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Wondery subscribers can listen to the best idea yet, early and ad free right now.
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Join Wondery in the Wondery app or on Apple podcasts.
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The best work we've ever created, I think, was at 4am in the morning on the Tuesday before something was due. In college, I mean, I remember you wrote a term paper on like the Berlin Wall's impact on the Hollywood movie industry. I did a term paper on New York street grid affecting gdp.
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Yeah, man, I think we watched the sunrise.
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But Jack, that's a story for another pod. Because yetis, according to our research, more than a third of adults sleep less than the recommended seven hours a night.
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Yeah, seven hours a night. Not happening.
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We've all been there. Burning the midnight oil, jiving on the java, and generally just trying to keep ourselves going.
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And if you've ever felt like that, you've probably at least once found yourself reaching for a skinny blue and silver can that was randomly 8.4 ounces.
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Yeah, that's right. We're talking about Red Bull. El Toro Rojo, Le Toro Rouge. The Krating Dayang.
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B
Sorry, what was that last one?
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Krating Dayang. It means Red Bull in Thai. And it's actually the OG name for today's story. Because before Red Bull populated college kid mini fridges and Copenhagen nightclubs, Red Bull was fuel for truckers in Thailand.
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But that original Red Bull, it was uncarbonated. And it did not come in an 8.4 ounce can. It came in a brown little bottle or a fat yellow can.
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Yeah, it kind of tasted like Robitussin too. But it might have all stayed that way had it not been for one Austrian toothpaste marketer who gave Red Bull the ultimate glow up this guy. He traded tartar for taurine and made it his mission to bring this drink to the entire Western world.
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He sponsored campus parties, he snuck the product into bars and dance clubs, and he even designed Red Bull Mini Coopers with giant Red Bull cans on top.
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Ye.
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And despite tasting like cough syrup cut with a can of Lacroix, Red Bull became the top selling energy drink of all time.
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Since those early days, Red Bull has sold over 100 billion units. That is 12 billion cans in 2023 alone. Jack, could you sprinkle on a little context for us over there?
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In just one year, Red Bull sells enough Red Bull to fill 1200 Olympic sized swimming pools.
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It's almost like Red Bull is on Red Bull.
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Red Bull created the energy drink sector in the United States.
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And decades later, Red Bull is still on top. The Bull is currently the best selling energy drink brand in America, and last year's Global earnings crossed $11 billion. Red Bull is bigger than Chipotle and Red Bull only sells one product.
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But it's not just a beverage company, is it Nick?
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Good point, Jack, because Red Bull is a media company. It's an athletics company. Red Bull is arguably even in the space business.
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Technically, Red bull competes with SpaceX. That's right, we said it.
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Red Bull even invented their own sport. It's called Fluke Tug, with events all over the world because once you run.
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Out of sports to sponsor, you just make your own sports up.
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And yet, Red Bull still manages to offset this adrenaline soaked vibe with the same beloved wistful animated ads that have been airing for over 20 years. Red Bull gives you wings.
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Today's story involves water buffalo, a bad case of jet lag, and even Leonardo da Vinci.
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It pairs well with a late night at the library or late night at the discotheca over in Prague.
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Five story bar. Five different decades. If you know, you know.
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Jack, get ready to stay up for the next 42 minutes and keep those eyes open because Red Bull is the best idea yet. From Wondery and T Boy I'm Nick Martell.
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And I'm Jack Crevici Kramer.
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And this is the best idea yet. The untold origin stories of the products you're obsessed with and the bold risk takers who brought them to life.
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I got that feeling again. Something familiar, but no, we got it coming to you.
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I got that feeling again.
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They changed the game in one move. It's how they broke all. This episode is presented by Lenovo.
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The Lenovo Aura Edition AI PC imagined with intel is an innovative PC with bold software solutions that elevate your day to day.
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Because whatever great idea you're creating may be your best idea yet.
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Best idea?
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It's possible on your Intel AI PC.
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Learn more about Lenovo Aura Edition AI PCs@lenovo.com Aura the Air is thick and humid, full of fragrances that don't quite go together. The scent of magnolia and fresh earth mingles with the acrid stink of diesel. It's 1976 and we're in rural Thailand. We're stationed along a winding highway lined with ferns, spiky bamboo and flowering rosewood trees. Stretches of quiet are punctuated with the rumble of small trucks piled high with supplies. Now, back and forth, these trucks go between the bustling city of Bangkok and its night markets and tuk tuks all the way to Thailand's far flung provinces.
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And patiently chilling at a plastic Table is an entrepreneur named Chalio Yuvidya, A man in his early 40s with a cooler full of little brown glass bottles at his feet.
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What Chalio is doing is he's waiting to talk to some truckers. You see, Chalio, he lives in Bangkok. But being out here, all the way out in the country, that's what feels like home. The son of Chinese immigrant farmers, he spent his childhood in petite province, raising ducks, selling fruit, and basically doing anything that he could just to help his family.
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So once he was old enough, he did what lots of rural people in Thailand did at the time. He left the farm to seek a better living in the big city.
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Now, at first, our guy Chalio, he is reaching for, like, any job he can get. But in just a few years, he's able to save up enough money to found his own pharmaceutical company, TC Pharmaceuticals. And at the time, he's just 23 years old.
