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CHAPTER 1

INTRODUCTION

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Due to the growing business competition and changing consumer trends, BMW had decided

that the company needs to have a marketing program that is based on the principles of

relationship marketing (RM). The program will be developed mainly to attain and obta in

customers from the Worldwide luxury market. The situational analysis of the company

indicated that the company does have the potential to support the program and its

requirements. Based on the needs of the company and its objective, the RM program will

involve the use of a strategy known as integrated marketing communication (IMC). This will

allow the effective combination of various communication channels to satisfy the needs of

the customers.

Three IMC tools had been included for the program. These include media

promotion, product assistance and customer service hotline. Through these tools, the

company will be able to address its market concerns with stronger customer relations, high

rates of loyalty and better brand equity. The program would have to be monitored in order to

ensure success. For this purpose, performance measurement, with both financial and non-

financial indicators, will be used. Specifically, monthly sales reports, records of repeat orders

and customer feedbacks will be used to monitor the program’s success.

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CHAPTER 2

OBJECTIVES

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My objectives for making the project on Marketing Strategies of BMW are -:

Firstly, Toknow the BMW company’s position in the global market.

Secondly, To gain the knowledge of BMW and its different products and companies.

Thirdly, To know the future Sales prospectus of BMW.

Research Objectives

The main objectives behind the study of marketing strategy of BMW are as follows:

i) To understand the 4p’s of BMW.

ii) To know the market share of BMW.

iii) To know the marketing strategy of BMW.

iv) To analyse the sales turnover of BMW.

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CHAPTER 3

RESEARCH

METHODOLOGY

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Research is a way to systematically solve the research problem. Research Methodology has

many dimensions and research methodology is wider than the research methods.

Research Methodology are the procedures used in making systematic observations or

otherwise obtaining data, evidence, or information as part of a research project or study.

Research methodology typically involves a full breakdown of all the options that have been

chosen by a company in order to investigate something. This would include the procedures

and techniques used to perform the research; as well as any of the terminology and

explanations of how these methods will be applied effectively.

However, research methodology is not always pin-point specific. Many areas of research

methodology may simply be referring to a generic path or method that a company will apply

in order to retrieve the information they need.

Research methodology is the way in which researchers specify how they are going to retrieve

the all-important data and information that companies will need to make vital decisions.

Research Design

Research Design refers to “framework or plan for a study that guides the collection and

analysis of data”. A typical research design of a company basically tries to resolve the

following issues:

a) Determining Data Collection Design

b) Determining Data Methods

c) Determining Data Sources

d) Determining Primary Data Collection Methods

e) Developing Questionnaires

f) Determining Sampling Plan

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Research Designs used in the project

This type of result is Descriptive research. Descriptive Research includes surveys and

fact finding enquiries of different kinds. The major purpose of Descriptive Research is

description of the state of affairs, as it exists at present.

Descriptive method includes surveys and fact finding enquiries of different kinds. The main

purpose of the descriptive research is description of the state of affairs as it exists in present.

The main characteristic of this method is that the researcher has no control over the variables;

he can only report what has happened or what is happening. For example, studies on

frequency of shopping, preferences of people etc

Data Collection

Data collection is any process of preparing and collecting data, for example, as part of a

process improvement or similar project.

Data can be collected by two methods:

1) Primary Method

2) Secondary Method

Primary methods

Primary sources are original sources from which the researcher directly collects data that

have not been previously collected, e.g., collection of data directly by the researcher on brand

awareness, brand preference, brand loyalty and other aspects of consumer behaviour from a

sample of consumers by interviewing them.

Secondary methods

Secondary data can be gathered quickly and inexpensively, compared to primary data (data

gathered specifically for the problem at hand). Such data are already available and can be

obtained much faster and at a fraction of the cost of collecting them again.

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The purpose of data collection is to obtain information to keep on record, to make decisions

about important issues and to pass information on to others. Data are primarily collected to

provide information regarding a specific topic.

MY PROJECT IS BASED ON SECONDARY DATA

Secondary Sources

Secondary Sources are those which provide us with secondary data (collected by someone

other than user). These sources are less accurate and more bias than primary sources.

Secondary Data is collected from:

a) Internet

b) Magazines

c) Journals

d) Newspaper

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CHAPTER 4

SECONDARY

DATA

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SCOPE

Since the release of BMW’s official strategy back in September 2007, media sources around

the world have speculated about the carmaker looking to either launch its own new brand or

acquire one to help its expansion.

Instead, BMW established a new environmental think-tank dubbed 'Project i', whose task is to

develop a number of solutions for a vehicle designed for congested city motoring.

The Project-I division runs independently to BMW and has been given until the middle of the

next decade to develop a concrete solution for a possible range of city cars. The urbanized car

for the masses connotation has lead to speculation that the Project i cars will be something

low-end and cheap. Nothing could be further from the truth, according to research and

development boss Dr Ulrich Kranz who revealed to Germany’s Handelsblatt that BMW will

be working on bringing the Project i solutions to market completely in-House.

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AUTOMOBILE INDUSTRY PROFILE

The history of the automobile begins as early as 1769, with the creation of steam-

poweredautomobiles capable of humantransport. In 1806, the first cars powered by internal

combustion engines running on fuel gas appeared, which led to the introduction in 1885 of

the ubiquitous modern gasoline- or petrol- fueled internal combustion engine. Cars powered

by electricity briefly appeared at the turn of the 20th century but largely disappeared from

commonality until the turn of the 21st century, when interest in low- and zero-emissions

transportation was reignited. As such, the early history of the automobile can be divided into

a number of eras based on the prevalent method of automotive propulsion during that time.

Later periods were defined by trends in exterior styling and size and utility preferences

GermanengineerKarl Benz, inventor of numerous car-related technologies, is generally

regarded as the inventor of the modern automobile. The four-strokepetrol (gasoline) internal

combustion engine that constitutes the most prevalent form of modern automotive propulsion

is a creation of German inventor Nikolaus Otto. The similar four-stroke diesel engine was

also invented by a German, Rudolf Diesel. The hydrogen fuel cell, one of the technologies

hailed as a replacement for gasoline as an energy source for cars, was discovered in principle

by yet another German, Christian Friedrich Schönbein, in 1838. The battery electric car owes

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its beginnings to Hungarian ÁnyosJedlik, one of the inventors of the electric motor, and

Gaston Planté, who invented the lead-acid battery in 1859.

Automobile Industry in India

The first motor car on the streets of India was seen in 1898. Mumbai had its first taxicabs in

the early 1900. Then for the next fifty years, cars were imported to satisfy domestic demand.

Between 1910 and 20's the automobile industry made a humble beginning by setting up

assembly plants in Mumbai, Calcutta and Chennai. The import/assembly of vehicles grew

consistently after the 1920's, crossing the 30,000 mark in 1930. In 1946, Premier Automobile

Ltd (PAL) earned the distinction of manufacturing the first car in the country by assembling

'Dodge DeSoto' and 'Plymouth' cars at its Kurla plant. Hindustan Motors (HM), which started

as a manufacturer of auto components graduated to manufacture cars in 1949.

In the early 80's, a series of liberal policy changes were announced marking another turning

point for the automobile industry. The GOI entered the car business, with a 74% stake in

Maruti Udyog Ltd (MUL), the joint venture with Suzuki Motors Ltd of Japan.

