In the highly competitive energy drink category, market share is determined primarily by the cunning and creativity of marketers who aim to differentiate their product from competitors by creating something that represents more than just a drink. Because of the similarity in taste and ingredients of the 210 North American brands the efficacy of each marketing plan is the prime driver of market sales.
RockstarTM will kick-off 2012 with an intensive marketing campaign, aimed to increase brand awareness, and expand market share in the UK. This report will describe the marketing plan that will be implemented, based around the 4 p’s, which are product, price, place and promotion. Market share expansion is not only possible, but expected, given excellent taste test results. Shifting demographics such as growing Black and Hispanic young adult population, along with the consumers that Red BullTM captured with its first-to-market products, who are aging, are creating gaps in the market that Rockstar must be vigilant to fill.
The advertising plan will continue its grass-roots, non-traditional theme, which resonates strongly with Rockstar’s demographic. The advertising plan will include a short commercial description featuring musicians and athletes sponsored by Rockstar Energy. The UK marketing campaign will aim to minimise gender biases, which have created a lag in female sales in the US due to distinctively masculine branding. The objective of the campaign is also to broaden the Rockstar demographic which has traditionally been young adult and teen gamers/metal genre listeners. In the UK the new slogan “The Rockstar Elixir” will be used on the drinks and in campaigns. Quantifiable marketing objectives are outlined: 2nd place market share in the UK with 17% by 2014, and a 300% increase in distribution outlets by 2013. 620,000 has been allocated to the UK marketing budget in 2012.
Company Profile: A Rockstar is Born Rockstar was introduced into the market in 2001 and is manufactured and distributed by Rockstar Inc, a private company based in Las Vegas, Nevada that was founded by Russell Weiner in 1998. Rockstar is currently distributed by Coca-Cola (Rockstar 2009) Market Situation Rockstar energy drink currently holds an 11% market share of the steadily growing energy drink category, a category worth an estimated $4.8 billion, which accounts for about 5% of all non-alcoholic beverage sales.
The energy drink business is a highly competitive one, being second only to coffee in terms of cost per litre; consumers are willing to pay premium prices in search of their desired kick, producing excellent profit margins. (Mintel. 2008, July) Sales change 2005-2009Since Red Bull introduced the energy drink formula to the world creating the whirlwind success without a patent, competition in this sector is rife. In North America alone there are over 210 brands of energy drinks, which are essentially different permeations of the original Red Bull formula imported from Austria in 1997. (Gates, K. 2008)
The Rockstar brand is well known in North America, however in the UK there is limited brand awareness and restricted distribution outlets. Generally in the UK the main way to purchase the drink is through the internet. Internet sales of energy drinks, although on the increase, represent only a small fraction of sales. This is primarily due to the fact that most energy drinks are consumed at the point of purchase on an impulse buy, for an instant energy boost. There is rarely premeditated consumption involved, and where it does occur often the cheaper products are selected because brand favouritism is bypassed by the more logical purchase decision.
Mintel (2008 April) This report calls for a redirection of focus onto real world outlets that are frequented by teens and young adults, especially males, such as convenience stores, gyms, university campus libraries, clubs, petrol stations etc. In combination with widening distribution outlets, this report will suggest a marketing strategy, specific to the UK which will allow Rockstar to infiltrate the market here. From the UK website www.rockstarenergy.co.uk it’s obvious that there is a fundamental lack of momentum and awareness this side of the Atlantic.
Product Description Rockstar is an energy drink available in a number of sizes and flavours. An ‘energy drink’ is generally considered to be a carbonated high sugar drink containing caffeine, taurine and guarana amongst other ingredients. The western version of the energy drink was first established by Red Bull in 1987, which is a carbonated version of a popular Thai drink called Krating Daeng. It was the idea of Austrian entrepreneur and marketing guru Dietrich Mateschitz to market the drink in Europe despite customer taste test feedback that concluded the drink tasted like ‘cough syrup.’ A lack of patent on the original formula meant competitors could quickly take a similar product to market.
Consequently market shares in the energy drink sector are determined primarily by marketing strategy and brand awareness, since every kind, from the cheapest generic energy drink at 30p per can up to 2 per can for Red Bull, consist of almost exactly the same thing. Recently further ingredients have been added, creating new varieties, such as green tea and fruit juices which aim to capitalize on the better-for-you trend. Gates, K. (2008) At one point Rockstar removed from market the alcohol containing variety Rockstar 21, for which it was applauded, since it was easily confused with other non-alcoholic varieties. (Drug Week 2007)
Product Lifecycle The energy drink sector is unlike many consumer products in that it does not display the typical product lifecycle curve of market introduction, growth, maturity and saturation. (Cravens. D, 2005) Red Bull experienced some degree of market saturation when competitors began to imitate their formula, however their overall sales have still continued to grow.
Using the product life cycle model it would have been assumed that Coca-Cola sales would have fallen as cheaper imitations flood the market, forcing Coca-Cola to lower its prices. Sales have not declined and this is because the brand in the most recognisable trademark in the world and is therefore trusted by consumers who identify with it. As long as Rockstar markets its products in a way that consumers perceive there is more to it than just a generic mixture of ingredients the growth stage can be sustained indefinitely. Rockstars slogan “Party like a Rockstar” and Red Bulls slogan “Red Bull gives you wings” allude to the point that their products are more than just a drink, and this is the power of marketing.