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Working in a metro hub like Bangkok exposes Chalio to all sorts of products he never saw back home in the countryside. Like tiny syrupy serums imported from Japan called energizing tonics.
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They got B vitamins, they got caffeine. They have a little thing called taurine, which is an amino acid found in animal tissue. And these elixirs, they're pretty popular with the city folk. So here's what Chalio does. He starts selling them through his pharmacy. But as he watched them fly off the shelves there in Bangkok, he got to thinking about the customers who might need them the most. The working class folks he grew up with.
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Chalio grew up poor. He knows what it's like to work hard for long hours and a caffeine and a vitamin combo that would really hit the spot. But workers on a budget, they can't afford these expensive exotic imports from Japan. So Chalio decides to make his own domestic affordable version of those premium Japanese energy drinks.
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And he calls it Krating Diang. Translated to English, that would be Red Gower, which is a type of South Asian wild cattle, kind of like a water buffalo.
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Jack, you've definitely seen this beast on.
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National Geographic picturing it now.
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It's a wild animal and the color red, both symbols of strength and power, perfect for this drink.
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Chalio adapts his recipe from the Japanese tonics that he's been importing in Bangkok. B vitamins, taurine, and about 80 milligrams of caffeine. A little less than your cup of coffee. But then Chalio does something different. He pulls a Mary Poppins and he adds several spoonfuls of Sugar, just to help the medicine go down. And voila. We've got Red Bull 1.0, a local.
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Domestic version for people in Thailand that don't have a lot of money but need a lot of energy. It comes in a brown bottle or a squat yellow can and it's not carbonated like today's version, but other than that, this is an early version of a Red Bull like the one you can still buy today at 7:11.
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Now, since Chalio manufactures his drink locally instead of in Japan, he can set the price way lower than those Japanese imports. Just 10 baht per drink, which at today's exchange rate is 30 cents.
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Yeah, that's a really good deal for the working people in rural Thailand.
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But besties. As Chalio waits at his roadside stand in the middle of nowhere, he's not here to sell his energy drink to truckers. No, he's here to, to give it away for free.
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Chalio is way out there in some rural highway giving out free samples of his new energy drink to truck drivers during their pit stops.
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He's taken the biggest, strangest risk of his life because out there, hundreds of miles away from the city, not making a penny on these samples, it's just losing money every single day. But yet he's taking this product into the Thai boonies. It's actually all part of Chalio's deliberate strategy because in the city, his new beverage, it's going to get lost amidst all the other brands on the shelves. But way out here at the only watering hole for miles kerting, Dayang stands alone. Most of these truckers that he meets have never even tried or even heard of an energy tonic.
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Chalio is going where the other brands aren't. And it works. He tests his brand new product where there's no competition, but where there are customers. And those customers crave energy.
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Suddenly Krating Dayang is all that everyone is talking about along Thailand rural route number one. In fact, word over the CB radio is that there's this new drink that can keep your eyelids open for hours, even on those long hauls through the jungle. No street lights, no problem.
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Krating Dayang achieves almost mythical status within the truck driver community. Now it has half the caffeine of your average double digit latte. By modern trucker standards, this is a pretty tame drink.
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But Jack, between the B vitamins, the tauri and the touch of mystery, this is exactly what those truck drivers need. Red Bull builds its reputation as the drink of choice for long haulers. And frankly, any worker who needs a productivity boost at 4am and it builds.
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Loyalty with a niche customer base that everyone else has been ignoring. Soon they'll pull way, way ahead of the competition in more ways than one.
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With Krating Dayang Chalio Yuvidia. He's got a hit on his hands. But he knows he can't just hang along highways dishing out drinks for free forever next to the porta potties. So he takes a portion of his earnings and he makes his biggest investment yet. He sponsors a popular sport, Muay Thai.
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This is high energy unarmed combat that uses leg sweeps, elbow strikes and hand to hand contact.
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It's basically mma, but with more feet to the face.
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And as the national sport of Thailand, Chalio thinks sponsoring Muay Thai will help him reach a much broader audience. And sponsoring competitions will make a connection in that new audience's mind between Red Bull and winning. Now, we don't have a lot of financial info on this period of Krating Dayang's growth because Chalio, he didn't do interviews, like ever. This entrepreneur didn't do a single interview for 30 years.
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But by 1980, four years after kriting Dayang debuts, it is everywhere in Thailand at a time when the country's economy is really picking up. It's part of a cohort that everyone at Goldman Sachs is calling the Tiger Cub economies. And the other ones are Indonesia, Malaysia, Vietnam and the Philippines. And as China has started to open up to outsiders, these nearby countries are seeing fast growth too, thanks to their exports. You see, these residents are using less than they're producing, so they have lots of surplus products they can export. In Thailand, they're exporting rice and rubber and textiles and electronics.
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But one thing they're not exporting, Nick, it's Red Bull.
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It's Red Bull.
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Despite being a hit inside Thailand, Krating Diang isn't getting exported anywhere. Chaliao is doing a great job appealing to local Thai customers. He's crushing it at the truck stop, but he's hitting a ceiling when it comes to putting his product into the international market. And that spells serious trouble. By this point in time, Coke and Pepsi are multinational giants. And like Varys with his little birds, they have spies all over the world finding out what kind of innovation is happening in beverages.
