Introduction
The relationship between sports and marketing has been studied for decades. Today, many businesses have recognized and embraced the potential of sports marketing to generate sustainable revenues and to ensure the survival and competitiveness of firms. In other cases, brands have used sports as a platform to launch and position themselves in the market. Several brands have seen their value skyrocket because of their association with sports.
For instance, Red Bull was not initially a popular global brand, but its association with multiple sports has popularized the brand. Such a strategy proves the sentiments expressed by such scholars as Manoli, who indicate that sports marketing is no longer a commercial tool but a wider umbrella of product promotion elements (2). Examples of such promotional elements include publicity, commercial sponsorship, and advertising. According to Ghezail et al., sports marketing is not just a form of marketing but a freestanding area attracting both scholars and investors (182). Therefore, it can be argued that businesses failing to take advantage of modern sports are missing lucrative marketing opportunities.
The primary focus of this paper is to explore how Red Bull utilizes sports marketing. A brief overview of Red Bull and sports marketing will be presented to offer a background for the discussions that follow. Three main methods of sports marketing will be discussed and how this company utilizes them. The selection of the company was made on the notion that Red Bull is one of those companies actively extensively involved in sports activities. Therefore, it should make the perfect case study in the examination of how modern corporations exploit sports marketing.
Red Bull’s Sports Marketing
Several articles have emerged on the internet claiming that Red Bull has revolutionized how sports marketing is done. Many agree that the company has changed the rules of the game, and its extensive participation in sports proves this point. An article by (Puzzlelondon) presents a historical background of Red Bull’s involvement in sports marketing, from which it can be understood that the first sponsorship activation technique was established in 1989. The program involved a one-shirt sponsorship deal entered with an Australian football team. From this point, their deals have expanded rapidly across an array of sports across all continents. Today, Red Bull is involved in high-octane events, including Red Bull Air Race, cliff-diving, motor-cross events, snowboarding, and the Red Bull Box Soap Box Racing.
Red Bull has become one of the highest-selling energy drinks as a result of its sports marketing strategies. The game-changing approach has involved the purchase of sports teams. For instance, Red Bull purchased a Formula One team several years ago and proceeded to claim multiple Drivers championships and Constructors Championships, despite being new to the sports (Cainwilkes). Additionally, Red Bull owns contracted athletes in multiple extreme sports and a Major League Soccer (MLS), as well as several sports-related events (Watkin). Therefore, Red Bull does not simply wish to use sports as a marketing and promotional tool.
On the contrary, the company seeks to build sports in what can be described as a symbiotic relationship with the Red Bull brand. The association of the company with extreme sports has served to popularize several sporting events. Equally, all the events have carried the Red Bull brand, which can be seen as a pursuit of mutual growth between the sports and the brand.
Modern sports marketing has embraced the new digital technologies, which offer more efficient platforms for businesses. Social media has become a mainstay of virtually all action sports because it can air events in real-time (Thorpe 556). As a daily method of interaction, social media creates endless possibilities for marketers using sports. With social media, Red Bull has taken the opportunity to air videos of all events and has successfully attracted massive viewership across the world. According to Watkin, Red Bull was the most-watched brand across all platforms in 2017, as illustrated by 2.5 billion views and 50.2 million engagements.
The video marketing spree has been made possible by going from part-time to full-time streaming and from occasional hits to daily activities. By August 2017, Watkin stated that the company had uploaded 4,331 videos to 23 accounts in the previous 365 days. These statistics indicate that Red Bull is not only committed to using sports for promotional purposes but also to becoming full-time participants in sporting events.
Sponsorships
The description of Red Bull’s involvement in sports described above reveals that the company has made sports its primary promotional tool. One of the most commonly used methods of sports marketing is sponsorships, which is also the first tactic employed by the company through the shirt deal with the Australian football team. Today, several incidences of sponsorships can be found in Red Bull’s portfolio of marketing activities.
According to Santos and Moreno, sponsorships are a non-traditional and unconventional marketing strategy whose impacts on economics are undeniable (25). Today, Red Bull’s sponsorship activities are expansive and innovative, as expressed by the wide array of sports, athletes, and teams sponsored by Red Bull. In the United States, Red Bull has sponsored the New York Red Bulls, one of the most popular MLS teams in the country. Red Bull also owns RB Brazil, RB Leipzig, RB Ghana, and RB Salzburg. In addition to ownership, the company sponsors these teams through funding, which allows the teams to display the Red Bull logo on all their sports attire and other strategic elements.