MUL introduced 'Maruti 800' in 1983 providing a complete facelift to the Indian car industry.

The car was launched as a "peoples car" with a price tag of Rs40,000. This changed the

industry's profile dramatically.

The de- licensing of auto industry in 1993 opened the gates to a virtual flood of international

auto makers into the country with an idea to tap the large population base of 950mn people.

Also the lifting of quantitative restrictions on imports by the recent policy is expected to add

up to the flurry of foreign cars in to the country.

Many companies have entered the car manufacturing sector, to tap the middle and premium

end of car industry. The new entrants are Daewoo (Matiz), Telco (Indica) and Hyundai

(Santro) in upper end of economy car market. GM, Ford, Peugeot, Mitsubishi, Honda and

Fiat have entered the mid-sized car segment and Mercedes-Benz is in the premium end of

market.

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BMW - BayerischeMotorenWerkeAG, Bavarian Motor Works (English)

BMW is a German automobile and motorcycle manufacturing company found in 1916, it is

known for its performance and luxury vehicles. It owns and produces the MINI brand, and is

the parent company of Rolls-Royce Motor Cars.

THE BMW GROUP

With the three brands, BMW, MINI and Rolls-Royce Motor Cars, the BMW Group has its

sights set firmly on the premium sector of the international automobile market. To achieve its

aims, the company knows how to deploy its strengths with an efficiency that is unmatched in

the automotive industry. From research and development to sales and marketing, BMW

Group is committed to the very highest in quality for all its products and services.

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Preface by The Chairman of the Board Of Management

Ladies and Gentlemen

The BMW Group achieved positive group earnings for the 2009 financial year, despite the

global economic crisis. The company remains the automobile industry’s leading premium

manufacturer. More than 1.28 million customers purchased a BMW, MINI or Rolls-

Roycelast year, and over 87,000 customers bought a BMW motorcycle. Sales benefited only

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marginally from the national stimulus programmers initiated in many countries, such as the

scrap page bonus scheme in Germany.

Our accomplishments in 2009 were realized as an independent company. We continue to

chart our own course with courage and determination – and with a clear view to the future.

The image section illustrates how we are translating the four pillars of our Strategy Number

ONE – Future, Growth, Customers and Profitability – into action. It also cites many

examples of how we are conserving resources and gradually realizing sustainable mobility.

Ultimately, companies and products are made by people. Here you can learn about the people

behind our products: Who are the men and women who make up the BMW Group? Above

all, you will have the opportunity to get to know our customers. Who buys our vehicles, and

why? What does their BMW, MINI or Rolls-Royce mean to them?

2009 – Crisis management and innovative projects for the future. Two factors

determined our actions as a company in 2009: active crisis management and innovative

future projects. We acted quickly and decisively in response to the econo mic crisis: Vehicle

inventories were reduced; fixed costs were substantially trimmed across all divisions; and

several plants temporarily implemented short-time working. We also took steps to secure

sufficient liquidity

We were capable of operating effectively throughout and were able to refinance at relatively

favorable rates on the capital markets at all times.

Parallel to these short-term measures, we also set the course for the successful development

of the BMW Group over the next few years – something I believe is crucial. We invested in

projects for the future and our sites, in particular in Germany, the US, China and India. Our

involvement in India is one of the focal points of this report. Our Strategy Number ONE lays

the foundation and sets out a vision that unites everyone at the BMW Group: to be the

leading provider of premium products and premium services for individual mobility in the

year 2020.

This makes it quite clear that premium is, and will continue to be, our business model. The

concept of “premium” is changing, just as society and people’s lifestyles are changing. To

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give an example: People still want to be mobile as individuals – and there is a rising demand

for mobility, especially in growth markets such as China and India. But people all over the

world are becoming more interested in how efficient their vehicle is.

Our Efficient Dynamics measures have drastically reduced fuel consumption and CO2

emissions across our entire fleet. Would you ever have believed that BMW could be the

world’s most environmentally friendly premium brand? Or that the average fleet

consumption of the BMW and MINI fleets could be lower than that of the mass

manufacturers – even though they offer much better performance? The statistics of the

German Federal Motor Transport Authority are unequivocal: Average CO2 emissions for

new BMW and MINI vehicles registered in Germany in 2009 were no more than 156 grams

of CO2 per kilometer. That represents an average fuel consumption of 5.9 liters per 100

kilometers.

We will continue to push ahead with Efficient Dynamics

For the BMW Group, the year 2010 will largely be defined by the new BMW 5 Series. I

personally believe that the new BMW 5 Series is one of the best cars we have ever built.

Currently, the vehicle with the best fuel economy and lowest emissions in the BMW model

range is the 320d Efficient Dynamics Edition. Customers will be able to experience its sheer

driving pleasure with a fuel consumption of just 4.1 liters per 100 kilometers and 109 grams

of CO2 per kilometer from spring 2010 onwards. We showcased everything that Efficient

Dynamics still has to offer at the 2009 IAA International Motor Show within our BMW

Vision Efficient Dynamics. This concept car rightly attracted a great deal of attention – not

just for its futuristic design, but also for its innovative drive train, comprising a 3-cylinder

turbo diesel engine with two electric motors mounted on both axles. Consequently, this

thoroughly sporty vehicle consumes an average of just 3.76 liters per 100 kilometers. This

technical masterpiece is highlighted further in detail.

New drive technologies: hybridization and electrification

We also believe premium means offering our customers new technical solutions. The first

two BMW models with hybrid drive will become available in 2010. Our worldwide MINI E

customer test has so far been a resounding success. There are about 600 MINI cars with

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electric drives currently on the roads. No other electric car has clocked as many kilometers

and as many miles as the MINI E. Our customers think it is terrific. They are helping us learn

how e-mobility can succeed in everyday situations. We also presented the first BMW with

electric drive, and will be releasing a further trial fleet of electric vehicles based on the BMW

Concept ActiveE concept car to customers next year.

All of the experience we gain will be incorporated into our Megacity Vehicle. This is much

more than just a highly innovative car. We aim to completely redefine how cars are built –

with regard to vehicle architecture, lightweight construction and use of materials – to create a

sustainable value chain

No automobile manufacturer uses resources more efficiently.

Everybody is talking about sustainability – when action is what is needed. We believe our

vehicles should also be produced in an environmentally responsible manner. In September

2009, the Dow Jones Sustainability Index named the BMW Group as the leading company in

the automobile sector for the fifth consecutive year. For us this is both an incentive and an

obligation.We are committed to sustainability in all areas

That is why we decided to send a clear signal and withdraw from Formula One at the end of

the 2009 season – although it was not an easy decision after ten years of successfully

competing at the highest level in motorsports

New directions with Strategy Number ONE.

We are taking a new direction with our Strategy Number ONE. The small car segment

represents a source of growth opportunities, and we will therefore be offering premium

products for these customers. Collaboration with others will also allow us to achieve

economies of scale. We will continue to rely on strategic partnerships with the best partners

for the task at hand. What is more, increased use of shared modules between models and

brands will enable us to further reduce costs throughout the entire process chain, but still

maintain our high quality

Our industry is currently in a period of tremendous upheaval and technological change. The

economic crisis has further accelerated this trend. In order to be successful in the

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marketplace, companies must find the right answers to the challenges of tomorrow. Our ideas

and actions are geared towards the long term. Our strategy provides us with the plan for

shaping our own future

We achieved a great deal in 2009. I would like to thank every single one of our 96,230

employees for their outstanding personal dedication. I would also like to thank our customers

for their confidence in our products and our company, as well as our entire retail network.