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So it's only a matter of time till one of these big guys discovers Red Bull, creates their own version, and then tries to extinguish Red Bull with a fire hose of their own advertising and branding.
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So Red Bull has a window of opportunity to grow into the world market before Coke and Pepsi destroy them. It's a small shrinking closing window. Grow or eventually get crushed.
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Well Jack, luckily for Chalio, a marketing whiz from Austria is about to enter his life and change everything. A toothpaste marketing whiz. Jack, am I wrong? Is there just like a particular smell you have when you get off a red eye flight?
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It's awful. You've been zombie sleeping for like six hours.
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Well, that desperate feeling for a cold plunge of breath min and seven showers is the situation that Dietrich Mateschitz finds himself in as he staggers out of the Bangkok airport and hails a ride to his hotel downtown. It's the early 80s and Dietrich is the international marketing director for a German company called Blendax. Blendax? It sounds like some kind of laxative smoothie, but they actually make products like toothpaste and shampoo and skin cream.
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If you can put it in a Dopp kit, Blendax makes it.
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But Dietrich, he's been making frequent international business trips from Europe to wherever. And on one particular 8,000 mile journey to Thailand, the jet lag is just really getting to him, man.
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To get a picture of Dietrich, he's Chalio. Yeah's polar opposite. Where Chalio avoids flash media attention, Dietrich relishes hit. While Chalio has always hustled to survive, Dietrich has taken his time.
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This guy spent 10 years getting his undergrad degree because college was such a blast. If Chalio brought the Red Bull and this guy's bringing the vodka, in fact.
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Being the international marketing director for shampoo and toothpaste, it's got Dietrich kind of bored.
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Understandable.
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And this boredom doesn't help the jet lag either. He's basically hit a career midlife crisis. He's lost motivation, he's lost direction, and he's definitely lost sleep.
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So yiddies, spare a thought for our poor Dietrich as he stumbles out of that taxi and 110% humidity of downtown Bangkok. His head is pounding, a tuk tuk like is about to run over his foot and he stumbles into the first tiny pharmacy that he sees. He needs something. He needs anything for his grogginess if he's gonna make it through a day of boring meetings and dreary presentations about.
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Floss squeezed in the drugstore's narrow aisles. He fumbles with mysterious products and labels that he can't read until finally he sees a small cold case with tiny bottles inside. He grabs one, pulls it out, and under the Thai script the label has two words in English that he can read. Those Two words are energy drink.
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So once Dietrich gets back to his hotel, he cracks that bottle open. He pours the syrupy stuff over some ice and takes his first sip. Okay, that's a strange taste. But you know what? Within minutes, his head stops throbbing. His toes start wiggling. That weird jet lag smell we talked about, it's gone. Dietrich, he feels ready to take on the world. So after Dietrich gets back from all of his meetings, he starts reading up on the energy drink market that he's just been introduced to. And to his total amazement, he learns that not only is this thing crazy lucrative as an industry, this stuff, it ain't found anywhere but Asia. In France, if you ask for an energy drink, you're going to get an espresso. In Italy, a double espresso.
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And in the gas stations of America, well, today you'll find Monster and Rockstar and 50 other energy drinks. Back then, you're just seeing the Slurpee machine.
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So looking at this crazy popular product that hasn't even crossed the continental borders yet, Dietrich gets an idea. There is a market that is way, way bigger here. And he becomes obsessed with bringing this idea, this industry, this energy drink to the west. So back to his hotel, he starts combing through his client list of Blendax licensees. Jack, get this. One of those licensees that he sees on his list, it's Chalio. You video his company, TC Pharmaceuticals, that means Dietrich has got a direct line to this guy, the guy behind the drink that just changed his whole life.
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So he picks up the phone and he rings him up. How would you like to bring your energy drink to Europe, America and beyond?
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Chaleo's like, absolutely so, because Dietrich is just this kind of guy, man. Dietrich quits his boring job at Blendax and he reaches deep into his personal pockets to put up 500,000 bucks in savings to match Chalio's equal investment. So now they are 50, 50. They're both taking a huge financial risk to take this product to the big time. Now, it's Chalio's invention that they're selling. But Dietrich, he'll run the company day to day, which suits Chalio just fine. It is crazy to think about how fast Dietrich went all into this thing. I mean, this guy got off an airplane, was jet lagged, had an energy drink once, and suddenly he's poning up his life savings into this thing.
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It goes to show how many huge business decisions are made based on intuition.
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He hits the ground running first thing first, Jack, what are we going to do? Brand new Business. What is priority number one?
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Make it pronounceable. Change the name Dietrich.
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He knows English is the language spoken all over the world.
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Plus, at this time, anything American sounding carries a subliminal message of business potential across the whole world.
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It's like tossing the word AI into a startup. Today, you use an English name 30 years ago. Boom, you are getting funding, man. So it's goodbye Kriting Dayang, hello, Red Bull. Next, it's on from the name and on to product testing. Priority number two. As a veteran marketer, Dietrich knows that tastes can be reached. You know, Western palates, they aren't always primed for eastern flavors and vice versa. So he sets up some focus groups over in Austria. And the results, Jack? Bad.
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Real bad. Those test customers hated this drink.
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The first volunteers, they are spitting out the drink. You could not give this stuff away for free. At a sample booth at Costco.
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And just as they're tossing his samples in the trash, you can see Dietrich wondering in his head, have I made a huge life savings?
