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UNIVERSITY OF BRADFORD
ADVANCED DIPLOMA IN BUSINESS MANAGEMENT MODULE ASSIGNMENT MARKETING MANAGEMENT LECTURER: Mr. Roland Kiew Huizhong bei
5. 3. 7. Executive Summary & Overview of company 2. 8. 4. 6. CONTENTS 1. Early history STP Strategy Markets of BMW Marketing mix Conclusion Recommendation Refrences .
its blue-and-white color scheme also references Bavaria's blue-and-white checkered flag. In this report I will be focusing on: THE COMPANY ITS HISTORY & PROUCTS STP STRATEGY BMW’S MARKETS MARKETING MIX ANALYSIS Gallery Selection BMW is an acronym for Bayerische Motoren Werke AG-or. Bavarian Motor Works. the Dixi. the company began in the early 1910s as an aircraft manufacturer. The car proved tremendously popular. OVERVIEW OF THE COMPANY & EXECUTIVE SUMMARY This marketing report aims to examine and explain the marketing strategies of BMW . and its success helped the manufacturer weather the Depression. BMW's current logo. in English. the Germanbased company is one of the world's most respected automakers. reflects these origins. BMW's best-known pre-World . Founded in Munich. designed to represent white propeller blades against a blue sky. renowned for crafting luxury cars and SUVs that offer superior levels of driving enjoyment. It wasn't until 1928 that production began on the first BMW automobile. Whatever you call it.
a sporty family sedan. foreshadowing BMW's ongoing commitment to developing new technology. The best-selling BMW of that decade was the Isetta. Postwar BMW cars maintained this tradition. rallying and hill climb victories . winning several racing. It was soon followed by the 502 which was powered by the world's first lightalloy V8. BMW sales strengthened significantly. By the 1970s. The mid-'50s also saw the debut of the limited production and breathtakingly beautiful 507 sports car which had an alloy body and used the 502's V8 for propulsion. a petite two-seat "microcar" typically powered by a 12. In the 1960s. a roomy. thanks in part to the immense popularity of the 1500. a supple two-seater that racked up over 120 victories on the motorsport circuit between 1936 and 1940. voluptuous sedan that was resplendent with all of the hopefulness of that era. BMW was establishing itself as a full-fledged car company. . War II vehicle was the Type 328 roadster.or 13-horsepower engine. The early 1950s saw the launch of the BMW 501.
and markets. something it has done since the 1920s. became loyal "Bimmer" owners. BMW has also manufactured the first passenger car running on hydrogen ready for common use. the UK. With family-friendly wagons. BMW operates an aircraft engine division under the brand name of Rolls Royce. 5 Series and 7 Series cars and the creation of its performance M division. BMW's model roster is diverse. The company's slogans in English are "The Ultimate Driving Machine" and "Sheer Driving Pleasure". The company produces. nimble sports cars and spacious SUVs offered. manufacturing plant in the latter half of the 1990s and has expanded its brand empire to include Mini and Rolls-Royce. The '70s also saw the birth of BMW's three-tier sport sedan range consisting of the 3 Series. South Africa. But its luxury vehicles all share a common characteristic: the ability to make drivers feel gloriously connected to the road. distinctive coupes. and. and Convertibles etc) and motorcycles. Mexico. the USA." and it's not mere hyperbole. Malaysia. is one of the most successful multi brand premium automobile manufacturers in the world. the company has been expanding its reach worldwide. More recently. Germany. Indonesia. It opened its first U. BMW also continues to build motorcycles. In addition to cars and motorcycles. BMW is the parent company of the Mini and Rolls-Royce car brands. distributes and sells passenger cars (including Sedans. The automaker's famous advertising slogan describes each of its vehicles as "the ultimate driving machine. headquartered in Munich. The company has worldwide subsidiaries and manufacturing plants in Germany. crisp sedans. Thailand. Austria. including turbocharging and advanced vehicle electronics. formerly. The company manufactures. Over the past couple of decades. Motorcycles and Financial Services. BMW operates three business segments namely: Automobiles. Egypt. a varied range of a higher end sporty cars and motorcycles. the . It was a pioneer for many emerging technologies. BMWs have become the standard for performance and luxury in most of the "over $30. who coveted both sports and luxury cars. Rover (car)/Rover.000" segments. This was also the period when BMW of North America was established and consumers.S. Coupes. EARLY HISTORY BMW Group. although the production figures are limited by the lack of a respective filling station net. Brazil.