We have also continued to work productively with our suppliers. Last but not least, I would

like to thank our shareholders and investors for their commitment to the BMW Group –

particularly in these times of economic crisis.

The effects of the economic crisis will continue to be felt in 2010. However, we are

cautiously optimistic that we will be able to resume our growth path this year.

We believe in the future of individual mobility – and we are already creating it.

Norbert Reithofer

Chairman of the Board of Management

COMPANY HISTORY

Era Of Aircrafts (1918) “The First Flight”

After World War I, BMW were forced to cease aircraft (engine) production by the terms of

the Versailles Armistice Treaty. The company consequently shifted to motorcycle production

in 1923 once the restrictions of the treaty started to be lifted, followed by automobiles in

1928.

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The circular blue and white BMW logo or roundel is often alleged to portray the movement

of an airplane propeller, to signify the white blades cutting through the blue sky - an

interpretation that BMW adopted for convenience in 1929, which was actually twelve years

after the roundel was created.

Era Of Motorcycle (1923):-“Face The Power, The Ride Is On”

BMW began building motorcycle engines and then motorcycles after World War I. Its

motorcycle division is now known as BMW Motorrad. Their first successful motorcycle,

after the failed Helios and Flink, was the "R32" in 1923. Many BMWs are still produced in

this layout, which is designated the R Series.

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In 1983 came the K Series affectionately known as "The Flying Brick", shaft drive but

water-cooled and with either 3 or 4 cylinders mounted in a straight line from front to back. In

the early 1990s, BMW updated the airhead Boxer engine which became known as the oil

head.

In 2004, BMW introduced the new K1200S Sports Bike which marked a departure for BMW.

It is both powerful and significantly lighter than previous K models. Innovations include a

unique electronically adjustable front and rear suspension and a Hossack-type front fork

BMW call Duo lever

Era Of Automobiles ( 1928) :-”The Ultimate Driving Machine”

The New Class was a line of compact sedans and coupes starting with the 1962 1500 and

continuing through the last 2002s in 1977.

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Powered by BMW's celebrated four-cylinder M10 engine, the New Class models featured a

fully independent suspension, Macpherson struts in front, and front disc brakes. Initially a

family of four-door sedans and two-door coupes, the New Class line was broadened to two-

door sports sedans with the addition of the 02 Series 1600 and 2002 in 1966.

Sharing little in common with the rest the line beyond power train, the sporty siblings caught

auto enthusiasts' attention and established BMW as an international brand. Precursors to the

famed BMW 3 Series, the two-doors' success cemented the firm's future as an upper tier

performance car maker.

New Class four-doors with numbers ending in "0" were replaced by the larger BMW 5

Series in 1972. The upscale 2000C and 2000CS coupes were replaced by the six-

cylinder BMW E9, introduced in 1969 with the 2800CS. The 1600 two-door was

discontinued in 1975, the 2002 replaced by the 320i in 1975.

The Automobile Industry Stats

BMW and the five major companies in 2008-09

Company No of vehicles (m) Euro(b)

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General Motors 8.5 157.19

Ford 6.7 116.47

Daimler-Chrysler 3.85 144.65

Toyota 6.25 125.30

Volkswagen 5.02 87.15

BMW Group 1.12 41.52

COMPETITORS IN MARKET

BMW BIRDS (PRODUCTS)

1 Series

The 1 Series was launched globally in autumn 2004 and shares many structural, chassis,

power train, hardware and electronic elements with the larger 3 Series. The model was started

to provide a lower point of entry into the BMW range as the 3 Series moved gradually up-

market. The 1 Series coupe and convertible went on sale in the United States in model

year 2008 as the 128i and the 135i.

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BMW 1 Series 5-door

BMW 1 Series Coupe

BMW 1 Series Coupe

3 Series

The BMW 3 Series is an executive car manufactured since model year 1975. The 3 Series is

currently in its fifth generation, the E90 Current models include the sport sedan (E90), station

wagon (E91), coupe (E92), and convertible (E93). It offers luxury. The 3 series is one of

BMW's most important models, as it accounts for a majority of its worldwide sales.

2007 3-Series Coupe

2006 3-Series Touring

2006 3-Series Sedan

BMW E46 Generation

with ZHP

Performance

5 Series

The M5 is the Motorsport division's version of the 5 Series. The new M5 is powered by

a F1-inspired V10 engine, producing 507 hp (378 kW) and is mated with a 7-speed sequential

manual gearbox (SMG) transmission, which is capable of a top speed of about 330 km/h

(production variants are restricted to 250 km/h, or 155 mph).

2005 5 Series with M

Sport Package

2007 5-Series Touring

with M Sport Package

2007 M5

E39 BMW M5

Sedan

7 Series

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BMW 7-Series (F01)

BMW's full-size flagship executive sedan. Typically, BMW introduces many of their

innovations first in the 7 Series. For example, the somewhat controversial iDrive system

debuted in the 7 Series. The 7 Series Hydrogen, featuring one of the world's

first hydrogen fuelled combustion engines, is fuelled by liquid hydrogen and emits only water

vapour. The V12 engine also runs on gasoline. Numerous engines power the 7 Series

worldwide. BMW offers diesel, straight 6, V8 and V12 motors, as well as the Alpinatuned

supercharged V8.

X SERIES SUVS

X1

The BMW X1 is a compact luxury crossover SUV developed by BMW, and manufactured

by BMW and BMW Brilliance, and marketed worldwide in rear-wheel (sDrive) and all-

wheel-drive (xDrive) configurations. Production followed the debut of a concept version at

the 2008 Paris Motor Show with series manufacture beginning at the BMW Leipzig plant in

October 2009. The sDrive28i and xDrive28i models will offer a 2.0L, 241 horsepower

turbocharged inline four-cylinder (I4) engine, and the xDrive35i model will o ffer a 3.0L, 300

horsepower single turbocharged inline six-cylinder (I6) engine.

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X3

BMW X3 (current generation)

BMW's second crossover SUV debuted in November 2003 as a Model Year 2004 (called

SAV or Sports Activity Vehicle by BMW) and is based on the E46/16 3 Series platform. For

2007, the X3 is powered by the N52 inline 6 cylinder engine that debuted on the 2006 E90 3

Series. In 2007 a face lift was given to the X3, including an X-drive update, suspension

adjustments, an engine upgrade, and aesthetics inside and out.

X5

The BMW X5 M is a high-performance derivative of the X5. It was introduced to the press at

the New York Auto Show in April 2009, and started appearing in BMW dealerships in

September 2009. The M offers the V8 M TwinPower Turbo, a twin-turbocharged 4.4- liter V8

delivering 555 bhp (414 kW; 563 PS) at 5,750 rpm and peak torque is 501 lb·ft (679 N·m),

available between 1,500 and 5,650 rpm

Z Series

Z4

A 2-seater roadster and coupe which succeeded the Z3. From 2006 the Z4 Roadster is

available as a 3.0i (3.0 L I6 with 215 hp), a 3.0si available with the new generation 3.0 L I6

with 255 hp (190 kW), a 2.5si with a 2.5 I6 with 218 bhp (163 kW) or a 2.0i with a 150 bhp

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(112 kW) 2.0 L I4. The Z4 coupé is available only in the high-performance 3.0si trim

powered by the 3.0 L 255 hp (190 kW) I6. The Z4 (E84) was built at the Spartanburg plant.