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Demolishing mistake.
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This episode is presented by Lenovo Yetis.
- [19:12]
A
We talk on the show a lot about great teams and fantastic partners behind insanely awesome products.
- [19:17]
B
Like how Michael Jordan and Nike together built a sneaker that changed the world.
- [19:21]
A
Well, Lenovo and Intel joined forces for the ultimate AI enhanced laptop with software solutions that'll make your work go by faster and better. The Lenovo Aura Edition AI PC imagined.
- [19:32]
B
With intel can predict your needs, enhance your creative projects and and automate mundane tasks.
- [19:36]
A
Okay, get this. Lenovo Aura Edition AI PC powered with Intel Core Ultra processors, it uses AI to intelligently adapt to whatever you do.
- [19:45]
B
If you're working in a cafe, Shield Mode will guard your privacy.
- [19:48]
A
All right, Jack, if you're taking a meeting, Collaboration mode optimizes your camera automatically.
- [19:53]
B
They also come with SmartCare, which is premier support for business.
- [19:56]
A
Get 24 7, 365 access to elite support teams who will give you the VIP treatment that Nike gave Michael.
- [20:03]
B
Lenovo and Intel. They built the laptop that lets you think up the best idea yet.
- [20:08]
A
Learn more about Lenovo Aura Edition AI PCs@lenovo.com Aura it's possible on your Intel AI PC, Jack. It's the mid-1980s, and Dietrich Mateschitz, Austrian marketing executive and head of Red Bull, is trying to solve a big problem. You see, the energy drink is huge in Thailand, but it's flopping with the Western test audiences. Oh, and Dietrich, he's got half a million bucks sunk into this thing. It's his whole life savings. They're all rolled up in one big Red Bull bet. So here's what Dietrich does. He spends the next three years working on both the drink's formula and the packaging. And both get transformed.
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Like we always say, the packaging is the product. And Dietrich thinks Red Bull will play best as a specialty premium beverage. So he wants it to stand out in the convenience store fridge.
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Picture the Coca Cola curvy bottle. You know, like that's the icon he is going for. But how do you make something look premium? Well, his team develops the sleek silver and blue aluminum can with the two Red Bulls charging at each other that we all know today. But here's the difference. They make that can 8.4 ounces instead of the usual 12 ounces. Basically, they make the can 30% smaller.
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This new smaller can isn't just about the design. It's also a clever psychological trick.
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A
Red Bull's smaller can, it actually adds to the mystique. It implies that what's inside is so powerful, you're going to want to take it easy on this stuff. Plus, by offering less for more, it is both a marketing and financial hack because the smaller servings are cheaper to produce, so they save money. But since it's implied that the product is stronger than its competitors by being small, they can charge a premium for it, too. With the packaging puzzle solved, now it is time to update the drink itself. And here is where Dietrich takes another risk. Because even though Krating Dayang tastes kind of like a liquid Ricola, he does not alter the flavor at all. No cherry, no grape, no island peach version. He's not going to go full Lacroix on this stuff. Instead, he does one addition. He adds bubbles. That's it. And somehow, carbonation, it's enough to make Red Bull's acquired taste a little bit more appealing. Actually, a lot more appealing. So he's cracked the flavor. He's cracked the can. But we're not done yet. Dietrich hires an ad agency because he wants to develop an iconic slogan and some equally iconic animations that will shape Red Bull's brand identity for the next 30 years.
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It's time for Red Bull to get some wings.
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A
Ah, the unforgettable slogan, Red Bull gives you wings. It goes back to their very first ad spot, a cartoon featuring Renaissance master Leonardo da Vinci hard at work on a painting. Morning, Leonardo. So what on earth are you drawing now? Glad you asked. This is the plan for my latest invasion. A flying machine. Now, at this point, we see Leo is painting a familiar looking can on his canvas. And what That's a flying machine. Well, how's it going to work? It hasn't got any wings. No, you don't understand. This is a tin can. The flying machine is a drink inside. And it's called Red Bull. A flying Bull you can drink? Trust me, Leonardo, this idea will never get off the ground. But Red Bull is stimulation for body and mind. Look. Red Bull gives you weight.
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Voila. Da Vinci has finally created his human flying machine.
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Jack, stick this ad in the Louvre. With its sleek little can, a flavor enhancing carbonation, and a catchy slogan all in one place. Those wings launch in Europe in 1987. Red Bull Europe starts in just a handful of exclusive Austrian ski resorts. But soon, Dietrich gets an idea. An idea for attracting a much, much, much W.
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Nick, we mentioned that Dietrich spent 10 years in college. He was going full Van Wilder on the college extracurriculars.
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A
Not to mix our movie metaphors, Jack, but the next thing Dietrich does is he pulls a Billy Madison and he goes back to school. Bringing Red Bull to a cohort famous for their all nighters. College kids.
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B
Dietrich's team is tiny, just six salespeople and one admin. They have no marketing budget for things like billboards, print ads or TV spots. So instead, they identify the most popular students on campus. Dietrich's team gives these campus hotshots cases of free Red Bull to give out to their friends. Because if the cool kids are drinking it, so will their friends and their followers.
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But we should point out Jack shilling for an unknown soft drink company is not exactly the popular girl vibe. So Red Bull, they need a way for all these Regina Georges to like, buy into this entire concept. So Red Bull actually throws these kids.
