Final BMW Slides1

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BMW

The Ultimate Driving

Machine !!

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Contents

Introduction and History

Mergers And Acquisition

Management Strategy Followed By BMW

STPFacts and Figures

Channels Of Advertisement

Reactions to ad campaign

Suggestions and Conclusion

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Introduction

BMW WAS ONE OF THE ASTOUNDING COMPANYIN THE WORLD.

THE WORD DRIVING EPITOMISES BMWs WORTH

YUPPIE SIGNIFIES YOUNG URBAN

PROFESSIONAL BMW PROMOTING ITSELF AS COMPANY OF IDEAS

WASNT INITIALLY SUCCESSFUL.

BRAND IMAGE FAILURE IN THE US MARKET.

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History

Founded in 1913 by Karl Fredrich Rapp.

Initially manufactured aircraft engine in Munich.

In 1916,First World War, BMW manufactured aircraft engines for Hungarian Army.

In 1918,taken over by Franz Joseph Pope , name changed to BMW-AG.

In 1919,after ban on manufacturing aircraft engine, started with manufacturingrailway brakes.

In 1923, it launched its first bike model R3-500cc shaft driven motorcycle.

In 1928, manufactured car engine based on Austin Seven car license.

It also acquired DIXI Co.

During World War-II ,its plants were destroyed.BMW again started production of carengine, which is today globally renowned.

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Mergers And Acquisitions

In 1928,BMW took over the comapany DIXI which isalso the very first car they launched.

In 1994, BMW acquired MG Rover + gained ownershipof successful brands like MINI, Land rover, TRUMPH,Range Rover.

In 2000,BMW sold MG Rover to Pheonix Co. for a tokenof $10.

In the same year, it sold Land Rover + Range Roverbrands to D Co.

In early 2002 Volkswagen brought Rolls Royce

outbidding for BMW

In 2003 BMW acquired rights over rolls royce

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Marketing Strategy

The Corporate Marketing Strategy must aimto create and retain a satisfiedcustomer and this is only possible when

the firms add values for the customers.Not only this the customer should also

perceive this value to be distinct from thecompetitors product. When this happens,the firm gets a premium in the form ofprofit


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STRATEGY1.IDENTIFYING THE ISSUE: The change in the add campaign from

The Ultimate Driving Machine to TheCompany Of Ideas arouse a question will itbe able to reach the creative class along withretain the yuppies group along with theretaining the creative class?

Dropping a 33 year old successful tagline.

New tagline attacked corporate conventionand compromise.


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STUDYING THE MARKET

ENVIRONMENT:By making a SWOT analysis of BMW:

1.S:Strength-The brand itself BMWFavorites among YUPPIESSynonym to performance and driving.

2. W:Weakness-Seen only as a performance based sports car.Couldnt attract a wider market beyond yuppies.

3.O:Opportuniy-The growing number of creative class[38 million].It could add additional economic function transfer to

creative class function.Opportunity to increase the U.S market share which was

just at 2.5%.

4.T:Threat-New add placed little emphasis on performance a sharp

departure from earlier adds.Prompted criticism for dropping a successful strategy for 33


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3.ANALYSING THE ISSUE:

Difficult to make impact among thecreative class who wanted brands whichstood for larger values.

A change or a sudden shift from asuccessful strategy may not workespecially when it was brands strength for33 years.

Difficult to retain existing loyalists.

Leesened emphasis on performance.


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4.PLANNING:

How to determine the needs of thecustomers?

How to expand their market?

What should be made to attract thegrowing creative class?

How to campaign their new ideaTHE COMPANY OF IDEAS?


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5.IMPLEMENTATION:

Changed their add agency from FALLON WORLDWIDETO GSDM to create their new add.

Showcase the companys design prowess andindependence.

Promoted their add through television, print adds,

lifestyle publications[focusing on art, design, travel,luxury, and sports], websites likewww.thegothamist.com, www.gawker.com, that werefrequently visited by the creative class, and also byshowing its environmental sentivity.

Adds sent across message that differentiated BMW fromother companies which destroyed creative and radicalideas.
http://www.thegothamist.com/http://www.gawker.com/http://www.gawker.com/http://www.thegothamist.com/


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6.CONTROL:

By analyzing the consumers reaction to thenew add and then taking corrective action.

