#4. What Does RedBull Do? How Do They Make Money? 🔴🐂

🌐 If you look at Red Bull from a bird’s eye view, you’d just see that they sell 1 drink! The Red Bull Energy Drink. (They have recently started to add a few flavored variants, but are still just an energy drink company.)

📈Here are some interesting stats about Red Bull:

— Red Bull sold 11.582 billion cans worldwide in 2022 (9.804 billion cans sold in 2021 - 18.1% increase)

— They employ 15,779 people in 172 countries as of the end of 2022.

— They were the creators of a new product category in 1987: Energy Drinks.

— Red Bull makes each can for approximately 9 cents.

— The suggested retail price for a can is 3.59 USD.

— The biggest customers like Walmart and big grocery stores pay between 44 and 48 USD per case of 24 cans.

— i.e. they earn 1.87 USD per can, which is 20x production cost.

🎯 Now let’s zoom into the other details. They are NOT just an energy drink company. They are a lot more than what meets the eye.

🏆 They own & run

• 2 Formula One Teams,

• 1 Nascar team,

• 7 Professional Football Clubs, and

• 2 Ice Hockey Teams.

🎪 They also own & host multiple proprietary events, like the

• Crashed Ice Challenge,

• Soap Box Race,

• Hip hop events (Beat Boxing & MC, B-boy/girl),

• E-sports (Counter Strike, Age of Empires 2, Dota 1, etc.),

• Rubik’s World Cup,

• The Wings for Life Run & 100+ more events.

🏅 They also sponsor thousands of athletes across different sports. If you were looking for a count, then they sponsor 1000’s of athletes in different 98 disciplines.

Now let’s look away from the front-end aspects.

💻 They own the

• Red Bull Media House, which operates Red Bull TV, Red Bull Photography,

• Benevento Publishing,

• Red Bull Music Academy,

• Red Bull Records, and

• Red Bull Music Publishing all focusing on sport, lifestyle programming, music, and games.

📰 Some of the several magazines they publish are:

• The Red Bulletin (lifestyle)

• Servus (food, health and gardening)

• Terra Mater (nature, science and history)

• Bergwelten (alpinism)

• Seitenblicke (celebrities).

🚀 Apart from all of these, Red Bull does some crazy things like the event in 2012 where Felix Baumgartner jumped from space. He became the first man to break the speed of sound in a freefall. (Reached a speed of 1,357.6 km/h (Mach 1.25)) Check this out:

💰 The project cost Red Bull a whopping $50 Million, but some experts estimate global reporting about the event to be worth ~6 billion USD. So it was probably worth it!

🏎️ Also, here’s the cherry on the cake if you are an F1 fan. Check out the 12 crazy stunts Red Bull did with its F1 cars

📣 So obviously, Red Bull does much more than sell an energy drink! They have built the world’s best marketing engine!

💡 Some final thoughts:

💼 They spend almost a 3rd of their revenue on marketing.

📈 The revenue growth of Red Bull hasn’t slowed down since 2012.

💡 The company is dependent almost completely on one product only: The Energy Drink.

💼 Investments in sports teams and media production are therefore not only marketing activities but also an attempt to diversify and create additional value chains next to the “can” business.

🌟 Nevertheless, the overwhelming revenue driver, to this day, remains beverage sales, representing ~97% of total earnings.

Red Bull mentions the other activities as “ongoing brand investment”, which indicates that these are losses, not revenue streams—at least not yet!

I hope you enjoyed reading this as much as I loved researching & writing it. Do consider sharing this newsletter with one other sports aficionado. Thanks!