BMW Brand Audit Report

8/6/2019 BMW Brand Audit Report

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PPROJECT RREPORT

ON

SubjectSubjectBrand ManagementBrand Management

Supervised BySupervised ByDr. Reshma NasreenDr. Reshma Nasreen

Submitted BySubmitted ByAzharuddin KhanAzharuddin Khan

MBA (Pharmaceutical Management)Semester: 1st, Batch: 2009-11

Department of Management Studies

Jamia Hamdard, New DelhiJamia Hamdard, New Delhi

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ContentsContents

Brand Inventory

History3

BMW Group..4

BMW India.4

Brand Width..5

Brand Portfolio.6

Product Attributes...7

Marketing Strategies...7

Brand Exploratory

Mental Map....8

Customer based Brand Equity9

CBBE Pyramid.10

Recommendations..11

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Brand Inventory

HISTORY:

Bayerische Motoren Werke AG (BMW) is a German manufacturer of automobiles,motorcycles, and aircraft engines. Based in Munich, Germany, the company is the leadingauto exporter in Europe. The English translation of the company's name is Bavarian MotorWorks.

The company traces its origins to 1913, when a Bavarian named Karl Rapp began anaircraft-engine shop in Munich named Rapp Motoren Werke. In 1917 Rapp resigned and thecompany, led by Austrian engineer Franz-Josef Popp, changed its name to BayerischeMotoren Werke. That same year chief engineer Max Friz designed the company's first aircraft

engine, the six-cylinder Type IIIa, which created strong demand for BMW engines. When the1919 Treaty of Versailles prohibited German companies from producing aircraft and aircraftengines, BMW switched to making air brakes for railway cars. In 1923 Friz developed thecompany's first motorcycle, the R32, a model that held world speed records for motorcyclesduring most of the 1930s.

In 1928 the company entered the automobile business by acquiring FahrzeugwerkeEisenach (Eisenach Vehicle Factory), a maker of small cars based in Eisenach, Germany. Inthe 1930s BMW began producing a line of larger touring cars and sports cars, introducing itshighly successful model-the 328 sports car-in 1936.

After World War II ended in 1945, Allied forces dismantled the company's mainfactories. BMW made kitchen and garden equipment before introducing a new, inexpensivemotorcycle to the German market in 1948. The company's return to auto production in the1950s resulted in poor sales. In the 1960s the company turned its fortunes around byfocusing on sports sedans and compact touring cars, and it began to compete with Mercedes-Benz in the luxury-car markets of Europe and the United States. BMW's U.S. sales peaked in1986 but then dropped steeply, partly due to competition from two new luxury cars-Lexus,made by Toyota Motor Corporation, and Infiniti, made by Nissan Motor Co., Ltd. The 1989collapse of the Berlin Wall led to a boom in car sales in Europe, and in 1992 BMW outsoldMercedes-Benz in Europe for the first time.

In 1990 BMW formed a joint venture with the British aerospace company Rolls-RoycePLC to produce aircraft engines for business jets. In 1992 BMW broke ground for a majorautomobile plant in Spartanburg, South Carolina, its first automobile plant in the UnitedStates. In 1994 BMW acquired 80 percent of the Rover Group-a British manufacturer of smallcars, luxury cars, and Land Rover sport-utility vehicles-from British Aerospace PLC. The $1.2billion acquisition brought the company into new markets.

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The BMW Group:

With the three brands, BMW, MINI and Rolls-RoyceMotor Cars, the BMW Group has its sights set firmly on thepremium sector of the international automobile market. To

achieve its aims, the company knows how to deploy itsstrengths with an efficiency that is unmatched in theautomotive industry. From research and development to salesand marketing, BMW Group is committed to the very highestin quality for all its products and services. The company'ssuccess to date is proof of this strategy's correctness. Thestrategic objective is clearly defined: The BMW Group is theleading provider of premium products and premium servicesfor individual mobility.

(BMW Headquarter at Munich,Germany)

Overseas subsidiaries

o South Africao United Stateso Indiao Chinao Canadao Austria

BMW IndiaHeadquartered in Gurgaon (National Capital Region) BMW India is a 100%

subsidiary of the BMW Group. The initial investment in India is 1.1 billion IndianRupees.The wide range of BMW in India include the establishment of a production plant inChennai (Tamil Nadu) and development of a dealer organisation across majormetropolitan centres of the country.

On 29 March 2007, BMW India officially opened its production plant inChennai. The BMW Plant Chennai produces the BMW 3 Series and BMW 5 SeriesSedans in petrol and diesel variants and has a capacity to produce 3000 units peryear on a single shift basis.

Presently, 12 dealers represent BMW in the Indian market; Bird Automotive(Gurgaon, NCR), Deutschen Motoren (New Delhi); Navnit Motors (Mumbai), InfinityCars (South Mumbai); Krishna Automobiles (Chandigarh); Navnit Motors(Bangalore), Delta Motors (Hyderabad), Kun Exclusive (Chennai), Bavaria Motors(Pune), OSL Prestige (Kolkata), Parsoli Motors (Ahmedabad) and Platino Classic(Kochi) . Owing to an exuberant growth potential, BMW is hopeful of multiplyingits annual sales volume and has already chalked out an extensive dealer strategyto support its plans.

