MINISTRY OF EDUCATION AND SCIENCE OF UKRAINE

National Aviation University

Department of Marketing

Marketing plan on BMW

Done by:
Student FML 206a
Dmytro Popovych

Kyiv 2014
Contents
1. Purpose and Mission……………………………………………………..3
1.1. Purpose of the Marketing Plan……………………...……….3
1.2. Organization Mission Statement…………………………….3
1.3. BMW Strategies………………..……………………………5

2. Situational Analysis…………………..…………………………………..7
2.1. Internal environment……………………...…………………7
2.1.1. Clients……………………………...………………7
2.1.2. Competitors……………………….………………..7
2.1.3. Suppliers……………………...…………………..10
2.1.4. Channel Members………………………...………10
2.1.5. Public………………………...…………………...10
2.2. External environment………………………………………11
2.2.1. Political…………………………………………...11
2.2.2. Economical……………………………………….11
2.2.3. Social………………………...……………....…...12
2.2.4. Technological………………………….………….12
2.3. Financial Codition……………………………….…………12

2.4. Summary (SWOT analysis)……………………….……….14

3. Marketing Programs……………………………………………….……16
3.1. Target Markets……………………………………….…….16
3.2. Product (PLC, BCG)………………………………….……18
3.3. Promotion……………………………………………….….24
3.4. Distribution…………………………………………….…..28
3.5. Pricing……………………………………………………...30

4. Conclusions and Recommendations…………………………………….31

4.1. Concusions……………...………………………………….31
4.2. Recommendations………………………………………….32

References………………………………………………………………….34

Part 1: Purpose and Mission

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 1.1. Purpose of the Marketing Plan
Purpose of this project is to provide the basic information about the
company BMW, analyze the contemporary situation, its place in the world
automotive market, identify its marketing strategy, determine the company’s
objectives and define the basic components of marketing mix.
In addition, this plan was produced to review the industry and BMW’s share
in it, continue the growth of existing product and revenues and give some
recommendations and my vision to the future.
Given information is useful for analyzing the automotive industry, research
of advantages and disadvantages of BMW production, elimination of these
problems and setting the targets to be achieved in the next year.
1.2. Organization Mission Statement
BMW is an acronym for Bayerische Motoren Werke AG or, in English,
Bavarian Motor Works. Whatever you call it, the German-based company is one of
the world's most respected automakers, renowned for crafting luxury cars that offer
superior levels of driving enjoyment. 
Founded in Munich, the company began in the early 1910s as an aircraft
manufacturer. BMW's current logo, designed to represent white propeller blades
against a blue sky, reflects these origins; its blue-and-white color scheme also
references Bavaria's blue-and-white checkered flag. 

It wasn't until 1928 that production began on the first BMW automobile, the
Dixi. The car proved tremendously popular, and its success helped the
manufacturer weather the Depression. BMW's best-known pre-World War II
vehicle was the Type 328 roadster, a supple two-seater that racked up over 120
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victories on the motorsport circuit between 1936 and 1940. Postwar BMW cars
maintained this tradition, winning several racing, rallying and hill climb victories.
The early 1950s saw the launch of the BMW 501, a roomy, voluptuous
sedan that was resplendent with all of the hopefulness of that era. It was soon
followed by the 502 which was powered by the world's first light-alloy V8,
foreshadowing BMW's ongoing commitment to developing new technology. The
best-selling BMW of that decade was the Isetta, a petite two-seat "microcar"
typically powered by a 12- or 13-horsepower engine. 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. In the 1960s, BMW sales
strengthened significantly, thanks in part to the immense popularity of the 1500, a
sporty family sedan. 
By the 1970s, BMW was establishing itself as a full-fledged car company. It
was a pioneer for many emerging technologies, including turbocharging and
advanced vehicle electronics. This was also the period when BMW of North
America was established and consumers, who coveted both sports and luxury cars,
became loyal "Bimmer" owners. The '70s also saw the birth of BMW's three-tier
sport sedan range consisting of the 3 Series, 5 Series and 7 Series cars and the
creation of its performance M division. 
More recently, the company has been expanding its reach worldwide. It
opened its first U.S. manufacturing plant in the latter half of the 1990s and has
expanded its brand empire to include Mini and Rolls-Royce. BMW also continues
to build motorcycles, something it has done since the 1920s. 
The BMW Group is one of the most successful makers of cars and
motorcycles worldwide and among the largest industrial companies in Germany.
With BMW, MINI and Rolls-Royce, the BMW Group owns three of the strongest
premium brands in the automotive industry. The vehicles it manufactures set the
highest standards in terms of aesthetics, dynamics, technology and quality, a fact
borne out by the BMW Group’s leading position in engineering and innovation. In
addition to its strong position in the motorcycles market, the BMW Group also
offers its customers a successful range of financial services. In recent years, the
Group has also established itself as a leading provider of premium services for
individual mobility.

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 Long-term thinking and responsible action have long been the cornerstones
of our success. Striving for ecological and social sustainability along the entire
value added chain, taking full responsibility for our products and giving an
unequivocal commitment to preserving resources are prime objectives firmly
embedded in our corporate strategy. Thanks to these endeavours, we have been
among the most sustainable companies in the automobile industry for many years.
The automaker's famous advertising slogan describes each of its vehicles as
"the ultimate driving machine," and it's not mere hyperbole. Over the past couple
of decades, BMWs have become the standard for performance and luxury in most
of the "over $30,000" segments. With family-friendly wagons, crisp sedans,
distinctive coupes, nimble sports cars and spacious SUVs offered, BMW's model
roster is diverse. But its luxury vehicles all share a common characteristic: the
ability to make drivers feel gloriously connected to the road.
1.3. BMW Strategies

One of the main strategies employed by BMW is niche marketing. BMW

protects its niche position by engineering, manufacturing, and developing
advertisement campaigns. BMW offers a distinctive product and service and it
developed differentiation between its products and the competitors’.
BMW used frontal attacks in order to gain a competitive position in the
automobile industry. The company employed a limited frontal attack, which
focuses on specific customers. Another frontal attack that was employed by the
company is through research and design. The company invested large amount of
money in designing and differentiating its products and services. The company
introduced improvements on the products and offered innovative features and
designs in order to enhance the value of its products.

