...School case from 2002 shows BMW attempting to focus purely on branding BMW in order to surpass competition in marketing innovation, gain market share and reach new sales goals of an additional 40% in the US. This focus on branding resulted in the production of 5 short films under the name BMWFilms that attracted the younger generation and neglected the current consumers. BMW should supplement this with advertising focused on their current consumer as well as additional customer service benefits for their current consumers who could progress from the 3 Series to 5 Series to 7 Series if properly maintained. Additionally, BMW in efforts to differentiate itself with seven new series in 2002 may potentially cannibalize the brand and force entrance into the mass-market. In order to avoid this issue BMW should focus on differentiating series and cars models from each other to better target their customers. In 2000, BMW had reached new record high sales in the United States after recovering from a record low in 1992. Due to this new high of sales along with no new car production for the next six months, there was an opportunity for branding BMW’s name specifically to differentiate it from the competition. This opportunity led to the creation of five short films that were only available online at BWMFilms.com. BMW hired Clive Owen as well as A-list producers to create these 5 short films that showcased BMW cars as supporting actors in dramatic plots. These films neglected the BMW customer...
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...HBS CASE: BMW FILMS 11/11/13 S. Kursat Sornaoglu 012541488 1. How fit is the BMW brand at the time of the case? Are there any reasons to anticipate undesirable financial performance in the future? BMW is well fit and is able to sell it's products easily. There is no reason to anticipate any financial problems. 2. What is BMW’s unique selling proposition? Describe a typical BMW’s target customer and how the company’s products fulfill his needs. They sell the world's most exciting luxury cars which are the ultimate driving machines. A typical BMW customer is a highly educated individual in late 40s with a high income. They are usually married but don't have children. They are hard workers and they don't have spare time. The time they spend on driving is the most pleasurable time in their day. Therefore they want this time to be as enjoyable and comfortable as possible. 3. Using research findings presented in the exhibits (especially Exhibit 11), perform a critical evaluation of the effectiveness of BMW films in attracting potential customers to the brand. Median age and the, age segments who watched this video a lot is not the described core customers of the company. So it is sure that these videos reached out to people who are not the customers of BMW. 84% of the viewers aren't BMW customers and they recommend the video to others. These aspects shows us that the videos definitely caught the attention of the targeted group. Their 88k income level is a good indication showing that...
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...BMW is one of the three European luxury vehicle powerhouses. BMW is known for its high end luxury vehicles but when the company was founded, automobiles were not its number one priority. In fact BMW didn’t start creating automobiles until 13 years after BMW was founded. BMW was founded March 7th 1916. Originally BMW mainly produced aircraft engines. They produced these engines until the end of World War 1. The Versailles Armistice Treaty halted their production because their engines were used in military planes. BMW changed gears and began to produce motorcycles in 1923 and finally started to produce automobiles in 1929. In 1928 BMW acquired the production plant of the popular Austin Seven. They released their first vehicle in 1929 which was the BMW 3/15 PS DA 2. Since then BMW has grown and grown acquiring several more automotive companies over the years to expand their brand. In 2012, Forbes.com stated that BMW is the most reputable company in the world. By the numbers, BMW is astonishing. In 2012 BMW produced over $100 billion in revenue with roughly $7 billion in profit. The fact that BMW has market presence in over 150 countries helps us understand where all the money comes from. Just recently in 2003 BMW entered the Chinese automobile market. Since then China has become BMW’s 2nd largest market ahead of the USA. They chose China for several reasons. The main reason is because of the extreme amount of potential that the Chinese Market has to offer. The first projection...
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...the pricing and distribution of their products. However, there are not that many small parts manufacturers in this market and therefore, the majority of suppliers to major automotive makers are medium to large businesses. As a result they have some flex in determining product pricing, delivery, and distribution. Power of Buyers - Medium While buyers are individuals and are not grouped together, they still have an immense amount of information available to them regarding the pricing and cost to manufacture a BMW. As a result, buyers do have some leverage in being able to negotiate a purchasing price from BMW. Competitive Rivalry - Extremely High Any competitor in this market is generally a global company with billions of dollars in assets and can compete on any level that BMW can. Furthermore, there is intense competition on all fronts in the car market in general, not to mention the luxury car market. Major manufacturers such as Toyota and Honda are pinching BMW with their luxury segments (Lexus & Acura) in terms of quality product and...
