Case Study BMW Films Decision Problem and Issues Statement With the great sales performance and strong brand awareness in U. S.
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BMW now needs to make a decision on whether to continue to build on BMW film idea or start looking for new ideas for the next campaign. In addition, BMW faces a variety of sub issues that stem from the major issue: • Strengthen brand image – always focus on strengthening the luxury image of the brand and not lose lead in the luxury market • Stay ahead of the competition – ensure that new marketing ideas are innovative, stylish that provides BMW with a competitive advantage Define the target market for each product line – differentiate each BMW product which caters to different specific target groups in order to further increase the sales volume and market share. Decision Alternatives 1. “Milk” the existing film campaign – use the existing 5 films to strengthen brand image by focusing on reaching a wider audience 2. Develop more short films - Develop more short films to compliment the originals and continue to build up the momentum and awareness. 3. Feature film - Develop a feature length movie for theatre audience to further enhance the emotional connection with BMW . Do nothing – move on to a new marketing initiative Decision Criteria The criteria that are important to the alternative analysis are: • Easy to implement • Improvement of luxurious brand image • exposure to all audience especially potential buyers and car lovers • brand recognition as the luxury and quality car maker • Monetary and time investment • Innovative non-traditional idea for communication campaigns Industry Analysis Success in the luxury car industry is characterized by the strength and quality of the product, differentiation of target customer group and uniqueness in brand communication.
The luxury car market is a highly competitive market consisting of numerous brands each with a variety of models. Elegance, performance, technology and driving experience are all critical factors in the manufacturer’s success. The threat of brand substitution is high, with each manufacturer offering competitive products positioned for specific market segments, whilst Supplier power in the industry is low as there are many suppliers competing for the luxury manufacturers business. Company Analysis With BMW quality of cars and their previous marketing campaigns, BMW is well positioned to compete in the luxury car market.
The company is building a strong product lineup, with additional models added to the core product segments. Through key position in performance they have improved brand loyalty and continue their focus on the “ultimate driving machine” campaign. This focus has now been expanded to position BMW as “the most exciting luxury car. ” To ensure the company is focusing and satisfying on the customers’ needs, BMW has conducted extensive market research and has worked hard to make the vehicles appeal to the North American market with a wide range of products for a variety of segments and stand out amongst the competition.
However, a limited marketing budget makes it difficult for BMW to effectively market to each one of these segments. BMW believes that “the future belongs to the nimble. ” which is central to the cars and the marketing efforts. BMW’s mission is to be the first to figure out what the “next big thing” in marketing is going to be. Evaluation of Alternatives 1. “Milk it” – in this situation BMW would use the existing short films and try to expand them to a wider audience. This would be easy for BMW to implement as the films have already been produced.
Films could be distributed to existing customers on DVD, or could be shown in theatre as a movie trailer. This option would expose to a wider audience and would promote BMW to more people, it would also reach audience who are used to the traditional TV channel or DVD viewers only, and would continue the success and awareness of the original release. 2. Develop more short films – This alternative would be expensive yet easier to implement because BMW has previous experience and resources in working with short films as a marketing tool and it may continue to build up the awareness.
However, some competitors might try to copy this idea so this would not be innovative or stunning anymore. Over time, these films would lose their effectiveness as a marketing medium. Moreover, it will require substantial investment (15 million) which could be used in a different way to improve sales revenue. 3. Feature film – This alternative is one the boldest idea of being the first to market with new marketing initiatives.
This is also the hardest alternatives for BMW to implement because of a huge amount of time and money associated with producing a feature film, and BMW has no experience with such an endeavor, although a feature film could strengthen the image as a market leader in the industry. 4. Do nothing, move on - This option is the easiest to implement as there is no immediate action required by BMW. The risk associated with this alternative is that a new idea may not materialize and the competition may be the first to act with new, powerful and more acknowledgeable marketing initiatives.
The do nothing strategy is not consistent with BMW marketing strategy, and does nothing to strengthen the brand image or improve market share. Recommendation The recommended course of action for BMW is to “milk it” (See Appendix 1). BMW should stop creating more films and use their limited budget towards other more innovative ideas to really promote each individual model that they are planning to launch. As can be seen from Appendix 2, except Lincoln, BMW spent the least money per sold unit car among 10 competitors.
BMW could consider to slightly increasing the marketing fund but spent in a different and smart way. Besides distributing films to existing customers on DVD and showing in theatre as movie trailer, we would highly encourage BMW to use their marketing budget: 1. To create internal customer appreciation support, such as having appreciation events, inviting their clients to ‘pre-launch” shows, encourage their current customers to share their BMW experience with their friends and families and reward them not with money, but with “recognition and appreciations”, which would truly make BMW a proud to be own vehicle. . To come up with more staff incentive with their marketing budget because their sales forces are the ones who market their products daily. 3. To participate and to create more kinds of award for their different lines, and add on product features to be promoted over and over again for their target and potential audience to understand what makes a BMW stand out more, how is it more innovative and to satisfy a customer’s need on other media channels. 4. To consider “product placement” in the movie(instead of producing a BMW movie), only if budget allows. Appendix -1 Alternative assessment form for BMW |Easy to implement |Improve brand image|Exposure to reach |Brand recognition |Monetary and time |Innovation on |Total | | | | |more people | |investment |non-traditional idea | | |Alternative 1 “Milk it”|3. 0 |2. 5 |3. 0 |2. 5 |0 |1. 0 |12. 0 | |Alternative 2 “ |1. 5 |3. 0 |2. |3. 0 |-1. 0 |1. 0 |10. 0 | |Develop more short | | | | | | | | |film” | | | | | | | | |Alternative 3 “feature|0 |3. 0 |3. 0 |2. 0 |-3. 0 |2. 0 |7. | |film” | | | | | | | | |Alternative 4 “Do |3. 0 |2. 0 |1. 0 |1. 0 |0 |1. 0 |8
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