In recent years, the Red Bull trademark war has broken out in full force. As Red Bull’s core operator in China, Thai Tencel and Reignwood Group, the brand owners, are facing increasingly fierce competition. In the second half of last year, Tencel applied to clean up Red Bull’s business in China, but in May this year, the relevant departments rejected the proposal.
Red Bull’s success in China cannot be denied. Reignwood Group has made a huge contribution. Currently, Red Bull is the undisputed king of functional beverages in China, accounting for more than half of the market. However, Reignwood Group does not own the Red Bull trademark. This seems to be a familiar plot, and it has to remind people of the dispute between Guangzhou Pharmaceutical and Jiaduobao over Wanglaoji; and will Reignwood Group become the second Jiaduobao?
My own brand has sold more than 80 billion yuan in China, but I don’t have the trademark rights?
Look at the past and present life of China’s Red Bull and Thailand’s Tencel: The founder of the Red Bull brand is Xu Shubiao, a Chinese who was born in Hainan, China and grew up in Thailand. In the 1970s, his company developed a functional drink containing water, sugar, cellulose alcohol and vitamin B and created the Red Bull brand. By the early 1990s, the domestic market was just opening up. Xu Shubiao saw an opportunity for Red Bull to expand into the mainland market, but it was difficult to do so as there were no functional drinks in the catalog at the time.
At this time, Yan Bin, who had been in Thailand for many years and was familiar with the domestic market, saw business opportunities. After friends’ introduction and understanding of Xu Shubiao, the two parties quickly reached a cooperation. In 1995, with the help of Yan Bin, Red Bull officially entered the domestic market and established a joint venture. The former is mainly responsible for production and sales operations, while the latter mainly provides brand licensing and technical support. Over the next 20 years, Red Bull's business also developed rapidly in China.
My own brand has sold more than 80 billion yuan in China, but I don’t have the trademark rights?
According to data from consulting firm Euromonitor, from 2014 to 2016, Red Bull’s sales in China reached 16.903 billion yuan, 20.115 billion yuan, and 22.163 billion yuan respectively. The market share of sex drinks has reached more than 68%, ranking first for many years. As a result, Yan Bin's net worth has also risen, reaching 12 billion U.S. dollars (83 billion yuan), making him a super rich man on Forbes.
As the sales of Red Bull drinks continue to increase in China, Reignwood Group’s dominant position in Red Bull China is also increasing. After Xu Shubiao's death, the heirs of the Xu family had different views on the distribution of interests, which led to conflicts between the two parties. China Red Bull's revenue has continued to decline over the past few years, with its market share falling to 58% amid pressure from competitors. The rise of Lehu and Dongpeng special drinks has gradually swallowed up a large part of Red Bull's market share. In addition, Carabao, another Thai beverage brand, also announced that it will invest 2 billion yuan in marketing and promotion in China in the future, and competition is becoming increasingly fierce.
My own brand has sold more than 80 billion yuan in China, but I don’t have the trademark rights?
Judging from the actual situation of both parties, both parties have their own preparations. Although Reignwood Group has launched other brands of beverages, Red Bull remains its main source of revenue and if it ceases operations, it will cause a heavy blow to the business. On the other hand, Thailand Tencel recently launched a new product, but if it wants to occupy the market in a short period of time, it is almost impossible to find richer channel resources than Reignwood Group. The long-term battle between the two sides will undoubtedly be a long-term damage to the Red Bull brand.