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...HBS CASE: BMW FILMS 1. How fit is the BMW brand at the time of the case? Are there any reasons to anticipate undesirable financial performance in the future? How fit is BMW at the time of the case? Justify: BMW is very fit at the time of the case, which was August 2001. Verify: During the period from 1996~2001, BMW sales rebounded and eventually reached record levels in the US Quantify: Compared to their slump around 1991 where BMW sold around 55,000 cars, they were able to sell 190,000 in 2001 in the US Are there any reasons to anticipate undesirable financial performance in the future? Justify: No Verify: 1. Because BMW’s US unit sales have been increased since 1991. 2. The BMW films were launched in 2001 with great success. Their creative, innovative style of marketing through short films that were directed by big name directors starring famous actors have given them more positive publicity than ever. 3. BMW was also planning on introducing new products including the redesigned 7-series, new Z4 Roadster, and the $20K subcompact Mini-Cooper. Quantify: Analysts were reporting that over the next few years, BMW was planning to increase US sales by 40%, to 300,000 cars a year. Keep in mind that as of 2001, they sold roughly 190,000 units. 2. What is BMW’s unique selling proposition? Describe a typical BMW’s target customer and how the company’s products fulfill his needs. Unique Selling Proposition: The factor or consideration presented by a seller as the...
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...Motoren Wekre (BMW) is a German automobile, motorcycle and engine manufacturing company founded in 1916. A number of different candidates have been put forward as the “founder” of BMW. In the absence of Karl Rapp, Gusstav Otto, Max Fritz or Camillo Castiglioni the company probably never would have been born. However, Franz Josef Popp can lay claim to being the prime force in the development of the mobility company we know today. The rise of the BMW to one of Bavaria’s and Germany’s big industrial companies began in 1922 under Popp’s management. He was the general director of the company from its foundation until he was forced to relinquish his position in 1942. BMW entered existence as a business entity following a restructuring of the Rapp Motorenwerke aircraft engine manufacturing firm in 1919. After the end of World War I in 1918, BMW was forced to cease aircraft engine production by the terms of the Versailles Armistice Treaty. The company consequently shifted to motorcycle production in 1923 once the restrictions of the treaty started to be lifted, followed by automobiles in 1928-29. The circular blue and white BMW trademark symbol we see today is portrayed by BMW as the movement of an aircraft propeller, to signify the white blades cutting through the blue sky. The emblem evolved from the circular Rapp Motorenwekre company logo, from which the BMW Company grew, combined with the blue and white colors of the flag of Bavaria, reversed to produce the BMW roundel. These colors...
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...BMW, renowned as one of the world leaders in the production of precision automobiles is not a company that has rested on the laurels of it products nor has the company allowed its success to hamper efforts to expand and remain a top competitor in the global market today. Begun as Rapp Motoren Werke, in Munich Germany, as an airplane engine manufacturer, in 1916 by Karl Friedrich Rapp, a well know engineer. (Rudelius, 2011) Nearby, Gustav Otto, set up his own shop, Gustav Flugmaschinefabrik, building small aircraft. Due to Rapp’s manufacturing problems, his company secured a contract with Austro-Daimler in order to fill orders that they could not keep up with; ultimately, Austro-Daimler expanded too quickly and was not successful. In 1916, Rapp resigned from his company and Franz Josef Popp and Max Friz, two Austrians, took over the company. In March of 1916, Rapp Motoren Werke merged with Gustav Flugmaschinefabrik to form Bayersiche Flugzeungwerke. It was renamed Bayersiche Motoren Werke (Bavarian Motor Works), which is today known as BMW. In 1917, BMW’s first aircraft, the type IV, went into production. Flying the type IV aircraft, in 1919, Franz Zeno Diemer set an altitude record of 9,760 meters. Due to restrictions set by the Treaty of Versailles, BMW briefly switched from the manufacture of airplanes to the manufacture of railway car brakes. In 1922, BMW was again to begin the making of aircraft engines. This period was marked by many successes as shown through no fewer...
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...This case is based in the 90’s era when BMW decided to reinvigorate its sales and brand, make the BMW brand global and penetrate into the US market. The key challenges that lie in front of James McDowell, VP Marketing at BMW (NA) to launch a Phase II program for BMW Z3 Roadster are: a. Design a marketing campaign to create a sustained product excitement, continuing what was generated from Z3 Phase I program, until product is available at dealer stores b. Attract consumers based only the demand that can be met with production c. Choosing between Non-Traditional and Traditional media 1. Was the Z3 Phase I launch successful? In order to understand whether Z3 Phase 1 launch was successful, we need to look at different pieces TG, Objective, Creative Strategy, tactics and end-result first and then combine them to view the holistic success. Target Group and its need: NA consumer who is Luxury/Performance driven, has lover of life mindset and propensity to seek unique expression of individuality. Further he/she is looking for ultimate driving machine that provides excitement similar to what can be derived from driving a motorbike. Includes everyone from aspirational GenX to nostalgic baby boomers. For this target group, the communication objective of the Z3 Phase 1 Launch were as follows: a. Get people talking and excited about BMW Z3 in the context of American culture b. Stimulate the dealer network c. Build an order bank to enable the Spartanburg plant to build specification...