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Parties yourself on a campus in the 1980s University of Salzburg. You're still figuring out your class schedule. You're not sure if those AP credits are going to transfer or not. And then suddenly, the most popular senior.
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Girl, you know, Jennifer Meyer, quality Austrian name, Jack.
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She actually invites you to her Red Bull party tonight.
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Duran Duran's cranking on the radio. The Red Bull is flowing freely. You look fantastic. And you even got to talk to Jennifer for a sec. Well, this high flying feeling, it's something you're going to be associating with Red Bull from here on out. It is a peak moment. And peak moments, they stick with you. For Dietrich and his marketing team, it is mission accomplished at the Red Bull parks.
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B
Next, they aim the free product fountain at local bars and local clubs. And here, Dietrich pulls off a growth trick shot that cost them nothing. That deserves to be in a hall of fame somewhere.
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To make people at the bar think that Red Bull was popular, Red Bull's team discreetly scattered a bunch of empty cans around the floor of the whole joint. So it looks like everyone at the bar is drinking cases of this stuff. He's designing the demand.
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Oh, and naturally, with all the free mixer around, bartenders start creating Red Bull specific cocktails.
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Red Bull and vodka. Or, Jack, your wife's from Long island, how would they pronounce it?
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B
Red Bull vodka.
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A
Exactly. It's a legal dance all night drink. Perfect for the no curfew, European club scene and the study abroad students like your buddy Timmy, who are ready to party.
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B
Add up all the initiatives from giveaways to Red Bull parties to empty cans to Red Bull vodka and Dietrich's devious marketing tactics, they all work in their very first year. Red Bull sells 1 million cans. The campus invasion has been a triumph.
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A
Now, Jack, we gotta talk about the financials a little more because they do sell 1 million cans, but they're also $1 million in the red from all those giveaways.
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But who cares? They're in the customer acquisition phase. The giveaways are the marketing budget. Same cost, same purpose, but bigger result.
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A
Honestly, Jack, that whole growth over profits mindset, it's one that's going to become entirely dominant in the Web 2.0 era. Like Uber and Lyft, Grubhub and Seamless, Facebook and Twitter, Robinhood and Coinbase, they are all focused for years on growth, even though it was unprofitable growth. And it's all based on the theory that grabbing customers early in your life cycle, that is the priority. Quote Ricky Bobby, if you ain't first, you're last.
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B
Especially if your category is a new one. When Uber started, ride shares weren't a thing in the U.S. ditto for energy drinks. When Red Bull debuts, if they don't acquire customers quickly, they'll be forgotten.
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A
They are moving fast. Before Big Soda can steal their whole energy drink idea, they can worry about the pricing structure, all that stuff later. And you know what? That mentality works because Red Bull's giveaways, they are paying off.
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B
Just one year later, sales double from 1 million to 2 million cans, and then they double again to 4 million units sold by year three.
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A
I mean, that's hockey stick growth, man.
- [28:21]
B
But hang on, Nick. Yeah, Jack, not to rain on Red Bull's parade, which we are. But three years is nothing in a product's life cycle. Red Bull is flying high at this moment, but they're still just in Europe. This is what you'd call the fad zone. We've seen a lot of drinks look really good only in hindsight to realize they were fads. Jagermeister, Fireball Whiskey. Truly spiked seltzer. They all dominated college campuses, but each one fell off after a while when the next thing came along.
- [28:50]
A
One sec, Jack. Hold my white claw. I got to pour out a four Locos. You mentioned all these brands that have passed us.
- [28:55]
B
Exactly.
- [28:57]
A
So right now, besties. Red Bull, it's the hot one. But does it have staying power? That's a different question. If Dietrich wants to push past the fad zone, he's going to have to upgrade. From scattering empties around all those college bars, he's going to have to make Red Bull stand for more than just an energy drink. It's a brisk morning in lovely Vienna, along the banks of the Danube River. A curious crowd is starting to gather around a temporary pier jutting out far above the water. Teams of competitors are dressed in wild, costumey getups. Some have helmets on, a few are wearing capes. One of them peers over the edge of the deck, judging the 20 foot drop to the murky waters that lie below.
- [29:40]
B
Suddenly, everyone's attention focuses on a team at the far end of the Runway. They're wheeling out a plywood contraption built atop an old bicycle. On the back, dragging awkwardly, is a handmade set of wings.
- [29:54]
A
The caped competitors grab this flying machine on either side. And one brave soul hops into the seat and straps himself in. And together they push this contraption toward the end of the pier with just their adrenaline fueled manpower. And at the very last minute, everyone pushing. Let's go. Only the rider sails off the edge, wings trying desperately to catch the air. But they can't. And the flying machine tumbles down into the river below.
- [30:26]
B
A moment of silence. Spectators hold their breath, and then everyone cheers. The rider is fine, whooping and cheering as he doggy paddles over to the shore.
- [30:39]
A
Okay, so the contraption, it's obliterated. But honestly, that's the point. Because what we are watching is Fluke Dog. That means flying day in German, by the way. And it's a sport that Red bull invents. In 1992, the first event, it's in Vienna, but then they'll sponsor it yearly in cities all around the world.
