Red Bull

In nineteen eighty-four, Dietrich Mateschitz found a syrupy energy drink in Thailand called Krating Daeng. Local truck drivers drank it for stamina. It cost pennies. Mateschitz licensed the recipe, reformulated it with carbonation, and launched Red Bull in Austria in nineteen eighty-seven. Production cost per can was roughly fifteen to twenty cents. Retail price was three to four dollars. Gross margin exceeded ninety percent. Red Bull was four times more expensive than Coca-Cola per serving and tasted worse. Mateschitz didn't compete on taste or value. He set the price high deliberately. A higher price signals exclusivity. A three dollar energy drink next to a seventy-five cent cola tells buyers this product is different. The price itself became the marketing. Red Bull spent roughly twenty-five to thirty percent of revenue on marketing. That marketing went to event sponsorship and athlete endorsement. Red Bull owns two Formula One racing teams, multiple soccer clubs, and sponsors over eight hundred athletes globally.