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...1 Nate Lindstrom Professor Fruchter Marketing Principles 10 February 2011 BMW Case Study Analysis According to a 2000 poll conducted by Gfk Roper, women buy 60 percent of new cars and 53% of used cars. A 2009 poll by NBC/Universal shows much of the same: ³eight of 10 women say they are involved, solely or jointly, in car purchase decisions. And a third say they make those decisions themselves´ (Motavalli, 2009). It logically follows that since women easily account for more than half of all car purchases, the marketing efforts of a car manufacturer, such as BMW, should focus on their female demographic. After all, why would they market their products to the minority demographic? Curiously, this is precisely what BMW has decided to do. In a case study of BMW¶s marketing efforts published in Marketing, 10th Edition, authors Kerin, Hartley, and Rudelius list at least three aspects of BMW¶s branding and marketing that they believe lend the most appeal. First, ³BMW is fortunate²we don¶t have too much of a dilemma as to what we¶re going to call our cars,´ says Jim McDowell, vice president of marketing at BMW. He¶s referring to the fact that BMW names their cars using simple numbers and letters²for example, the M3 or the 7 series²rather than using unique names as so many other manufacturers do (Kerin, Hartley, & Rudelius, 2011). Lindstrom 2 Second, the authors identify that BMW has been successful as placing its vehicles in four different James Bond movies...
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...MARKETING MANAGEMENT CASE STUDY : Launching the BMW Z3 Roadster SYNOPSIS BMW, a German automobile manufacturer, known for its German engineering and quality, had established itself as a strong brand in the luxury/performance segment in U.S.A. However due to increasing competition from car makers such as infinity, Lexus, Acura, its sales dropped during the period mid 80’s to late 90’s . The case deals with the launch, of the now infamous BMW Z3 roadster, a car that revolutionized and rejuvenated the boring American motor industry back in the mid 1990's. The case talks about the successful first phase launch of this new drop top beauty. It focuses on the customers and how they suddenly picked up the marketing cues and stories depicted by the various promotional parties that were led by James McDowell, BMW's marketing vice president. This was a marketing campaign that gained a lot of merit and success by using unconventional promotion methods to put their product out into the public. The primary methods tried to stay away from the usual billboards and print media. Rather, the marketing teams decided to take the car into the new world of cinema and multimedia, where sound, sight, video and technology would promote the car during a time of accelerated IT growth. The team at BMW decided that since the Z3 was a new unconventional' car, it also required equal unconventional marketing methods to match its identity. The BMW Z3 was a lifestyle car and what better way to put this...
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...quality? Cause and Consequences of BMW quality problems In this case, there are few cause and consequences that BMW face during their production with newly launch products and resulting in some major impacts that puts BMW in disadvantage position when competing with its competitors. One of the reason that affects the launch quality was the designing time duration. In styling, BMW took around 2 years on designing and finalize the launch products which is longest time would be spend on any automobile company. However the Japanese automobile company would likely only to spend no more than 6 month to finalize the products which is 3.5 times effective then BMW. Nevertheless BMW argues that the time were spend in this stage was essential as they have to work from creating a excellent durable design and also to ensure every single components to ensure it fits and matched into the launch products. This slow decision making process by BMW may cause few impact towards the company and even loss. According to Gilani Natasha, he state that business with slow decision making process may cause organization to increase organization cost and impedes performance. Besides that, BMW also will lost their competitive advantage towards its competitors as they could not able to produce as much variety of choice of launch products then the Japanese automobile company because of the time duration were took too long to proceed for a launch products. Besides that, BMW use to identify problems in the development...