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 The detailed view on Strategies is as follows:
1) Well-Executed Strategies
BMW is a company with well-executed strategies. The company recognizes
its distinct capabilities and chooses the market and subsequently markets, which
realized its full potential. Its dealings with its suppliers and distributors, its pricing
approach, its branding and advertising strategies, are all built around that
recognition and these choices. The company maintains a tight control over its
distribution network. This control supports the brand image and aids market
segmentation. BMW cars are positioned differently and priced very differently in
the various national markets. The same tight control is reflected in BMW’s
relationships with suppliers, who mostly have continuing long associations with
the company. BMW’s activities are focused almost exclusively on two product
ranges – high-performance saloon cars and motorbikes – which reflect its
competitive strengths.
2) Image of Prestige
Part of the company’s overall strategy is to market its products as
‘prestigious’. The company was able to develop an image of quality, reliability and
consumer aspiration. Advertising images can create strong differentiation in the
customer’s eyes. BMW has spent millions of dollars on advertising to create an
image of performance and prestige for the automobile buyer.
3) Branding
Branding is also an important strategy of BMW. BMW was able to develop
premium brands. In the development of premium brands, BMW subjects its
products in a process of continuous evolution and development. The company
established a Brand Academy.
4) Flexibility for the Customer
The BMW Group has optimized its internal processes to such extent that
wishes expressed by the customer to modify the power unit, the color, upholstery
and special equipment of the car he has ordered may be taken into account just six
days prior to the start of assembly – without any affection on the delivery date of
the car.
5) Differentiation
Differentiation is the act of designing a set of meaningful differences to
distinguish the company’s offering from competitor’s offerings. The five
dimensions of Differentiation are:
1. Product – physical products vary in their potential for differentiation.
2. Services – when the physical product cannot be differentiated easily, the key to
competitive success nay lie in adding valued services and improving quality.
3. Personnel – companies can gain a strong competitive advantage through having
better-trained people.
4. Channel – companies can achieve competitive advantage through the way they
design their distribution channels’ coverage, expertise, and performance.
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5. Image – buyers respond differently to company and brand images. Identity
comprises the ways that a company aims to identify or position itself or its
products, whereas image is the way the public perceives the company or its
products.
The automobile manufacturer uses differentiation strategies to differentiate
its products from its competitors’. By introducing innovations in engineering and
design, the products of BMW gained an image of prestige. This image is
strengthened by the company’ advertisement campaigns.
Part 2: Situational Analysis
2.1. Internal Environment:
2.1.1. Clients
After a careful investigation of BMW market we have divided BMW
customers into 3 major segments: Individuals, Businesses and Government (which
includes Police, Administration and Army).

 Individuals, amount for almost half of all customers (45%), are

businesspeople of medium+ and high income (starting from 2,500 Euros).
These are people, who work for large companies or businesses’ owners.
These are middle-age people, living in big cities, of high-status, open-
minded, adventurous and young in spirit. These people usually have at least
two cars in the family. Their cars are usually of such models, as 5, 6, X3,
X5, X6 and Z4 (usually as the second or the third car in the family).

 Businesses amount for 20% of BMW’s clients. These are medium- and
high-sized businesses with a year’s revenue of more than 2,000,000 Euros.
They prefer to use the cars in a leasing form (and then lease new ones).
Their cars are 5 and 7 models.

 Government: administration amount for 27% of the clients. All

governmental staff that have cars with drivers (BMW 7-series); and
governmental staff of middle level which use 5-series.

 Government: army amount for 1%. These are generals who have cars (7-
series) with drivers.

 Government: police amount for 7% of the customers: Special Forces of

police, who work in order to perform high-speed pursuits and catch very fast
criminals. Their cars are BMW 5-series, preferably starting with 3.5-liter
gasoline engines.
2.1.2. Competitors

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 BMW Group is the leading premium car manufacturer in the world. In
recent years BMW Group has been closely marked by its competitors. List of few
BMW Group’s series lines and brand names has to market specific competitors.
1 Series: Audi A3, Volkswagen Golf, Alfa Romeo 147,

3 Series: Audi A4, Jaguar X-Type, Mercedes C-Class, Lexus IS200,

5 Series: Audi A7, Mercedes E-Class, Saab 9-5, Jaguar XF, Volvo S80,

6 Series: Jaguar XK, Maserati 4200, Porsche 911,

7 Series: Audi A8 and S8, Jaguar XJ series, Lexus LS400, Mercedes S-Class,

X3: Land Rover Freelander, X5: Range Rover, Mercedes M-Class, Volvo XC90,
Porshe Cayenne, VW Touareg, Acura MDX, Lexus GX 470,

Z4: Porsche Boxster, Audi TT, Chrysler Sebring Convertible, Toyota Camry
Solara,

M Range: M3 Coupe - Mercedes C55, Audi RS4, M5 - Mercedes E55, Audi RS6,

MINI: Mercedes A Class, Peugeot 206 H/B, Volkswagen Polo, GTI, Golf, Renault
Clio, Ford Focus RS, Vauxhall Corsa and Toyota Yaris,
Rolls-Royce Phantom: Mercedes Maybach, Bentley Arnage.
Competitors’ analysis
Now let us compare BMW with its most specific competitors in the sphere
of business class automobiles. For this, we have chosen the BMW 535i X Drive
(The BMW 5 Series), Audi A7 and Jaguar XF.
The 5-Series is available in rear-wheel drive or all-wheel drive (X drive).
The BMW 535i X Drive has 300 horsepower 3.0-liter 6-cylinder engine. It gets 14
l/100 km in the city and 11 l/100 km on the highway. The price is near $86,000.

Jaguar XF
Strengths Weaknesses

1) Well Known Brand 1) Import Parts

2) Status Symbol 2) Repair Costs
3) Quality 3) Change in currency; price
4) A lot of add on options fluctuation
4) Ecological/gas friendly

Opportunities Threats
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 1) Globally recognized brand
2) Established brand
1) Tariffs on shipping
2) Competitive Car Industry
3) Rising fuel costs
4) Severe economic downturn
5) The BMW 535 X-drive
The Jaguar XF runs about $1800 cheaper, base price. It gets 17 l/100 km in
the city (3 more than BWM) and 12 l/100 km on the highway (2 more than BMW).
BMW is obviously the GREEN CHOICE, which gives us an upper hand on the
competition.

