BMW wanted to shape a new corporate image and planned to use the introduction of a sporty new roadster, the Z3, to set this in motion. In this process, they wanted to position themselves as a global brand, appealing to broader market segments. Due to their significant financial investment in a new manufacturing plant in South Carolina, they were highly motivated to make the launch of their first American-made car, the Z3, as successful as possible.
Phase I of the marketing plan, which involved strategic product placement and cross-promotional activities with the new James Bond film, Goldeneye, proved to be a triumph, replacing previous traditional advertising methods with an “emotional fantasy”, out-of-the-box image-based promotional campaign. The time gap between the height of Phase I publicity and the actual availability of the product requires a highly strategic Phase II plan. Another issue is the concern about maintaining BMW’s well-known reputation as a German automotive company dedicated to quality and performance.
Given this information, we determined that the three alternatives BMW could chose to implement in their Phase II design are either nontraditional marketing, traditional marketing or a well thought-out combination of both. We recommend that BMW continue into Phase II with a combination of both strategies. Having fulfilled their stated goals for Phase I, we believe this approach will continue to benefit the company throughout Phase II. Now that the hype from the James Bond movie has subsided, BMW must find a way to sustain the cachet built around the car until it’s dealership arrival in March 1996.
They want to continue promoting the car and the company through their sponsorship of the Summer Olympics while also reminding the public of BMW’s traditional reputation. By emphasizing the previous success of Phase I using nontraditional concepts with an increase in more traditional methods both to compensate for the inability to maintain the highs of the movie premier and to re-emphasize BMW’s commitment to excellence, this dual marketing system will solidify the successful launch of the Z3 in March and continue enhancing BMW’s brand image in the eyes of the global market.
Problem Statement: BMW, a highly regarded, strong performing, German automobile manufacturer has decided to produce a roadster to appeal to consumers who desire driving excitement and the experience of the BMW brand. Phase I of their marketing plan has proven to be wildly successful through its product placement and co-launch with the James Bond movie, Goldeneye. As Goldeneye’s release date as come and passed, BMW must establish an effective marketing plan for Phase II of their Z3 launch.
This marketing plan must maintain the excitement and high demand generated by Phase I, as there is a four month discrepancy between promotion and the actual arrival of the cars. This plan must also help position BMW squarely into American culture and develop their image as a global brand. One of the challenges to these goals is their stodgy, solid reputation that may deter BMW from developing the new brand image they desire.
As they strive to establish a broader, improved product line, they need to take into consideration their dealer network, a very costly new manufacturing facility in the United States instead of Germany, and of course, operating at peak efficiency. They want to update their corporate image but maintain their fine reputation for reliability and luxury. Situation Analysis: External: BMW has successfully created a strong public interest in their new car, the Z3, by using non-traditional marketing methods before it’s launch in March 1996.
The challenge for BMW is to maintain the hype created by promotions involving James Bond’s Goldeneye, which was released in November of 1995 until the Z3’s dealership arrival four months later. They also must deal with market competition, as competitors such as Mercedes-Benz and Porsche were rumored to be developing similar products. In order to have competitive advantage, BMW had to have an effective marketing strategy to be first to mind share in the eyes of the consumers.
However, BMW’s Z3 was at an advantage anyways because of their low price point. Another issue BMW must deal with is that the Z3 is the first American made car being introduced to the market. The implications of this “is a 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. ” It is important for BMW to monitor this transition in the eyes of their consumer in order to maintain their strong reputation as well as promote their new image.
The demographic of the baby-boomers and Generation X, that more youthful population, BMW has been so successful in attracting in Phase I is still in their favor. However, they also need to remember the traditional base of their customer profile. Internal: Heading into Phase II, BMW has a lot to live up to after the success of Phase I out-of-the-box marketing. In order to maintain that success, BMW must continue to appeal to the fantasy and sophistication they have associated with the Z3.
Not only do they have to maintain the image they have created, but also keep customers interested until the Z3 is available in dealerships in March. In fact, BMW’s concerns that this highly promoted product was actually unavailable, became an asset rather than a liability with initial orders at 9,000 units compared to the projected 5,000 units. The unavailability created a cache surrounding the product, and as James McDowell stated, “It heightened the excitement value of the message and made people ripe with anticipation for the experience”.