Had come a long way since 1980s,therefore BMW had the confidence to tacklethe critics who said it was creatingconfusion among consumers and wasinsecure and threatened by competition.

Took measures to maintain the originality ofthe ad campaign.


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S T P

Segmentation :

Viewing heterogeneous market as agroup of small homogenous market

It is one of the basic element inmarketing strategy

It also helps in focusing corporateresources more sharply on customers


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SegmentationBasis ofClassification

Before 2005 After 2005

Age In early 30s to mid

40s

20 - 30

Occupation Hold Jobs inProfessional Sector

They are Musicians,Engineers,

Entrepreneurs.

Class Upper middleeconomic class

Creative Class

Taste andPreference

PerformanceDriven Cars

Creativity andIndividuality


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Targeting

After the market has been separated into itssegments, the marketer will select a segmentor series of segments and 'target' it

Earlier Targeted Customers

Young Urban Professional

Present Targeted Customers

Creative Class


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Positioning

It is creating place in the minds of thecustomers and making themremember our brand in the way we

want them to remember it.

BMW Advertisement

No to Compromise

Yes to innovative idea

Not Taking risk is risky


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BMW Vision


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Marketing Mix

It Involves a deliberate and careful choiceof organization, product, price,promotion and places and strategies &

polices. Each of them is important, butwhen all the 4 elements of marketing areproperly selected and mixed in the rightproportion ,they enhance the product and

make it attractive to the customers.


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Product7 Series Sedan


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BMW 745 Hydrogen Car


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PriceBMW had fixed prices for various customers of creative

class through which it could be in the shopping list ofthe customer who did not think BMW was aneconomical option

Place BMW had it first overseas plant set up in South Africa

In 1980 it had increased export to US, Asia andAustralia

It became the first European car to set up a subsidiaryin Japan

In 2004 BMW became had outsold Mercedes Benz


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Promotion

BMW came up a new ad campaign whichpromoted BMW Company Of Ideas.

It aimed to communicate BMWs independenceand freedom to pursue innovative ideas.

The ad campaign was unveiled through variousmedia such as newspaper, magazines,television, outdoor billboard and the internet.


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Facts and figure BMW released a new Tagline Company of ideas in 2006

This move took many by surprise 2005 had been good year for BMW with successful tagline then

question arises what was the need for changing successfultagline.

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Unique Selling Proposition

Started with manufacturing aircraftengine

328 roadster Car of the Century

BMW 700 and 1500 gainedreputation as a manufacturer ofsports sedans

Acquired MG Rover

Joint venture with Rolls-Royce Motors

Sky is not thelimit

Company wanted to increase its

growth in US market.(less 2% market

share)

US citizens were not considering as

a luxury vehicle.

US people were looking for large

brand value.


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Facts And FiguresProduction Curve

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Net Profit from 2001-05

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Production Curve 2005-09

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Net Profit from 2005-09

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AD CAMPAIGN

BMW independence and freedom to pursue innovativeideas, as it was neither owned by nor part of a division ofanother company.

Its tagline The Ultimate Driving Machine signifies the

emphasis on its high performance feature likehorsepower.

The new ad campaign promoted BMW as The CompanyOf Ideas .

With a passion and inspiration- they arent hindered by

idea killing bureaucracy. The print ads were, unconventional and different from

regular automotive advertising campaign.

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There ads were all text pieces , featuring simple

but bold copy. BMW autonomy and commitment to protect great

ideas.

Ads projected BMW as a company , that fostered

creative. The achievements based on inspiration ,

innovation , and creativity.

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Ways of Promotions

Placing the ads in lifestyle publications.

Posting ads on websites - creative class.

BMW also showcased its environmental sensitivitythrough one ad that hailed one of its models.

The message BMW was not like othercompanies that destroyed creative and radicalideas.

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Print Ads

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Print Ads

NO

MATCH

AIRBAGS RISKY

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TV Ads

OVERTHINKERS

EUPHEMISMS

BENEDICT ARNOLD ENEMY OF IDEAS

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Defining Innovation


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Reaction To Campaign

Analyst were struck by the originalityof ad campaign, but some weredisappointed with the ads.

Preventive Maintenance - Atechnique to expand its customerbase.

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Competitor Bashing

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Ultimate Driving Machine

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Ideas Are Everything

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Conclusion

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Documents

Final BMW Slides1