Audi A7
Strengths Weaknesses

1) Well Known Brand 1) Import Parts

2) Status Symbol 2) Repair Costs
3) Quality 3) Change in currency; price
4) A lot of add on options fluctuation
4) Ecological/gas friendly

Opportunities Threats

1) Increased media attention on 1) Tariffs on shipping

Audi through NY Yankees 2) Competitive Car Industry
baseball sponsorship 3) Rising fuel costs
2) Globally recognized brand 4) Severe economic downturn
3) Established brand 5) The BMW 535 X-drive
Audi A7 costs $4,400 more on average at the base price. It gets 15 l/100 km
in the city (1 more than BWM) and 11 l/100 km on the highway (the same as
BMW). BMW is still slightly more fuel-efficient and saves money for fuel.
BMW lacks slightly with horsepower, in comparison to its biggest
competitors. BMW 535 x-drive has 300 horsepower which is a very powerful car.
Audi’s A7 has 310 horsepower which really isn’t noticeable. Jaguar, however, has
385 horsepower which is significantly more. That is also what is causing the
Jaguar to get poor mileage. Our eye on the market leads us to believe our
customers want a fast car, one that can pass other cars quickly when desired, but
that is also eco-friendly and safe for traveling with the whole family.
The BMW and the Jaguar seat 5 persons where the Audi only seats 4. BMW
also provides more comfort space overall than the competition. This means that
our car, the BMW, is designed to fit you and your family comfortably. Further,
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Jaguar beats BMW and Audi in the matter of having some additional standard
equipment including a DVD player and a navigation system. We offer those items
as upgrades. Moreover, BMW happens to weigh more, but has better fuel
economy. In addition, our BMW is shorter in length and is also narrower in width
so it makes it easier to park, especially in smaller parking spaces. This will also
help protect/prevent your car from others’ unintentional door dings and butt
bumps. All the other equipment listed are pretty much standard between all 3 cars.

In this situation BMW Group has to maintain a strategy in which BMW

Group has advantage over its competitors in the long run: “to provide quality
products and services to customers by charging an extra premium showing high
production costs.”

BMW Group should look for ways of improving their supply chain
management. By doing this they can reduce the costs of their cars and could gain
more advantage over their competitors.
2.1.3. Suppliers

Suppliers could directly influence our marketing strategy in a number of

ways. First of all, if there is a shortage of raw materials, our suppliers might be
unable to produce the items we buy from them to add to the car. Perhaps it is the
plastic molding for the trim of the bumpers. There is no way we would ever sell a
car that was not 100% built and we would not heavily and financially promote car
sales if we couldn’t keep up with demand. We would have to delay the
introduction of the strategy a few weeks or months so that our suppliers could
catch up. Supply management might want to consider alternatives. There could be
a worker strike that seizes production. Tornados, tsunamis, earthquakes, and the
breakout of war could also impact production.
2.1.4. Channel Members

Channel Members could certainly impact the way the customer centers
receive the cars. Channel members mainly consist of transportation forms from
where the car is put together to the sales lot. Luckily, there is not really a
distributorship and the primary storage facility is located on each sales lot in front
of public view. There could certainly still be delays in shipping as well as at
customs. Since BMW cars are made overseas, each car sent to the US gets loaded
onto a ship and transported. Each car must go through customs, which is not a
channel member but more of a hurdle to cross. Inclement weather, natural
disasters, war, a truck-jacking, and breakdowns could also impact the delivery
dates of the cars to the sales lots. Unfortunately, it would be too late to postpone
the strategy implementation if many of these issues occurred. Plus, some of these

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issues may only impact one sales lot or just a small portion of their inventory for a
limited time.
2.1.5. Public
In order to have the whole image of the trends in the industry, it is necessary
to have the understanding of consumer buying habits, which are as follows:
 Ecological issue: as the Planet is facing serious problems with the Global
Warming, Carbon Dioxide Emissions, Pollution and other environmental
problems, it is becoming more and more popular to buy the products and use the
services of green companies.
 Price consciousness: many people are not in the race for expensive cars
and there is a great demand on low-priced cars for everyday use (particularly of
Asian automobile producers, like Kia, Hyundai, and Cherry).
 Innovation: people enjoy it to use cutting-edge technologies in a car,
such as Wi-Fi, TV connection, entertainment, autopilot system and so on.
 Tendency to use small cars, because of their mobility, which is
extremely relevant in big cities.

2.2. External environment

BMW is a vast organization and thus a vast majority of external factors

affect the running of the company which are discussed below.

2.2.1. Political

In the recent past the EU laws have recognized the fact that the car industry
is a major contributor to the emission of CO2 in the environment, recent studies
have shown that 22% of the overall CO2 emissions have been caused by road
transport of which 92% are from cars. This has had an immediate impact on
BMW’s automobile industry. The pressure of governments for greener
technologies and environmental friendly cars has led BMW to invest in such
technologies, although this has raised the manufacturing costs for BMW, it has
also created a positive image in the minds of its customers by reducing the carbon
foot prints which is created on the environment.

This has led to BMW launching its first car running on hydrogen in 2007,
which produced very less CO2 emissions. This greener image is also being made
prominent by the new engine technology called the Efficient Dynamics, which
BMW launched recently.

2.2.2. Economical

The recent financial crisis has had a huge impact on all businesses
throughout the EU, consumer purchasing power has fallen significantly this is the

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reason why in 2008 BMW had a profit before tax of 351 million Euros whereas in
2011 the profits have increased to 7.3 Billion Euros.

The second major factor regarding BMW economical climate is that of

rising oil prices, last month a barrel of crude oil had soared up to $122. This has
raised the cost of sales for the company as it has risen by 9.5% when comparing
the 2010 and 2011 financial statements. However it is worth mentioning that
profits for BMW automobiles has increased by 75% in comparison with 2010.

2.2.3. Social

The EU population is expected to be increase by 100-200 million by the year

2029 when in comparison to 2012. The breakdown of this increase shows that the
population is shifting towards more life expectancy and thus to an older
generation. This shift will cause BMW to ponder upon its green technologies as the
consumer will likely prefer a greener environment.

2.2.4. Technological

Technology has driven many aspects of social development, business and

marketing over the centuries, however the technological revolutions of the last 100
years have also led to the demise of various industries..

BMW has to constantly look after these changing environments, the BMW
efficient dynamics is doing well in the markets but the organization should always
be ready for change and one step ahead of its competitors.

Recently Mercedes Benz launched an advert of its invisible car, which emits
zero emission and Mercedes equipped one side of the car with sheets of LEDs that
show streaming images captured by a Canon 5D Mark II camera attached to the
other side of the car. The car blends into the background, making it nearly
invisible. Although the car will not go in production until 2014 but his promotional
campaign has caught attention of consumers throughout the world. BMW should
critically analyze this situation and improve its efficient dynamics and hydrogen
fuelled cars to respond to this technological advancement.

2.3. Financial Condition

The BMW Group experienced the best year of its corporate history in 2013,
selling 1,668,982 BMW, MINI and Rolls-Royce brand cars (+ 14.2 %); this was
more than ever before in an annual period. With this performance, the BMW
Group retains the pole position in the premium segment of the world’s car markets.

Sales volumes grew dynamically for all three car brands, each of them
recording their best levels ever. Sales of BMW brand cars alone rose by 12.8 % to
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1,380,384 units. A total of 285,060 units of the MINI brand were handed over to
their new owners (+ 21.7 %). At 3,538 units, Rolls-Royce set a new sales volume
record, posting an increase of 30.5 % on the previous year.