Its successor, also named Z4 (E89) - this time a coupé-convertible with folding hardtop- will

be built in Regensburg alongside the (E93) 3-Series Cabrio.

Z4 M The new Z4 M roadster and coupe have been released with an E46 M3 motor (3.2 L,

333 hp) and also features the M braking, suspension, and styling characteristics.

Z4 Roadster

Z4 Coupe

Z4 M Roadster

M SERIES

BMW M

1 Series M Coupé

BMW M boss Dr. Kay Segler officially announced the making of the M variant of the BMW

1-Series Coupé on July 9, 2010, via an official YouTube video and press release.[26] On

December 9, 2010, BMW officially announced all details of the car in the media.[27In the 1M

Coupe, the engine produces 340 PS (250 kW) at 5900 rpm and 332 lb·ft (450 N·m) torque

from 1,500 to 4,500 rpm (with +369 lb·ft (500 N·m) overboost). The sole available drivetrain

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is a six-speed manual gearbox with a limited slip differential.The 1M coupe has a

significantly wider track and bigger body than the standard E82 coupe, as well as a different

body kit. Despite the car's larger size, it is 77 lb (35 kg) lighter than the standard E82 coupe,

giving it a weight of 3,296 lb (1,495 kg

M3

E92 M3 Coupé

Based on the 3 Series, the M3 defined an entirely new market for BMW: a race-ready

production vehicle. Since its debut, the M3 is heralded in enthusiast circles, in large part due

to its unique geometry and award winning engines. The newest platform became available the

Autumn of 2007 in Europe, and second quarter of 2008 for the U.S. in Coupe (E92), and later

the Cabriolet (E93), and Sedan (E90) variants.

M5

The BMW M5 is a high performance version of the BMW 5-Seriesexecutive car built by the

Motorsport division of BMW. Beginning production in 1986, the first incarnation of the M5

was hand-built utilizing the 535i chassis and a modified BMW M1 engine, being the fastest

production sedan in the world at the time of its introduction.[1] Subsequent iterations of the

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M5 have been built from each generation of the 5-Series platform, including the E34, E39,

E60/E61, and most recently, F10, with the first orders delivered in late 2011.

M6

BMW M6 Coupe

The M6 is the M division's version of the 6 Series. The M6 shares its drive train with the M5.

The V10 produces 508 hp (379 kW) and 383lb/ft (520Nm) of Torque. The production M6

debuted at the 2005 Geneva Motor Show. It is currently available in a coupe and a

convertible version. There is speculation that an M6 CSL version is to be released in the

future.

The vehicle is based on the 6 Series coupe and convertible, which were launched in 2004.

Carbon fiber and other light materials are used in places like the bumpers and roof that are far

from the centre of gravity and/or high up, so that they not only reduce the overall weight but

improve the handling by reducing the moment of inertia and the centre of mass height.

The previous generation was launched in 1983, but ended in 1989 with around 5,855 sold.

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MINI

Mini (styled as MINI) is a British automotive brand owned by the BMW Group that has

produced the successor of the original Mini in Oxford, England since April 2001.

Currently three body variants are available: hatchback, convertible and Clubman.

The car, whose first generation was designed by Frank Stephenson, is drawing inspiration

from the original Mini, which was manufactured by the British Motor Corporation and its

successors from 1959 to 2000. The name of the car's brand, MINI, is all-capitalized to

distinguish it from its predecessor.

The development of the first generation had been done between 1995 and 2001 by Rover

Group in Gaydon, United Kingdom and BMW AG in Munich, Germany and was

accompanied by continual contention between Rover and BMW. Especially the positioning

of the car was contended. Rover wanted an economy car, whilst BMW supported a small

sporting car and finally prevailed. In 1999 BMW assumed control over the whole project

after BMW's CEO Bernd Pischetsrieder had left the company. When BMW divested itself of

Rover in 2000, BMW decided to keep the Mini project and to build the car, which was

originally to be built at Rover's Long bridge plant, [3] the former production plant of the

traditional Mini, at BMW's Oxford plant in Cowley, Oxford, United Kingdom, in what was

historically the Pressed Steel Company body plant. The 2001 to 2006 model years included

four hatchback models: the basic "Mini One", the diesel-engine "Mini One/D", the sportier

"Mini Cooper" and the supercharged "Mini Cooper S".

The Mini was designed and engineered to replace the long running Rover 100 and the

larger Rover 200, both deemed unsuitable for the modern world automobile market. The Mini

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was supposed to replace low-end models of the 200 and high-end models of the 100 with a

Rover 35 replacing high end 200s and low end 400s. After the divestment of MG Rover, the

Mini was instead marketed as a small yet desirable city car rather than a mainstream

replacement of the 100 and 200.

ROLLS-ROYCE MOTOR CARS

Rolls-Royce Motor Cars is a British manufacturer of luxury automobiles based in Goodwood,

England. It is the current producer of Rolls-Royce branded automobiles, whose historical

production dates back to 1904. The factory is located across from the historic Goodwood

Circuit in Goodwood, West Sussex, and England. It is a wholly owned subsidiary of

the BMW Group.

In 1998, owners Vickers decided to sell Rolls-Royce Motors. The most likely buyer

was BMW, who already supplied engines and other components for Rolls-Royce

and Bentley cars, but BMW's final offer of £340m was beaten by Volkswagen's £430m.

A stipulation in the ownership documents of Rolls-Royce dictated that Rolls-Royce plc, the

aero-engine maker would retain certain essential trademarks (the Rolls-Royce name and

logo) if the automotive division was sold. Rolls-Royce plc chose to license not to VW but to

BMW, with whom it had recently had joint business ventures. VW had bought rights to the

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"Spirit of Ecstasy" hood ornament and the shape of the radiator grille, but it lacked rights to

the Rolls-Royce name necessary to build the cars. Likewise, BMW lacked rights to the grille

and mascot. BMW bought an option on the trademarks, licensing the name and "RR" logo for

£40m, a deal that many commentators thought was a bargain for possibly the most valuable

property in the deal. VW claimed that it had only really wanted Bentley anyway.

BMW and VW arrived at a solution. From that date, only BMW would be able to name cars

"Rolls-Royce", and VW's former Rolls-Royce/Bentley division would build only cars called

"Bentley". The Rolls-Royce's Corniche ceased production in 2002.

Environmental Record of BMW

The company is a charter member of the U.S. Environmental Protection Agency's (EPA)

National Environmental Achievement Track, which recognizes companies for their

environmental stewardship and performance. It is also a member of the South Carolina

Environmental Excellence Program and is on the Dow Jones Sustainability Group Index,

which rates environmentally friendly companies. BMW has taken measures to reduce the

impact the company has on the environment. It is trying to design less-polluting cars by

making existing models more efficient, as well as developing environmentally friendly fuels

for future vehicles. Possibilities include: electric power, hybrid power (combustion, engines

and electric motors) hydrogen engines.

32

What Critics Says?