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BMW India will further strengthen the dealer network by stepping into PhaseII, by expanding into the markets of Ludhiana, Bhubaneshwar, Jaipur andCoimbatore, by the end of 2009.

BMW dealerships presently display the BMW 3 Series (325i, 320i and 320d,320d Highline) and BMW 5 Series (525i, 530i, 520d, 530d and 530d Highline) that

are produced at the BMW Plant Chennai. BMW dealerships also display the BMW6 Series (650i Coup and 650i Convertible), BMW 7 Series (750Li), BMW X3 (X3xDrive25i, X3 xDrive20d) and the BMW X5 (X5 xDrive48i and X5 xDrive30d) whichare available in the country as CBUs (completely built-up units). The BMW M3coup, BMW M3 Convertible, BMW M5, BMW M6 Coup, BMW M6 Convertible,BMW 6 Series Individual and BMW 7 Series Individual can also be ordered at BMWIndia dealerships.

BMW India has also established an International Purchasing Office (IPO) atits Headquarters in Gurgaon. The IPO will focus on the development of exportsfrom India to the BMW Group International Production Network and there worktowards increasing the sourcing share from India over the next years. The

activities include the identification and assessment of potential suppliers takinginto account BMWs requirements for quality, technology and logistics. The IPOwill explore procurement of production material (components) as well as IT andEngineering Services.

BMW Financial Services.BMW India has partnered with Bajaj Allianz General Insurance for offering

motor insurance and with ICICI Bank to offer customized financial solutions andORIX Auto Infrastructure Services Limited for leasing services for its customers.These products and services are offered through the BMW Financial Services.

Brand width

BMW: Since its inception, the BMW brand has stood for one thing: sheerdriving pleasure. Sporting and dynamic performance combine with peerlessdesign and exclusive quality, resulting in the unique appeal of BMWautomobiles.Website: www.bmw.com

MINI: The MINI brand is refreshingly different: extroverted, spontaneousand in every respect something out of the ordinary. Ideal for a society thatwas young, unconventional and ready for change, the MINI Classic became

a cult vehicle in the sixties and seventies. Since then the brand has lostnone of its youthful charm. MINI is part of a lifestyle that is cosmopolitanand confident, ready for everything.Website: www.MINI.com

Rolls-Royce: Rolls-Royce Motor Cars Limited has been part of the BMWGroup since January 1, 2003. Rolls-Royce is one of the most fascinating andwell-known brands in the world, the luxury motor car par excellence. For over

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100 years, motor cars of the Rolls-Royce brand have stood for truly outstanding engineering,quality and reliability.Website: www.rolls-roycemotorcars.com

Motorcycles: Premium is the key word for BMW Group motorcycles as well.

The group has enjoyed great success with their strategy: to develop and buildthe best motorcycles, set standards with regard to technology, environmentalprotection and safety, and provide outstanding customer service in the pre- andafter-sales phases.Website: www.bmw-motorrad.com

BMW Brand Portfolio

1Series

Three-door Five-door Coup Convertible

3Series 6Series

Sedan Touring Coupe Convertible Sedan ActiveHybrid 7

5Series 7Series

Sedan Touring Gran Turismo Coup Convertible

X Series Z4 Series

X1 X3 X5 X6 ActiveHybrid X6 Z4 Roadster

M Series

M3 Sedan M3 Coup M3 Convertible M5 Sedan M5 Touring M6 Coup

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M6 Convertible X5 M X6 M

PRODUCT RELATED ATTRIBUTES: Stylish peerless design German engineering Performance Luxury Reliability Comfort Speed Safety

Exclusive quality Well-established brands

Marketing Strategies

COMMUNICATION, PRICING AND DISTRIBUTION:

Most of the BMW communication takes place through print media inmagazines and newspapers. This is supported by communication through TVadvertisements and point of sales promotion. Now a days a good company has a

state of the art web portal, BMW websites are highly informative, interactive anda pleasure to watch. One can get any amount of detailed information regardingthe prices, features, retailers, and support services etc. There are companyspecified retailers and distributors throughout the world who are in constant touchwith the parent and comply implicitly. Dealers also have round the clock servicingand repair. BMW also has a used car portal where one can choose and buy his/herappropriate model.

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Brand Exploratory

Customer knowledge: BMW has successfully leveraged its history and traditionof excellence along with innovation to become the most famous and recognizedcarmaker in the world. Typical consumer brand associations for BMW might beheritage, stylish, luxurious, powerful, elegant, performance and fuelefficient to an extent.

Sources of brand equity:The BMW name, one of the oldest in the history of carmakers, is no doubt is an important source of brand equity. But being a Germancar is also a key source of brand equity. The symbol with white and bluepartitioned circle is a known symbol all over the world. The fact that its a Germanengineered car adds a ton to its brand equity. Germans are the best engineers inthe whole world. BMW has a Brand Ambassador named as Maria Ilieva, who is aBulgarian Singer and Producer, recognized as a most successful female vocalartist.