- [30:58]
B
It's inspired by the drawings of Leonardo da Vinci, who, as we learned in that first Red Bull commercial, spent years trying and failing to design a human powered flying machine.
- [31:08]
A
He didn't have wings.
- [31:09]
B
So Fluke Talk is brilliant. It encourages everyone from aerospace engineers to fearless college kids to meet up and build their own flying machine. Each attempts to build a flying machine that they can push down the plank using human power only. And the winner is the team that goes furthest in the air before crashing into the water.
- [31:29]
A
Human powered is key, Jack. I just happen to have the flug tog rulebook right here with me. And it says that you cannot use motors nor engines in your contraption. Just muscle, gravity and imagination.
- [31:42]
B
This fake sports mix of whimsy, creativity and a little bit of danger captures the exact brand identity that Red Bull wants to cultivate.
- [31:51]
A
Once Dietrich Mateschitz takes over Red Bull, the number and the type of sporting events that the company gets involved with, oh, it just explodes. But here's the interesting thing. Red Bull starts focusing only on extreme sports. If you need to sign a waiver just to watch the event, Red Bull wants to sponsor that event.
- [32:10]
B
Red Bull sponsors their first athlete in 1989, an Austrian Formula One driver. But that's only the beginning. Soon it's cliff diving, windsurfing, a soapbox derby, a stunt flying team. They have a fleet of classic prop planes called the Flying Bulls. They attract crowds of 200,000 people.
- [32:30]
A
Because Dietrich wants Red Bull to stand for more than just an energy drink. He understands that Red Bull needs to represent energy, while other brands, they're just going to play it safe out there. But Dietrich, he wants the sport where your life is on the line.
- [32:45]
B
Like Nick, and I say there's opportunities in the extremes.
- [32:49]
A
Yeah, if you choose the most extreme version of anything in any industry, there is no competition on one side of you. It's just like Chalio, who went hundreds of miles into the remote provinces to sell his product in Thailand. Dietrich is going out of his way to stake out new uncharted territories.
- [33:07]
B
And he doubles down on this strategy of extreme sports. When Red Bull finally arrives in America in 1997, he avoids the traditional American sports like football, baseball, hockey, basketball. Instead, Dietrich leans into the sports where people are airborne or where people are plunging into the ocean or where people are jumping off cliffs.
- [33:27]
A
It's a lot more bang for your sponsorship. Buck A 32nd Super bowl ad that's going to cost you millions of dollars. And every product is just one among dozens. For that money, though, you could buy an entire soccer team.
- [33:40]
B
That's what Red Bull actually does. They buy an entire soccer team. This is unheard of. Instead of just sponsoring, Red Bull gets into buying professional sports teams. Today, Red Bull owns four soccer clubs. One in Austria, one in Germany, one in the United States and one in Brazil. They even pull off arguably the greatest sports acquisition of all time. Steinbrenner thought he got it good by buying the Yankees. In the 70s, Red Bull bought a Formula One racing team from Ford for $1. They wanted it off their hands because they'd been losing races and losing a lot of money.
- [34:19]
A
But here's the wild development. Once Red Bull takes over that racing team, they don't just slap their name on it and move on with their day. They Turn it around. 180 degrees. Red Bull's racing team. They end up winning four world championships. Then Red Bull starts attracting sponsors from other companies for their racing cars. And now those racing cars are generating revenue for Red Bull.
- [34:43]
B
The more they start winning, the more revenue they start seeing. The cost center has become a profit center.
- [34:49]
A
This is a financial phenomenon that's called Win on Sunday, sell on Monday. When people see a brand name attached to a winning sports team, it boosts sales of the associated product. The very next day, the data backs it up. Sebastian There is no question that Red Bull's domination of the sports world it was paying dividends for the company. By the time Red Bull's original founder, Chalio Uvidia passes away in 2012 at the age of 89, this company is selling 3 billion cans of product a year.
- [35:18]
B
They were only selling 1 million units per year in 1987. So in 25 years they have 3.3000x their sales. But get ready besties, because as high as Red Bull is flying right now, they're about to go into free fall.
- [35:34]
A
Spoiler alert in a good way.
- [35:38]
B
This episode is sponsored by Abbott. Let's talk about a small thing that can make a big difference if you have diabetes. The Freestyle Libre 3 sensor. It's amazing how the sensor gives you real time glucose readings so you can see the impact of every meal and every activity. To make better choices. The Freestyle Libre 3 Plus sensor can help you live life with diabetes on your terms. You can try it free at FreestyleLibre US offer available for people who qualify. Visit MyFreestyle US to see all terms and conditions. Certain exclusions apply for prescription only. Safety info found @freestylelibre us.
- [36:18]
A
It is a cloudless October day in Roswell, New Mexico. The sun blazes across the desert, but the light disappears when a technician closes the door to the hatch in a teardrop shaped capsule that looks not unlike a can of Red Bull. The skydiver and daredevil Felix Baumgartner awaits. And then the massive helium balloon that he's attached to drifts up and up and up towards space.
- [36:44]
B
It's 2012, and the man they call Fearless Felix is about to attempt a world record free jump. 128,000ft above the warm desert sands.
- [36:56]
A
128,000Ft is over 24 miles, or as high as 88 Empire State Buildings. This stunt, it puts Felix above our atmosphere. Once he's reached the peak, he's actually going to be in actual space. So it's time for him to check in with mission control on the ground back in Roswell. That's Red Bull Mission Control.