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...BMW Case 1. What was BMW’s position in the market in 1986? Who was buying BMW and what were they buying? BMW was in a leadership position in the U.S. market as it peaked at 96,000 units sold. Its worldwide performance had continually improved. It was the “high flying” brand of the 1980s, the ultimate “yuppie” status symbol. Generally, younger affluent customers, the most demanding market segment, are buying BMW’s. More specifically, people that make a median income of 100 thousand to over 200 thousand dollars and people with median ages from 39 to 46 are purchasing BMW’s. The trend is that the customer who is younger who makes a lower income buys a lower series of BMW. 2. What caused the unit sales decline from 1986-1991? Could BMW have prevented it given its position in 1986? The U.S. car buyers’ values changed value-orientation and BMW’s marketing and new product development did not change to meet this change. The three external events that affected this change were: The 1987 Tax Reform Act, The Stock Market Crash of 1987, and The Luxury Tax imposed gas guzzler tax doubled. BMW definitely could have prevented the sales decline by aligning their marketing strategy to value-orientation while they were a leader. They are in a highly competitive industry where it is important to constantly connect with your customer. They lost sight of this and did not change with the times. 3. Evaluate Gerlinger’s performance. What has he accomplished to date? Can...
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...OVERVIEW In 2001, BMW came out with its latest innovative marketing strategy titled BMW Films. In partnering with Fallon and Anonymous Productions, who connected with A-list directors, actors, and production value, created a series of five films collectively called “The Hire” that generated 2.5 millions viewers with over 24,000 more unit sales than the 2000. And the question now rise to what should BMW’s next move be. ANALYSIS It took the firm about 50 years from its first automobile in 1929 to be firmly established in North America. But right when other Japanese cars entered the market in in the late 1980s, BMW went from one of the most brought luxury car to falling behind Lexus who became the number-one luxury import in the country. The brand had an outdated image and U.S sales went from 96.8 (thousands) in 1986 to 53.5 (thousands) in 1991 supported by Exhibit 1 and 4. But after taking drastic measure of reinvigorate itself in North American by introducing newer models and series that were more suitable for the North American market, a new brand image arose and BMW sales rebounded reach records level from 1996-2001. In 2001, BMW was definitely in its maturity phase where it has enough brand awareness amongst its target market that it didn’t’ need an extravagant marketing budget. In Exhibit 2, out of the luxury brands top 5 highest total sales, BMW was the second most selling brand while only spending half (62.4 million) of its competitors (134-215 million). BMW attracted a...
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...BMW Case Study A. The BMW customization program “Dream It.Build It.Drive It.” for X3 series compact SUV model had driven sales across North America. Joseph Wierda, BMW product manager was contemplating using the same marketing strategy to drive sales across all BMW product lines. He was particularly interested in using this customization strategy for flagship brand X5 and a new model X4 launching in 2015. The major marketing challenges to implement this customized program were as below: * Regional and Global Manufacturing Strategy: In North America compared to Europe, customers wanted immediate delivery. Purchase of a car was a major decision and that meant there was a high emotional value attached to the purchase. Customers wanted to experience thrill and excitement attached to car purchase. To solve the problem of immediate delivery for North America and to maintain customer interest during the sales process, BMW team made significant adjustments at the plant, in BMW’s supply chain and IT systems. For X3 series, they even shifted their assembly line from Austria to South Carolina to reduce delivery time across continents. BMW‘s plant in South Carolina manufactured six different models including X5 and X4. For other models which are not manufactured in North America immediate delivery in few weeks would be difficult to achieve. As models manufactured outside North America meant increased shipping time between continents. So, the concept of “Dream It.Build It...
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...Case Study # 7: BMW Automobiles INTRODUCTION PROBLEM BUSINESS ENVIRONMENT Pestel Analysis Political * Geopolitical tensions and concerns about oil supplies, added to the uncertainty about the political environment due to war. * Employment laws vary in Europe, US and Asia. Economical * The financial crisis reduces the disposable income of consumers. * Taxes imposed by governments due to car’s emissions. * Equity prices fell. * Oil price went up so the derived product’s prices when up as well. Social * BMW have diversified into many different markets and countries meaning that they are dealing with different cultures, expectations, values and incomes. * Customers’ predisposition to select design and prefer brand appeal. Technological * BMW has had to invest in technology in order to maintain its competitive advantage and be able to offer high quality vehicles. * Developing eco-friendly technologies. Environmental * CO2 emission laws * Development of eco-friendly vehicles Legal * CO2 emission laws * Taxation laws in the countries where BWM has presence. As a result from the PESTEL Analysis we can conclude that BMW will require a good marketing plan to preserve their market position. Also, their employees will need to have to skills to develop sustainable technology; they will need to have the knowledge of the current legislation and how to implement it. We can conclude as well that...
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