Bmw Films Case Analysis Essay Example

Bmw Films Case Analysis Paper Marketing I : Professor Ian Fenwick Marketing I : Professor Ian Fenwick | BMW Films Case Analysis| | | Chalit Borwonnauwarux D540010| | | Executive summary BMW face though competition in US market after try to improve the situation by introduce number of new model to the core series, adjust pricing so it can compete, reorganize the dealer network and introduce new series of car to the market. Now we have a chance to focus on brand campaign call â€Å"BMW films† which is very successful campaign base on number of people who visit the web site and number of people who want more information about BMW. After analyze the data I found that viable option for management should do after very successful BMW films campaign is to utilize the film more by spreading and make more people see the film. We also can make people get DVD of the film if they go to the BMW dealer and this will show how we improve our dealer. This will only last for short term since the impact will be decrease as time goes by. My purpose for long term plan is for BMW to launch new BMW 1 series, which is design to be to capture younger customers. From data of people who visit bmwfilms. om website younger generation is also interested to buy our car but they can’t because of price barrier. I want to introduce new coupe for this new market segment. BMW films Analysis In BMW films we shift from what we normally do which is push strategy to pull strategy and emprise more on what make a BMW a BMW focus on branding only. To measure it success, movie quality is not the main measure of success, I will look at it from 3 perspective viewer data, target group and brand image. In this analysis I will make Lexus and Mercedes as main competitor because from data in chart1 and Chart 2 we can see that a lot of BMW owner witch from BMW to Mercedes and they switch to buy another car not to truck or SUV that BMW didn’t have. For Lexus they are the next brand that customers of BMW switch to in luxury segment and in term of volume they are number one in this market segment. While their car are at lower price point but they triple media expenditure compare to BMW, while Mercedes is spend twice compare to BMW, try to defend and counteract to Lexus is important or otherwise Lexus brand may surpass BMW in north America too. We will write a custom essay sample on Bmw Films Case Analysis specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Bmw Films Case Analysis specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Bmw Films Case Analysis specifically for you FOR ONLY $16.38 $13.9/page Hire Writer First I will focus on data that we collected from user who watch the film from website so we can see how many people are watching each movie and then judge whether target customer, both current and prospect, is watching this film. From data in chart 3 we can see that number of user who came in and watch movie is over 9. 6 million views we also got almost 2 million visitors. The most important thing that we get from that is data for both current target market and prospect customer in the future and in that we found that around 30 percent of user who register already own luxury cars, some may argue that data that have been put in may be fake. Even so the number of data that we gather is a lot, if we cut half of them as fake, we still get one million prospect customers and we get 300 thousand luxury car owners. We got around 1. 2 million user who want email update and if we run campaign again this group will also tell their friends about that ,if manage well, they may turn in to brand ambassador protect BMW brand. Another way to make sure accuracy of data is to cross check name and address with current BMW customer database and see how many of them are match. This campaign may attracts younger audience the average age is only 31 compare to average age of BMW owner which is 46 years old and have less average income only 88,000 compare to 150,000 but one thing that you need to keep in mind is most of BMW owner when they want to buy new car they still prefer BMW if we can persuade younger generation to buy BMW 3-series as their first car there are very high chance that they will upgrade to BMW 5 series and 7 series when their salaries increase especially since we have broader type of car to answer different need of customers that’s very profitable when we look at customer lifetime value to company. Attracting younger customer also help us improve brand image compare to competitor. From data (Chart 4) we can see that BMW driver are younger compare to main competitor, such as Lexus and Mercedes, if we can make BMW brand attach with â€Å"young â€Å" and then make other competitor brand look old this will help to attract more younger customer and make them commit to use BMW for the rest of their life. Another thing that we can see from BMW customer base is while average ages of BMW owner are younger but their average incomes are higher we make people remember that BMW is the car for â€Å"highly educate, bright, affluent person who want to have a great driving experience†. If we can own that position which utilize BMW strong point as â€Å"Ultimate driving machine† then push other competitor to â€Å"car for boring and old people†. This campaign also improve brand image by reduce bad thing that associate with BMW brand such as â€Å"Status symbol, Yuppie-Machine† and also stress what BMW is all about â€Å"amazing performance† and try something new and exciting. This show people what make a BMW a BMW which is the main purpose of this campaign. From all reason above I think this campaign is successfully improving brand image of BMW and since target customer of BMW in another part of the world is almost the same we can use this movie to another part of the world. The effect may be not as successful as original one because we lose element of due to the internet age some may already watch movie via internet. It may not be as effective but since we already paid for the cost of production if it improve brand image we can utilize it more without any drawback. Some may argue that movie from America may not suitable for European or Asia but most of