BMW-MINI Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

Introduction

The Automotive Industry is a worldwide industry having a massive presence of manufacturers, intermediaries and consumers all over the globe. Differentiations in the automobile industry are evaluated by the production of cars that vary in size, price and specifications. Overall combined turnover of the global car industry, is estimated at $2 trillion until date, making it equivalent to the sixth largest economy of the world. BMW was founded in 1916, as a German automobile, motorcycle and engine manufacturing company. Currently, it stands as a global brand catering to consumers who can afford the luxury to buy posh vehicles (Amos, S. 2011).

BMW-MINI is a product of the BMW Corporation that attracts buyers who want to buy the brand’s product but for a low price, with classiness and compact size. MINI as the name suggest is a vehicle, which is manufactured to be compact but a spectacle to the eye boasting a sporty, classy and energetic image. It came into being in 1959 and through the years has established itself as a highly sought out brand for not just regular consumers but for celebrities as well. BMW-MINI, has survived the test of time and today BMW’s prime product is catering to purchasers who are interested in buying compact vehicles (BMW Group 2012).

SOSTAC Analysis of BMW-MINI

SOSTAC analysis is going to be the main framework through which BMW-MINI’s marketing presence will be highlighted and the features, which define this framework, are situational analysis, objectives, strategy, tactics, actions and control (Kurtz, D.L. 2009).

Situational Analysis

Situational Analysis of BMW-MINI begins with the definition of the product’s goal, which states that MINI is a brand that focuses on providing reasonable product consumers at low price, which meets all his desires regarding attractiveness, sportiness and classiness. The compact feature of the car and additional features like reduced fuel consumption, customized engine and low price makes it an attractive commodity for the consumer to purchase (BMW Group ,2012).

Customer’s perception about the product is very much influenced by the fact that it is a compact solution to all their car troubles. Its strengths can be categorized as its longevity to survive as a viable commodity for the consumer, in addition to the features of low fuel consumption, cheap price and attractive nature. Its opportunities include further infiltration into international markets especially the Asian markets and growth of the brand’s overall production that was estimated to be 216,538 units in the case (Amos, S. 2011).

MINI is a sustaining innovation that does not creates new markets or values as in the case of disruptive innovation but evolves existing markets with new values as it has done by extending BMW-MINI’s original product line with the introduction of new models like MINI-Cooper, Hatch, Convertible and Countryman. Due to the brands popularity BMW has kept the brand continuation thereby; ignoring the transaction cost in favor of economic prosperity (Lindstrom, M. 2005).

Objectives

Jochen Goller director of MINI-UK said “The new MINI was introduced as a technological evolution and a branding revolution”. This indicates that objectives are clearly defined for MINI that involves continuous improvement and innovation in its technology and to brand the product in such a way that creates value for the consumer (Brand Report. 2011).

Network Effect is a very important concept to understand here because in order to create value for the product, the company must create awareness about it and MINI has done it through networking; that is by bringing intermediaries into play like advertising agencies and social networking forums. MINI wants to provide customer satisfaction and create brand loyalty, so it can sustain itself in the market of compact vehicle manufacturers by offering wide variety of MINI models and customized MINI vehicles (Trehan, R. 2009).

Strategy

BMW-MINI segments its market as a compact size vehicle manufacturer and targets a market of individuals who want to buy low cost but branded BMW cars. It positions itself as a car solution for all consumer problems whether they are of commuting, fuel cost and high prices; MINI resolves all of them through its low price, fuel efficiency and compact size. It also creates an online value proposition by providing on its website the facility of customization of the car and test-drives to attract aspiring buyers (Madslien, J. 2010).

Another strategy that BMW-MINI uses, which will be further elaborated in tactics is media marketing which allows it to run promotional campaigns on the TV, Social media and other means of mass communication (Face book 2012).

Tactics

According to the marketing mix provided in the case, MINI continuously innovates its product line and brings in more models as stated in the case like MINI-Clubman or Countryman. It also provides test-drives to encourage buyers for early booking of models that are introduced in the market. Its price setting is done in such a way, which influences buyers to acquire the product as its prices are reasonable for a branded car and for different models, these differentiated models are well differentiated to accommodate a customers buying power (Vered, A. 2007).............................

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