and also the group has many intangible financial services. BMW X 6 and the BMW Z4. BMW group is focused on fabricating a variety of tangible products. PLC and as well as Research and Development. The company has built its brand and continues to focus on the following core values which is shown in the . and BMW Z4 M Well I agree with the below statement which is being provided by BMW group which states that the BMW offers emotional product to the customers this could be seen or felt with their current marketing strategies also with their SWOT analysis. BMW 5 series. which through the strength of the brand and the substance of the product fulfil the customer’s wish for individualisation and differentiations”.www. and RollsRoyce of which I would be more only looking at BMW and would also demonstrate their marketing."We offer our customers emotional products.bmw. BMW X 5. BMW Group comprises of many segments within its vast portfolio. BMW 6 series. BMW M6. (Reference. BMW M5.uk). BMW is supported by 11 different model series which are: BMW C1. BMW 1 series. BMW X 3. BMW 3 series. MINI.co. and BMW 7 series. BMW’s mission statement is clearly defined as “To be the most successful premium manufacturer in the industry”. The main reason of BMW’s success is recognized by the development of a steady marketing policy. but I would be only concentrating on Automobiles. The BMW Group’s automotive which I am more interested in this easy is portioning of their portfolio consists of the three premium brands: BMW. Philippines and Vietnam.
trade fairs. Audi TT. USA and Germany these three countries as in comparison to other countries. Renault Clio. M5 . Rolls-Royce Phantom: Mercedes Maybach. magazine. 85. Super sports (M series). Volvo S80. Bentley Arnage. Peugeot 206 H/B.088 units sold in 2006 which beat the record of 2005 by 5. Mercedes S-Class. Volvo XC90. The markets that BMW would normally or likes to target are Sports Convertibles (Z3. Maserati 4200. which we can see with the current advertising strategies of the company. Touring / Estate (3 series. Acura MDX. GTI. Executive (3 series. Ford Focus RS. 68% sales in Italy. Alfa Romeo 147. Mercedes E-Class. BMW has always used a differentiated strategy. below figure. 7 Series: Audi A8 and S8. we can also point out that BMW also bank’s on the sensitively to the environment. also we can find out the competitors as their segmented markets. X5: Range Rover. Volkswagen Golf. we can see it in advertising campaigns on television. Z4: Porsche Boxster. Jaguar XJ series. 6 Series: Jaguar XK. Jaguar X-Type. However. Lexus LS400.Mercedes C55. Chrysler Sebring Convertible. and 4X4 (X5). 3 Series: Audi A4. Vauxhall Corsa and Toyota Yaris. List of few BMW Group’s series lines and brand names has to market specific competitors. Toyota Camry Solara. Lexus IS200. BMW ensures to have full satisfaction to their customers. below in figures it shows to break down of sales figure for different segment in BMW cars . Furthermore. Porsche 911.2% level increase in the sales. etc. Audi RS6. 5 Series: Audi A6. motor shows. Audi RS4. 1 Series: Audi A3. This markets suit different people within the specific segmentation. 3 series. VW Touareg. We can also find company explicitly expresses one or more of these values in all BMW advertisements. Super Executive (7 series). X3: Land Rover Freelander. Major Key markets for BMW group have approx.Mercedes E55. In addition to the message of these values. press. Volkswagen Polo. Moreover. 5 series). Mercedes M-Class. BMW still remains the world’s most successful premium car brand with 11. Lexus GX 470. Let have a look at BMW competitor analysis where we can find BMW is a provider of premium cars and primarily serves for customer as if life time experience for them. 5 series). Porshe Cayenne. and new Z4). BMW has always maintained this core values since the company’s inception. M Range: M3 Coupe . Mercedes C-Class. Jaguar S-Type. Golf. MINI: Mercedes A Class. Saab 9-5. this means that they aim on specific automobile markets.
