BMW
INTRODUCTION
Bavarian Motor Works
BMW logo : An aircraft propeller to signify the white blades cutting through a blue sky
Founded in Munich, 1917
Acquisition Of Rover Group in 1994
The BMW Group is one of the most successful manufacturers of automobiles and
motorcycles in the world with its BMW, MINI, Husqvarna Motorcycles and RollsRoyce brands.
As a global company, the BMW Group operates 25 production and assembly facilities
2
in 14 countries and has a global sales network in more than 140 countries
HISTORY
Decade
Key dates
1910a
1916 :
1917:
1923
1928
1951
1952
1920s
1950s
1980s
1990
Opportunities
Increasing
levels of
popularity of
electromobilit
y
Green
vehicles and
new emission
regulations
Changing
customer
needs
Strategic
alliances with
other
automobile
companies
Improved
quality and
customer care
Market
expansion
Increasing
product
portfolio
Changing
lifestyle &
customer
groups
THREATS
Increasing
prices of raw
materials
New
competition
Malfunctio
ns
Euro
exchange
rates
Decreasin
g fuel
prices
Price
Factor
Failed to
obtain spare
parts
Weight
Rating
Weighted Score
Opportunities
1.
0.08
0.24
2.
0.08
0.24
3.
0.11
0.44
4.
0.04
0.08
5.
0.10
0.40
6.
Market expansion
0.05
0.10
7.
0.06
0.12
8.
0.05
0.10
Subtotal
0.57
1.72
Weight
Rating
Weighted Score
0.08
0.08
0.10
0.30
11. Malfunctions
0.04
0.08
0.05
0.10
0.03
0.03
14 Price Factor
0.09
0.18
0.04
0.08
Threats
9.
TOTAL
1.0
2.57
External position of BMW is good as the weighted score (2.57) is higher than
average score (2.50)
Five-Force Modal
sufficient knowledge
needed
highly skilled
technicians and
engineers required
Brand equity
HIGH
threat of
substitute
LOW threat
of substitute
Low
switching
cost
No penalties of
changing
brands
Many
substitutes
Competitor in
same industry
(luxury car
industry)
Environme
nt issue
Awareness
about fuel
emissions
Prefer to use
public transport
Strong brand
image
Rather buy
something that
has a reputable
name behind it.
Brand
loyalty is
high
Competitor in
different
industry
Car with lower
price
Differentiation of material
Majority of suppliers
medium to large
businesses
Level of difficulty for a
new supplier to enter the
industry
Economic recession
Customer forced to buy less costly cars
Brand image
LOW power
of consumer
Low market
share
Not much new
market share
Must take market
share away from
other competitors
while most of the
competitor are in
same size
Technology
development
Increasing
competition and
demand over
hybrid cars
increase in the fuel
efficiency
environmental
friendly cars
Therefore a luxury
car company must
have in-depth
research to attract a
customer
Hard to achieve
market
leadership
Technology keep
changing
Competitors keep
innovate
Hard to recognize
as the top luxury
brand in
customers
perception.
Low
Threat of Substitutes
High
Power of Suppliers
High
Power of Consumers
High
Competitive Rivalry
High
BMWS COMPETITORS
Slogan
The Best Or Nothing
Active in 3 forms of
motorcar racing:
Formula Three, DTM
& Formula One
Relaxed atmosphere
R&D centre in Silicon Valley
flexible working time
create visionary concepts and
production-ready products for crossmedia networked vehicles
Expansion of the product network
continues
plant aligning for compact car
production, facility of preparation for
the plants role as center of competence
for the new C-class
China - to expand the local production
to build a new engine plant
Sales and marketing initiative launched
Best Customer Experience sales and
marketing initiative
Reconfiguring the sales to align it with
the changing preference of customers
First premium manufacturer to sell new
cars on the internet
Restructure the organization along the
divisional lines
Mercedes-BenzPRE-SAFE introduced
Comprehensive system of safety
features activated once unavoidable
collision is detected
Newly launched PRE-SAFE Sound Harnessing the stapedius muscle reflex
in the ear
Maintain car price when other competitor producing cheaper entry level
To prevent low unit price in diluting the brand value
Market Position
Avoid flooding the market with many car models and try to dominate the niche
market
Dealership & dealership service
Strategically located on prime real-estate
Vehicle Delivery Specialist (answer the question after delivery)
Vehicle Technology Specialist (expert guidance on the dealership or via camera-enabled apps)
OWNERS APP
Providing Lexus owners convenient access to vehicle service history, how-to videos and
information about nearby owner benefit
Critical success
factors
AUDI
Weight
Rating
Advertising
0.05
Market shares
0.05
Customer Service
Score
MERCEDESBENZ
LEXUS
BMW
Rating
Score
Rating
Score
Rating
0.10
0.20
0.05
0.15
0.15
0.10
0.05
0.20
0.25
0.25
0.50
1.00
0.75
Customers loyalty
0.20
0.40
0.20
0.80
0.60
Price competitiveness
0.20
0.40
0.60
0.20
0.80
Global Expansion
0.15
0.45
0.60
0.15
0.30
Management
0.10
0.10
0.30
0.20
0.40
Total
1.00
1.85
2.50
2.45
Score
3.20
BMW is the strongest automotive company compares to its competitors. The main competitor for BMW
is Mercedes-Benz as it has the second highest value which is 2.50
Strengths
Strong
Reputation
Environmental
Friendly
Technology
Workforce
Corporate
Social
Responsibility
(CSR)
Quality
Products
Competitive
Customer
Service
History
Weaknesses
High cost
structure
High prices
perception
Weak brand
portfolio (only
three brands)
Lack
partnerships
Younger generation
less brand conscious
Weight
Rating
Weighted
Score
Strengths
1.
