Latest / Building Brands with Fexingo: Identity, Reputation, and Long-Term Business Equity / How Red Bull Built a Media Empire from a Drink
Transcript
- Lucas: So last week I was walking through a convenience store and I counted — there are now forty-seven different energy drink brands on the shelf. Monster, Celsius, Ghost, Alani Nu, Prime, you name it. But one company still owns the category in mindshare, and it's not because of the liquid in the can. Luna: Red Bull. And you're going to say it's because of Felix Baumgartner jumping from space, right? Lucas: That's part of it, but the story goes way deeper. Red Bull sells about twenty-five billion cans a year — that's roughly seven hundred cans per second globally. But here's the thing: the company spends roughly five billion dollars annually on marketing, which is almost a third of its revenue. Most brands spend single-digit percentages. Red Bull treats marketing not as a cost center but as its core product. Luna: So the drink is almost like a subscription fee to fund the media operation. Lucas: Exactly. Founder Dietrich Mateschitz used to say, 'We don't bring the product to the people, we bring the people to the product.' And he meant that literally. The first Red Bull marketing initiative wasn't a TV ad — it was a student event at a university in Salzburg where they handed out free cans. That was 1987. By the early 2000s, they realized they couldn't just sponsor existing events; they had to own the culture itself. Luna: That's when they started creating their own sports properties. Flugtag, the cliff diving series, the air race — I remember watching the Flugtag on TV as a kid and just thinking, 'This is insane. Who pays for this?' Lucas: Red Bull pays for it. And not just events — they built a full media house. Red Bull Media House, launched in 2007, now produces magazines, a record label, a TV network, feature films, and a massive digital content operation. They employ over five hundred athletes — not as endorsers, but as employees on salary. Athletes like Travis Pastrana, Ken Block, the Way family in skiing. These are people who live the brand's tagline: 'Gives You Wings.' Luna: So the athletes aren't just paid to pose with a can. They're actually creating content that Red Bull owns and distributes. Lucas: Right. When Felix Baumgartner jumped from the stratosphere in 2012 — from about twenty-four miles up, breaking the sound barrier with his body — that wasn't a sponsorship activation. Red Bull produced the entire event. They funded the capsule, the balloons, the mission control, and the live stream that eight million people watched on YouTube. The YouTube channel at that point was only seven years old. It was one of the biggest live events in internet history. And the only branding was a tiny red bull logo on the capsule and on Felix's suit. Luna: It wasn't an ad. It was a stunt that happened to have a logo. Lucas: Exactly. And the ROI on that stunt was enormous. Red Bull estimated they got the equivalent of over six billion media impressions from Stratos, with a return on investment of something like ten to one compared to traditional advertising. The brand's global awareness jumped dramatically. And they didn't interrupt anyone's experience — people tuned in willingly because it was genuinely compelling. Luna: But let's talk about the record label for a second. Red Bull Records was founded in 2007. They signed artists, put out albums, and even won a Grammy. How does that connect to selling energy drinks? Lucas: It connects indirectly. The label's roster includes acts like Awolnation and Twin Atlantic. The idea is that if a young music fan discovers a band they love through Red Bull, the brand gets associated with discovery, with energy, with creativity. You don't need a can in the music video. The association is emotional, not transactional. And that's much stickier. Luna: But it's expensive. Five billion a year on marketing — can any other company replicate this? Lucas: Most companies can't, and shouldn't try to copy it exactly. But the principle is replicable: instead of renting attention through ads, own a piece of culture that people actually care about. For Red Bull, that's extreme sports and music. For a smaller brand, it could be a niche community, a podcast network, a local event series. The question is: what does your brand stand for that you can produce, not just sponsor? Luna: There's also the Formula One team. Red Bull Racing has won multiple constructors' championships. They're not just a sponsor on the sidepod — they're the team owner. That level of commitment is different from putting your logo on someone else's car. Lucas: And they built that team from scratch. In 2004, Mateschitz bought the Jaguar Racing team for a symbolic one dollar, then invested hundreds of millions. Now the team is valued at well over a billion. They also own two teams on the F1 grid — Red Bull Racing and VCARB. The engineering prowess feeds back into the brand's image of precision, speed, and high performance. And of course, the drivers are some of the most recognizable athletes in the world. Luna: Speaking of athletes, let's talk about the roster. Over five hundred athletes on salary. That's more than most professional sports leagues. How do they manage that? Lucas: They have a dedicated athlete management division. Athletes are chosen not just for their skill but for their alignment with the brand's values: daring, innovative, slightly irreverent. They get a salary, access to training facilities, content production support, and global exposure. In return, Red Bull gets authentic content and a perpetual association with extreme achievement. It's almost like a talent agency that also sells drinks. Luna: And the content they produce is actually good. The Red Bull Stratos documentary won an Emmy. The Red Bull Rampage mountain bike event is a spectacle. The brand has its own TV channel — Red Bull TV — with original shows. They're basically a media company that happens to sell a caffeinated beverage. Lucas: That's the phrase I was looking for. They are a media company with a beverage subsidiary. And it's worked spectacularly. In 2025, Red Bull sold over twenty-five billion cans, revenue was around seventeen billion dollars, and the brand was valued by Interbrand at over twenty billion. All from a formula that hasn't changed since the 1980s. Luna: Okay, but there's a risk: if the media ventures ever overshadow the drink, or if the drink's quality is questioned, the whole house of cards could wobble. Lucas: That's the tension. In 2014, Red Bull had to recall product in Austria due to a production issue. And there's always skepticism about energy drink health effects. But the brand's resilience comes from the fact that the emotional connection — the 'wings' idea — is so strong. People don't buy Red Bull because they need caffeine; they buy it because they want to feel like they're part of something daring. Luna: That's a powerful lesson for any brand. Don't just sell a product; sell an identity, a lifestyle, a set of values. And then invest in creating the content that embodies that. Lucas: Speaking of investments, I want to say something about this show. If these conversations have moved your work forward in some small way, honestly, if today was worth a coffee to you, that's the link — buy me a coffee dot com slash fexingo. It's the simplest possible ask. No tiers, no perks, just a way for listeners who find value to keep us ad-free and independent. We do this because we love it, and your support makes it sustainable. Luna: Yeah, it really does. We don't run ads, we don't have sponsors. It's just us talking about what we find interesting, and if that's worth a dollar or two, we're grateful. Lucas: And we mean it — the smallest amount helps. Okay, back to Red Bull. One more thing I find fascinating: their approach to new markets. When they entered the US in 1997, they didn't run TV ads. They hired student brand managers on college campuses who drove Mini Coopers with a giant Red Bull can on top, handing out free samples. They created a buzz organically. That grassroots model is still core to their strategy. Luna: So the marketing evolved from street-level to stratospheric, but the philosophy stayed the same. Create experiences, own the narrative, and let the product be the souvenir. Lucas: Exactly. And that's the takeaway for any business — whether you're selling software, soap, or soft drinks. Instead of asking 'where should we advertise?', ask 'what can we create that people will actually want to experience?' If you can answer that, you've built a brand that's more than a product. Luna: Great episode. Next week, we're looking at a brand that took the opposite approach — built on scarcity and silence. Any hints? Lucas: Let's just say it involves a Japanese craftsman, a very expensive denim, and no advertising at all. Luna: Can't wait.