Sales volume of automobiles*

The Motorcycles segment put in another highly stable performance despite

persistently unfavourable market conditions. In total, we handed over 113,572
BMW and Husqvarna brand motorcycles to customers during the year under
report, 3.1 % more than in 2010.

Financial Services business also made an important contribution to the

success of the BMW Group. With a portfolio of 3,592,093 contracts in place with
dealers and retail customers at the end of the year, the segment recorded growth of
12.6 %.

New records set for revenues and earnings

Group revenues and earnings broke all existing records on the back of
dynamic car sales volume growth and flourishing financial services business.
Revenues in 2013 totalled € 68,821 million, 13.8 % higher than in the previous
year. Earnings were also strong, with profit before financial result (EBIT) up by
56.9 % to € 8,018 million and profit before tax up by 52.1% to € 7,383 million.
The Automotive segment recorded a 16.8 % increase in revenues to € 63,229
million, with EBIT soaring to €7,477 million (+ 71.7 %) and segment profit before
tax reaching € 6,823 million (+ 75.5 %).

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 Motorcycle segment revenues grew by 10.1 % to € 1,436 million on the back
of good sales volume performance. EBIT fell by 36.6 % to € 45 million, primarily
due to restructuring measures taken at the level of Husqvarna. These measures also
caused segment profit before tax to drop to € 41 million (– 36.9 %).

Revenues

The Financial Services segment also performed extremely well, posting a

5.4 % increase in revenues to € 17,510 million. In earnings terms, segment EBIT
rose by 46.8 % to € 1,763 million and segment profit before tax by 47.4 % to €
1,790 million.

2.4. Summary (SWOT analysis)

Strengths Weaknesses

1) Well Known Brand 1) Import Parts

2) Status Symbol 2) Repair Costs
3) Quality 3) Change in currency; price
4) A lot of add-on options fluctuation
4) Ecological/gas friendly

Opportunities Threats

1) Increased media attention on 1) Tariffs on shipping

Olympics 2) Competitive Car Industry
2) Increased media attention on 3) Rising fuel costs
BMW Championships 4) Severe economic downturn
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 3) Globally recognized brand
4) Established brand

For any organization to be successful the company has to identify its own
strengths and rectify its weaknesses, as both of them are internal to the company.
Opportunities and threats are external to the company and necessary steps should
be taken to counter these external factors. For any marketing plan to succeed a
SWOT analysis is quite important, for BMW it is below.

Strengths:

1. Strong marketing strategy.

2. Customers recognize the strong brand name of BMW Group Company.

3. Strong brand image i.e. BMW, MINI Cooper and Rolls Royce.

4. Every 2 to 3 years BMW introduces its new version of cars i.e. constant
innovation and technology.

Weaknesses:
1. There is an increasing number of duplicate spare parts of BMW and MINI
Cooper.
2. The manufacturing costs of BMW cars are very high as compared to its
competitors. This is also a reason for high pricing of BMW cars.
3. Not a mass-market company like Toyota and their volumes are small.

Opportunities:
1. There is an opportunity for BMW Group to increase further innovation and
technology in their cars due to increasing competition in car industry.
2. BMW Group should also look to make new collaboration with other car
manufacturers i.e. introducing new brands.
3. BMW Group should also look to produce cheaper cars by new innovation and
technology.
4. Expansion of the BMW Group in Asia Pacific, Asia, Africa and Australia.

Threats:
1. Recession which has affected businesses in every part of the world.
2. To maintain the same level of innovation and performance.
3. The growing competition in the automobile industry i.e. competitors of BMW
Group include Mercedes, Audi, Jaguar, Ford, Lexus.
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4. The earnings of the BMW Group are Dollar dominated, so the increasing
strength of Euro is another threat for the company.

Once an organization has established its strengths, weaknesses, opportunities

and threats, it can develop the SWOT further through matching and conversion.

In the case of BMW the company can match its strengths against its
opportunities, for example as previously mentioned that BMW spends a huge
chunk of its revenues on research, what the company can do is to direct most of its
research into how to make smaller and more efficient cars for the middle class
society as most of the consumers are not able to afford the current premium prices
of BMW cars. If the company can in some way accomplish this, it will result in
elevated sales in the EU and globally as well.

BMW recognizes the threat of volatility in the oil and fuel prices and has
thus launched its Active Hybrid 5 car which is better than the previous hybrid cars
and has a better fuel-electric consumption than its predecessors. The car can
accelerate on electricity alone. Over here it can be seen that BMW has countered
this threat by its biggest strength which is its diversity and product development.

Part 3: Marketing Programs

3.1. Target Markets

The main markets for BMW automobiles have been in Europe, the USA,
Japan and the Pacific region, with the markets of Germany and the US accounting
for almost half the total car sales. Important markets have also been the fast-
growing UK, and the Italian, French and Japanese markets.

Singles who want this car should make approx. $125,000 per year based on a
5-year loan. He or she should spend up to 15% of income covering transportation
costs (car loan, fuel, maintenance, etc.).

Income $125,000 per year or more

Marital status Any

Household size Any

Education Bachelor degree and higher

Age 30-45

Gender Any

Race Any

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 Occupation Manager or professional, technology specialist

Geographic North America, Asia, & much of Europe

Select the Possible Segment and Niche

Young Digerati: We have decided to select the Young Digerati as our target
market for several reasons. First of all, they are wealthy enough to afford the
BMW of all series. Also, they care about technology, and the BMW is very
technologically advanced. Furthermore, they care about image and status, and the
car is a hip, trendy status symbol. Lastly, we want to get customers while they are
young, so they will become lifelong BMW customers. Hopefully, the Young
Digerati will purchase pricier BMW cars like the 6 Series and 7 Series as they age.

Urbanicity: Urban

Income: Wealthy

Income Producing Assets: High

Age Ranges: 25-44

Presence of Kids: Family Mix

Homeownership: Mix, Owners

Employment Levels: Management

Education Levels: Graduate Plus

Psychographic variables

Lifestyle: Full time employee, full time dad. Very active lifestyle

Activities: often attends sporting events, opera and theater, business parties,
networking events. Active in community and church, coaches kids sports

Interests: Driving, Reading, stock trading, attending plays and sporting

events, watching CNBC and ESPN, exercising often, eating at fine restaurants, and
drinking only the best import red wine.

Behavioral variables

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 Rate of usage: Drive everywhere… to work, the kids’ schools and sports,
groceries, church, dinner, parties, date night, short family trips.

User Status: Powerful, important, upper-class, demands respect, someone to

know

Technological orientation: customers will want the best… a BMW. BMW

will offer the best; most advanced technology in cars including increased fuel
economy, collision impact safety devices, seat comfort design with heating and
cooling, music and sound, engine and sound, transmission shifting and options,
and hundreds of extra accessories that could make their car fit their every need.