0.12
0.48
2.
Environmental Friendly
Technology
0.10
0.40
3.
0.09
0.27
4.
Corporate Social
Responsibility (CSR)
0.08
0.24
5.
Quality Products
0.07
0.28
6.
Competitive Customer
Service
0.09
0.27
7.
Engineering History
0.04
0.12
8.
Continuous Improvement
0.10
0.40
Subtotal
0.69
2.46
Weight
Rating
Weighted Score
0.08
0.08
0.10
0.10
0.05
0.10
12
0.06
0.06
0.02
0.04
Weaknesses
9.
1.0
2.84
Internal position of BMW is good as the weighted score (2.84) is higher than
average score (2.50)
Liquidity ratio
( Current ratio )
Profitability ratio
( Net profit margin )
FINANCIAL
CONDITION
Financial Leverage
ratio
( Debt-to-total-assets
ratio )
Growth ratio
( Sales growth rate )
LIQUIDITY RATIO
(CURRENT RATIO)
1.08
1.08
1.04
1.04
1.02
2009
2010
2011
2012
2013
LIQUIDITY RATIO
(CURRENT RATIO)
Year/Company
2009
2010
2011
2012
2013
BMW GROUP
1.082
1.075
1.038
1.044
1.021
VOLKSWAGE
N GROUP
1.119
1.049
0.971
1.071
1.030
DAIMLER AG
1.142
1.024
1.114
1.149
1.192
TOYOTA
1.067
1.223
1.096
1.046
1.068
Industry
Average
1.103
1.093
1.055
1.078
1.078
PROFITABILITY RATIO
(NET PROFIT MARGIN)
7.09
6.62
5.34
0.4
2009
2010
2011
2012
2013
6.97
PROFITABILITY RATIO
(NET PROFIT MARGIN)
Year/Company
2009
2010
2011
2012
2013
BMW GROUP
0.403
5.336
7.092
6.617
6.972
VOLKSWAGE
N GROUP
0.913
5.387
9.671
11.269
4.602
DAIMLER AG
-3.345
4.601
5.319
5.624
5.799
TOYOTA
-2.128
1.105
2.149
1.526
4.361
INDUSTRY
AVERAGE
-1.039
4.107
6.058
6.259
5.434
54.78
53.07
51.37
2009
2010
2011
2012
2013
50.81
2009
2010
2011
2012
2013
BMW GROUP
59.078
54.776
53.065
51.365
50.806
VOLKSWAGE
N GROUP
43.797
38.623
36.857
38.015
37.463
DAIMLER AG
40.039
47.258
41.967
46.762
46.130
TOYOTA
47.257
49.388
41.589
39.119
39.827
INDUSTRY
AVERAGE
47.543
47.511
43.370
43.815
43.557
GROWTH RATE
(SALES GROWTH RATE)
19.33
13.8
11.66
-4.73
-1.03
2009
2010
2011
2012
2013
GROWTH RATE
(SALES GROWTH RATE)
Year/Company
2009
2010
2011
2012
2013
BMW GROUP
-4.730
19.329
13.797
11.664
-1.027
VOLKSWAGE
N GROUP
-7.575
20.619
25.586
20.924
2.248
DAIMLER AG
-17.679
23.867
8.980
7.281
3.224
TOYOTA
-21.909
-7.689
0.225
-2.159
18.729
INDUSTRY
AVERAGE
-12.973
14.032
12.147
9.428
5.794
OBJECTIVE
46 years old
provider
g
n
i
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a
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worlds
e
h
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es for
c
s
i
i
v
r
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e
u
s
o
r
m
G
iu
The BMW products and prem
m
of premiu
ility.
b
o
m
l
a
u
individ
Mission
Interested
in sport
Income
$150,000
Leader,
Hardworking
Targeted
Customers
High Brand
Loyalty
2/3 Male
Married, no
kids
Well
Educated
51
R
T
S
E
T
A
S
E
I
G
52
This strategy forms the foundation of the success of the BMW Group.
