Bmw Strategy

Topics: Brand, Strategic management, BMW Pages: 11 (3776 words) Published: May 11, 2013
171 a


Question 1 - Success of the BMW Group
1. Introduction
The BMW Group was founded in 1917 and today is one of the leading. automobile and motorcycle manufacturers worldwide with a workforce of more than 100,000 associates in over 100 countries (BMW Group 2012). The company possesses three of the stron gest premium brands in the car industry, BMW. MINI and Rolls-Royce, as well as holding. a strong market position within the motorcycle sector (Innovation Leaders 2011). According to Linkedln (2012) the company aims to create profitable growth and returns that are above-average by focusing on the premium segment of the automobile market internationally.

2. Approptiate Measures for Success
2.1 Revenue and Profit According to the BMW animal report (2011), the company sold 1_668.982 automobiles and the overall revenue for the compan y was e68.8 billion at the end of the 2011 financial year, with the net profit standing at 64_9 billion, Furthermore the report shows that the 2011 fiscal year was the best in the history of the company, with sales volumes, revenues and profits reaching, new highs and exceeding annual targets set by the BMW Group. This is reinforced when comparing current profits to those before the worldwide economic recession; net profit in 2007 was E3,14 billion, meaning 2011 showed a 51_7% increase in profit from that year. This is a clear indication of the recent success of the BMW Group on a financial basis, as the company is outperforming their set targets and seem able to sustain sales revenue and profit growth over time. Although the sales and profit figures discussed are obviously large in volume, to be

appropriately measured as success, it is appropriate to compare these figures against competitors within the luxury car market. Tony Paterson (2011) indicates that BMW currently rates as the world's best-selling premium car-maker against its main rivals, being Audi and Mercedes-Benz. A.ccording to Audi (2011). their revenue for the fiscal year 2011

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was €.44 Billion, with a net profit figure of €4.4 Billion, For Mercedes-Benz cars, Daimler

(2011) report revenues for 2n11 of €57_4 billion and earnings before interests and taxes of €5.1 billion, with no net profit reported_ These figures support data regarding the BMW Group, as it shows the company is superior to competitors in both revenue and Net profit. 2.2 Brand Name and Global Brand

With regards to the strength of the BMW brand: in 2011, the brand value of the company increased by $15 billion to 520.15 billion (Brand Directory 2011). This resulted in the BMW Group rising within the BrandFinance® global 500 to a ranking of 23. evidence to suggest that the BMW Group have one of the best known brand names in the world. The BMW Group is committed to enhancing and maintaining its presence in key markets worldwide (BMW 2009), Furthermore the BMW Group operates 2.5 production and assembly facilities in 14 countries and has a global sales network in more than 140 countries (BMW Group 2011). proving that the company operates very much on a global scale, Therefore the success of BMW can be further acknowledged, as they are able to sustain their success globally and not simply on a domestic scale.

3. Reasons Behind BMW Group's Success
3.1 Growing lielarkets According to the BMW Annual Report (2011) the worldwide sales of automotive passenger cars and light commercial vehicles grew from 72.5 to 75 million from 2010 to 2011. showing a growth in the market as a whole_ As discussed BMW Group has recently displayed their best financial year in the company's history, which can be linked to many of their current individual growing markets. BMW Group Asia (2012) reported a total sales of 9,336 units in

the East Asia Region, that includes 11 markets, which is a 17% increase compared to 2010. Similarly. the sales of BMW Group in Russia amounted to 30,167 cars and SUV's for 2011. which equates to a 39.8% growth from the previous...
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