Sponsorships: BMW has been engaged in motorsport activities since the dawn of the firstBMW motorcycle. It is currently sponsoring:

Formula BMW - A Junior racing Formula category. Kumho BMW Championship - A BMW-exclusive championship run in the United

Kingdom.

Games:Formula One - BMW has won 19 Grands Prix as an engine supplier. In July 2009, BMWannounced that it would withdraw from Formula One at the end of the 2009 season.

Touring car racing- BMW has a long and successful history in touring car racing.Motorcycle Rally - BMW motorcycles have won Paris Dakar Rally 6 times.

Philanthropy: The company is a charter member of the U.S. Environmental ProtectionAgency's (EPA) National Environmental Achievement Track, which recognizes companies fortheir environmental stewardship and performance. It is also a member of the South CarolinaEnvironmental Excellence Program and is on the Dow Jones Sustainability Group Index,

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which rates environmentally friendly companies. BMW has taken measures to reduce theimpact the company has on the environment. It is trying to design less-polluting cars bymaking existing models more efficient, as well as developing environmentally friendly fuels forfuture vehicles. Possibilities include: electric power, hybrid power (combustion, engines andelectric motors) hydrogen engines.

BMW offers 49 models with EU5/6 emissions norm and nearly 20 models with CO2output less than 140 g/km, which puts it on the lowest tax group and therefore could providethe future owner with eco-bonus offered from some European states.

At brand level, too, BMW does better than its main competitors in the premiumsegment by significantly more than half a liter of fuel consumption with an average level of160 g CO2/km. The vehicles of the next best competitor have a CO 2 emissions level of 16grams more than the models of the brand BMW, with the next competitor after this at a levelwhich is as much as 28 g higher than the brand BMW - equal to a whole liter of diesel.Between 2006 and 2008, the brand BMW achieved a reduction in fuel consumption of 16%,more than doubling the reduction attained by the next best premium segment competitor. Atthe same, BMW vehicles are still well ahead of their competitors in terms of average engineoutput

BMW Mental Map

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Luxury

Image

Stylish

Powerful

Heritage

Efficient

Performance

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(BMW mental map)

The customer based brand equity pyramid (CBBE):

The BMW customer based brand equity is equally strong on the left andright hand sides. It is also strong from bottom to top, enjoying the highest brandawareness of a carmaker as well as high repeat purchase rates and customerloyalty. To a certain extent BMW has successfully focused on both the superiorproduct attributes and the imagery associated with owning and driving a BMW.

Points of parityGerman automaker, Quality engineering, Durable, Stylish & sleek designs,Attractive

Points of difference

History and heritage, Characteristic Symbol, Number of variants, Luxurywith Performance efficiency

CBBE Pyramid

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CBBE Pyramid attributes

Resonance:Top notch quality and comfort: highloyalty, highrepeat purchase,

Judgment:State of the art technology and quality: world classcars, innovation anddesign, cleverdesign, simple tooperate.

Feelings: Social approval and self respect, environment concern.

Performance: Exceptional Customer service, good resale value, less maintenance, lesspolluting, superb on road performance.

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Imagery:Historical and classic image: since 1916, associated with racing events andRallies.

Salience:High awareness: German marvel, best in the class, excellent finish.

Recommendations:

Competition:There is a sudden increase in competition from the other carmanufacturers in all the segments. Mercedes is the prime competitor then thereare others like Volvo, Honda , Toyota, Volkswagen etc. The competitors arelaunching new products everyday to have a greater pie of the market share aswell as the customer mind. The trends and scenarios are constantly changing inthe consumer market. The silver generation with a demand for mobility andfinancial strength needs something which appeals to them. The lifestyles havechanged. There must be individualization and differentiation between lifestyles

and products. BMW must keep this in mind and develop products. For instance,BMW can attract middle and moderate culture families by launching more fuelefficient and less priced variants.

Technology: Market needs products with excellent networking but simpleinteraction. Customers environmental sensitivity is increasing. Environment isbecoming a competition factor. Nevertheless BMW takes necessary steps towardsenvironment protection and development but the need of hour is to developvehicles powered with renewable sources of energy. E.g. BMW has Hybrid carsbut they are not much efficient as Hondas Hybrid cars.

Product differentiation must be done through technology and emotion and a

clear product and a brand image. BMW must extend product leadership especiallyregarding design, driving experience and quality.

BMW must specifically address image generators and developing loyal, longterm customer relations. BMW must connect to the women consumer too. BMWhas MINI brand but there is a huge untapped female consumer market which isstill untouched. BMW can design and develop products exclusively for thissegment.

Merchandising: Company can sell t-shirts, mugs, apparels of BMW logo in orderto build a strong brand equity. Company can also appoint EntertainmentCelebrities (with respect to locality or region basis) to strengthen brand equity.

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BMW Brand Audit Report

Documents

Transcript of BMW Brand Audit Report