BMWFilms Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

BMW Films

Introduction:

Bayerische Motoren Werke formally known as BMW was originally formed in the year 1916 as an aircraft engine manufacturer. The company has produced its very first automobile in 1929 that was Munich-based. By 1980, BMW had successfully positioned itself as luxurious brand with high performance. By the end of 1990s, the company has 400 dealers in the United States that is 106 sold BMW only versus 150 dealers for Lexus and Infiniti. The production cost of 5 BMW films was $15 million. The market share of BMW along with its other competitor are mentioned in the figure 1.

bmw films case solution

Problem Statement:

In order to out class its competitors, the company is making its attempt to focus on good branding strategies. The primary goal of BMW is to bring innovation, achieve goals related to sales and gain maximum share in the market. As a result of this, BMW produced five short films and named as BMW films. The purpose was to attract a younger generation but during this, the company neglected its existing customers. As of now, the company needs to ensure market share growth to become a leader in the industry. Further, the company needs to win over its new and existing competitors to increase brand loyalty. In addition to this, the company needs to maintain a high level of productivity and creativity of marketing campaigns.

Symptoms:

The main reason behind these problems was that the company was losing its market share against new Japanese market players. Further, customers disposed of their BMWs at the end of the year 2000 but there were only 44.7% who purchased the new one. In addition, 37% of the customers switched their brand and purchased Mercedes, and approximately 12% of the customers replaced their BMW with Lexus. Lexus was giving a tough time to BMW by having a cheaper and fresh luxury image than BMW and thus penetrated more aggressively in the market.

Situation Analysis:

By the end of 2000, the vice president of the marketing department of the company Jim McDowell decided to make short films on the product of the company. At that time, the company was leading in terms of its brand equity in the American market. The management of the company was now thinking about creating their relationships more and stronger with their existing consumers and to grab the attention of new ones.

The marketing team of the company was not in favor of using traditional advertising and promotion as there was no new launch of BMW’s product. At that point, the company found an opportunity and decides to show people that the company does not produce just cars with tremendous performance. The aim of the company was to alter the traditional perception of individuals about the BMW, and this can be done by making amendments in the communication mix. After that, the BMW came up with the idea of BMW films after realizing that there are many individuals that are not only murmured about the superlative performance of the brand whilst Madonna and altered the behaviors of potential and existing customers. The big idea of these films was not making people buy the brand rather, making long-term relationship with them.

SWOT analysis:

Strengths:

One of the main strengths of BMW includes superior quality along with reliability and tremendous service. Further, the company is introducing new model and series in its portfolio. Another strength of the company includes strong and renowned brand image with unique brand positioning. Further, because of the BMW films, the company is enjoying a buzz in the market and the media is giving a positive reaction about it. The company always enjoyed high customer loyalty. Additionally, the company always enjoyed a first mover advantage in the industry along with having professional and experienced marketing team.

Weaknesses:

One of the primary weaknesses of the company is a premium and higher pricing than its competitors that make them less attractive to price-sensitive customers. Further, the company has to spend high to ensure desired product diversification. In addition to that, the target market of the company is mature married individuals with nearly niche product. The consumers of the company were sick of BMW’s historical Yuppie-car image.

Opportunities:

The company can target market segments with having lower income bracket. The company can also go for new products like small SUVs, minivans and pickup trucks. The company can make efforts to improve performances of its vehicles as well. Furthermore, BMW can make more and more these kinds of short films. Moreover, the company can go for finding new marketing opportunities that are not the traditional ones for instance, games.

Threats:

One of the major threats for BMW was obviously from its competitors. With respect to the idea of BMW films, the company has threat that competitors......................

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Jim McDowell, vice president of marketing for BMW North America, discussed how to ensure the success of its latest marketing campaign, "BMWFilms". The campaign consists of five short films for the internet, directed some of the hottest young directors in Hollywood. Apparently, the unconventional campaign was a huge success. Now the question is what to do for an encore? "Hide
Youngme on the Moon, Kerry Herman Source: HBS Premier Case Collection 26 pages. Publication Date: February 11, 2002. Prod. #: 502046-PDF-ENG