Through sponsorship, it can be argued that that Red Bull has managed to create a global brand by making sure it is present and visible in all major markets where the company sells its products. The company’s major markets include the United States and Europe. RB Salzburg plays in the Austrian Bundesliga while RB Leipzig plays in the German Bundesliga, two popular football leagues in Europe.
The New York Red Bulls play in the American MLS, which means that the company’s image and brand are displayed in all major match events in these two regions. Shirt sponsorships in football have become a major topic for debate, majorly because of the huge amount of money that companies spend on the clubs. According to Gorecka, the huge funds offered to clubs imply that many corporations perceive football clubs as a critical part of their marketing strategy (1267). The primary rationale is that the football clubs tend to ensure a high level of exposure. Additionally, it has been established that over two-thirds of all sponsorship activities are related to sport (Gorecka 1267). These statistics indicate the sports are the best tool for brand exposure.
Therefore, the extensive sponsorship activities across the major sports leagues in the world mean that Red Bull has successfully conquered all markets through widespread exposure. RB Leipzig has been one of the longest shirt sponsorship deals in football, which started in 2009 and continues to date (Felicano). However, German football does not allow companies to put their names on the club. Therefore, Red Bull named the club RasenBallsport, which would allow them to use the RB brand on the shirts. The logo, which comprises two bulls, has been retained. Therefore, it can be argued that the company’s sponsorship has been retained for over a decade in the German Bundesliga.
Besides the shirts, the company has also sponsored the club’s stadium since they bought the club in 2009. The RB logo has since been a prominent feature and appearance in both the players’ shirts and the stadium. Similar strategies are used in other leagues whether Red Bull is present. In other words, sustained sponsorship deals for the clubs the firm owns have become a key feature of Red Bull’s sports marketing.
The sponsorship strategy has worked best for Red Bull because the company owns most of the clubs in which it has such shirt and stadium deals. However, the fact that the firm actively engages in other less popular sports means that both the athletes, their sporting attire, and the sporting events are also sponsored by the company. Such is the case with extreme sports where all athletes wear attire with the Red Bull logos. The sporting equipment has also been branded by the company, and funds for organizing and filming the events are also provided by the company. Therefore, it can be agreed that Red Bull’s arrangements with the clubs, athletes, and sporting events go beyond mere sponsorship, as argued by Ayles.
Red Bull has built a world-class sporting empire through which it exposes its brand. The association of the brand and some sports serves to make the company’s products more desirable. The sponsorship of the extreme events is particularly aligned with the marketing message of the energy drink and that slogan that the drink can give the consumer wings to fly.
The effectiveness of sponsorships as a sports marketing method has been studied in the marketing literature. There is a consensus that sports marketing helps create value for the stakeholders or facilitates value co-creation (Manoli 3). Sponsorship deals with such clubs as RB Leipzig means the players, fans, the club, and the company can all gain value through the sports marketing effort of the company. The same can be said with all other sports sponsored by Red Bull, where athletes can get paid for their talents, and the company can gain exposure for its brand. Therefore, Red Bull has effectively and successfully utilized sponsorship as a method of sports marketing.
Sports Branding
Sports branding is another method widely used by red Bull and other companies. According to Thorpe, Red Bull can be described as a transnational brand tied to youth culture and action sports community and lifestyle (558).
The connection between the brand and the sports has been set up through more than 90 independently branded action sports events, for example, Red Bull X-Fighters, Red Bull Air Race World Championships, and Red Bull Road Rage. Sports branding has been historically used by businesses to reach young consumers. The onset of social media has companies a new platform through which to establish and maintain customer engagement through sports. The idea behind this method is that sports events are named after the sponsoring company. In the examples given above, all the events are called Red Bull, which insinuates that the firm takes ownership and control of the sports.
It is important to emphasize that sports branding works best when a firm has avenues for exposure. The red Bull Media House was created and encompassed television, print media, online, and featured film production (Thorpe 558). Through the ownership of the media assets, Red Bull’s branded sports can be aired at the convenience of the company. Additionally, it allows the organization to control the content and its flow, as well as the message broadcasted.