“There have been some criticisms in past directed at BMW, and in particular,

accusations of green wash in reference to their BMW Hydrogen 7. Some critics claim

that the emissions produced during hydrogen fuel production outweigh the reduction of

tailpipe emissions, and that the Hydrogen 7 is a distraction from more immediate,

practical solutions for car pollution.”

Innovations /Progress

All Wheel Drive

All-wheel drive means traction, directional stability and driving safety. With BMW xDrive, it

also means driving pleasure. On dry tarmac, xDrive transfers 40% of the torque to the front

wheels and 60% to the rear, allowing the car to retain the sporty handling characteristics

you'd expect from a BMW. If the situation or surface changes, xDrive redistributes torque

within milliseconds to prevent over- or under steer at the onset. It's the perfect blend of

safety, traction and agility.

Active Steering.

Active Steering adjusts the steering ratio and weight to the car's speed. At low or medium

speeds, it translates steering input directly for easier parking in town and enhanced agility in

33

bends. At high speeds, the amount the wheel needs turning increases, resulting in greater

directional stability - on motorways for instance - and therefore safety. It means optimum feel

and maximum enjoyment, whatever the speed and situation.

DISTRIBUTION CHANNEL OF BMW

BMW is an automobile dealer that manufacturers and sells a wide range of vehicles.

The BMW automobiles are sold to a special target market and appeals only to a particular

stratum of people. BMW vehicles are classy, stylish, comfortable and luxurious. With regard

to the BMW films, which can be viewed on www.bmw.com, there are a number of reasons

surrounding the success of these films. The films allow prospective customers to view the

cars before purchasing them. Marketers ensured that the visitors to the site felt compelled to

stay at the site. They associated each model of the vehicle to that of human attributes.

For example, the BMW Formula M was described as having a ‘soul’. When consumers see

these attributes, they suddenly begin to identify with these attributes, and then create an

image and personality of the vehicle for themselves, by also giving the vehicles personal

human traits as well. The site also offers consumers the option of customizing their own

vehicle to their preference and taste.

Another reason the BMW site and films have increased sales for the company is that

marketers have used dynamic features for the site. The site is portrayed as a type of one-stop

shopping, because not only are BMW vehicles showcased, but an online magazine is on the

site. If visitors to the site do not wish to make a purchase, they may opt to view the online

magazine. Marketers embarked on an intense Integrated Marketing Campaign that gave rise

to increased interest and traffic to the BMW site.

34

Integrated Marketing Communication (IMC) is a strategy used to plan, execute and monitor

communication about a brand. In addition, the IMC is aimed at attracting and retaining

customers. The marketers of the BMW site had to have extensive knowledge of the brand,

competitors and target audience. Through the IMC plan on the Internet, marketers were able

to use a direct marketing channel to reach it target audience.

In addition, the type of distribution channel that was employed by marketers on the BMW

website was to perform the facilitating function, where contact was made with buyers, the

needs of buyers were matched with the product and they had ideal communication strategies

to ensure effective information transfer.

The success of the BMW films also include the that fact that each Vehicle is presented with

the possible fuel consumption information as well as the model of the vehicle that would be

most appropriate for the consumer based on the model chosen and the consumer’s lifestyle.

When marketers cater to the needs of customers and a positive perception of the brand has

been created, the success of the product is inevitable.

35

UNITS DELIVERED

Cars delivered by the BMW Group in 2008-09 (1000 units)

0

200

400

600

800

1000

1200

Rolls R

oyceM

INI

BMW

BMW

7 Serie

s

BMW

X5

BMW

5 Serie

s

BMW

Z4

BMW

3 Serie

s

Total D

eliverie

s

36

POSITION IN THE MARKET:-

The German carmaker is revving up sales….. ….Overtaking Lexus in the US…..

Billions of dollars

*Forecast by Lehman Brothers

Luxury Model auto sales January through

April

* Including 11,304 minis

Operating Margin*

Porsche 15.8%

Nissan 11.0%

Toyota** 8.5%

BMW Group 7.4%

Volkswagen Group 6.1%

Mercedes & Smart cars 5.8%

PSA Group 5.4%

Volvo Group 2.5%

Renault Group 2.3%

Chrysler cars & trucks 1.5%

0

10

20

30

40

50

60

70

94 95 96 97 98 99 00 01 02 03 04* 0 20 40 60 80 100

Porsche

Jaguar

Audi

Infiniti

Volvo

Acura

Cadillac

Mercedes

Lexus

BMW*

37

REVENUE AND SALES

During the financial year 2011, the BMW Group sold approximately 1.67 million cars and more than

113,000 motorcycles worldwide. The profit before tax for 2011 was € 7.38 billion on revenues

amounting to € 68.82 billion.

For the year 2012, BMW Group profits were up 4.4 percent to $6.65 billion and increased sales were

a main driver of BMW's improved profits. The Group delivered 1,845,186 BMW, Rolls -Royce and MINI

vehicles last year, marking an increase of 10.6 percent over the prior year.

WORLDWIDE SALES

Vehicles sold in all markets according to BMW's annual reports.

Year BMW MINI Rolls-Royce Motorcycle*

2005 1,126,768 200,428 796 97,474

2006 1,185,088 188,077 805 100,064

2007 1,276,793 222,875 1,010 102,467

2008 1,202,239 232,425 1,212 115,196

2009 1,068,770 216,538 1,002 100,358

2010 1,224,280 234,175 2,711 110,113

2011 1,380,384 285,060 3,538 113,572

2012[2] 1,540,085 301,525 3,575 117,109

38

OBJECTIVES

As a person with knowledge of business strategy, the author has always brought up to his

superiors the viability of strategy formation regarding the analysis of this topic and at times

fails to understand the reasons or logic behind certain strategic implementations imposed on

it.

By delving into this project paper, the author intends to have better insights into how business

strategy is thought up, formulated and then imparted down into the subsidiaries of the

company or organization. The author hopes to have an in-depth understanding as to how the

implementation of business strategies enables companies and organizations to compete

effectively and profitably in this era of internationalization where competition is extremely

intense.

In order to reinforce the learning objectives, two key focal issues were focused upon, i.e.

innovation and diversity. Innovation was discussed with regard to business strategies where

they were renowned for their developmental capabilities to constantly innovate. Diversity

came under strategic thinking and formation as the author considered the diverse culture,

political climate, economic surroundings, social environment, technological settings,

government policies and legal systems in its bid to become a leading player in order to better

understand the issues being discussed.

EXECUTIVE BRIEF

This essay utilized BMW as the model organization to review its present business strategies

and how they dealt with critical situations. From the analysis, key trends in the business

strategies of BMW were then identified, how they worked and their effectiveness in dealing

with critical situations was ascertained. The paper then moved on to assess these business

strategies with regard to their suitability to critical situations, during which the internal

capabilities of these business strategies in relation to the strategy being followed by BMW

was determined also. An overall analysis of the performance and effectiveness of the business

strategies of BMW was also conducted to assess and compare the capabilities of these

business strategies with those of others. Gaps in the capabilities and environment were then

identified.

39

Finally, several choices of strategies to improve the business strategies of BMW as effective

means in critical situations were recommended and evaluated in terms of appropriateness to

the issues reviewed, feasibility in carrying out the options and acceptability within the key

stakeholders and decision makers. Several key implementation issues related to managing

strategic change were also addressed as well.

