Bmw Branding

7 July 2016

Coursework Title: Identify your favourite brand from any sector of your choice. What makes the brand successful? Use relevant theories (branding concept, brand equity and brand positioning) and examples to illustrate your answer. You need to integrate and critically evaluate these concepts in the context of your chosen brand. “The Ultimate driving machine”, a simple, strong, distinctive and clear message that has been heard and recognized around the world for more than 30 years. This coursework will look into how a company can create, maintain, and most important, make its brand extremely successful.

Theories will be used together with examples to illustrate the connection, the first one being brand awareness and the fact that you are probably aware of what brand this coursework will be covering. The Bayerische Motoren Werke, also known as (BMW) is considered one of the world’s most successful automobile manufacturer, with three premium brands – BMW, MINI and Rolls-Royce. The group was established in Munich on the year of 1916 as an aero-engine manufacturing company, and from the very start it was setting its high standards and innovation culture that is inherited in the company and lives up to this day.

Bmw Branding Essay Example

1917, was the year the group produced its first 6-cylinder, 185hp engine, something that none of its competitors could match and it was the first time aluminium piston were used in a engine, setting a new benchmark in construction. With the end of the First World War and the Treaty of Versailles, new laws were created in Germany for the aircraft industry and the company had to change its manufacturing process and reposition itself in the market it operated. Nevertheless, with its highly skillful team of engineers, and the technology it possessed the company focused on the production of automobiles and motorcycles instead.

Soon after that, in 1923 the world’s first motorcycle with alloy cylinders was launched, and in 1928 BMW launched its first car. BMW continued with its breakthrough mentality in the decades that followed with developments such as being the first manufacturer to release a V8 (1951) and a V12 ( 1987) engine, in 1991 the company was already looking ahead in the future and was working towards its sustainability and green fuel with the launch of the worlds first E-car. In 2006 was launched the world’s first hydrogen car and late this year, the BMW I3 was revealed, as the first purely electric

production car, those are examples that reflects the culture and future strategy of the group as as stated by the chairman of the board of Management, Norbert Reithofer “We strongly believe that sustainability is a key factor in the long-term economic success of the BMW Group. We are proud to be the sector leader, (Dow Jones Sustainability Index 2012). and at the same time, it motivates us to continue to be a pioneer in corporate sustainability in the future”. Having look briefly into BMW history, I will now look a bit deeper into a few concepts. A brand, what is it? How can I define?

How does it related with a product? The American Marketing Association define brand as “name, term, sign,symbol or design, or a combination of them, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors”. In the case of BMW the easily recognizable logo, the name, the colours, have been the same throughout the years and according to (Jobber, 2010) a brand name, or symbol should be just that, easy to pronounce, to remember, suggest positive benefits, be distinctive, evoke positive associations and be transferable across national boundaries.

To create a brand a company needs to add particular values to its core products and according to Strizhakova, (2008), a branded product can related in 7 different ways:: quality as associated with risk reduction, social status as reflective of personality, self-identity, as integration of personal values with brand image , group-identity, values, family traditions, and national traditions, and thats where the concepts of brand equity and brand positioning are going to be used.

First we need to understand the concept of Brand Equity, a model created by Kevin Keller a marketing professor at the Tuck School of Business at Dartmouth College, and is divided in two parts, Firm-based Brand equity, which focus more on the financial value of a brand and some of its attributes, such as patents and channels relationships. However the “financial value of a brand is only the outcome of a consumer response to a brand name”,(Christodoulides. G and Chernatony.

L 2010) therefore I shall focus more deeply on the other part of brand equity, the Customer-Based Brand equity that according to as Srivastava and Shocker (1991) can be defined as; ‘a set of associations and behaviors on the part of a brand’s consumers channel members and parent corporation that enables a brand to earn greater volume or greater margins than it could without the brand name, in addition provides a strong sustainable and differential advantage’, or simply as Keller, (1993) has described it “Customer-based brand equity is defined as the differential effect of brand knowledge on consumer response to the marketing of the brand”.