BMW has remained consistent to its beliefs of focusing on the substance of the cars themselves. which runs through every BMW car. and more recently through different television commercials. This philosophy. The brand image has been built up by press advertisements. has been communicated through a number of TV and print ads. Throughout this campaign. .
reliability & quality. the main markets for BMW where they are doing more than 65% of sales are Europe & North America as these areas are both heavily industrialised locations which results into residents are financially positioned to buy upper market cars as they capita income is more. behavioural. Let’s see how BMW uses segmentation to identify specific buying characteristics. target choice. quality automobile . they also like to want a clean modern look or sports look. performance. performance. POSITIONING BMW uses three steps to targeting which are market segmentation. and the feel good factor of an established dealer network. Behaviourally these people have a successful image in their mind before buying the car. The image that BMW has managed achieved over the years is to position its self on the customers mind is superiority. To find more information BMW looks at the geographic. socioeconomic. The benefits required by these people are superiority. Geographically. technologically advanced. product positioning. STP STRATEGY SEGMENTATION. TARGET MARKET. and beneficial characteristics of society which helps them to target the market more effective. The demographics of people who are able to purchase a BMW are men and women aged 30 – 50 years old. demographic.
the outlook for 2004 by group management and industry observers was upbeat. This has lead to continuing sales growth throughout the international car markets. Important markets have also been the fast-growing UK. and etc.000. MARKETS OF BMW The main markets for BMW automobiles have been in Europe. with the markets of Germany and the US accounting for almost half the total car sales. the introduction of the BMW X3. E. Porsche. At the end of 2003. reliable and quality producer that BMW does but on the other hand Alfa Romeo is renowned for being stylish and performance breed but unreliable car as per the research.g. but the other models were also in significant demand. Exhibit 4 shows the details of automobile deliveries in 2003. This view was supported by the successful launch of the new 5-series. the USA. Jaguar. When we talk about Brand Recognition BMW is an instantly recognized brand name that has a reputation for its age-old tradition of quality. The market where BMW is position them is highly competitive. and image. Jaguar is seen as a luxury. becoming the biggest market for the group and overtaking the Lexus brand for the first time. Japan and the Pacific region. etc. Audi. Sales in the USA market have been particularly successful. price. and the Italian. Also many of us identify its logo from a distance during travelling in cities. The new BMW 1 Series and the BMW 6 Series cabriolet were launched early in 2004. The main manufacturers that BMW compete with are as discussed before to name a few are Mercedes. French and Japanese markets. producer. the 3-series and the 5-series. Most of these are blue chip manufacturers use differentiated strategies to produce large ranges of cars and has similar product life cycle which BMW follows. The positioning of these companies and their brands has been built up over many years but BMW has impressed their mark upon the public in a positive way with the help of good public relation and innovative advertising campaigning. specifically for 7-series and 5-series. The difference is that each of these companies relies on different brand images to sell their cars. In the Chinese markets there was growing demand for the higher end models of the range. Range Rover. Reason being for the competitive is the number of other automobile manufacturers that produce cars of a similar quality. this brand recognition allows BMW to redirect its resources from expensive advertising campaigns in a highly competitive market. Unlike other lesser known luxury car manufacturers. By far the most successful models were the MINI. Ford. the consolidation in Europe and Asia of the BMW Z4. The market in which BMW operates has being seen as good and loyal customers. . highways. as they grew by over 8 per cent on the previous year to 277.
