Analyzing the Effectiveness of BMW Films

A Research Proposal

PYF Research Inc.Fei Hao

Pamela PrietoYvonne Tran

November 11, 2012

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Table of Contents

Executive Summary

Situation Analysis

Specific Aims

Research Design

Expected Results

Researchers

Timeline and Budget

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Executive Summary

As BMW begins to see the effects of their innovative BMW Films, it will be important to accurately evaluate and analyze the results of the campaign in order to decide the best option to move forward with their marketing projects. This proposal provides a comprehensive understanding of the situation created by the BMW Films. The proposed research is aimed at analyzing the effectiveness of the existing campaign and the four options for moving forward. Included will be a detailed explanation of the research design with the necessary background information, study population and methodology to answer the research questions. Finally, a timeline and budget will provide the projected financial and time-related needs of the proposed study.

Situation Analysis

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BMW has long been at the forefront of non-traditional advertising in the luxury-performance vehicles industry. In early 2001, BMW produced a series of five short films (“The Hire”) for the Internet that featured a variety of BMW models as actors in a Hollywood-style narrative. The $15 million production and promotion of the film involved world-renowned directors, famous actors and actresses, and a three-month PR campaign. The film attempted to change the BMW brand image into one that was more provocative. After a generally positive reception by viewers, industry-wide buzz, and more than 9,000,000 views online, BMW is looking to the future and needs to decide whether to continue to build on the BMW Films idea or look elsewhere for a new marketing campaign.

Strengths The BMW Films campaign was the first of its kind, so it offered many advantages for

BMW. The hype and positive reception of the films from website visitors and major film critics helped spread awareness and positive associations with the brand. BMW’s innovation and creativity in their marketing techniques are characteristics that might very well be transferred onto their brand image.

The films showcased the capabilities and performances of BMW vehicles in a more impactful way than traditional advertising because they demanded an active viewing experience. Because the films were distributed online, the campaign was able to reach more than 9 million views from fans who shared the content through links and word of mouth. This share-ability helped BMW expand their customer database thanks to the registration required to watch the viral video.

BMW’s choice of Internet distribution also gave the company a means to gather customer information and perform analytic evaluation of the campaign in a way that couldn’t be done through traditional media.

Finally, through comments left on the BMW Films website, it is easy to assume that there was a shift in customers’ perceptions of the BMW brand. However, the evidence of this shift is anecdotal and needs to be formally measured.

Weaknesses In addition to the lack of evidence for the videos’ effectiveness at shifting brand image, it

is yet to be established whether the BMW Films campaign actually led to a higher volume of sales or a higher likelihood to purchase BMW cars.

The campaign’s demand for active involvement is a double-edged sword, as it can only reach people who are curious or interested enough to visit the website to watch the films. Not only are the online films excluding people who are more passive, they also leave out people who don’t have the access or desire to use the Internet, some of whom are typical BMW buyers. According to the BMWfilms.com visitor profiles, the films reached viewers that were younger than the typical BMW consumer.

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Finally, the cost of the films is something to consider when evaluating the success of the campaign; it is yet unclear whether the investment resulted in increased sales of BMWs or if it significantly changed consumers’ intent to purchase.

Opportunities In terms of opportunities, BMW has great potential to turn their BMW Films audience

into actual customers. According to the BMWfilms.com Visitor Profiles, around 60% of the BMW Films viewership is younger than 35 years of age and the median income is $88,000. Even though the majority of website visitors have demographics that don’t normally match the typical BMW customers’ (younger viewers with a lower income), their early engagement with the brand is an opportunity to influence brand image in potential customers. On the other hand, because the films have yet to gain popularity among the target demographic, who are on average 46 years old and have a median income of $150,000, BMW can refocus their marketing efforts of the films to reach the target customers.

Unlike traditional media channels, the films provide BMW with the ability to engage and educate visitors by directing them to BMW’s main site and by creating an interactive experience. This experience can also lead to a greater understanding of potential customers’ tastes and preferences, not just about cars but also entertainment interests. This information can prove useful in future marketing.

Finally, BMW has an opportunity to strengthen the brand image created by the films campaign. It can position itself as an innovator, willing to take risks in reaching a new level of engagement with potential customers. They have a unique opportunity to depolarize people’s perceptions of BMW as a brand they simply either love or hate into a brand with depth and personality.

ThreatsBMW has already experienced the diluted effects that come from second installments of

non-traditional advertising approaches with the Z3 GoldenEye campaign. There’s always a risk that the second part of the BMW Films campaign will not be as successful as the first exposure. Additionally, rumored copycat projects by competitors could damage future BMW Films efforts by saturating the market and lessening the films’ impact on viewers. A saturated market could also result in comparative evaluations of the films, where viewers might become more critical about individual films.