OVERVIEW OF BMW

BMW aims for sustainable growth as a broad market leader in the automobile industry as

well as for segment leadership. In both cases, the automobiles of BMW will play a crucial

part. BMW is able to establish its broad leadership usually by acquiring other strong

automobile companies and their cars, which are then combined into a new, larger company.

Offering training to its employees, improving the company operations, and the introduction

of new car technologies then reinforces the positions of the various BMW automobiles. This

practically results in economies of scale that is able to create a distribution network for both

the local and international BMW automobiles. If a market is already in the control of other

automobile companies, BMW devotes its attention towards the development of a premium

segment with its various automobiles.

The mission of BMW is to secure the growth of the business in a sustainable manner, while

at the same time constantly improving the company’s profitability. The strategy to achieve

this involves four elements:

1. Striving in order to reach a leading position in attractive markets

2. Focusing on securing a competitive share of the automotive market segments.

3. Working in order to improve the company’s efficiency and cut costs in operations.

4. Continuous growth through selective acquisitions for as long as they are able to create

shareholder value.

40

The Markets

The main markets for BMW automobiles have been in Europe, the USA, Japan and the

Pacific region, with the markets of Germany and the US accounting for almost half the total

car sales. Important markets have also been the fast-growing UK, and the Italian, French and

Japanese markets. Sales in the USA market have been particularly successful, as they grew

by over 8 per cent on the previous year to 277,000, becoming the biggest market for the

group and overtaking the Lexus brand for the first time. At the end of 2003, the outlook for

2004 by group management and industry observers was upbeat. This view was supported by

the successful launch of the new 5-series, the consolidation in Europe and Asia of the BMW

Z4, the introduction of the BMW X3. The new BMW 1 Series and the BMW 6 Series

cabriolet were launched early in 2004. By far the most successful models were the MINI, the

3-series and the 5-series, but the other models were also in significant demand. In the Chinese

markets there was growing demand for the higher end models of the range, specifically for 7-

series and 5-series.

“We offer our customers emotional products, which, through the strength of the brand and

the substance of the product, fulfill the customer's wish for individualization and

differentiation. The BMW Group will never build boring products.”

0

50

100

150

200

250

300

USA

Ger

man

yUK

Italy

Japa

n

Franc

e

Spa

in

Chin

a

Belgium

S A

frica

41

VIEWS OF OWNERS

42

GLOBAL BRAND IMAGE

First, let’s take a look at BMW in context of the global automobile industry. In recent

decades, the industry has undergone significant consolidation among manufacturing

enterprises. From multiple acquisitions by Ford to the Daimler-Chrysler merger, many

automakers now enjoy economies of scale and global distribution networks that afford

significant advantages in procurement, R&D, manufacturing, and distribution.

The synergies borne by these scale economies allow larger manufacturers to better weather

fluctuations in the macro-economic environment, yet profit from the evolving needs of the

car consumer. For instance shifting production away from gas-guzzling SUVs to more

economical automobiles helps manufacturers profit in years where oil prices rise; while

developing innovative brands and designs can satisfy new segments of consumers who will

pay premium dollars for differentiated features and styles. Manufacturers that cannot rely on

scale to deliver profitable returns need to ensure that their brands and limited product lines

remain highly differentiated and relevant, and continue to aggregate a growing consumer

following in the face of sophisticated competition.Even without a degree in microeconomics,

you can get a sense of the relative advantage among various manufacturers by examining the

sector below.

43

COMPANY’s MARKETING STRATEGY

OBJECTIVES

As a person with knowledge of business strategy, the author has always brought up to his

superiors the viability of strategy formation regarding the analysis of this topic and at times

fails to understand the reasons or logic behind certain strategic implementations imposed on

it.

By delving into this project paper, the author intends to have better insights into how business

strategy is thought up, formulated and then imparted down into the subsidiaries of the

company or organization. The author hopes to have an in-depth understanding as to how the

implementation of business strategies enables companies and organizations to compete

effectively and profitably in this era of internationalization where competition is extremely

intense.

In order to reinforce the learning objectives, two key focal issues were focused upon, i.e.

innovation and diversity. Innovation was discussed with regard to business strategies where

they were renowned for their developmental capabilities to constantly innovate. Diversity

came under strategic thinking and formation as the author considered the diverse culture,

political climate, economic surroundings, social environment, technological settings,

government policies and legal systems in its bid to become a leading player in order to better

understand the issues being discussed.

EXECUTIVE BRIEF

This essay utilized BMW as the model organization to review its present business strategies

and how they dealt with critical situations. From the analysis, key trends in the business

strategies of BMW were then identified, how they worked and their effectiveness in dealing

with critical situations was ascertained. The paper then moved on to assess these business

strategies with regard to their suitability to critical situations, during which the internal

capabilities of these business strategies in relation to the strategy being followed by BMW

was determined also. An overall analysis of the performance and effectiveness of the business

strategies of BMW was also conducted to assess and compare the capabilities of these

44

business strategies with those of others. Gaps in the capabilities and environment were then

identified.

Finally, several choices of strategies to improve the business strategies of BMW as effective

means in critical situations were recommended and evaluated in terms of appropriateness to

the issues reviewed, feasibility in carrying out the options and acceptability within the key

stakeholders and decision makers. Several key implementation issues related to managing

strategic change were also addressed as well.

OVERVIEW OF BMW

BMW aims for sustainable growth as a broad market leader in the automobile

industry as well as for segment leadership. In both cases, the automobiles of BMW will play

a crucial part. BMW is able to establish its broad leadership usually by acquiring other strong

automobile companies and their cars, which are then combined into a new, larger company.

Offering training to its employees, improving the company operations, and the introduction

of new car technologies then reinforces the positions of the various BMW automobiles. This

practically results in economies of scale that is able to create a distribution network fo r both

the local and international BMW automobiles. If a market is already in the control of other

automobile companies, BMW devotes its attention towards the development of a premium

segment with its various automobiles.

The mission of BMW is to secure the growth of the business in a sustainable manner,

while at the same time constantly improving the company’s profitability. The strategy to

achieve this involves four elements:

1. Striving in order to reach a leading position in attractive markets

2. Focusing on securing a competitive share of the automotive market segments.

3. Working in order to improve the company’s efficiency and cut costs in operations.

4. Continuous growth through selective acquisitions for as long as they are able to create

shareholder value.

45

1. What is the organization’s strategic position?

BMW’s generic strategy in the automotive market lies on product differentiation. The

differentiated automobiles and motorcycles of BMW are able to satisfy the needs of their

customers through a sustainable competitive advantage. This allows BMW to desensitize the

prices of their automobiles and motorcycles and instead focus on the values that generate not

only a comparatively higher price but also a better margin.

BMW is committed on its efforts to continuously develop original automotive technologies

that generate a high appeal to the general public due to its quality and cost effectiveness.

Over the years, BMW has been able to build a substantial base meant to boost the company’s

designing and manufacturing capabilities. This enables the company to bring to markets truly

original and more importantly efficient automotives that are reasonably priced. The research

and development team of BMW also plays a crucial role in the achievement of this feat. The

company also believes that making a positive impact in the society through their quality

products is the very essence of being a manufacturer.

BMW has been able to ma inta in its reputat ion as one of the world's lead ing

automotive companies for more than 130 years now. It is able to face the challenges

in many of its markets directly. This is made possible by the effect ive gener ic

strategies aimed to deliver not only profit growth, but also on build ing down the

foundation of BMW’s brands and business.