- [37:18]
B
This is the Stratus jump and it's got Red Bull written all over it. From the space capsule to the Crane to the YouTube channel, live streaming to millions of people.
- [37:30]
A
Now, if anything does go wrong with this stunt, it's going to be all on Red Bull's heads. So everyone on the ground is concentrating hard, making sure they check everything twice and then triple check it again.
- [37:39]
B
So when this helium powered capsule finally hits its top altitude of 128,000ft, Felix takes a deep breath and remembers he's a professional. He opens the hatch, face covered by his space helmet. This is his Neil Armstrong moment. He thinks of something to say to the millions of viewers glued to their screens watching him. And here's what he comes up with. I know the whole world is watching right now. I'm going home now.
- [38:11]
A
And then, just like that, he tumbles head first into nothing. By the time mission control says jumper away, he is barely a dot on the screen. Felix is falling for 24 miles in the air and he's rocketing straight down to earth.
- [38:26]
B
The Stratus free fall lasts 4 minutes and 20 seconds. That's the same length as Taylor Swift. Blank space.
- [38:32]
A
And at second 42, when Taylor is singing Grab a passport in my hand.
- [38:36]
B
Felix reaches 834.4 miles per hour. Pretty fast, Nick. That is one and a quarter times the speed of sound. In fact, he becomes the first human outside of an aircraft to break the sound barrier.
- [38:51]
A
Eight million human beings watch this legendary Stratos jump live on YouTube at the time. This actually sets a record for most concurrent livestream viewers. And that's on top of the record Felix breaks for highest free fall and highest manned balloon flight. Red Bull, they like it.
- [39:08]
B
Finally, he opens his parachute and glides gracefully to the earth. The stunt is a total success. Red bull sales jumped 13% globally in just six months to over $5 billion.
- [39:23]
A
In like we Said win on Sundays, sell on Mondays.
- [39:26]
B
Our man Dietrich has come a long way from selling toothpaste in Bangkok. He literally put his brand into space. Red Bull is soaring to new heights in every sense. But little do they know they're about to face the absolute worst news a company can hear.
- [39:44]
A
Now, yetis, as a brand, Red Bull has embraced extreme sports, risk taking, and a spritz of danger. But what happens when people think your product is actually dangerous?
- [39:55]
B
Well, In Ireland in 1999, an 18 year old sadly dies after drinking three Red Bulls with friends and then playing basketball. Obviously this is a horrible tragedy.
- [40:06]
A
And after a lot of investigating, it seems like the drink itself wasn't responsible. Remember, Red Bull actually only has half the caffeine of a Starbucks coffee. But still, three Red Bulls, that is a lot all at once. So Red Bull, they're gonna have to answer some questions. And officials, they start asking those questions. Red Bull actually gets banned in the early 2000s in France and then in Denmark and then in Norway.
- [40:29]
B
This isn't some company recall. These are governments banning Red Bulls outright. This is the kind of thing that could totally kill a brand.
- [40:38]
A
But, Jack, if there's one thing again, we know about our boy Dietrich and the entire Red Bull story, it's that they just keep going forward.
- [40:47]
B
Instead of killing the brand, the brand actually gets stronger with younger male customers.
- [40:52]
A
Drinking it feels risky, which is why the young male demo becomes even more interested in Red Bull. Demand actually grows.
- [41:00]
B
Eventually, politicians start to realize that the ingredients in a Red Bull aren't any worse than a strong Earl Grey tea. So the ban eventually goes away, which is now double good for Red Bull. More than ever, Red Bull enjoys the benefits of being a safe brand. With the mystique of an edgy brand.
- [41:17]
A
The sales recover and Red Bull helps create a massive sector that is still booming to this very day.
- [41:24]
B
The energy drink market has grown more than 65% in the last 10 years, crossing $208 billion last year. And Red Bull is still sitting right at the top of that market, especially in the United States.
- [41:37]
A
Red Bull is the number one energy drink in America to this day. They're bringing in $7 billion in US sales just in 2023.
- [41:45]
B
That's 40% more than Monster Energy, 10 times more than Rock Star Energy, and 14 times more than Ghost Energy.
- [41:53]
A
All of that is in one category that did not exist in America until the late 90s.
- [41:58]
B
And all of this growth comes without really doing much to diversify their actual product line. If you set aside the multiple sports businesses that they still own. Red Bull's only consumable product is that can of energy drink.
- [42:12]
A
Yeah, Red Bull does a sugar free version in 2003 and they do some seasonal edition flavors in 2012. Pumpkin spice. We're still waiting on it. But if you think about all the categories Red Bull has not touched, Jack, I mean that is like a whole lot of categories right there.
- [42:28]
B
There's no Red Bull cereal, there's no line of Red Bull protein bars. Crucially, there's no Red Bull spiked seltzer or pre canned vodka cocktails.
- [42:36]
A
I mean, not getting directly into alcohol was probably a wise move. You saw what's happened to the Truly's and the white claws out there.
- [42:42]
B
And you saw what happened to Four Loko. It got banned because it was a combination of alcohol and energy.
- [42:47]
A
Dietrich really showed a powerful combination of skills after going all in 25 years ago. Not just the ability to take huge risks, but also the ability to show huge restraint where it counts.