United Stated
"The Ultimate
Driving Machine"
Worldwide
"Sheer Driving
Pleasure
Canada
The Ultimate
Driving Experience
53
Sponsorships
54
Member of :
U.S. Environmental Protection Agency 's (EPA) National Environmental Achievement Track, which recognizes
companies for their environmental stewardship and performance.
Activities :
In 2001, the BMW Group committed itself to the United Nations Environment Programme, the UN Global
Compact and the Cleaner Production Declaration.
Achievement :
In 2012, BMW was named the world's most sustainable automotive company for the eighth consecutive year by
the Dow Jones Sustainability Indexes.
BMW is industry leader in the Carbon Disclosure Project's Global 500 ranking
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.
electric power
55
Online Marketing
Uses internet thru its main international website (www.bmw.com) and its
subsidiaries as parts of marketing strategy to conduct mass marketing worldwide
This has been advantageous to BMW since 2001 when it conducted RD and found
that 85% of its customers used the internet before purchasing its product.
Use website :
-
Latest news on products and details to promote the brand and maintain its awareness
Downloads for wallpapers, screen savers, widgets, and other brand promoting applications
BMW multi-player online games : promote performance of its vehicles, create string
positive brand image, influence players who are potential buyers or ambasadors
56
Competitive
Competitive Advantage
Advantage
Competitive Scope
Scope
Competitive
Lower
Lower Cost
Cost
Broad
Broad Target
Target
Narrow
Narrow
Target
Target
Differentiation
Differentiation
Cost Leadership
Differentiation
Cost Focus
Differentiation
Focus
57
58
How
SWOT
Opportunity
O 2 Green vehicles and new
emission regulations
O 3 Changing customer needs
O 4 Strategic Alliances
O 5 Improved quality and
customer care
Threats
T 2 Intense Competition
T 3 Malfunctions
T 6 Price Factor
Strengths
S 1 Strong Brand Reputation
S 2 Environmental Friendly
Technology
S 3 High Skill Workforce
S 4 Corporate Social
Responsibility (CSR)
(S2, O2)
Focusing on Hybrid technologies
(S3, O3)
Product Diversification
Weaknesses
W 1 Lack of Strategic
alliances
W 2 High cost structure
W 3 High prices perception
W 4 Weak Product Portfolio
(W1, O4)
Expand and Find Strategic
alliances
(W3, O5)
Position as premium car
brands
Recommendation
Similarities/Differences
Existing Strategies
Hybrid technologies
Reduce Pollution
Environment friendly
vehicles
Product Diversification
Undifferentiated vs
Differentiated Focus
Differentiation Focus
Sponsorships
POWERFUL BRAND
IMAGE.
R & D to counter
Malfunctions and failure to
obtain spare parts
Online Marketing
New
wareho
use
faciliti
es
-To
lower
cost
Overcom
Why
e Spare
BMW
part
becaus
problem
e it is
Luxury
!
-premium
Car
-exclusive
experience
-inimitable
feeling
tand
Custo
mer
-Culture
and
preferenc
e
-innovate
car to
suit them
To be
The
World
Top
Luxur
y Car
Improve
Product
Maker
ion
Efficienc
y
- Cut
cost
-Reduce
environ
Raise
Green
Aware
ness
Advertisi
ng
Through
Increas
Social
Media
e
Produc
t Port
Folio
- Find
Strategy
Alliances
introduc
e more
brands
What implementation
problems do you envision?
Financial
problem
New
Emission Standard
Time
Hard
Improper Alliances might ends up BMW acquiring more problems and could harm
their brand.
Volkswagen
Mercedes
Lexuz
How
Conduct
Utilize
social media
Collaborate
Choose carefully
Innovate
Eg:
Special
innovative technologies
Understand
Conclusion
1.
BMW Group Mission Statement - One Premium Success From Three Distinct Visions.
Retrieved
from
http://
retailindustry.about.com/od/retailbestpractices/ig/Company-Mission-Statements/BM
W-Group-Mission-Statement.htm
2.
BMW Group
(2013).
Company
Portrait.
Strategy. Retrieved
from
http://www.bmwgroup.com/e/0_0_www_bmwgroup_com/unternehmen/unternehmensprofil
/strategie/strategie.html
3.
4.
5.
Roop.
(2015).
SWOT
Analysis
of
BMW.
Retrieved
https://www.scribd.com/doc/240158470/SWOT-Analysis-of-BMW#scribd
6.
7.
Marketing
91.
(2015).
BMW
SWOT
http://www.marketing91.com/swot-analysis-of-bmw/
Retrieved
analysis.
from
Retrieved
http://
from
72
from
9.
10.
11.
12.
13.
14.
QUESTION ?