The gener ic strategies of BMW are focused mainly on dr iving the growth o f its

brands and improving the company’s financia l performance. These campaigns have

also he lped secure significant acquis it ions and partnerships. And more importantly,

these campaigns have led to the release of the potentia ls of the company’s

employees, thus building a quality performance- based culture.

The gener ic strategies of BMW’s local automotives are practically reinforced by the

local emp loyees themse lves. These moves certainly a llow the company to improve

even more without the costs of introduc ing new technologies. These efforts have

resulted in increased financ ia l ga ins for the company and have a llowed the

establishment of d istr ibution networks for both the local and inte rnat iona l BMW

products.

46

DID YOU KNOW?

A.BMW AG bought the British Rover Group in 1994 and owned it for six years.

B. In year 2000, Rover was making huge losses and BMW decided to sell the combine. The

MG and Rover brands were sold to the Phoenix Consortium to form MG Rover, while Land

Rover was taken over by Ford.

C.BMW built mini in 2001

D.BMW was one of the earliest manufacturers to offer anti- lock brakes on production

motorcycles starting in the late 1980s.

E. BMWSponsors Kumho BMW Championship in UK every year.

Formula One - BMW has won 19 grand prix as an engine supplier..

Sports car

Le Mans 24 Hours - BMW won Le Mans in 1999 with the BMW V12 LMR designed

by Williams Grand Prix Engineering.

24 Hours of Daytona - BMW won 1 time (1976) Rally

RAC Rally - The 328 sport car won this event in 1939.

Paris Dakar Rally - BMW motorcycles have won this event 6 times.

Tour De Corse - The BMW M3 - E30 won this event in 1987

47

CORPORATE SOCIAL RESPONSIBILITY

BMW is the first company in its industry to ever produce a CSR Annual Report, which

summarizes its achievements in "Corporate Social Contribution Activities" revolving around

'five pillars' – Cultural Promotion, Education Support, Environmental Protection, Corporate

Governance and Customer Integration.

The report also highlights the significance of the activities in BMW's long-term corporate

development, building a win-win situation within society.

Highlight 1: Cultural Promotion

BMW China and BMW Brilliance jointly launched 'BMW Corporate Social Contribution

Activities' in the summer of 2007, dedicating a large budget to promote nearly 20 projects

within 'five pillars'. Among them, "BMW China Culture Journey 2007" was the most

attractive and impactful project. During the exciting, 11-day journey covering over 3,500

kilometres, a fleet of 15 BMW vehicles drove all the way from Beijing to Dunhuang and

visited 11 "Material Cultural Heritage Projects" and 17 "Non-Material Cultural Heritage

Projects". A total of 1 million RMB was donated to provincial cultural departments. The

event called for the protection and restoration of state- level and provincial- level cultural

heritage sites and cultural practices, and was warmly-received nationwide. The CSR Annual

Report notes that as an important part of BMW's Corporate Social Contribution Activities,

the culture journey will continue in years to come.

In addition, in promotion of cultural communication and the arts, BMW also sponsored

several cultural promotion projects, including 'BMW Culture Night and 'BMW Night',

featuring performances by the Liaoning Ballet Tour Show and world renowned violinist Lv

Siqing.

Highlight 2: Education Support

As the key project in education support, BMW launched a long-term "BMW Children's

Traffic Safety Education" program. By providing transportation safety education through

attractive and engaging methods to over 2000 kids aged four to six years over 15 key cities,

the safety training camp generated a great amount of attention to children's traffic education

and transportation safety. Through this project, BMW has proven to be an industry leader in

children's traffic safety education.

Meanwhile, BMW is also actively promoting a five-year "BMW China Scholarship for

Outstanding College Students" project in cooperation with the Song Qing ling Fund by

48

providing scholarships totalling 2.5 million RMB to 500 outstanding students from 10

universities. 2007 was the third year of this five-year project. Apart from funding 100 distinct

college students per year, BMW also provided internship opportunities to 10 select students

at its Shenyang Plant. So far the project has received wide support and appreciation from

teachers and students.

Lighting up "The Flame of Life."

BMW personnel compose a song to show their support to children affected by the

earthquake.

"Let's stand shoulder to shoulder, lighting up the flame of life / Together embracing the bright

future". Following the Wenchuan earthquake, BMW staff members were moved to compose

and record an original song that would convey their support and love to the children in the

disaster area. Working at a professional recording studio, the group quickly completed the

song, entitled The Flame of Life. Although not professional singers, everyone truly sang their

hearts out, "lighting up the flame of life" and spreading strength, optimism and hope for the

future to those affected.

49

Mutual respect and care.

BMW has always viewed its employees as the foundation and decisive element for its

corporate development. Creating space for its employees to grow is thus an important

objective for BMW. As a result, BMW's commitment to corporate social contribution is also

reflected internally, in attention to employee concerns, the working environment, and the

broader corporate culture. Indeed, BMW sees its employees as creators of the corporate

culture and partners in corporate social responsibility. Encouraging voluntary employee

participation in public welfare activities serves as an embodiment and extension of BMW's

corporate culture and emphasis on corporate social contribution.

Virtuous Actions, Endless Passion.

Hand in hand, contributing to reconstruction in Sichuan.

BMW joins with the China Charity Federation to establish the BMW Warm-Heart Fund.

The Sichuan earthquake, measuring 8.0 on the Richter scale, unleashed its destructive power

in just minutes -- but also instantly produced a tremendous outpouring of concern and

compassion. Together with the China Charity Federation (CCF), BMW China and BMW

Brilliance Automotive have set up the BMW Warm-Heart Fund, which will contribute to

reconstruction projects in the earthquake area. The Warm-Heart Fund also provides a

platform for BMW employees; BMW authorized dealers, BMW car owners as well as all

BMW fans to constantly gathering their love and generosity. It's a perfect channel for the

BMW community to show its support and contribute to reconstruction in the earthquake hit

50

area in the near future, and will also brought warmth and help to broader regions in the long

term.

Concept of BMW advertisement

BATTLE OF TWO

BMW and Audi are duelling again, but this time, onto the “marketing battle field”. And what

would be the best place to do so other than the one of the top states when it comes to car

luxury sales: California.

51

On the corner of Santa Monica Blvd. and Beverly Glen Blvd (corrected the

location), Audi has put up some Billboards showing the all new Audi A4 along with the

headline: “Your move, BMW”. Santa Monica BMW, A local dealership, took on the

challenge and entered a virtual chess game ….of course, with cars rather than Pawns, kings or

queens.

Juggernaut Advertising, an independent advertising agency headquartered in Santa Monica,

CA, has initiated a

Tactical outdoor marketing campaign on behalf of BMW of Santa Monica. The campaign is

in response to

Audi’s current billboards challenging BMW with the headline “Your move, BMW.”

Juggernaut Advertising’s creative work features the BMW M3 with the headline

“Checkmate.” and is

Positioned .Prominently within the same sightline to westbound traffic as the Audi ad.

Juggernaut approached

BMW of Santa Monica after identifying a unique and immediate geographical opportunity

along the highly

Trafficked Santa Monica Blvd. corridor between Beverly Hills and Santa Monica.

“When we heard the idea, we loved it and couldn’t resist going forward,” says Del

Montell, Jr. of Santa

Monica BMW.