Phase I proved that nontraditional marketing techniques provide more results for less cost, therefore the nontraditional marketing, such as the James Bond related promotions, TV appearances, interactive internet programs, etc must be consistent to provide continuity for the customer. It would be disadvantageous to switch abruptly from one technique to the other. Since the company had invested $600 million dollars in their new South Carolina plant and firmly committed itself to the U. S. market, it is important that they don’t let this change in location lead to any negative reactions. Marketing must focus on the positive aspects of U.
S. manufacture and reassure customers that BMW quality will not be compromised. The company also must find a way to keep the enthusiasm of the dealers and help them with various local promotional activities. Scenario Analysis: McDowell’s assertion that he never wants to use traditional marketing again might need to be reevaluated. While the non-traditional marketing approach used for the Phase 1 of the Z3 launch was successful and exciting, it is not only hard to maintain that level of glamour and product buzz, but also important to remember the traditional basis of BMW’s reputation for outstanding engineering and quality.
Because Phase 1 successfully accomplished creating a new image for the company, attracting a more youthful customer, and generating tremendous word of mouth publicity accompanied by excellent results reflected dealership traffic and car orders, the challenge remains to maintain the momentum of these non-traditional marketing tactics. The use of BMW’s non-traditional marketing techniques such as the Neiman Marcus catalog order, the build-your-own module on BMW’s website, press launch in Central Park, appearance on the Jay Leno Show and the Radio DJ Program proved to be very successful during Phase 1.
If they were to continue with non-traditional methods, they would be some advantages and disadvantages. It will be very difficult to sustain the high level of interest and attention generated by Goldeneye and all the cross-promotions until dealership availability in March. However, BMW does have the rights to use the Goldeneye tie in until March, and it would be in their best interest to continue with that because of it’s proven results during Phase 1. An additional asset BMW has heading into Phase II is their title as “Official Automotive Sponsor” of the 1996 Summer Olympic Games in Atlanta.
As the date for the summer Olympics approaches, and BMW loses their official affiliation with the James Bond franchise, they could migrate to using Olympic athletes as spokespersons to promote the Z3 as well as the brand’s new global image. A potential drawback is the idea that they cannot neglect promoting their traditional qualifications as a German-based high quality engineering luxury car. The idea of a BMW “Made in USA” may not appeal to entrenched European devotees.
On the other hand, it is probably not a good idea to ignore the “Made in USA” label. It could be used to reinforce BMW’s position as a global brand and the Z3 as an American cultural icon, all the while making sure to stress BMW’s continuing high standards. Upon the arrival of the Z3’s in March, dealerships could spark local interest by holding another round of promotional cocktail parties for their best customers. Another idea would be to incorporate local Olympic athletes into these dealership promotions.
This accomplishes not only more excitement for the Z3, but also attention for the new redesigned 5-series which will be a main focus for BMW during the Summer Olympic games. If BMW were to switch to traditional marketing methods it would fail to capitalize on all the excitement coming out of Phase I, as well as not being very cost effective. If they did decide to follow traditional approaches, they could still use the Goldeneye tie in for TV and print advertisements until March and then proceed with the Olympic theme.
As in Phase I, this advertising would use the pre-established fantasy image elements. Additional advertisements promoting BMW quality would revert to their program highlighting their “performance capabilities in a no nonsense manner”, emphasizing the serious performance oriented qualities of BMW’s Z3. By placing these advertisements in appropriate media, BMW would be able to reach their psychographic as well as demographic target markets and hopefully maintain their high product awareness. Recommendations:
Promoting a new BMW product through image rather than more practical considerations was a “paradigm shift” for the company. It is so important to maintain the momentum achieved in Phase I, but equally important to allay apprehensions about reduced quality in a car manufactured in the United States, perhaps sneaking into the customer’s psyche after the thrill of the original launch has faded. Phase II advertising should incorporate some more placement in automotive publications and websites, which support BMW’s high performance and high caliber.
In Phase I, BMW did successfully use a combination of traditional and nontraditional methods, and we suggest that again, although with some slight modifications due to the changed market environment. Not only will this approach continue to market the Z3 effectively, but also reinforce public opinion of BMW as a whole. This position will be meaningful and influential as they try to promote the new redesigned 5-series throughout their Olympic sponsorship. This marketing program fits in well with the new global brand image BMW initiated in 1992, positioning it’s cars as the “Ultimate Driving Machines”.