blockbuster movie also came from US not just that all movie critics were very positive about our films. One thing that we need to adjust is to make it more effective we should select only 3 films that have high positive impact on our brand then we need to add subtitle to make sure that peoples in each continent, which use different language, understand what movie is all about. We should run campaign to draw people to the BMW website in each continent then make them register their data to the website the same way that we do it in America. BMW owner demographic is different compare to main competitors such as Mercedes and Lexus. BMW owner are male, the same as our main competitor, but average age is lower compare to others (chart4). Median income is higher compare to Lexus customer base but lower than Mercedes. When we compare that demographic to data of people that watch BMW films we can see that viewer are younger and have lower median income this could be one of the opportunity of BMW. - BMW target is different from competitors, not just in term of demographic, in term of positioning. Mercedes are focus on classic prestige luxury and status, more comfortable and more conservative the same go for Lexus. BMW though we focus on driving experience car shouldn’t be just the tools to move you to point a to point b but experience in between BMW slogan as â€Å"ultimate driving machine† said it all. Evaluate options Before we decide what we want to do next I would like to go through each option strength and weakness of each option separately 1st Option: making existing five movies available for wider audience. We can make full length version of the existing movie in DVD and distribute it for people who come and test or buy any BMW car this will draw people to come to dealership and try our car. Another thing we can do is distribute this movie to every BMW customers who have owned BMW before and from record we didn’t see them bring their car for the routine checkup and didn’t buy any new BMW this can interpret that they already sold car and didn’t buy new BMW as their new car. We can use that movie to impress them with what BMW is all about and how we improve. Final group that we can send DVD to is current BMW owner who have come to checkup in the last 6 month to show them the new version of the car and remind them that if they want to buy a new car BMW is still a great choice. Strength 1. This will fully utilize money that we already spend on the movie. 2. Draw people to the showroom which increase chance of sell 3. Improve BMW brand image by remind people who never watch BMW films before what make a BMW a BMW improve our brand image. 4. Make people who may use to own BMW but switch to another brand to re-consider BMW next time they buy new car. Weakness . A lot of current BMW owner or used to own BMW may already see that movie so this DVD may not have any impact at all on brand image. 2. Some who switch to another brand may be because of another reason that didn’t about brand image such as quality of dealer and/or price this campaign isn’t help to improve anything. 3. We didn’t emphasize on improvement that we make a t all. Since we have improve a lot of thing from number of new model in core series to new series especially on pricing strategy and dealer which may be more important factor for a lot of people compare to just brand image alone. nd Option: Develop more short films, all featuring same lead actors. Since a lot of people who watch the film tell us that they want more this type of short films and the movie is help improve BMW brand image. While some may argue that we look like we repeating ourselves. We can build another 5 films and then we can distribute it as â€Å"collectors set† Strength: 1. We build on something that proves work last time around. This time more people may want to see it since last one is love by critics. 2. If we build different type of movies not only just action film we may draw new group of customer who never watch the first batch of movies. Weakness: 1. Since competitor will copy our success, impact of the new film will be a lot less because we lose element of surprise that we got from the first movie plus another will copy it so people may see new movie and look down on it. This may have bad impact on brand image. 2. Amount of money that we need to invest in this new movie will be high, may be higher because we need to improve from the first one. We will need to decrease normal advertising which will be used to introduce new model to people. Trade off will be hard to justify since impact of campaign will be reduce. We also need money to introduce a lot of model that will be launch. If we reduce money that use to make new movie the impact of the movie will be reverse now BMW brand may look cheap not luxuries. 3rd Option: Develop a feature-length movie and air in theatres around country. Strength: 1. Brand awareness that we will get from movie will be very high since this movie will be air around country and BMW will be the first brand who do something like this. All of the buzz will be belong to BMW and tell customer what make a BMW a BMW. Weakness: . Cost to do full feature-length film will be very high and this is not counting cost of promoting the film properly, cost of make BMW films available in movie theater all across country. While another film can charge full ticket price but this film since a lot of people will know that it is came from BMW it will be hard to ask for audience to pay full price for movie that want to show a car. With very high cost we can’t just share it with nor mal marketing budget it won’t be enough or you will need to use all budget for the movie alone. You will need a lot of sales to support that amount of spending which I don’t think it will increase that much. 2. With another brand launch short films, people may be bored with this type of tactics and make not that much improvement in brand image. 