BMW Z3 Roadster Launch in USA

04/10/2023

Launching The BMW Z3Roadster

SuketRajul

Ashish SinhaAbhishek AnshumanPGPEX-III

04/10/2023

What Are We Going To Discuss?

• About BMW’s Objectives• How did they select Z3 Roadster for launch• How did they select non traditional marketing• How did they utilize the channels• What are the challenges ahead• How can we analyze it further

04/10/2023

BMW Group International

•Cars produced–BMW, MINI and Rolls-Royce

•HQ in Munich, Germany.

•Operations in 150 countries

•Attractive 'four-cylinder' tower as main office building

04/10/2023

BMW Sales Needed Attention

0

100

200

300

400

500

600

700

US Unit Sales(in thousands)

Worldwide Unit Sales(in thousands)

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BMW Wanted To Grow Further

• Target– Increase unit sales to 100,000 in the US mkt. – Promising youth segment

• Opportunity– Falling Worldwide Market for Motorcycle

which generated market of substitute product for the same psychographic market segment

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BMW Had To Identify Right Product

• Race Cars

• Dune Buggies

• SUV

• Roadsters

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BMW Selected Z3 Roadster

• Captured essence of BMW brand–Performance and luxury – The Ultimate Driving

Machine

• Was best fit with positioning of driving excitement–Emotional substitute for motorcycle segment

• Evoked BMW’s heritage as a producer of roadsters

• Fit the corporate goal of being the best not the biggest

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Z3 Concept Tests Were Conducted• Revealed interest across life stage segments– Image conscious Gen X– Aspirational car for men and women in 40s– Nostalgia for late baby boomers

• Identified commonalities across groups– “Lover of Life” mindset– Propensity to seek unique expressions of

individuality

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Spartanburg Selected For Production

Germany America

Munich

Spartanburg

04/10/2023

Why Spartanburg?

• Displayed commitment to dealers and American people that BMW is here to stay

• Provided cost advantages–High cost environment in Germany–Cushion against monetary fluctuations

• However, also posed challenges – To convince consumers that quality of cars

produced in the USA would be no different from cars produced in Germany

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So What Did BMW Aim For?

• To expand the BMW franchise & market share– Target of 100,000 annually in USA

• To rejuvenate the BMW brand by positioning the Z3 squarely in American culture and settling into the hearts and minds of the American public

• To make BMW a global brand– Transition from Made in Germany Made by

BMW

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Why Did BMW Select Non Traditional Marketing

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Components of Advertising

Objectives Setting

•Sales objectives

•Communication objectives

Budget Decisions

•Placement in movie at low cost

•NTM more cost effective

Advertising Evaluation

• Sales impact

• Communication impact

Message Decision

•American experience

•Made by BMW

Media Decision

•Co-launch with movie & star

•6 other NTM channels

•Synchronized with movie premiere & product launch

04/10/2023

Why Non traditional Marketing?

• Non traditional marketing is fit – – To weave the car into the fabric of the American

experience.– Also to get the car on people’s conversational

agenda. – Then to leverage the buzz to promote the brand.

• For psychographic segmentation, nontraditional marketing is more cost effective

04/10/2023

How The Media Was Selected

• Primary choice multi media including – a product placement in a premier film– a TV show sponsorship– fashion world tie-in

• Selected Fallon as the agency – based on proven experience in integrated and

electronic marketing, key skill for nontraditional marketing

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Why Product Placement In A Movie?

• Adds glamour to the product• Reaches out to two hard-to-reach audiences:– Foreign viewers– Young people

• Highly visible placement with celebrity endorsement – “impact placement” - at an average of $40,000.

04/10/2023

Z3 Roadster in “The GoldenEye”

• Without a fee! – MGM got the use of prototype vehicles for the movie.– MGM also obtained worldwide rights to reference the

placement

• Perceived fit between Bond & Z3 brand personality– BMW looking for a glamorous hero. – Bond as handsome, wealthy, resourceful & adventurous. – Man who loves life and is in control of his destiny– Known for using technology with penchant for fast cars

The quintessential hero for a quintessential car!

04/10/2023

BMW-MGM “Co-Launch”

• Co-launch of – The Bond actor – The GoldenEye film – And the BMW Z3 roadster

• BMW – Covered product costs for prototype vehicles– Invested in advertising Z3 as James Bond’s new car

• MGM – Supported Z3 in the movie previews and trailers

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And Here Is Z3 with Bond!