Specific AimsTaking into account the situation analysis and the information provided by BMW, the

main purpose of this study is to determine whether to continue to build on the BMW Films idea and how to do so or to start looking for new ideas for the next marketing campaign. To do this, the study must first evaluate the effectiveness of the existing campaign and then guide BMW through their available choices to the most profitable option. Thus, the specific aims of the

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research proposal are broken up into two phases and distinguished by the research questions each phase seeks to answer.

Specific Aims Outline ● Phase 1: Was the Films campaign successful?

○ What is the brand image of BMW?○ Has the Films campaign successfully changed the brand image into what BMW

expects? ○ Did the Films campaign influence intent to purchase a BMW in the future? ○ If the films were effective, what's the likelihood that new films will add to the

success of the campaign?○ If the films weren’t effective, why not? How can the campaign be modified to be

effective?○ Have sales increased in correlation with the BMW Films?

● Phase 2: If the Films were successful, how should BMW proceed? Which is the most effective option?

○ Option 1: Make the existing films available to a wider audience. ○ Option 2: Produce a feature-length film.

Research Design The primary goal of our research is to measure the effectiveness of the existing BMW

films campaign, as well as the additional paths that BMW can follow in their marketing efforts. The research design and methodologies described below are the best options to achieve the specific aims of the proposal.

Background InformationIn order to execute the proposed studies, we would first need to gather background

information from the client and the marketing environment of the BMW Films. To better understand the competitive environment, information about the luxury-car industry and BMW’s competitors will be assembled. In order to focus our research on BMW’s target audience, we will garner information that will allow us to better understand their lifestyles and habits. Because this campaign places emphasis on branding, we will search for the components and constructs that enable brand image formation. Finally, it will be important to explore the roles and effectiveness of non-traditional advertising, focusing on marketing that uses the Internet, social media and web videos.

Study Population

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For Phase 1, our population will be the registered viewers of BMW Films as well as people who have not seen the BMW Film series. Because BMWFilms.com gathered contact information before viewers could access the films, we can create a random sample from these respondents and send selected respondents an email to participate in our survey. For comparative purposes, it is necessary to test people who have not seen the films. We will find these participants through market research online panels. The demographics of the sample population will be representative of the U.S. population as we want to test general attitudes, perceptions, and behaviors towards BMW.

For Phase 2, the sample will be selected in a way that is representative of BMW’s typical consumer. The sample will be selected to only include people aged 35 years and older, given that BMW’s target consumers have an average age of 46 years old. The study population should represent the gender and racial make-up of BMW’s target audience as well. According to BMW’s background information on its consumers, two-thirds of our sample should consist of males, many of which have a high income (most likely above $100,000), and higher education levels (at least college-educated). For telephone surveys, we will find participants through a survey-sampling agency to contact participants that match our sample profile.

Methodology In order to evaluate whether or not the BMW Films campaign was successful, the first

phase of the study will focus on a few key questions: (1) What is the brand image of BMW?(2) Has the Films campaign changed the brand image to match BMW's expectations? (3) Did the Films campaign influence intent to purchase a BMW in the future? (4) If the films were effective, what's the likelihood that new films will add to the success of the campaign? (5) If the films weren’t effective, how can the campaign be modified to increase success? (5) Have sales increased in correlation with the BMW Films?

Phase 1The first phase will determine if the existing campaign was successful for BMW. This

requires a quantitative evaluation of attitudes and behaviors from respondents who have seen the films as well as the people who have not seen the film to serve as our control. Using random sampling techniques, we will survey registered viewers of the BMW Films as well as general internet users, whose contact information we will obtain through an online marketing research panel. A lottery prize will be used to incentivize survey participation.

We will create a web survey that measures a) how people perceive the BMW brand; b) their attitudes toward the brand; c) online media consumption; d) interest in development of future films; e) intent to purchase. By comparing the answers of both groups, we can see the differences in attitudes, perceptions and intent to purchase between viewers and non-viewers of the BMW Films. A successful campaign will result if respondents’ brand image matches the client’s expectations. The online media consumption information will help to rule out the confounding variable of the internet medium and its effect on BMW Film’s reception. The survey will also measure respondents’ interest in seeing additions to the BMW Films series, so

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that BMW can discover if there is a demand out there for future films. Two different measures will be used to determine the intent to purchase: the net promoter score and self-reported likelihood to purchase. Correlation between BMW’s sales data before, during and after the BMW Films release will provide a clearer picture of the campaign’s role in driving sales on a short-term scale.

BMW should abandon the films project and move on to other marketing efforts if: (1) Phase 1 proves that media consumption habits have a negative influence on the campaign and (2) if the campaign was unsuccessful in meeting BMW’s expectations. If the results indicate that the internet is an effective platform and the respondents showed interest in seeing more short films, but that the campaign expectations were not met, BMW can consider creating new films. However, if the BMW Films proves successful, then we will proceed to testing BMW’s other two options in Phase 2.

Phase 2 If Phase 1 proves the campaign is successful, Phase 2 aims to help BMW to decide how

to continue with the BMW Films. We will be testing the viability of two options: making the existing films available to a wider audience and creating a feature length film.