BMW was planning to launch a new model every three months through to 2005. and BMW's long term ambition of being number one would be finally realized. Exhibit 5: BMW’s top ten markets 300 250 200 150 100 50 0 Ja pa n an y Fr an ce G er m Be lg iu m S Af ric a US A UK Ita na ly BM W 3 ls . had become the new Group's CEO. Helmut Panke. a nuclear physicist. Mercedes-Benz would then become number two producer of premium cars. and to achieve sales of 1. Exhibit 4: Automobiles delivered by the BMW Group in 2003 (1000 units) 1200 1000 800 600 400 200 0 I Se rie To s ta lD el ive rie s X5 W Se rie s Se rie s Ro yc e BM M W W BM BM Sp ai n Ch i Z4 IN W 7 BM W 5 Ro l BM In 2002. In 2003. providing a range of premium automobiles that ranged from the Mini to the Rolls Royce. The aim was to raise sales by 40 per cent a year for the next five years.4 million vehicles. and started a strategy of internal growth through market and product development.
For example: a car that does not start in the morning will not be liked by consumers. Price. THE MARKETING MIX Lets considered within the marketing mix can be put under four headings. It was an ambitious plan that if successful. where the Spartanburg plant was not running at full potential. he did not show it at the Annual Accounts of Press Conference on 17 March 2004. Product : The most important element in the marketing mix is the company’s product because this provides the useful requirements required by customers. 1. Place. Touring. Difficulties in dealing with labor cost control in the European political climate had also led BMW to expand its production facilities in the US. Panke was mulling over any of these concerns. If H. Compact • BMW 5 Series – Sedan. The BMW Group will never build boring products. The present models are: • BMW 3 Series – Sedan. often referred to as the 4 'P's: Products. Touring • BMW 6 Series – Coupe. when he said: We offer our customers emotional products. There is limited time and resources and decisions in one area will likely have an impact elsewhere. Marketing managers develop their products into brands that help to create a single position in the minds of customers. and China where a well qualified labor force cost much less than in the West. Convertible. which. Convertible . Promotions. as well as giving the group greater prominence and profitability would also effectively cure the problem of vulnerability to acquisition. through the strength of the brand and the substance of the product. the company was pushing hard in the US and Asian markets to find buyers for the high-end models that they had found difficult to sell in the flat saturated European market. Coupe. 'Mix' is an important term because each element of a plan cannot be considered in isolation. To achieve the targets it had set itself. fulfill the customer's wish for individualization and differentiation.
and 7 Series saloons. BMW knows the importance of making sure that not all of its products are at maturity at once. this does create problems. for 3 series its 7 years lifecycle and for 7 series is 7-years only for the 1’st model life cycle was for 9years. • BMW 7 Series – Sedan • BMW Z4 – Roadster • BMW X3 – SUV • BMW X5 – SUV • BMW M –Convertible. When exploring what mix is best suited to the product. This PLC system not only helps to ensure a more constant income. as this might result in the products beginning to decline at the same time normally the life cycle has a particular year when the car lunches and after certain years it on matured level where the company has to get something new in that series to lunch where customers can enjoy the product to the fullest and with few new features in the car. These are the 3. 5. Although it is attractive to have all the products within a portfolio at the peak of their sales at the same time.BMW has also been expanding its portfolio recently and this can be seen . but also allows for the development of replacement products on a consistent basis. It is clear that BMW has spread over a period of time the lifecycles of three products. Coupe Each product goes through what is known as a life cycle process. we need to consider where in the life-cycle your products lie which is shown in the below figure and then depending decide if there is need to make changes in the product and re-launch. For example BMW X5 launched at 2000 and then company lunched the higher or new version of X5 in 2006.
