• (medium risk/ new product/ existing market) Similarly to the Red Bull Sport investment, the Media House is only introduced in markets were the Soft Drinks already has a strong presence. However, this Business Division continues to grow, with the latest addition being the introduction of an Online Fashion Retailer.

GEOGRAPHIC SCOPE

Red Bull’s initial expansion plan for the Soft Drink Family had it moving into established markets such as Europe and North America. The group has since then understood that these mature markets do not provide the best ground for expansion and has begun focusing on emerging markets such as Brazil, China, and India. This has also been accompanied by an expansion of its manufacturing structure, were Red Bull has built a factory in Brazil to decrease logistical costs in the area. (Appendix 7)

FIG 4. Red Bull’s Global presence.

KEY STRATEGIC ISSUES OF RED BULL’S CORPORATE STRATEGY

UNCLEAR SUCCESSION PLAN

As Red Bull continues to grow into a conglomerate of diversified businesses, it should consider taking the Group public in order to not only secure the implementation of a strong succession plan, but also to leverage on its attractiveness to obtain financing for future investments, which are currently being sourced from its cash flow.

LACK OF PRODUCT INNOVATION AND AGEING DEMOGRAPHICS

Although extremely successful, Red Bull’s product offering is also very limited, and according to consumer reports, does not have any differentiating factor. Previous attempts to expand the product line have failed to produce good results, which has the Group moving ahead with very limited options for growth.

Similarly, Red Bull’s marketing strategy also presents a significant area of concern. The product is aimed at a rapidly ageing target demographic who tends to change consumption habits as they age.