BMW Case Study - Solved

Marketing Excellence - BMW Introduction Bayerische Motoren Werke AG, known as BMW, is a German multinational company which produces automobiles and motorcycles. The company was founded in 1916 as a manufacturer of aircraft engines, which it produced from 1917 until 1918 and again from 1933 to 1945. The company later started production of automobiles under the brands BMW, Mini and Rolls-Royce, while motorcycles are marketed under the brand BMW Motorrad. In 2015, BMW was the world's twelfth-largest producer of motor vehicles, with 2,279,503 vehicles produced. BMW is headquartered in Munich and produces motor vehicles in Germany, Brazil, China, India, South Africa, the United Kingdom, the United States and Mexico. BMW has significant motorsport history, especially in touring cars, Formula 1, sports cars and the Isle of Man TT. Brand Persona BMW is attributed to performance and luxury. Logo The logo of BMW ‘roundel’ was colored blue and white which was initially perceived to represent spinning propeller blade set of aero plane which blue and white sky at the background. However, later it was revealed that blue and white are official colors of Bavarian Free State, where the company was headquartered. As per research, it turned out that it was impossible to use national colors for trademarks in accordance with existing laws which prohibited using such tones for any commercial purposes during that period of time. Questions & Answers Question 1: How does BMW segment its consumers? Why does this work for BMW? Answer: BMW focused mainly on 4 segments described as follows; 1. Geographic Segmentation: As per geographical boundaries, BMW focus on; Region : National And International Consumers Density : Urban class 2. Demographic Segmentation: Demographically, BMW’s segments are: Age : 20 – 45+ Gender : Males & Females Life-cycle stage : Bachelors, Newly Married Couples, Elderly People Income : High Income Group Occupation : Professionals & Executives 3. Behavioral Segmentation: As per behavior, the segmentation can be described as: Degree of loyalty: Hardcore loyal, Soft loyal, Switchers Benefits sought: Reliability, Sense of achievement, Expression of high status Personality : Determined and ambitious User status : Non-users, Regular users, Ex-users, Potential Users, First-time users 4. Psychographic Segmentation: Psychographic ally, the segments can be described as follows: Social class : Upper Class, Elite Class Lifestyle : Reformers, Aspire Responding sensitively to unique values and purchasing behavior, enabled BMW to transcend intended performance. The segmentation, targeting and position worked for BMW because by targeting to difference classes and groups, it was successful to strengthen its brand image and made profit eventually. Question 2: What does BMW do well to market to each segment group? Where could it improve its marketing strategy? Answer: BMW marketed to each segment by giving them what they needed. They targeted four markets primarily as per below details; 1. Target Market: Modern Mainstream: These cars targeted the ‘modern mainstream’ – a group of people who family-focused and active but have previously avoided BMW because of high prices.  Car Series (Less Expensive Cars): 1, 3, 5, & 6, X1 & X3 Series, Low-priced SUVs 2. Target Market: Upper Conservative Group: These cars targeted ‘upper conservative group’ who are wealthy consumers. These cars had electronic components such as multiple options to control windows, seats etc.  Car Series (Premium-priced Cars): SUVs, Convertibles, Hybrids. 3. Target Market: Upper Liberals: These cars targeted the ‘upper liberals’– a group of people who had achieved success in the 1990s and gone to have children and take up extra activities like golfing, biking etc.  Car Series (Expensive Cars): X Series 4. Target Market: Post Moderns: These cars targeted the ‘post-moderns’– a group of people who have high income and like to attract attention to their showy cars.  Car Series (Expensive Cars): Roadsters, Convertibles Question 3: Should BMW ever change its tagline ‘The Ultimate Driving Machine’? Why or why not? In our opinion, BMW should not change their tagline because it represents the brand origination and experience which they try to create and evolve. When consumers drive BMW, they cannot simply deny the fact that a BMW means moving from point A to point B and just a means of transportation. BMW is more than that. The sole spirit behind these cars is a luxurious experience which is meant to be enjoyed. Hence BMW is rightly called as “The Ultimate Driving Machine”.