- [42:59]
B
Dietrich died in 2022 at the age of 78. The New York Times remembered the thrill seeking Austrian with this thought. For Red Bull, sports is marketing and marketing is sports. And the company won't stop until the two things are one.
- [43:14]
A
Mission accomplished. Thanks for staying up past 4am with us on this one. Now you've heard the entire story of Red Bull. So Jack, I gotta ask you, what's your takeaway?
- [43:25]
B
Every business should be guided by a North Star word. Early on in Red Bull's growth, Dietrich Mateschitz and his team recognized that Red Bull isn't about selling beverages. It's about that feeling of energy. Once they identified that key word, it could pursue new opportunities that were vastly more powerful than just selling a drink. Not just the sports stuff. We didn't even get into all of Red Bull's brand extensions.
- [43:49]
A
True, Jack. We didn't even jump into this like.
- [43:50]
B
Their documentary and broadcasting vertical, Red Bull tv.
- [43:53]
A
I mean, Jack, if you're hosting live sporting events, you got to have a way to stream them, I guess.
- [43:57]
B
And that's a category they might never have discovered if they hadn't been following the North Star word energy. What about you, Nick? What's your takeaway?
- [44:05]
A
For a product to flourish, you need a seed and you need fertilizer. Now Chalio Youvedia, he created the product, that's the seed that was the original Red Bull. But it might have died without Dietrich providing the fertilizer of incredible marketing and big brand extensions. It shows that you don't need to have a product idea to be an entrepreneur. You can bring the marketing power to a great product idea. It's just like a car needs gas, Justin Bieber needs Usher. You need the product and you need the marketing man. It takes a seed and fertilizer for your product to grow.
- [44:41]
B
And now for my personal favorite part of the show. I'm a trivia guy. The best facts yet.
- [44:48]
A
The hero stats, the facts and the surprises we discovered in our research, but we just couldn't fit into the story.
- [44:54]
B
Here's number one. Remember those kids on college campuses offering free Red Bull to their friends?
- [45:00]
A
Yeah.
- [45:00]
B
Jacked. Well, in 2006, Red Bull pimped their rides. Red Bull and Mini Cooper created a branded Mini Cooper featuring a giant Red Bull can welded on top of the car.
- [45:11]
A
These things, they make Google Maps cars look extremely subtle.
- [45:15]
B
Here's another one. In 2013, someone actually sued Red Bull for not actually giving them wings.
- [45:21]
A
Now, Jack, that is funny. But the funnier part is that Red Bull settled that lawsuit for $13 million.
- [45:26]
B
Red Bull agreed to give every Red Bull customer $10 or $15 in Red Bull credit. No proof of purchase necessary.
- [45:35]
A
Red Bull, they'd rather give out free product than go to court.
- [45:38]
B
Classic. But rumor has it that lawsuit is why Red Bull's slogan changed from Red Bull gives you wings to Red Bull gives you wins with three eyes in the wings. Those three eyes, they're a legal liability shield.
- [45:54]
A
Add a few letters, never get sued.
- [45:56]
B
And that, my friends, is why Red Bull is the best idea yet.
- [46:00]
A
Now, if you'll excuse us, Jack and I have one hour left to get this term paper in on the next episode of the Best Idea yet. Grab your monocle, hold the railroads, and Jack, I'm going to need my damn 200 bucks.
- [46:13]
B
Right now, we're covering Monop, the board.
- [46:17]
A
Game that changed it all.
- [46:20]
B
Follow the Best Idea yet on the Wondery app, Amazon Music, or wherever you get your podcasts. You can listen to every episode of the Best Idea yet early and ad free right now by joining Wondery plus in the Wondery app or on Apple podcasts.
- [46:32]
A
Before you go, tell us about yourself by filling out a short survey@wondery.com survey the best idea yet is a production of Wondery hosted by me, Nick Martel.
- [46:45]
B
And me, Jack Crevici, Graham.
- [46:47]
A
And hey, if you have a product you're obsessed with, but you wish you knew the backstory, drop us a comment. We'll look into it for you. Oh, and don't forget to rate and review the podcast.
- [46:55]
B
Our senior producers are Matt Beagle and Chris Gautier. Peter A.R. cooney is our additional Senior Producer. Our senior Managing Producer is Nick Ryan and Taylor Sniffin is our Managing Producer.
- [47:04]
A
Our Associate Producer and researcher is H. Conley.
- [47:07]
B
This episode was written and produced by Katie Clark Gray.
- [47:10]
A
Special thanks to Adam Asaraf.
- [47:12]
B
We use many super sources in our research. A few that were essential for this episode were the Soda with Buzz by Kerry Dolan for Forbes and the Hidden Truth of Red Bull by Mitchell Hazelwood. Sound design and mixing by CJ Drummler.
- [47:25]
A
Fact checking by Molly Artwick Music supervision.
- [47:28]
B
By Scott Velazquez and Jolina Garcia for Freeson Sync.
- [47:31]
A
Our theme song is Got that Feeling Again by Blackilac. Executive producers for Nick and Jack Studios.
- [47:37]
B
Are me, Nick Martell and me, Jack Revici Kramer.
- [47:40]
A
Executive producers for Wondery are Dave Easton, Jenny lauer, Beckman, Aaron O'Flaherty and Marshall Louie.