A brand is considered to have a positive brand equity when the behaviour of users result in strong brand loyalty, insensibility to price changes, high volumes of sales leading to high profits and the success of a company. Last year, for the second consecutive year, BMW has won the war against its german rivals on the luxury market by being the highest seller manufacturer by selling 281,460 vehicles against 274,134 sold by Mercedes-Benz.

Brand knowledge itself is composed of Brand awareness and Brand Image and Rossiter and Percy (1987) described brand awareness as being essential for the communications process to occur as it precedes all other steps in the process. For a consumer to buy a brand they must first be made aware of it. ”So what has BMW done to create its brand awareness? A consistent advertising campaign targeting the same market and evolving around the core values and mission of the company.

Many and consistent television adverts, one of them being on one of the worlds most watched sporting event, The SuperBowl, making its presence online with the group website (bmwgroup. com), a online TV channel (bmw. tv), a blog (bmwblog. com). It has been present in sports events such as car racing ( 24-hour LE Mans, BMW had a formula 1 team), golfs events and Yacht racing. The cars have also been popular in movies such as James Bond and the Transporter, and in 2001-2002 BMW shot 8 short films starring Clive owen to promote its range of cars.

Adding to that, theres billboards campaigns, magazines adverts and BMW also has a magazine of its own. All of the above should create a good awareness of the brand therefore raising brand recognition and making brand recall easier to happen, what brand Awareness is made of. Having explained one part of Brand Knowledge, I shall now look into Brand Image and its concept and how BMW has create a positive image of its brand. The term can be defined as “perception about a brand as reflected by the brand associations held in consumer memory, containing the meaning of a brand” Keller, (1993).

For a brand to have a meaning, or in this case a favorable image with the public, first the company needs to decide in what market it will compete using a technique called market segmentation, which i will not look very deep into to, but can be defined as “the identification of individuals or organizations with similar characteristics that have significant implications for the determination of a marketing strategy” (Jobber, 2010).

BMW, with its superior technology, unique design, high focus on premium and comfort has chosen the premium market to compete and to create its brand image. Therefore the elements of the marketing mix,(Product, Price, Place, ) with the promotion which was discussed above, are all of major importance for the creation of a positive brand image and to successfully target its users.

However, to create a marketing mix and to position a brand within, Jobber ( 2010) claims that it should be founded on a framework of 4’Cs, those being Clarity, Credibility, Competitiveness and Consistency. Its clear on the mission group statement where BMW has positioned itself “The BMW Group is the world’s leading provider of premium products and premium services for individual mobility. ” The competitive edge and the consistency can be seen on the phrase “The ultimate Driving Machine”, as it has been consistently used for the last 4 decades and it shows how they will compete.

The last and sometimes the hardest to achieve is the credibility of the brand as it has to be gained over time and later on some examples will be shown as how BMW has gained its credibility through the quality of the vehicles it has produced. Positioning of a brand and its strength also depends on other 6 elements; Brand Domain, Brand Heritage, Brand Values, Brand Assets, Brand Personality and brand Reflection and BMW has used those elements to strengthen its brand positioning in certain ways.

Brand Domain for example, correspond with the brand target market, and within the premium sector BMW group has 3 brands, BMW, Mini and Rolls Royce each targeting different segments inside the premium sector, BMW for example has a product line of 19 different vehicles. Brand values are the characteristics of a specific brand and the group is very distinctive with each one of them. BMW Brand – “stands for one thing: sheer driving pleasure. Sporting and dynamic performance combined with superb design and exclusive quality. ” The MINI brand,” Exciting, unconventional and full of ideas.

An original with high recognition value and a distinctive design”, and the last of the three brands, Rolls-Royce,” The pinnacle luxury automobile manufacturer in the world. Renowned for supreme quality, exquisite hand craftsmanship and attention to the finest detail. ”. Brand heritage, its the brand culture and its background, what has influenced it to become what it is today. A company with more than 90 years of experience with a strong set of beliefs that shaped its culture and helped it gained the reputation it has today.