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And Here Is The Scene

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Other Marketing Channels Used By BMW

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Need for Other Marketing Elements

• To Pre Sell Z3– Golden Eye movie placement was just a teaser

• To close gap between Golden Eye Launch and dealership availability

• To stimulate interest in other BMW brands• To reach a wider audience• To reinforce brand image

04/10/2023

Neiman Marcus, Today’s Show

• Sep’95– Known for its unusual product offering

• Features– Special Limited Edition Bond Roadster

Launched in Neiman Marcus Catalog– Catalog and Vehicle featured on

Today’s Show• Goal– 20 Units over 3.5 months

• Result– 100 units in just2 days– 6000 orders in the Christmas period

04/10/2023

BMW Website• Oct’ 95– More information– Virtual View of the Car

• Features– Golden Eye film Segments– Today Show Clips and Movie Offer– Build your own Roadster: View

Display and Price• Result– Hit rates tripled from 35,000

hits/day to 125,000 hits/day.– Apple used this as a reference in

their advertising

04/10/2023

Press Launch in Central Park

• Nov’95– Formal introduction– Reach out to broadcast and print media– Prepare the ground for movie launch

• Features– Media attention: 200 media rep.– Preceded by CEO Interview in “Today

Show”– Special Effects to generate Interest

• Result: Extensive Coverage in– Print: “Hard Copy”, “The Morning’s

Business”, “The Money Wheel”– All major network news channels.

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Jay Leno Tonight Show

• Nov’ 95– Reaching out to wide audience– Promoted movie and car

• Features– Jay Leno using the car in his show– Bond to dodge all security and enter– Took calculated risk and gamble

• Result– Worked Out Well as per Mc Dowell.

Not much data.

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Radio DJ Program

• Nov’ 95– Word of Mouth effect– But was the “most risky”

• When?– Early November 1995

• Features– Innovative ideas used by DJs– Gave away Z3.

• Result– Got brand into conversation milieu.– 6000 spots against 3800 promised.– 3 Times Word of mouth effect of

other programs

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Traditional Media Used In NT Spirit

• 40% Traditional vs. 60% Non-Traditional• TV and Print Advertisement s on 1st November– “Humor and Fantasy” instead of traditionally

“no-nonsense”– TV: Spots in Network Shows, Lifestyle Cable

programs– Print: Placed in business, lifestyle and Auto-buff

magazines.• Utilized to prime the launch of movie.• Advertising Recall – 15% of TV viewer (50% higher

than Mercedes E class)

04/10/2023

Dealer Promotion

• Objective– To be integrated from outset– To motivate dealers to spend

resource on product to be launched after 6 months.

• How?– Dealer Visits and Presentation– Emphasized strategic importance

• Result– Private Film Screening– Cocktail Receptions– Circulated the Cars for Display– Merchandise e.g. Bond License plate– These generated publicity in media

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Challenges For Phase – II

How To Sustain The Interest?How To Convert Interest Into Order?

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Infatuated Customers

Word Of Mouth, Buzz

Advocacy

Infatuation

Excitement

Exposure

Purchase

Fast and Emotional Response

Leaves Customer in Fragile Stage

Requires Reinforcement

Customer May Become Missionary

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From Excitement to Sale

Desired End-State:

Purchase

Possible End-State: Brand forgotten

Time

Phase I Phase II

Gene

ratin

g ex

citem

ent,

buzz

, visi

bilit

y

Point of“infatuation”

Excitement

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How To Sustain Interest?

• Maintain the taste of infatuation – Contacts through mails, phone etc.

• Plan dates– Demo rides

• Win hearts– Progress updates to increase anticipation

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How To Convert Interest Into Orders?

• Stay committed – Deliver the product on time

• Build support system– Expand dealer network

• Get married– Convert purchase decision into a relationship

• Be caring and understanding– Provide affectionate post purchase support

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Critical Analysis

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Was Phase 1 of Z3 Launch Successful?

•100 orders within 2 days

•6000 orders by Christmas

NeimanSep 11, 1995

•Hit from 35000 to 125000 / day

•Apple also approached for rights to reference

BMW Internet Site

•Extensive coverage in broadcast, print and news

•Cartoons in news paper

Central ParkPress Launch

04/10/2023

Was Phase 1 of Z3 Launch Successful?

CognitiveFrom Unawareness To Knowledge

AffectiveFrom Liking to Conviction

BehaviouralPurchase ???

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Should BMW Persist With NTM?

• McDowell wanted to. But... Non traditional can not be repeated

Else it may become traditionalAnd lose the infatuating charm

Would they find such a combination again?Successful Bond movie with new hero?

Will that be successful again?

04/10/2023

Is NTM Good For All Products?

• Good for – High involvement products & emotional purchase– Ancillary / Support products with less risk– Target defined in psychographic segment– Excitement generation– Intensely competitive with high ad clutter

• But– Unpredictable and Risky– Measurement system not defined

04/10/2023

Open Questions..

• What else could BMW do within NTM framework?

• Why didn’t BMW launch Z3 in auto-show in Detroit?

• Why did bike market decline? Why didn’t BMW target that market?

• How can we develop a system to measure effectiveness of NTM?

04/10/2023

Thank You!