Price sensitivity: Not the cheapest car line, but not our most expensive car
line either. Our customers are willing to pay more for perceived personal status.
They want status, prestige, luxury, reliability, and everything else that is associated
with our brand.

3.2. Product (PLC, BCG)

The most important element in the marketing mix is the company’s product
because this provides the useful requirements required by customers. For example:
a car that does not start in the morning will not be liked by consumers. Marketing
managers develop their products into brands that help to create a single position in
the minds of customers.

Current models of BMW:

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 The 1 Series, originally launched in 2004, is BMW's smallest car. Currently
available are the second generation hatchback (F20) and first generation
coupe/convertible (E82/E88). The 3 Series, a compact executive car manufactured
since model year 1975, is currently in its sixth generation (F30); models include
the sport sedan (F30), and fourth generation station wagon (F30), and convertible
(E93), and theGran Turismo. In 2014, the 4 Series has been released and replaced
the 3 Series Coupe and Convertible. The 5 Series is a mid-sizeexecutive car,
available in sedan (F10) and station wagon (F11) forms. The 5 Series Gran
Turismo (F07), which debuted in 2010, created a segment between station wagons
and crossover SUV.
BMW's full-size flagship executive sedan is the 7 Series. Typically, BMW
introduces many of their innovations first in the 7 Series, such as
the iDrive system. The 7 Series Hydrogen, having one of the world's
first hydrogen fueled internal combustion engines, is fueled by liquid hydrogen and
emits only clean water vapor. The latest generation (F01) debuted in 2009. Based
on the 5 Series' platform, the 6 Series is BMW's grand touring luxury sport
coupe/convertible (F12/F13). A 2-seater roadster and coupe which succeeded
the Z3, the Z4 has been sold since 2002.
The X3 (F25), BMW's second crossover SUV (called SAV or "Sports
Activity Vehicle" by BMW) debuted in 2010 and replaced the X3 (E83), which
was based on the E46 3 Series' platform, and had been in production since 2003.
Marketed in Europe as an off-roader, it benefits from BMW's xDrive all-wheel
drive system. The all-wheel drive X5 (E53) was BMW's first crossover SUV
(SAV), based on the 5 Series, and is a mid-size luxury SUV (SAV) sold by BMW
since 2000. A 4-seat crossover SUV released by BMW in December 2007, the
X6 is marketed as a "Sports Activity Coupe" (SAC) by BMW. The X1 extends the
BMW Sports Activity Series model lineup.
In 2013, the company announced that it was to launch its first fully electric
car range. This would begin with the launch of the BMW i3 in the second quarter
of 2014.

 1 Series (F20) (2011–present) 5-door Hatchback

 1 Series (F21) (2011–present) 3-door Hatchback
 2 Series (F22) (2014–present) Coupe and convertible
 BMW 2 Series Active Tourer (F45) (2014-present) Compact MPV
 3 Series (F30) (2012–present) Sedan and wagon
 4 Series (F32/F33/F36) (2014–present) Coupe and convertible
 5 Series (F10) (2009–present) Sedan and wagon
 6 Series (F12) (2010–present) Coupe, convertible, Gran Coupe
 7 Series (F01) (2008–present) Sedan
 3 Series Gran Turismo (2013–present) Progressive Activity Sedan
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 5 Series Gran Turismo (2009–present) Progressive Activity Sedan
 BMW i3 (2014-present) Electric vehicle
 BMW i8 (2014-present) Hybrid sports car
 X1 (E84) (2009–present) Compact Crossover SUV/Sports Activity Vehicle
(SAV)
 X3 (F25) (2010–present) Compact Crossover SUV/Sports Activity Vehicle
(SAV)
 BMW X4 (F26) (2014-present Sports Activity Coupe
 X5 (F15) (2014–present) Mid-Size Crossover SUV/Sports Activity Vehicle
(SAV)
 X6 (F16) (2014–present) Sports Activity Coupe
 Z4 (E89) (2009–present) Sports Roadster
M models
M-series models (fifth column in the table): based on the 3 Series, the M3
defined an entirely new market for BMW: a race-ready production vehicle. Since
its debut, the M3 is heralded in enthusiast circles, in large part due to its unique
geometry and award winning engines. The newest V8-powered platform became
available the autumn of 2007 in Europe, and second quarter of 2008 for the U.S. in
coupe (E92), and later the cabriolet (E93), and sedan (E90) variants. Based on the
5 Series, the M5 is the M division's V10-powered version of the E60 5 Series. The
M6 is the M division's version of the 6 Series, and shares its drive-train with the
M5. The Z4 M, or M Couple/M Roadster, is the M division's version of the Z4.
The X5M is the M division's version of the X5, and the X6M is the M division's
version of the X6. Both the X5M and X6M share the same V8 twin scroll twin
turbo.
Motorcycles
BMW Motorrad produced 82,631 motorcycles in 2009, compared with
104,220 in 2008, a fall of 20.7% The most popular model is theR1200GS and its
sibling R1200GS Adventure, which sold 24,467 units – accounting for 28% of
BMW's annual production. Current production includes a variety of shaft, chain,
and belt driven models, with engines from 650 cc to 1,649 cc; and models designed
for off-road, dual-purpose, sport, and touring activities.
In 2008, BMW introduced the DOHC Boxer HP2 Sport, and entered the
serious off-road competition motorcycle market with the release of the BMW
G450X motorcycle.
BMW Motorrad motorcycles are categorized into product families, and each
family is assigned a different letter prefix. The current families are:

 C series – Maxi-scooters called Urban Mobility Vehicles by BMW

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  F series – parallel-twin engines of 798 cc capacity, featuring either chain or
belt drive. Models are F650GS,F700GS,
F800GS, F800R,F800S, F800GT and F800ST.
 G series – single-cylinder engines of 449 to 652 cc capacity featuring chain
drive. Models are G450X (now discontinued), G650GS, G650 Sertão, G650
Xmoto, G650 Xchallenge and G650 Xcountry. The 450 cc engines are
manufactured by Kymco in Taiwan. The 2009 and 2010 650 cc engine parts
were manufactured by Rotax in Austria, with the engine being assembled
by Loncin Holdings, Ltdin China.
 R series – twin-cylinder boxer engines of 1,170 cc capacity featuring shaft
drive. Models are R1200GS, R1200R, R1200RT, R1200S and R nineT.
 K series – four-cylinder engines of 1,157 to 1,649 cc capacity featuring shaft
drive. Models are K1200LT, K1300GT, K1300R and K1300S. In 2011, BMW
Motorrad launched the six-cylinder 1,649 cc K1600GT and K1600GTL.
 S1000RR – sport bike with transverse-mounted, 999 cc inline-four engine.