4th Option: move to the next thing While this option may be look like it is more risky but it’s show that BMW as a brand is not just an boring brand but a brand who always defined what can be done which show both in the BMW car and way we market them. Recommendations My recommendation is to use option 1 to spread out movie to draw customer to a improve dealer and see what BMW car really all about but also use option 4 Move to the next thing done something that hasn’t been done before in the long run I select option 1 at the beginning because it can be done very fast and almost without any draw back but it cannot work in the long run. Most people who want to see the movie will see it already. How can we make a progress from this very good brand image? We need to make sure that we communicate to more people what make BMW a BMW It’s something that consistent with our brand image. We can’t just do the same thing over and over again then call our brand â€Å"exciting edgier and youthful† it is inconsistency which bad for BMW brand image. Especially when your target is highly-educated, bright and affluent person they will see that BMW is about doing the same thing which is not what we want to do. Let others do it make competitor follow us that way our brand look like leader not a follower the same for BMW owners. From demographic of people who watch BMW films we can see that the average age is younger and because of that their average salary is lower. I saw this as an opportunity to make them BMW owners. Now they want to own BMW but they can’t, they have to buy from other brand which mean we loss customers not only for that car but it’s possible that we may lost that customer forever. From data we know that most of BMW owner will stick with BMW I would like to make an entry level car for customers who want a driving experience which they cannot get from other car in the market. We can show that BMW can do something that other can’t, we will make new coupe for young manager who want to experience the â€Å"ultimate driving experience† that other cannot give them. Price of this new car which I will call it â€Å"BMW 1-series†, the smallest car BMW will ever make, the base car will be the same as competitors while we can add another optional extra to increase on the road price of the car. Currently (in 2002) Lexus still didn’t have coupe car and Mercedes A-class isn’t well accepted since they have problem about the car will be overturn when you change direction so suddenly (eventually they have to recall). We will start new category which is luxury sport coupe and make it work this time. We can make profit from this car because of additional extra normally are fitted to another BMW, we don’t need money to develop new technology for that. Another thing that we can do the sport version like BMW M1 which will show if you willing to pay more how much faster you can go compare to normal version. This will make profit especially when we look at life time value of customer when they age is increasing their salary will be increase too. They will move from 1-series to 3-series and then when they have family they can move to BMW X5. The new BMW 1-series must be represent what BMW is all about â€Å"what make a BMW a BMW†. When other coupe are focus on folding seat and space inside car, BMW 1-series while we still need to have folding seat but main focus will be on the driving experience. Normally in Japanese or European coupe are front wheel drives which make driving is boring. BMW 1-series should be rear wheel drive and have higher horse power compare to competitors. We can advertise this car as a ultimate driving coupe, the only coupe that care about how you get to the place you want to go. Not just that but we still need to focus on another part which we still need to focus on it is luxuries. This is not easy we need to control cost to make the price low enough so it’s lower than BMW 3 series but still have performance and luxuries that consistent with BMW brand image. To make a car more luxury we didn’t have to put everything in a car what we need to do is put something that make a car more civilize such as good air-conditioner and radio as a standard we didn’t have to put something that customer in this market segment is consider important such as vibrate seat or cruise control as standard. We still have all of that option as optional extra if customer want it you can add it to car at a price. Some may argue that BMW series 1 will reduce prestige of BMW brand and that happen to Mercedes when they launch the A-Class. We can prevent that by make sure that the new BMW 1 series meet the standard that our brand has been doing all along. Start from the look and feel of the car, it still need to look sport that’s the reason why I am focus on coupe instead of hatch back which have image of cheap car. Another thing that shouldn’t be forgot is the build quality including quality of material that we use in the car from plastic console to rubber seal that use to make sure that noise from outside won’t come in to the car. If we do it properly consistent with our brand value we will improve our image since we can do something that our competitor can’t. We introduce â€Å"ultimate driving experience† to more people and we do that in the price that younger generation can’t resist. Another argument that may arise is this new BMW 1 series cannibalize 3 series. They won’t because the difference is not only price but it is also difference in size and power. If you want to buy mid-size sedan, which what 3 series is in, you can’t buy BMW 1 series since it’s smaller and power that it have also lower too. Since 1 series design as a coupe you will only get 2 seat not four it is more suitable for young people who still didn’t have children which from average age of bmwfilms. com visitor profile there will be market for this car that is not cannibalize BMW 3 series. Some may ask how about Z3 roadster is this new 1 series cannibalize it that is impossible because of price different and Z3 is a roadster which have different target customer. Exhibits Chart 1 : BMW Defection to all makes (4Q,2000) Chart 2 : BMW Defection to competition in luxury segment (4Q,2000) Chart 3 : BMWfilms. com visitor profile Median Income| $ 88,000| Total Visitors register| 1,981,049| Opted in for email update| 1,170,953| Voluntarily responded to survey | 41,411| Recommended films to others| 94%| Want to see more films| 88%| Chart 4 : BMW customer base Vs the competition