Case Study: Bmw

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In 2006 BMW Group confirmed its position as the world's leading premium manufacturer in the automobile industry with record sales, and profits exceeding €4 billion1. Since its inception, the BMW brand has stood for one thing: sheer driving pleasure. For many BMW drivers, owning a BMW has symbolic meaning of quality, efficiency and engineering expertise. BMW’s long-standing marketing message has been simply “the ultimate driving machine”, which is now 33 years old, (Trout, 2005).

In 2000, BMW linked suggested future segments with the redesigns to its product line. The new cars reflected the predicted changes in consumer tastes and behaviour which they had found through commissioned consumer research. According to the then Chief Executive. Helmut Panke ‘The product initiative allows us to be focused on market segments that we see developing in the future. Tastes are changing. Customers are slicing the market into more focused pieces. It's becoming more differentiated…. The market is shifting. But satisfying the market's demand for new niche products is a strategic risk anyone in the industry has to take. To be successful, you have to fulfill 100% percent of customers' expectations.2

Matching future segmentation research to product development or product or line extensions can be difficult. There are strategies to execute line extensions without confusing, and losing, your customers (Trout, 2005). What these strategies have in common is rigorous attention to the brand's position matched to clear understanding of future customers needs.

BMW regularly undertakes research into their customer’s occupations and hobbies. The information is used across all areas of the business, from the design and development of the cars, through their premium pricing and all elements of the marketing mix. 3 In the late 1990’s, BMW sensed the attitudes and values of luxury-car buyers were changing with more emphasis on family and leisure time. These new upscale consumers included...
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