Bicycles

Like all vehicles produced by the BMW Group, the 2014 bicycle collection
meets top standards in quality and design. The design of this new third-generation
frame gives the bicycle’s functional geometric shape a stylish and dynamic look.
The signature feature of the bikes in the collection is the “bull neck” on the front of
the top tube. The frame is reminiscent of a motorbike, tracing the outline of the
tank. Another enhancement is the third generation bikes’ seamless design. The
welding lines are smooth and all cables run inside the frame.
The 2014 collection is not just innovative in terms of its design, it also
includes a range of new technical features. Alongside innovations by BMW itself,
the new models are fitted with components by top manufacturers like Shimano and
Suntour. The hydroformed frame is robust and light, guaranteeing optimal
efficiency by ensuring maximum power transfer with minimum effort.
The new bike collection includes the BMW Cruise Bike, a new sporty
version of the M Bike, the Cruise e-bike, and the comfortable and functional all-
rounder, the BMW Trekking Bike.
Key Product features in the marketing mix of BMW
 Luxury segment
 High Quality products
 Excellent brand pull
 Good service

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 BCG Matrix

BMW has a number of successful and unsuccessful cars within their

automobiles section. The most famous and long running is the BMW 3 series.
Since 1975 when it was first launched, it has been produced in six different
generations and in no fewer than five different body styles. It is BMW's best-
selling model, accounting for around 30% of the BMW brand's annual total sales.

To analyze the portfolio of cars that BMW has to offer in the world, the best
way is to use the Boston Consulting Group Matrix.

STARS QUESTION MARKS

3 series

4 Series

CASH COWS DOGS

X series 6 series

5 series Z series

According to this matrix business and its products can be classified as high
or low according to their industry growth rate and relative market share.

BMW BCG matrix shows that Star product for the company is the BMW 3
series and the 4 series. The new BMW 3 series is highly successful in the world
market. Its market share growing from 15% to 28% in 2014(High Market Share).
This market segment in which 3 series belongs to is the major segment of the
world luxury car industry (High market growth).

The Cash cows are the evergreen products of BMW, the 5 series and the X
series. The 5 series accounting for the major chunk of the BMW world revenue
approx 30% (High Market Share). However the market which this car belongs to
does not show signs of growing.

Finally the Dog is the 6 series, which has failed to achieve the targets for
which it was produced. The reason being that their competitor’s car like the
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Porsche 911 is much better in performance and design in comparison with the
BMW 6 series.

Product life cycle

20000
18000
16000
14000
12000
10000
Sales

8000
6000
4000
2000
0
Introduction Growth Maturity Decline
Time

BMW 3 series, 7 series, 1 series, 5 series, 6 series, X1, X3, X5, X6 and Z4,
out of these models the best in running is the BMW 3 series; the car has collected
the greatest chunk of revenue for BMW over the years. But the thing to consider
while keeping these models in mind is the product life cycle. It shows the sales of
the product through their useful life during different stages of their lifecycle. The
stages include Introduction, Growth, Maturity and Decline.

If considering the product life cycle against the portfolio of cars that BMW
has to offer then it can be said that most of the BMW cars are on the maturity
stage, even though the BMW 3 Series has high market share but the market which
it belongs to does not show signs of growing as previously mentioned in the
analysis of the BCG matrix. BMW has realized this and has launched the new
version the BMW 3 Series in 2011.

BMW has to consider and place its products accordingly into the market, if
most of the products of the company are going to be in the maturity stage then
there will be serious problems for the company as all of them will be going into
decline together. Thus constant and increased improvement into research and
development has to be made in order for BMW cars enter into the growth stage of
the product life cycle.

In 2007 BMW launched a clip on the internet about its GINA Light
visionary model, it is a fabric skinned shape shifting sports car concept built by
BMW. The car is enclosed with flexible, stretchable water resistant translucent
man-made fabric skin – polyurethane-coated Spandex, is resilient and durable. It
resists high or low temperatures, does not swell or shrink and the movement does
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 not slacken or damage the fabric. Though the car is not for sale and thus hasn’t
been introduced into the markets and is kept at the Munich museum it has caught
the attention of the world when it was premiered in 2007.

BMW should launch this car in the markets now using outdoor campaign
and digital marketing as such mediums should be used for high value impact
products. The BMW Gina can give competition to the Mercedes invisible car as
both of them are new and innovative technologies and consumers are willing to
pay higher prices for such innovations.

3.3. Promotion

2012 saw BMW ranked as the world’s most reputable company by

Forbes.com. Criteria included ‘people’s willingness to buy, recommend and to
work for’ the company. Interestingly, the answers were driven 60% by perception
of the company, and 40% by perception of the company’s actual products. We
marketers know that to build a positive brand perception, it takes years and the
same has happened with BMW. BMW has been promoting itself with the most
amazing television commercials, print advertisement, out of home advertisement
and now through online advertising.

Key promotional features in the marketing mix of BMW:

 Strong brand pull due to excellent marketing over the years

 Company relies on pull strategy more than push strategy
 Top of the mind positioning in automobile brands

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 BMW has always focused entirely on their cars with same advertising
company, WCRS being the used since 1979. A broad range of advertising is used
by this agency such as television for branding campaigns and new car launches, the
press with Tabloid weekend colour supplements, regional publications and
magazines, Outdoor campaigns, Sales literature, brochures, etc. Advertising
Campaigns/Slogans used by the company in the past .

Slogans Used Time Frame

1.Positioned itself as the 1. Established itself over time
brand with the unique from its introduction in the US
benefit of ‘a luxury car that market in 1974 (the First Great
provides an exhilarating Opportunity)
driving experience with
2. Ran for 15 years – Overall
advertising.
brand – focus on prestige
2. The Ultimate Driving
3. Focus on the 7 Series
Machine
4. Focus on the 3 Series
3. The New 7 Series:
Designed for Peace of 5. New strategy with a focus on
Mind, Not Just Peace and brand & product, franchise, and
Quiet organization.
4. BMW core values at
more attainable price5.
BMW – The Smart Choice

BMW association is the ‘James Bond’ films from 1983, 1994, 1997 and
1999. E.g. 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. 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,
more technologically advanced and had created an image in mind of future
customers that have best quality, safety, they are different from others.
Sales Promotion

Sales promotion involves offering short-term incentives for potential

customers to commit to the purchase of products and services. BMW Group is

25
recommended to use sales promotion in the world market in an occasional manner
in order to increase the levels of revenues for short-term perspectives.

For example, 100th anniversary of BMW on March 7, 2013 was specified as

an appropriate occasion to announce 10% sales promotion for all BMW models.
However, it is important to note that BMW needs to engage in sales promotions in
the world market only in an occasional manner, no more than once a year, because
using sales promotion more frequently may cause depreciation of BMW premium
brand value.
Public Relations

Effective public relations need to play an integral part in BMW marketing

strategy. It is important for BMW to maintain regular contact with all
organisational stakeholders with the use of various marketing communication
channels. Specifically, communication channels used in public relations include,
but not limited to online press releases, annual reports, speeches, and seminars.