Option 1: Reaching a Wider AudienceMaking the existing BMW Films available to a wider market entails placing the films in

various media channels. We want to test three different channels: movie theaters, television and DVDs. A similar survey will be administered across the various channels, but the language of the survey will be modified to fit the medium that is being tested.

For the movie theater option, the films would be played during the previews as precursors to feature films. Three cities and one theater per city will be selected as the test market. After the film’s end, moviegoers will be surveyed to gauge their attitude toward the short film. Small incentives will be provided to encourage participation.

To measure the effectiveness of television as a platform for the films, we will broadcast the movies several times during a one-week period in select markets. Telephone surveys will be conducted to measure attitudes toward branding and likelihood to purchase. This data will be compared across viewers and non-viewers of the films to see if there is a difference in attitudes. The sampling pool will be selected by random digit dialing in the test markets.

To measure the effectiveness of DVDs as a platform for the films, we will distribute DVD compilations of the full-length versions of the films at select BMW dealerships. People who want the free DVD will need to provide a phone number where they will later be contacted for a survey.

Option 2: Feature FilmTo test the value of creating a feature length film based on the short films, a series of

focus groups will be conducted. Because it is a film that doesn’t yet exist, a focus group is the best method to explore the reception of the film among the target consumers. The focus group

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will consist of five to eight members from the target demographic who will be compensated with monetary incentives for their time. During the discussion, the participants will view a trailer to the new film, which we will create from the existing films. The purpose of the focus group is to gauge the participants’ perceptions, attitudes and opinions toward a potential new film.

Expected ResultsThe innovative nature of the BMW Films campaign requires a detailed and intuitive

approach to research its effectiveness. Recommendations on how to proceed will result from an effort to integrate the results of the different areas of investigation into one comprehensive analysis of the situation and probable outcomes. If, during Phase 1, it is revealed that the campaign was not successful because the medium and the content were ineffective, then BMW will know with a high level of certainty that they should abandon the project. However, Phase 1 will also serve to understand whether it would be beneficial to adjust the campaign by improving the original films or by releasing new short films altogether. If this is the case, Phase 2 will also help determine whether distributing the films across a variety of media — including through the production of a feature film — is a viable and profitable option for BMW.

ResearchersYvonne Tran’s research methodology expertise derives from her communication

consulting work for Researchworks, where she specialized in innovative communications solutions for various clients ranging from academia to industry. She is also a freelance film producer and editor with a creative knowledge of the production side of the media industry.

Pamela Prieto is a data analysis professional with extensive background experience working in large-scale market research projects from her time at Allegra Strategies. She specializes in analyzing and predicting market trends based on quantitative data.

Fei Hao has years of experience conducting qualitative research in both an advertising agency setting and an in-house marketing department setting. She is familiar with moderating focus groups, in-depth interviews, and content analysis. Her digital marketing experience from Ve Interactive makes her an expert at developing innovative marketing strategies using new media technologies.

Timeline and Budget Timeline

Phase 1:● Questionnaire design and sampling: 2 weeks

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● Data Collection: 2 weeks● Data Analysis and Creation of Report: 2 weeksPhase 1 Total Time = 6 weeks

Phase 2:Option 1: Wider Audience● Questionnaire development and sampling: 2 weeks● Data collection: 1 week● Data Analysis and creation of report: 3-4 weeksOption 2: Feature Film● Designing and sampling: 1 week● Execution: 3 days● Analysis and Report: 1 weekPhase 2 Total Time = 8 weeks

Project Grand Total = 14 weeks

BudgetPhase 1:● Sampling: 500 contact emails from online panels

$10 per respondent x 500 respondents $5,000

Phase 2: Option 1: Wider Audience

Movie Theater● Survey administrators

(8.50/hour per person x 16 hours x 5 showings x 3 cities) $2,040● Movie Theater Preview Placement $9,000

($10 per thousand viewers x 150 estimated viewers x 2 showings x 2 days x 1 theater x 3 cities)

● Survey incentives $500Total $11,540

TV● Ad space on local broadcast channel $20,000

($1,000 per 30-sec spot for local channels x5-minute short x 2 showings)

Outbound call center $15,000

(7,500 minutes survey time x flat rate of 250 minutes for $500)● Survey incentives $500

Total $35,500

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DVD ● 1,000 DVDs in Amaray cases for distribution $900● Outbound call center $15,000

(7500 minutes survey time x flat rate of 250 minutes for $500) Total $15,900 Option 2:

Feature film($3,000/focus group [includes incentives and facilities] x 3 groups)

Total $9,000

Investigators:Phase 1: $18,000$25/hour x 8 hours/day x 5 days/week x 6 weeks x 3 researchers Phase 2: $24,000$ 25/hour x 8 hours/day x 5 days/week x 8 weeks x 3 researchers

TOTALSPhase 1● $5,000 + 18,000 = $23,000Phase 2● $24,000 + 11,540 + 35,500 + 15,900 + 9,000 = $95,940

Project Grand Total = $118,940