After 20 years, Red Bull has dominated the energy drink industry even with its premium retail price in 83 countries with an estimated 70% share from world’s energy drink market (Andrews & Siengthai, 2009). Red Bull founder, Mateschitz, believes that the concept of Premium Pricing enables positive perceptions from consumers(Franzen & Moriarty, 2008). According to Wong (2006), Red Bull’s implementation of premium pricingis a necessary step in encouraging significant trendsetters to support the brand, to promote product consumption, and to establish value perception towards the brand.In the study of Massad and Tucker (2000), they have found that premium pricing and added-value through product branding influence the consumer spending for a given commodity.
Meanwhile, the study of Atwal and Williams (2009) adds that customer experience links premium pricing and the product’s added value, and guided by the Expected Value Theory, consumers must first perceive the existing value of a commodity before consumers could justify the reason for premium pricing.Thus, the promotion campaigns of Red Bull center in letting the targeted customers experience their products, and from there, create a demand via the unconventional word of the mouth or the so-called, buzz marketing strategy. The strategy aims to establish added-value perception channeled through identified trendsetting individuals or establishments who have been exposed, who have experienced and who have initially identified the brand as “highly valuable”(Lamb, et al., 2011)..
These are excerpts of essays please place order for custom essay paper, term papers, research papers, thesis, dissertation, book reports and case studies.