As part of their corporate social responsibility initiatives BMW management

is also recommended to increase the level of its association with local charities in
the countries.

Moreover, BMW management can initiate the development of identity

magazine of the BMW Group which can cover the latest trends and news in local
and global automobile industry and at the same time serve as an effective channel
to communicate the marketing message to the target customer segment.
Engagement in Celebrity Endorsement

BMW can engage in celebrity endorsement by attracting celebrities that are

respected by the majority of BMW target customer segment. Real-life examples of
celebrity endorsements in automobile manufacturing industry include singer Heidi
Klum associating herself with Volkswagen Beetle, Australian pop-singer Kylie
Minogue advertising StreetKA, Victoria Bekcham associating herself with Range
Rover, Uma Thurman serving as the face of Range Rover etc.

Celebrity endorsements can be done in relation to BMW brand in general, or

in relation to specific car models within BMW portfolio. Effective engagement in
celebrity endorsement can offer BMW the advantages of increasing the levels of
credibility, enhancing the level of brand recall, enhancing the appeal of BMW
brand to the masses, and others.

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 BMW E-Marketing
To outrun its competition, BMW has incorporated the internet to its overall
marketing strategies. Because about 85% of its customers conduct internet research
before purchasing, BMW has invested on internet through website, online
applications and television, and social networks to conduct e-marketing. BMW
uses internet for online advertising, marketing public relations, promotions, direct
marketing and improving customer relations. With its establishment on internet,
BMW provides its customers with rich marketing information quickly, on-time and
at low costs through e-newsletters, e-magazines, online broadcast, emails and text
messages.
Social networks
BMW e-marketing strategy incorporates social networks such as Facebook,
Twitter and Youtube due to the potential of reaching a great number of people at
relatively low cost. BMW uses social networks as they allow multimedia and
interactive communication with a large number of consumers enabling to conduct
viral, communal and influenced marketing campaigns. Additionally, the company
uses the platforms for satisfied customers to easily recommend their products to
others and also as a medium to conduct customer-product conversations and brand
blogging. The official BMW Facebook page has 13,396,064 likes and more than
100 thousand followers on Twitter. With such a great number of fans compared to
its competitors, BMW is able to deliver its advertisements to a large number of
people at an instant and easily draw them to its websites at a relatively low cost.
“Story of Joy” campaign

BMW’s 2010 “Story of Joy” advertising campaign was intended to attract

customers who were not necessarily driving enthusiasts as the “Ultimate Driving
Machine”.

The campaign associated social networks, dedicated website , games and

interactive ads, collectively integrated with traditional marketing channels. An
industry-specific intelligent social media listening tool was used to determine the
impact of the campaign; and was noted that the brand conversations by females
had increased by 20% signaling a definite demographic shift (J.D.Power, 2010).
The impact of the campaign was easily understood through internet compare to
traditional channels due to the rich user information such as age, gender and
location. The overall joy campaign was very successful resulting in a rapid
recovery of company net profit.

27
 BMW Films Campaign

The 2001 “BMW Films” promotional campaign through online short films
was designed explicitly to direct consumers to the BMW Films website. Web
visitors were required to registration in order to watch the films, hence BMW was
able to both spread the message and obtain consumer information. The campaign
was supported by TV adverts, prints, billboards and online advertisement that all
directed to the same BMW Films website thus collectively increase traffic. The
campaign results were historical to the automotive industries at that time with more
than 10 million views, 2 million registrations with 60% opting to receive more
information, all at a cost of around only $1.20 per person (Hespos, 2002)..
Additionally, 94% of the registrants recommended films to others which resulted
in a viral campaign and website traffic increase by 55% to 214,000 unique visitors
compared to the weekly 138,000 enabling BMW to increase yearly sales by 12.5%
in 2002 and later reported to have reached 74% (Pareek, 2009; Strauss, et al.,
2006).

3.4. Distribution

Distribution includes all of the business activities involved in making the

product available to target customers. BMW sells its cars through a number of
showrooms in each country and as well as from an extensive network of dealers
who are provided with far-reaching expertise and knowledge from BMW. B sales
services to their customers.

There are more than 16 dealers in Ukraine who are franchised to sell BMW
cars. Worldwide BMW operate in more than 100 different countries with
approximately 4,000 plus dealers which are authorised to sell both new and used
cars, parts and after sales service products.

Pattern of distribution for BMW is shown below in the diagram which is

followed by the company: Manufacturer  Dealers  Consumers.

Proportional flow performance of channel member:

Manufacturer performs mostly in Promotion, Negotiation, Financing, and
Risking, and Payment - as these are the most important parts of the business.
Dealer is mostly involved in Physical possession, Negotiation, Risking as it
deals with warehousing and transporting the cars and Ordering, as it needs to deal
with customers directly.
Consumers' performance is in Physical possession, Ownership, Promotion.
Financing, and Payment, as it is the customer who makes the whole system
working.

28
 The cost added by each member is as follows:
Dealers 15-18%
BMW 82-85%

Major Channel for segments

In order to satisfy various customers needs, BMW uses the following

channels.
Individuals make orders through the web site and in dealer offices.
Businesses as well make their orders in dealers but they also can order the
cars directly from BMW manufactures.
Government Structures, obviously, order cars from BMW manufactures.

BMW dealers in Ukraine:

• AWT Bavaria (Lepse) - Kiev

• AWT Bavaria (Parus) - Kiev
• AWT Bavaria (Podol) - Kiev
• AWT Bavaria - Dnepropetrovsk
• AFZ Bavaria - Zaporizhia
• Car-Alliance - Poltava
• Emerald Motors - Odessa
• Impulse - Donetsk
• Bavaria Motors - Kharkiv
• Avtodel - Simferopil
• Christina - Lviv
• Aria Motors - Lviv
• M AUTO - Mikolaiv
• Car Alliance - Kremenchug
• Automobile House "Victoria" - Lugansk
• Bayern Zahid - Khmelnitsky
• Valerie M - Rivne
• Center Kherson – Kherson

On the Ukrainian market BMW uses only exclusive distribution. This type
of distribution is usually seen with high end and luxury products, which is
absolutely suitable for BMW cars.
The structure of an exclusive distribution favors both the manufacturer and
the distributor: All dealers receive cars and auto accessories without mark up, they
have unlimited dealer agreement and are provided with all necessary corporate
identity elements. The headquarters on the other hand have complete market
coverage and a total control over the quality of front office, which is especially
important for luxury products.

