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Portfolio BMW Marketing Report PDF
Portfolio BMW Marketing Report PDF
Portfolio BMW Marketing Report PDF
Claudio Floritelli
M00390157
17 April 2013
The purpose of this study is to analyse the current position of BMW; the first
phase will aim in providing information on the automotive sector, analysing the
company, the competitors, and the macro-environment identifying also the
key issue of the company. The second phase presents a more practical
approach targeted to the identification of some marketing objectives, and
developing a strategy to achieve them.
1. Introduction
In this report just secondary data will be used; collected from BMW annual
reports, automotive related website, and market analysis. Some marketing
tool such as PEST analysis, SWOT analysis, Bell curve and Boston matrix
model will be used to analyse the company and some of it’s products.
3. Findings
a. Competitor analysis
The German automaker experienced a steady increase in sales in the last few
years, as it has always been able to respond to the attacks of its competitors
with an increasing level of technology and innovation that characterizes its
products, thanks to important investments in R&D. The design is also a
fundamental and integrant part of the competitive advantage of BMW, despite
the critics to the ex chief of design Chris Bangle (Wired, 2009). As far as
competitors concern, the BMW has always faced the competition of the
compatriots manufacturers such as: Mercedes, Audi, and Porsche which
benefit from a similar brand-reputation and price range, but also from
overseas brands brand such as Lexus and Toyota. It is important to consider
that BMW Group has two other brands in its product range moving from the
premium sector of MINI to the luxury one of Rolls Royce, which would imply
also a different range of competitors. The automotive sector is a fast moving
sector, and the competitive advantage is not immune to this type of
environment; for this reason BMW cannot count on temporary advantages
over competitors but should always aim to improve their competences
(Mangold, 2012).
b. Market and Customer analysis
The main purpose of the environment analysis is to identify and evaluate the
future prospective of the company and its relations with the external
environment. PEST analysis will be used analysing political, economical,
social, and technological factors, which affect the macro-environment of
BMW. As far as political factors concern, laws and regulation are strongly
affecting the automotive sector; increasing restriction aimed to the
environment preservation and pollution abatement are being applied,
especially in the European countries, with a major impact on automobile
manufacturers, and BMW (Bmwgroup, 2010). Economic growth on certain
countries and a strong economical crises of others are the two variables
which strongly affect the automotive sector; as mentioned before BRIC
countries are experiencing growth with a resulting increasing buying power
which would affect positively the sector, but at the same time an economic
downturn in the US is generating unpleasant consequences. Demographic
and cultural changes are usually the ones, which affect the social factors in
the analysis. In the automobile sector seems evident a change in the
customer choice; as a matter of fact fuel efficiency and low emission are
becoming more and more important in the car choosing process (Gstatic,
2011), also guided by the economic recession in mature markets.
Technologically, there is a really important trend, which sees R&D taking a
crucial role; increasing technology with the aims to gain competitive
advantages are widely applied from automobile manufacturers and BMW, in
some cases technology is also being used to regain the decreased margins of
the industry (Autoevolution, 2011).
d. Internal analysis
e. SWOT analysis
Strengths Weakness
- Significant investments in R&D - Strong competition in the luxury
- Strong brand reputation segment means constant fight for the
- Solid production and distribution market share
network - Uncertainty of competitive
advantage
Opportunities Treats
- Growing market in the BRIC - Strong competition in the global
countries market
- Growing demand for hybrid and - Currency exchange risk
electric vehicles - New pollution governments
- UAE emerging markets regulation
- Increase in fuel price
- Economic downturn of certain
markets
f. Key issues
- Could the increase in the fuel price represent a problem for BMW?
- How the company could manage to remain the market leader in the segment
of premium automobile despite the strong competition in the sector?
- Economic downturn of European and US market will represent a problem for
the company?
- Will the new regulations and laws in term of ecology represent a problem for
some of the brand’ products?
4. Marketing objectives
BMW has always been linked to exclusivity and luxury, but according to the
new perspectives of German carmaker, seems that the group wants to open
the doors to the entry level segment of the market (Bmwgroup, 2012). For this
reason, another important marketing objective should be orientated on
creating product awareness for this particular sector in one-year time; this
would work especially in the markets affected by the crisis in order to regain
the lost sales. Without a correct implementation of this kind of strategy, there
is in fact the possibility that the customer would not consider the possibility of
buying BMW because perceived as too expensive for his budget. At the same
time it is important fort the company to not lower the perception of the main
brand.
BMW is finding increasingly interesting the concept of eco-friendly, and
environmental sustainability car and way of transportation. The company
since 2007 is involved in developing a new sustainable concept of mobility
trough hybrid and electric cars (bmwgroup, 2013). This can be seen and
interpreted in two different ways and it can generate another two important
future marketing objective for the company. The first one is product related;
BMW will soon lunch in the market the new i3, a fully electric concept car
equipped with an high technological content, capable of covering more than
200 km on a single charge, and this demonstrates how the group is interested
to embark on the road of environmental sustainability. Basically, producing
eco-friendly vehicles should be set as a marketing objective bearing in mind
the economic crisis, the increase in fuel and new laws in terms of pollution;
this objective could be reached in four years time because of the already
structured competencies of BMW. Another important example that confirms
the theory comes from the New York Auto Show where the first ever four-
cylinder diesel, has been presented in the US market from BMW (Autoblog,
2013). As far as the forth and last marketing objective it presents itself as a
result of the previous one; the group should increase awareness of its Eco
sustainability in two year time, which would also give resonance to all the
advanced technology achieved trough R&D investments.
6. Growth strategy
a. Product
b. Price
c. Place
BMW is very committed in the promotion of its products, the company in fact
invest large amount of money in product placement in movies such as “The
World Is Not Enough” and others. New advertising techniques are largely
used by the brand to enhance the design and quality of its products, however
could probably be profitable for the company to focus on the environmental
sustainability of its future products. In order to create awareness in the BRIC
countries BMW should apply principles of global marketing to its
advertisements, in order to shape them according to the county’s culture.
9. Conclusions
Autoblog (2013) 2014 BMW 328d ready to burn oil in just four
cylinders. [online] Available at: http://www.autoblog.com/2013/03/28/2014-
bmw-328d-new-york-2013/ [Accessed: 14 Apr 2013].
Franzen, G., & Moriarty, S. E. (2009). The science and art of branding.
Armonk, N.Y., M.E. Sharpe.
Milmo, D. (2012) European car sales fall for 12th month. [online]
Available at: http://www.guardian.co.uk/business/2012/oct/16/european-car-
sales-fall-new-car-registrations [Accessed: 15 Apr 2013].