Let’s take an example of the pricing strategy that has been used by BMW for the 3-series is competition-orientated pricing. additionally 148 dealers are franchised to sell Minis.Manufacturer >>>>> Dealers >>>>> Consumers 4. There are more than 156 dealers in the UK who are franchised to sell BMW cars.000 plus dealers which are authorised to sell both new and used cars. regional publications and magazines.000 to £60. WCRS being the used since 1979. Promotion : BMW has always focused entirely on their cars with same advertising company. etc. Many of them have been being manufactured for many years now with several re-designs and re-launches 2. The above products are all fairly settled. There are many factors that can affect their car prices such as engine size. This is because the car industry is large and production costs are not so important and creating the largest profit is not as necessary as it would be for a smaller company. Outdoor campaigns. parts and after sales service products. A broad range of advertising is used by this agency such as television for branding campaigns and new car launches. Sales literature. the press with Tabloid weekend colour supplements. brochures. etc. Advertising Campaigns/Slogans used by the company in the past . `Pattern of distribution for BMW is shown below in the diagram which is followed by the company: . motor sport versions.000 plus. Worldwide BMW operate in more than 100 different countries with approximately 4. Alfa Romeo and etc. Price : BMW price ranges are from approximately £16. Audi. 3. by the presence of some new product launches in the last few years. Most of the Research shows that all other competitor such as VW. in the 3-series market is based around the same price. Placement : BMW use superior market Dealerships & Imports for non-dealer networked countries they have four car manufacturing plants in the UK.
Focus on the 7 Series 4. and organization. more technologically advanced and had created an image in mind of future customers that have best quality. In 2001. The New 7 Series: Designed for Peace of Mind. E. BMW – The Smart Choice Time Frame 1. BMW released film called "The Hire". a series few feature-quality short films for the Internet to support the release of new vehicles during launch. Focus on the 3 Series 5. Established itself over time from its introduction in the US market in 1974 (the First Great Opportunity) 2. franchise.Hespos. 2002). Slogans Used 1. In ‘The World in not Enough’ James Bond drove the new Z8 before the car had been launched and in ‘Austin Powers 3 – Goldmember’ the Mini Cooper was used. New strategy with a focus on brand & product. 1994. Each short film featured a central character called The Driver who "helped people through difficult . safety. BMW association is the ‘James Bond’ films from 1983.Positioned itself as the brand with the unique benefit of ‘a luxury car that provides an exhilarating driving experience with advertising. The Ultimate Driving Machine 3. Not Just Peace and Quiet 4.g. BMW core values at more attainable price5. the "Ultimate Driving Machine" (ref. This kind of move has helped BMW to position its Car and the brand in front of vast audience across global also this also indicated that the car was fast. 1997 and 1999. they are different from others. Ran for 15 years – Overall brand – focus on prestige 3. With BMW viral Marketing started developing BMW Films was the driving force of BMW's successful interactive marketing campaign. 2.
Communication : BMW has 24hour hotline numbers to help in communication with the company exclusively for certain model customers. and print and online advertising. 3 October 2005). hence making it more convenient. Convenience: BMW doesn’t have online purchase systems but due to the high price of their products BUT they have an online test drive appointment system for the 7 series using which doesn’t need to go to the store to test drive the car. 4. Customer solution : BMW strives hard to find out what their customers needs are and works hard towards fulfilling them . BMW Films series the promotional campaign consisted of TV spots that which showed trailers. 2002). "During the 1’st four month of the promotion. They have retailers selling their cars in different regions/countries at different prices based on the acceptable customer cost for that region. . 2.asp. They believe in listening to customers when they are “with” you. But it was much successful concept it increased the BMW sales in 2001 by 12. which included extra features (ref -Hespos.Hespos. 3.pmalink.5% as compared to 2000. "BMW Films was a non-traditional concept to show consumers what makes a BMW a BMW" (Ref.They believe that it is important to satisfy customer needs to keep customers happy and satisfied Customer cost: BMW also realizes that all the costs taken to design their cars are also to be included in the cost of the car. the films were viewed more than 11 million times.They have a website for online communication . The short films were recommended by 94%. circumstances using deft driving skills-in a prominent BMW" (ref.org/awards/reggie/2002reggiewinners3. initially drawing more visits than the site could handle" (Ref -http://www.Hespos. THE FOUR C’S 1. It proved to be so immensely popular that BMW produced a free DVD of the series. With this kind of massive promotional activities BMW was able to achieve in mind of costumers wish of for individualisation and emotional product as these promotional activities somewhere or other make costumers feel like that. 2002). 2002).
