitors (Urbany and Davis, 2010). Even when it uses traditional marketing media such as TV, it does so in a quirky ways that does not take itself too seriously. In doing so it maintains the image that appeals to its customers. It is this consistancy of message that is so important to IMC. Whatever channel is used to get the message across, it must be the same as those used on alternative channels. Digital media provides an increasingly important method of communicating with consumers, and Red Bull has identified this. As well as having a strong website that focuses on the sponsorship activities it is involved with, it also provides links to social media websites such as Facebook, Twitter, Google+ and You Tube. These sites provide consumers with a means of communicating with the company and with like-minded individuals across the world. This fosters a club-like experience that enhances the company’s alignment with its customers. The use of social media to build on relationship marketing is now well recognised, and Red Bull has been in the forefront of exploiting this (Lamb, Hair and McDaniel, 2011). The company has also been active in the field of mobile marketing, launching its own app to allow subscribers to keep in touch with the company when on the move. Overall, Red Bull is one of the most effective marketing communications companies in the world, and it does so by offering interesting content to its customers. The actual advertising of the products forms a small part of this. However, the brand is intimately linked with its products and thus the message gets across clearly. The continually changing content prompts users to visit its sites frequently, and in doing so keeps the brand close to the user’s attention. Few companies have been so successful in doing so. The next section looks at the current state of the company in the market. Company Analysis Analytical Methods There are a variety of methods available for the analysis of a company. These include analyses on the external environment in which the company operates, such as PESTLE (Political, Economic, Social, Technical, Legal and Environment), and those that examine the internal context such as SWOT (Strengths, Weaknesses, Opportunities and Threats) (Allen, 2001; Murray-Webster, 2010). Other techniques include VRIO (Value, Rarity, Imitability and Organisation), used to determine the level of competitive advantage a company has and how long it is likely to be retained (Peng, 2011). In this case, a PESTLE analysis would provide results indicative of the energy drinks market rather than being specific to Red Bull. A VRIO analysis lacks the depth of SWOT analysis in terms of a general assessment of the internal and external situation, and therefore a SWOT analysis was chosen for analysis of the company. This is shown later in the next section. Company Sales and Diversification Apart from its energy drinks, the company has diversified into other businesses that have synergy with its brand image. These include football clubs, youth academies, online clothing sales and even a construction company. It has moved into media ownership, with print magazines and the mobile phone service industry. Red Bull is privately owned and therefore does not need to report its performance publicly. However, it reported net sales of 4.9 billion Euros in 2012, with 5.2 billion cans of its primary product sold. This represented considerable growth on the previous year (15.9% on sales; 12.8% on number of cans). The company showed very strong net sales growth in South Africa (52%), Japan (51%), Saudi Arabia (38%) and strong continued growth in France (21%), the US (17%) and Germany (14%) (Euromonitor, 2012). The company attributed this to ongoing brand investment and efficient cost management (Euromonitor, 2012). Strengths The main strength of Red Bull is its brand, which is very valuable and has allowed it to grow a strong set of customers. It is synonymous with its energy drink, which is a positive factor (Park et al, 2013). The company has successfully developed new markets internationally using the same brand image. It can therefore be considered as a global company. This is important in that many of its current markets are at or near market saturation. Its use of social media to help to build its brand by relationship marketing is also a strength (Segrave, Carson and Merhout, 2011). Weaknesses The main weakness of the brand is its limited product portfolio. It primary relies on its single main product. This product is at risk of political or legal controls owing to the high levels of caffeine used, or it could just lose its appeal to the market (Aaker and McLoughlin, 2010). This could adversely affect the ability of the company to maintain its position in various markets. Opportunities The company has been effective in developing emerging markets, and if this continues it could largely offset poorer sales developments in the mature markets. Its global marketing message appears to be universally appealing to its target audience, despite cultural differences. It has also invested in new production facilities in Brazil to support domestic sales in the South American continent management (Euromonitor, 2012). This model could easily be extended to local production in Asia and other developing markets. This would both reduce cost of sales and provide a greater sense of community belonging. Threats A range of similar drinks have emerged following its success, increasing the level of competition within its market sector. Some of these competitors use natural ingredients, which may be seen as more desirable to its target audience. This includes the Monster product, which is pressuring sales particularly in North America management (Euromonitor, 2012). The company also faces competition from entrenched market leaders in the wider drinks market such as Coca Cola and Pepsi. These companies work continuously to reduce the threat level posed to themselves from Red Bull. With their huge marketing budgets and ability to develop new products, this could eventually prove decisive and reduce the success of Red Bull. The company also faces the law of diminishing returns in marketing in its mature market, in that the cost to reach the relatively small number of potential customers remaining in these markets becomes prohibitively high (Mike, 2004). The company invests considerable resources in its relationship marketing, and this ongoing cost may also become more onerous, should sales in its target market fall for any reason. Therefore the company faces the potential of having high marketing costs leading to smaller sales despite its dominant position in many markets. Conclusions Red Bull has demonstrated a novel approach to marketing and has introduced a new product to the market that has spawned an entire new category of product. Through its actions, the company has become very successful and has become the market leader in its sector. Its use of a marketing message that is light on selling the product but heavy on building the brand image and associating it with extreme sports and other activities of interest to its target audience has possibly shown the future direction of much marketing effort. The current position of Red Bull remains strong in its market sector. However, as it is now the leading brand in many markets, it will find it difficult to maintain its position due to increased competition from other brands that have seen the opportunities offered by the sector. The growing age of its original target audience may also prove a factor; the company has deliberately addressed a youthful market and as these original customers grow older, it remains to be seen whether the product will continue to appeal to newer generations. However, the company can n develop new markets, and it can potentially reduce costs by focusing on domestic production. These new markets may allow the development of complimentary new products. . It is possible that these could then be sold in its mature markets, widening its product portfolio. Whether the company remains successful will depend on a number of factors. Primarily, there is a question of whether the brand can continue to be trendy now that it is well established in the market. It faces increasing competition in its sector, and this will affect sales unless the company can successfully fend it off. However, it can still expand into new markets and streamline its production facilities to allow the business to continue to grow. Future of Red Bull and Recommendations In order to protect its position and continue to grow, the company should embrace the opportunities offered in emerging markets. It should also work to streamline its distribution to reduce costs. This could be through domestic production or through setting up alliances with existing distributors in those regions. The competition to Red Bull is only likely to increase as more manufacturers seek to exploit its market sector. Emerging products may replace the Red Bull brand image of being cutting edge and anti-establishment; one company cannot keep this mantle forever. The company should therefore consider adapting its message to existing consumers as they mature. The company is well placed to make this transition. However, it cannot simply rely on existing customers, but must appeal to new consumer groups. This could be assisted by the launching of additional products aimed at different demographics. Red Bull is used as a mixer for spirits such as vodka. This offers an additional opportunity to target the more mature audience by launching pre-mixed alcoholic drinks. Red Bull has shown itself adept at social media. The company should develop this as far as possible, embracing new technologies as they arise. This is vital for it to maintain its relationship marketing and also allow the brand to continue to spread through word-of-mouth and sharing of information online. Since the company has so much news to share from the events and teams it sponsors, it has a readymade store of information. This could prove to be important in maintaining brand loyalty in the future. References Aaker, D. A. McLoughlin, D. (2010), Strategic Market Management: Global Perspectives, UK: John Wiley Sons Allen, M. (2001), Analysing the Organisational Environment, UK: Select Knowledge Boswijk, A., Thijssen, T. 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