29
 All Customer Segments are covered: those customers who are aware of the
BMW products are able to buy very easily what they are intended to buy; those
who don’t know what they need but want to buy some BMW car, receive high
quality consultancy so that they can make a decision whether to buy a car and
choose the specific package that absolutely suits the customers’ needs.
In order to communicate to those potential customers who don’t have the
intention of purchasing BMW, the company uses TV, Internet, wire advertising,
product placement and screening short films dedicated to BMW cars, so that
potential customers become interested in this brand.

3.5. Pricing
The prices of BMW Group are based on a differentiated strategy. This
means that they charge extra for premium quality. This difference in prices is due
to each cars different engine size, gear levels, fuel consumption, sports version.

Let’s take an example of the pricing strategy that has been used by BMW for
the 3-series is competition-orientated pricing. Most of the Research shows that all
other competitor such as VW, Audi, Alfa Romeo and etc. in the 3-series market is
based around the same price. 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.

BMW could be either dynamic or negotiated pricing depending on the sales

person. Dynamic because the car can fluctuate between prices or negotiated
because the buyer and seller can come up with a reasonable price for both parties.

Value based pricing

BMW is definitely a value-based product brand. Cost can be an issue if it is

priced unrealistically against the cars of close competition, but overall most of our
customers are not concerned with price as a contribution factor. BMWs are luxury
cars and are elastic expenses. But when the economy is weak, our car becomes a
hot pick as a secondary choice for BMW customers who buy the higher luxury
cars. BMW customers are not only purchasing their car due to legroom, high
technology, and comfort nor just for the reasons of high horsepower and great fuel
mileage. They are buying BMW’s because of the brand name and the quality and
reliability the brand name stands for.

External Pricing
1. Customers: Since it is perceived as a luxury automobile, BMW customers
are willing to pay around $60,000 for a 5-Series. However, if BMW decided
to increase the price of the 5-Series to $90,000, the company would most
30
 likely lose some customers because $90,000 is beyond the acceptable range
for that type of product. For $90,000, BMW customers expect to buy the
larger 7 Series.
2. Competitors: Regarding the BMW 5 Series, its main competitors are the
Audi A6 and the Mercedes-Benz E-Class. As a result, BMW must ensure
that the 5 Series has a similar price.
3. Legal, Regulatory, and Ethical Concerns: In addition to applicable laws
and regulations, BMW should consider the ethical dilemmas in pricing. For
instance, what are BMW’s ethical responsibilities regarding full disclosure
of prices for upkeep, updates, or replacement parts?

Internal Pricing
1. Product Strategy: If sales of the Audi A6 increase dramatically, BMW
could lower the price of the 5-Series to defend its market share.

Segment Pricing

BMW uses segment pricing in their pricing strategy by offering programs

for recent college graduates. With a recent degree or diploma and a letter from a
current or future employer, graduates that qualify can receive the best pricing and
financial offers that BMW has. This is particularly good for the demographic
chosen because of their young age. Many may have already graduated from
college, but many more may be going to law school or going back to get their
Masters. BMW wants to hook a younger market so they can be life-long
customers. By helping graduates, they are making that possible.

Discounts

BMW offers several different discounts depending on what and how the
customer is purchasing. For example, in a lease, BMW offers a $1,500 dollar credit
and a reduced interest rate of 2.9% for 36 months. Leasing, especially starting out,
is a good idea for a young person like those in the target demographic. BMW
offers discounts because, to a buyer, it is enticing. A good deal has the potential to
persuade a customer to choose BMW over, say, Mercedes-Benz.

Part 4: Conclusions and Recommendations

4.1. Concusions

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, I started off with very little knowledge
about this topic and worked my way through the assignment and I would conclude
31
that BMW is a very powerful name in the automobile industry due to its reputation
of providing high quality products and services.
BMW Group is the leading premium car manufacturer and seller in the
world. The sales of BMW Group are rising day by day. But one great threat for
BMW Group is the increasing competition in the automobile market. BMW Group
has got fiercing competitors like Audi, Mercedes-Benz being the two nearest to
BMW Group in competition in the premium car industry.
BMW Group is now trying to target the emerging markets of the world. The
sales of BMW Group in different markets of the world tell that the European and
the US markets are the best markets for BMW Group in terms of sales. In recent
years, however, the Chinese market has been a great attraction for the BMW Group
and sales have been increasing every month for the BMW Group.
In the end it may be said that the BMW Group distinguishes from its
customers by its great advertising and marketing campaigns and mostly by their
great brand image. The innovation of the company, diversification in new markets,
technological advancement and customer satisfaction are the key to BMW success
in the luxury car market.
The latest TV-Ad of BMW Group is a great description of BMW Group as
an automobile leader in which they say, “we just don’t make cars, we make joy”.
BMW Group should also remain careful to the changing trends in demographics,
society, thinking of people and remain a diversified company.

4.2. Recommendations

Most of the people argue that there is always a chance to learn new thing or
no matter. 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, I would like to recommend few points.

The BMW cars are considered to be as the luxury cars, of which most
products are applied to rich people but not the poor people. BMW can enter the
market with Small ‘Lifestyle’ Car which can apply to the middle-class people, its
market share can be expanded.

On the other hand, its accessories and parts of cars are expensive for
maintenance, which can reduce the desire of people purchasing its cars.

In addition, for this can get few new models in BMW Mini this could help
then to target few different segments and also can target females, Middle-class or
upper middle class people. BMW can also create good relationship with female
buyers, they need to do more of promotional strategies to attract more of female

32
consumers 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- pink colour, soft-
toys, trendy seat covers, etc.

Furthermore, The Asia Pacific region is becoming increasingly crucial to

global automotive sales. Although it has been overshadowed by China's rapid
growth in recent years, 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. These markets are going to be huge as there is
more population in these countries as in comparison to US and UK market.

In addition, BMW needs to come with few more BMW Films interactive
marketing campaigns, the "Ultimate Driving Machine". As it is had very
successful and showed good promise in it for the selling point. 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.

33
 References
1. BMW Annual Report 2013.
2. Hespos, T. (2002) “BMW Films: The Ultimate Marketing Scheme, retrieved
October 3, 2005, from http://www.imediaconnection.com/content/546.asp
3. BMW BLOG, BMW targets 8% return on equity, Retrieved from
http://www.bmwblog.com/2011/03/15/bmw-group-annual-report-2010-bmw-
aims-to-further-increase-earnings-in-2011/
4. Article. Supply Chain Management of BMW. Management Paradise, online
community
5. http://www.managementparadise.com/forums/elements-logistics/211402-
supply-chain-management-bmw.html
6. International BMW website
7. http://www.bmw.com/
8. Bavarian Auto Group website
9. http://www.bag-eg.com/

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