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 according to customers
Marketing Plan:
The Z3 Phase 1 Launch Program used a 40:60 TM/NTM split and majorly revolved around using unconventional ways to create a buzz and match the ‘unconventional’ness that BMW was doing with Z3 brand. The Program heavily utilized its co-branding with MGM for James Bond GoldenEye movie and complemented it with other elements/ vehicles such as Bond Edition Catalog of Neiman Marcus, large scale PR event at Central Park and featuring on Tonight Show among others.
Success of the campaign:
1. MGM Co-branding: With respect to the MGM co-branding, not only did the image of James Bond blend well with BMW Z3 roadster’s brand personality but also it helped create a buzz among the TG, especially the aspirational GenX. Further, the film had the largest opening weekend ever for MGM and hence for BMW would have created a wider reach. As this was a no-fee deal the ROI was significantly high in terms of awareness, persuasion and buzz-creation. Additionally, MGM support the dealer initiatives in attracting more consumers and helped stimulate network.
2. Neiman Marcus catalogue: Once again, the catalogue was aimed well at the TG and was deemed to be a part of the unusual product offering, creating a buzz and aspiration among consumers. The response was overwhelmingly positive and generated 6000 orders for 100 cars production.
3. BMW Internet Site: With the inclusion of the “build your own roadster’ module, BMW attracted consumers who are tech savvy and aspirational to see the car being made themselves and was able to generate triple amounts of hits/ day and further was used by Apple in its site and TV Ad. Thus in terms of reach, buzz creation and awareness, the website proved to be a decent support.
4. Central Park PR Event: With the event involving 200 media representatives and a grand public launch, the PR event created help create a buzz and generate awareness through different print and broadcast media. Additionally, it was featured in many network channels and establish newspapers that most of the baby boomers and mid-40s of the TG can associate with.
5. Jay leno tonight Show, Radio DJ Show and Video: Although claimed on different parameters that these initiatives were successful/ well appreciated or at least unconventional, I strongly believe they did not do a great job of providing a support to the overall message/ association catered towards the TG. To me, they created a confusion as they took away the fun-sexy-unconventional product theme and went too specific in catering to only a certain demographic of the TG.
6. Traditional Media: Although the Z3 Phase 1 launch used different traditional media vehicles, the result of TV is only reported and suggested a 50% increase in the advertising recall, which the highest in a decade. Hence, TV was a successful component of the campaign as recall is a big part of awareness.
Overall, based on the information provided in the case, the strategy and tactics used in the Z3 Phase I launch proved to be largely successful in meeting its key objectives of creating, stimulating the dealers and building an order bank of. Also, given the extensive use of nontraditional media, the cost-efficiency was very high in the Phase 1 and hence, concrete success (9000 orders) seemed ever higher in terms of ROI.
2. Based on your analysis of Phase I, what should BMW do in Phase II? Be specific about the communications objectives, the creative strategy, media choices (e.g. “traditional” vs “nontraditional”), and tactics. Currently it is planning on sponsoring the Olympics, so be sure to address this option.
BMW was largely successful in attaining its objectives of Phase I and creating strong awareness around Z3. This resulted in the demand spike and product unavailability, which although perceived positively, cannot be a sustainable model of supply chain as in Phase II BMW will have to meet orders while being attracting consumers. Also, success in supply chain is critical to the SC plant in its first launch. Another consideration is to understand that the Bond association was going to weaken with movie getting older and new movies coming along but is worth capitalizing in the initial part of phase II. Based on these parameters, my suggestion for BMW for Phase II Launch is as follows:
Communication Objective: To continue the product excitement, generated from Z3 Phase I program, until the product is available at dealer stores
Creative Strategy: Theme – Unconventional Hero of an Unconventional Car.
Media Choice: Continue the 40/60 Traditional/non-traditional marketing split with a more integrated approach to build the Knowledge and Liking phase along with general awareness
Tactics: I recommend BMW use the following tactics:
1. Appeal: BMW should use a combination appeal of informational and emotional in order to give more product knowledge for interested consumers while attracting consumers.
2. Execution: I recommend we encode the message in appeal in the following way:
a. Celebrity Endorsement: BMW should cash bank on its association with the Bond movie and tie up with the actor, Pierce Brosnan for Celebrity endorsement for a quarter with the message – Unconventional Hero of an Unconventional Car! This will essentially, create strong brand recall and will continue enthusing people with the Bond connection.
b. Imagery: As Z3 sets in a luxury/ performance quadrant which involves high involvement and positive motivation, BMW should use a transformational imagery for aspirational consumer focusing again on the theme. As the awareness is already created, the imagery will help gain liking.
c. Association: F1 Racing branding for F1 enthusiasts.
d. Events: Participate extensively in auto shows/ luxury shows.
e. The Real Hero Contest: Conduct a nation-wide contest and test interested consumers with a Q&A associated with BMW Z3. Winners should be invited to factory and photos taken should be printed.
f. Sales Promotion: Support the dealers by training the sales representatives.
g. PR: Continue PR to create a countdown event showing what it takes to make a Z3. They can share these series of videos justifying the wait is going to be worth.
h. In terms of traditional advertising, both TV and Print should be used selectively. Specific network channels that reach to the target audience such as news, lifestyle shows and corporate talks should be used for advertisement slots. In terms of print, magazines, websites and newspapers that again cater to target for instance the Forbes should be used.
i. Olympics: BMW could be the title mobility sponsor for the Olympics torch event and can give tickets to customers participating in a draw) who have pre-ordered Z3.
Finally, in order to ensure that the demand-supply is steady, BMW can create a Pulsing-Schedule for Phase II. Moreover, for existing customers who have already placed orders, timely emails/ newsletters/ updates should be given along with the above.