Eminent production. How big is the company and how successful they are companies needed to think about the future and make few plans for them? For the future marketing strategies.This becomes of interest to study more profoundly. On the other hand. which can reduce the desire of people purchasing its cars. of which most products are applied to rich people but not the poor people. Russia. trendy seat covers. Not only are the financial statements taken into consideration.I started off with very littler knowledge about this topic and worked my way through the assignment and I would conclude that BMW is a very powerful name in the automobile industry due to its reputation of providing high quality products and services. BMW possesses high internal competence and the company develop a large part of the car by themselves. an individual actor. its market share can be expanded. The emerging markets in South East Asia . Middle-class or upper middle class people. Results and Conclusion: BMW is a well known and highly valued brand and has high diversity in the product portfolio.The thesis is based on the assumption that BMW is the most successful automotive manufacturer in the premium segment. Purpose: The purpose of this thesis is to analyse the development of BMW during the past five years. CONCLUSION It has taken a lot of referencing and researching for me to write this report and I have learnt a lot from this report too . The primary data consists of an interview and secondary data is collected from annual reports. BMW. The BMW cars are considered to be as the luxury cars. for this can get few new models in BMW Mini this could help then to target few different segments and also can target females. In addition. Furthermore. Methodology: In the study of BMW both primary and secondary data are used. BMW can also create good relationship with female buyers they need to do more of promotional strategies to attract more of female consumers with like of limited edition specially for females in their existing models or for new models in this edition just by giving few simples thing which females like in the car for example. transportation and raw material costs have both dampened margins and affected the buying power of consumers likewise as high oil prices. The Asia Pacific region is becoming increasingly crucial to global automotive sales. RECOMMENDATIONS Most of the people argue that there is always a chance to learn new thing or no matter. In addition. Although it has been overshadowed by . Can enter the market with Small ‘Lifestyle’ Car which can apply to the middle-class people.pink colour. I would like to recommend few points. Eastern Europe and South America have shown evident growth developments. etc. has yearly shown strong financial results and has retained its market shares . in order to find the factors behind a successful company and a strong brand. soft-toys. a comparison to competitors and the market situation is also made . its accessories and parts of cars are expensive for maintenance.
These kinds of advertising are creating very good brand value for the company and company portrayed itself how they want to be in front of customers. S.pmalink.00.uk/companyfacts.com/features_profile. and Armstrong.co.dtvprofessional. David Jobber.co. from http://www.brandchannel.asp www.html# Kotler.supercarworld. 2005." retrieved October 3. These markets are going to be huge as there is more population in these countries as in comparison to US and UK market.bmw. (2002) “BMW Films: The Ultimate Marketing Scheme.uk/statistics http://www. G.com/cgi-bin/overview. the "Ultimate Driving Machine". Principles and Practice of Marketing 5’th Edition www.co.com/content/546. from http://www.org/awards/reggie/2002reggiewinners3.1156___sitlook-before-you-leap/ bmwuk. retrieved October 3. P. BMW needs to come with few more BMW Films interactive marketing campaigns. China's rapid growth in recent years. In addition. (1989) Principles of Marketing.co. emerging markets is set for steady growth where BMW is already there but needs to concentrate more and needs to adaptive marketing strategies to get success out there.bmw.bmweducation.co.15digitalmarketing.. References Hespos.bmweducation..uk/articles/2006/01/21/mobile-marketinghttp://www.asp Giardina. Prentice-Hall International Edition.co.uk/bmwuk/modelselector/0. and Lehane.imediaconnection.com/2002/12_dec/features/bmw_returns." retrieved October 3.htm (2002) "BMW Films.uk/models www.com http://www.co. C.asp? pr_id=171 http://www. 2005.shtm www.bmw.just-auto. T.cgi?BMW . 2005. from http://www.bmweducation. (2002) "The Driver Returns. As it is had very successful and showed good promise in it for the selling point.uk/prices www.uk/company history www.