The branded events are captured by some of the most talented cinematographers and photographers. Therefore, it can be argued that sports branding works best where there is adequate media exposure. By controlling the media and the content, it can be argued that Red Bull has maximized the value it can gain from the multiple events taking place almost every day of the week.
Sports branding is a concept that falls under branded entertainment. Branded entertainment allows for the effective integration of editorial content and commercial advertising. Through the use of branded entertainment, a brand is not placed into the existing content. Rather, the content is co-created by the brand, which makes it impossible for the consumers to perceive the content as being branded. Sports branding means that the brand and the sporting content are created together. The consumers may be followers of the sports, but the presence of the brand makes it possible for the company to sell both the brand and the sport at the same time.
For Red Bull, sports branding means that the company initiates exciting events which are recorded and shared across all media. The primary communication focuses on the event, especially through the commentary. However, the brand is made visible through the logos displayed on sporting attire, equipment, and even the sports venues. The consumers of the sports become automatic consumers of the brand content.
It can be argued that Red Bull has attempted to exploit all avenues of brand promotion through multiple sports. Many companies often focus on well-established sports where global outreach is already guaranteed. Red Bull’s investments in football are also an example of this approach to sports branding. However, the company goes further to other less popular sports. The main motive for using such events is not for brand promotion, especially because this objective has been achieved through the more popular sports. However, Red Bull seeks to attract viewers to other sports and to make such sports more accessible to people (Puzzlelondon).
The smaller and less popular sports are hardly covered by the mainstream media. Red Bull uses its media assets to exploit this opportunity and to fill a gap that has commercial potential for the stakeholders. It can also be argued that popular sports attract more investors and sponsors. Therefore, the sports branding by Red Bull in the less popular sports can be seen to have a futuristic perspective. Extreme sports are growing in popularity, which could offer another investment opportunity for the company through attracting sponsorship deals.
Tourism Events
Another sports marketing method that is being used by Red Bull is sports tourism events. In literature, these marketing exercises are often intended to popularize tourist destinations and attractions. Therefore, sports tourism has been used as a tool for the development of symbiotic services and products (Pounder et al. 186). The emergence of the sports tourism market has been studied by several scholars. However, the literature regarding how companies can exploit it from a market perspective is yet to be fully understood. However, Red Bull can act as a perfect case study in the exploration of this topic.
As with all sports in which the company is involved, Red Bull shares the events through the company’s media assets. The key idea is that with new or less popular destinations growing in popularity, Red Bull will benefit from the association of the destinations with its brand. Additionally, both traditional and emerging sports markets can be pursued, which allow companies to sponsor multiple events spread across a set period.
One example of Red Bull’s sports tourism events is the Red Bull Cliff Diving World Series Case conducted in the Azores Islands. According to Avelar et al., this sports event took place for the seventh consecutive year in 2018 (65).
The Azores Islands have been selected because they offer a perfect location where sea and nature provide a natural and dramatic backdrop. Additionally, the Azores Islands have gained multiple awards and international appraisals due to sustainable tourism and development. Examples include the national geographic Traveller, UNESCO, Green Destinations, and QualityCoast. The selection of this island for the cliff diving helps improve the reputation of both the destination and the company’s brands. Most importantly, many sports tourism events allow the tourists to be the key participants in the events. The events are most likely branded, as explained by the name Red Bull followed by the specific sport.
It can be argued that Red Bull’s use of sports tourism events is similar to the branding method. This is because the events bear the name and brand of the company. Therefore, Red Bull can be seen as pursuing new and emerging sporting niches due to its desire to be associated with all possible extreme sporting events. However, it can be said that this method also helps in publicity by addressing some of the main issues affecting society today. Azores Islands can be associated with a positive concept of sustainability, which Red Bull hopes to exploit. Value co-creation between the destination, tourists, and the company is also apparent.
Conclusion
Sports marketing is a broad subject that has been studied for several decades. The concept involves an array of activities and approaches that help firms create value through their association with sports. Red Bull has revolutionized how sports marketing is done because of the extremes pursued by the company. This sentiment is manifested by the fact that the company owns sports and sporting assets in major leagues. Additionally, the company creates and funds new and extreme sports and uses its in-house media to popularize the events. In the process, the Red Bull brand has become globally recognized in a few decades, which has also made Red Bull the highest-selling energy drink in the recent past.
Works Cited
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