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MBA 503 BMW Case Study

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by

Emily Ardoin

on 11 April 2013

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Transcript of MBA 503 BMW Case Study



Bayerisch Motoren Werke (AG)

It is headquartered
in Munich, Germany

Mini and Rolls-Royce
also in the portfolio About BMW 1913: founded as an airplane engine manufacturer
1928: became an automobile manufacturer
1975: established in America as an importer of vehicles
1994: BMW unveils it's first car produced in North America BMW History Goals of the Company The Ultimate Driving Machine The BMW Target Markets Emily Ardoin Bailey Wilkes Lakeshia Williams BMW's Marketing Mix The Competition BMW has many competitors in the luxury car market, but they stack up well against the competition.
In 2011, BMW adorned the most luxury automobiles in United States
BMW takes extreme pride in their reputation for being the “ultimate performance machines”
Recipients of DJSI award from 2005-2012 Questions? SWOT Analysis Strengths: Flexible production network
Wide range of models offered
Reputation of excellence Weaknesses: Opportunities: Environmental consciousness
Expanding to growing countries
New technological resources Threats: Government regulation
Demographic change
Shortage of specialists BMW in the US Late 1970's:
Very popular
luxury brand Late 1980's:
Luxury car
market shift
Competition:
Acura (1986),
Lexus & Nissan
(1989) After 1992: Reinvigoration In 1992: BMW sales
fall & very low
customer satisfaction

The introduction of a number of new models in its core Series
An aggressive pricing strategy
Worked hard to make the BMW more suitable for the North American market BMW took a number of
actions to reinvigorate Mid 1970's:
niche foreign
car manufacturer Financial Goals: To achieve an EBIT margin in the Automotive Segment in the range of 8 to 10 per cent over the long-term Non-Financial Goals: To sell over two million cars in 2016
To be the leading provider of premium products and premium services for individual mobility Price: Product: Place: Promotion: Differentiation from the Competition Constantly evaluates the current market to find new wants and needs of the consumer
Adapting models or creating new models to expand the target market
Assesses the world market when looking for expansion ideas 338 BMW Passenger Car and Sport Activity Vehicle Centers in North America
Browse inventory
Test drive
Buy
Browse dealer inventory and design your car online Car prices range from $30,025 to $103,225
The entry-level 1 Series and the top-of-the-line M6 model represent the cheapest and most expensive of all BMW models respectively. The BMW group now owns the brands BMW, MINI, and Rolls-Royce Motor Cars.
Since 2000, new BMW models have included the BMW 1 Series and the large coupe and convertible BMW 6 Series. Mismanaged marketing techniques
Strong competition High Income Family Safety Environmentally Conscious Thermal backup camera
Blind spot detection
Heads up display
Advanced emergency call
Hands free calling
Text to speech
X3 and X5 are versatile and large enough for families BMW Active E 100% electric car
Fuel efficient yet powerful four cylinder
Hybrids
Fuel efficient diesels Park assist
Rear view camera
Navigation
Xenon adaptive headlights
Power and speed - M series has 560 horsepower and starts at $88,000 Dan Creed, Vice President of Marketing for BMW of North America
$166 million on advertising in United States in 2010
$109 million in first nine months of 2011 Marketing the New X3 $5 million of marketing budget dedicated to X3 model
Encourage built to order vs. already built from the dealer lot
TV commercials, print ads and Internet ads
Extra incentive
Watch your car being made via webcam
CEO Jim O’Donnell’s goal is for 70% of X3 model to be built to order BMW’s current marketing campaign is unique
Focuses on overall exceptional experience with all models of the brand rather than promoting individual models
Renee’ Gosline, assistant professor of Marketing at MIT’s Sloan School of Management suggests ways to make individual model owners feel included
Direct mail campaigns
Online community groups BMW Stands Out Luxury and Performance
Full transcript