52

The trouble began when BMW released an ad for its new 3-series and congratulated Audi for

winning the South African car of the Year award. Certainly an esteemed honour in it’s own

right, but BMW signed the congratulations with the line, “From the winner of the world

car of the year award 2006.”

Audi’s PR guerrillas, not willing to sit idly by while being assaulted in the print realm fought

back with the ferocity expected from the German carmaker. They parried BMW’s thrust with

an ad proclaiming that the “world car of the year award” was nice, but we’ve kicked butt

at LeMans for six consecutive years, so put that in your pipe and smoke it!

VIEWS

Clever advertising, BMW won the battle but Audi is winning the war. Audi has re-branded

them as the Progressive luxury car. Mercedes is catching up finally with the current redesigns

but how is BMW adapting? By offering maintenance for up to 50,000 miles.. Come on BMW

you can do better, maybe its time for a redesign as well.

BMW and Audi Ad War

53

CHAPTER 5

FINDINGS

AND

ANALYSIS

54

BMW SWOT ANALYSIS

• Strengths

BMW is not the best biggest but the best car company in the world.

BMW has strongly influenced consumers through media and film industry.

Spartanburg demonstrates that BMW is firmly committed to the US market and

rededicated to the performance values that made BMW a cult here in the

1980s.

The Spartanburg plant can build 250 to 300 cars a day and production is set up to be

flexible so that it can produce several models on the same line in random

sequence.

The plant currently employs 1,500 people and the plan is to grow to 2,000 by the end

of this decade.

Spartanburg offer us the opportunity to develop a new set of relationships in North

America.

• Weaknesses

Their corporate image is too serious and tradition-bound.

BMW was perceived to be a German-made car, not an American-made car.

• Opportunities

The cars won't be that expensive as compared to German-manufactured cars.

This is BMW's first auto plant outside Europe. This is the chance for BMW to take a

step away from being a German car manufacturer towards its long-term goal of

becoming a truly global brand.

Spartanburg can really change what BMW stands for.

55

•Threats

Other luxury car import manufacturers were rumored to have similar concepts

under development.

There are a lot of competitor luxury cars in the country.

Alternative Courses of Action

• Take the traditional marketing strategy of BMW. This is the traditional television and print

advertisement marketing strategy. The television and print ads will be utilized in order for the

new Z3 roadster be advertised all over the United States.

Advantages

In this way, the tradition of television and print advertising will be preserved.

It will be less costly for them to advertise the new Z3 model.

Disadvantages

Their goal of making the new Z3 model unconventional will be defied.

There will be less impact with regards to their new car model.

Strengths

BMW is a well-known company with a high status branding that has a very high recognition

factor. The company has been strengths in both research and development and design as well

as in marketing. For example when it comes to marketing it was a BMW advertisement that

was the first e-advertisement that made it to Campaigns 'Pick of the Week' (Doman).

However, in a long-term purchase such as this there is a need for moire substance than just

marketing, otherwise the life of the company would be relatively short due to the nature of

the purchase. It is in these longer-term systems and strategies that we can see many of the

strengths of BMW, we can consider these by starting with the market position of

thecompany.

56

BMW as well as Mercedes' and a few other companies have managed too successful attain a

market position where they have a focus on a narrow range of exclusive cars. These can be

seen as aimed at the market place that is not also sensitive to price, and as such we must

argue that the market positioning may be seen as a strength as there will not be such a

reaction if the economic conditions change. The customers that are in the target group are

happy to pay a premium price for what they perceive as a premium product (Thompson).

This may not be so true of the subsidiary companies that have had different problems, such as

the ill- fated Rover group. However, the core product has remained strong (Thompson). This

may be seen as diversification, and some of the diversification may also be seen as a strength,

for example the purchase of Rolls Royce where there is a similar strategy, however the range

and target market are even more focused and exclusive.

The strategy of BMW is designed to be defensive against other car manufactures, and as we

will see when it comes to the section on threats this is a defensive strategy that BMW have

adopted after learning the need for defensive as well as aggressive marketing and strategies.

57

CHAPTER 6

LIMITATIONS

58

The Limitations of the project are -:

TIME CONSTRAINST :-

Since the study was taken for a short period .so time was the biggest constraint.

RELIABILITY OF DATA :-

Since subject taken is vast so there are always possibilities that something may not

be forgotten to be mentioned .Data collected may not be 100% reliable and accurate.

SECONDARY DATA:-

It is secondary data so we can’t work upon it .It is not Primary data so we can’t use

statistical tools.

DIFFICULT PATTERN :-

Topic is very vast. Hence, Difficult to monitor the company and celebrity’s pattern

of endorsement.

59

CHAPTER 7

CONCLUSION

60

The automotive industry is distinguished by a highly competitive market. Thus, the players

on the market struggle with increasing cost of production, development and mature markets.

With the aim to increase profit margins and reduce costs, Volkswagen, GM a nd Ford are

some companies, which use the same components in different car models and car brands.

These companies have in other words succeeded in synergising research and development

effects within the company despite car model and business area. By a contrast, BMW, an

individual actor, has yearly shown strong financial results and has retained its market shares.

This becomes of interest to study more profoundly, in order to find the factors behind

successful company and a strong brand.

Purpose: The purpose of this thesis is to analyse the development of BMW during the past

years. Not only are the financial statements taken into consideration. In addition, comparison

to competitors and the market situation is also made.

Delimitation and assumptions : This project is delimited to an analysis of BMW between the

years 2001-2005 basically. The thesis is based on the assumption that BMW is the most

successful automotive manufacturer in the premium segment.

Methodology: In the study of BMW mostly secondary data is used.

Results and Conclusion: BMW is a well known and highly valued brand and has high

diversity in the product portfolio. BMW possesses high internal competence and the company

develop a large part of the car by themselves. The emerging markets in South East Asia,

Russia, Eastern Europe and South America have shown evident growth developments.

Eminent production, transportation and raw material costs have both dampened margins and

affected the buying power of consumers likewise as high oil prices.

Suggestions for further studies: What would be of interest are the services that the

automobile manufacturers offer beside the cars, the after sales services, like financial services

for example. In addition, future research could also include studies of customer loyalty in

association to the after sales services.

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CHAPTER 8

SUGGESTIONS

62

Some of the suggestions that company should take care of are -:

The BMW group should launch a small lifestyle car which can be afforded by

middle-class people its market share can be extended.

Its accessories and parts of cars are expensive for maintenance which can reduce

the desire of people purchasing its cars.

The company should keep on a regular check on its rivals so that product

development can be done accordingly hence contributing towards growth of the

firm.

63

BIBLIOGRAPHY

The Following References are taken in consideration for the preparation of this Project.

Website / Webpage

http://www.bmw.in/in/en/

http://www.bmw.com/

http://www.bmwgroup.com

http://www.infibeam.com/cars/make/bmw.html

http://bmw-motorsport.com/ms/en/index.html

http://www.bmwblog.com/

http://www.zigwheels.com/b2cam/home.action

BLOGS

http://www.bmwblog.com/

Books

Chhabra ,T.N , Marketing Management , NaiSarak , Delhi , DhanpatRai& Co.(Pvt)Ltd, 2012

Magazine & Newspaper Articles

AUTOCAR INDIA

BMW AUTHENTIC

ZIGWHEELS

What’s HOT?-Hindustan Times