The Secret Behind Red Bull's Success

It was 1984, a time when big hair, popped collars and Reaganomics defined popular culture in America. Across the Atlantic, an entrepreneur looking for an energy boost was hard at work on the next big pop culture fad. It took three years of experimenting and hard work; but in 1987, Dietrich Mateschitz and Nina Avery gave the world wings with a new drink called Red Bull.

It begins with a tuk-tuk ride.

Avery and Mateschitz got their inspiration when they traveled to Thailand. They noticed that the tuk-tuk drivers kept drinking something to keep them energized throughout the day. They adapted the Thai beverage known as Krating Daeng, which translates into English as Red Gaur. Red Gaur eventually became Red Bull. After some changes to the recipe and flavor, the new energy drink was ready for the public.

Mateschitz's native Austria was the first market in which Red Bull was launched. It was a smash. Sales doubled from year to year. In 1994, the partners expanded into Germany, before going global in 1997. When Red Bull hit America, sales hit the roof, doubling every single year since. Last year, worldwide sales were $1 billion. The company hopes to expand into Asia next, starting with Japan.

Do urban myths help propel sales?

Matechitz is known for being a marketing specialist. To say that his strategy is working would be a gross understatement. However, critics of Red Bull say sales are boosted, at least in part, by 'underground' marketing. In Europe and the United States, the drink is not only available in stores but also in bars and pubs. It has a growing reputation as a brand name alcoholic mixer. The myth associated with mixing Red Bull and hard liquor is that it allows the drinker to get a buzz without feeling tired. There are also rumors that the drink has aphrodisiac qualities. This most likely starting because of the name and an association with using bull testicles as a performance enhancer. Executives deny marketing the drink as a mixer or having anything to do with any of the myths. On the other hand, none of these myths are being dispelled.

In the Bull's Eye: The Youth Market

The Red Bull marketing team does admit that their target market is the young and restless. It does a guerilla marketing campaign with Mobile Energy Teams. These teams are staffed mostly with college students. They load a car with Red Bull, show up at events, and hand out free samples.

The company has also revved up its bottom line with licensing. The taurine logo is on the shirts of extreme athletes and racing cars worldwide. Dietrich bought the Formula 1 team Jaguar Racing from Ford Motors in 2004. Now it's called Red Bull Racing. In April 2005 he bought the Austrian football club SV Austria Salzburg. In March of this year, he bought the American soccer club Metro Stars. Both teams are now associated with the energy drink; bearing the names Red Bull Salzburg and Red Bull New York.

Soccer and racing are not the only places where the bull logo has shown up. The company also supports hang gliding, BASE jumping and ice climbing, along with many other extreme racing.The next steps in the licensing scheme include setting up an automobile testing set and partnering with the Austrian army to create an aviation academy. Perhaps the planes will showcase the logo, "Red Bull gives you wings."