Beliefs such as “placing the customer at the heart of everything we do, and the results of what we do must be evaluated from the perspective of benefits for the customer” or the tireless commitment to premium “Our aim is to be the best. Everyone has to set themselves this goal”. Brand assets as what makes the brand distinctive from competitors. The white and blue, the colours of the state of Bavaria, easily recognizable across the globe, the extremely talented engineering workforce or the “ The Ultimate Driving Machine” slogan, have made BMW distinct.

The personality of the brand, as Franzen and Bouwman believed (2001, cited by Chernatony, L 2009) should be created as emotions resulting from the brand communications and with the organization culture that drives staff behaviour ( Cameron and Quinn, 2006. Cited by Chernatony, L 2009). BMW has used precisely this to build its personality. Its advertising campaigns have always been based and reflected on what the company stood for and as mentioned, the vision, mission and values statements of the group have enforced its personality.

On the other hand some would say, a brand personality is the character of a brand described in terms of other entities, such as people or animals, Jobber (2010), and if that is the case, I would see BMW as a wealthy, very stylish , well educated and powerful person, that thinks highly of himself/herself and believes it deserves and need to have the best of what’s its available in terms of technology, comfort, performance and design and its age range would be between 30 to 45 years.

The last of the elements is brand reflection, how the brand relates to one self-identity, or in what way the consumer sees and perceives himself as a result of buying the brand, as it being social related, self-image, accomplishment emotion or status and with a BMW vehicle I would say the consumer would perceived himself/herself very much with the imaginary person described above. Having built a strong position on the market, I will now go back on the idea of the marketing Mix to analyse the rest of its aspects.

The first and most important is the product, as a brand will not succeed if its product fail to deliver the essential requirements, or if its faulty. In the case of BMW, it has made its product qualities the foundation for its success and differentiation, but how can a product be considerable of the highest quality? It can be based on reliability, BMW was recently named the most reliable automobile brand by the FN50 survey – one of the world’s largest reliability studies.

The engineering efficiency, that has given BMW many award-winning engine performance, (Engine or the year in 2009,2011,2012,2013 – BMW GROUP) that also reflects on its handling excellence, powerful acceleration, lower fuel consumption and reduced exhaust emissions. The design of the vehicle, or as BMW believes, “We do more than just design automobiles. We awaken passion”, and to prove it, they have a list of awards, 20 on the last 3 years (bmw. com) and one of them being Louis Vuitton Concept Classic award in 2009.

Perhaps it can also be the fact that today some technologies used in BMW vehicles were been used space shuttles 10 years ago, so its fair to say that, BMW products have been of exceptional quality and the foundation of its success. To complete the marketing mix, Place and Price needs to be established. How does price help in positioning and creating a positive brand Image? First due to the association of high quality and high prices, even if someone does not possess any knowledge about the products, its high prices will be associated with higher quality, and will strengthen its premium position.

Associations with non-product related attributes can also happen such as status and self image and looking from the company perspective, its premium high prices have helped the company to achieve high profit margins, enabling the development and growth of the group. The last factor is the Place factor, or distribution element and it concerns how and where a company sells its products. BMW has its own flagships dealerships increasing the profit margins of every vehicle sold as it does not depend on independent dealers and it can display the latest and best models however and wherever suits them best.

Expectations of its consumers are high for being a premium brand in every aspects and knowing that BMW also invested on the latest technologies and designs on its dealerships, one example being one in south Korea, where it was designed with state-of-the art solar panels and equipped with sustainable technologies reducing water consumption, energy consumption and carbon emissions, reflecting the group long term sustainability strategy. Building successful brands is a very complex and time consuming activity, it requires dedication, investments, and a lot of skills to say the least, as examples have shown.

Some key factors have been identified as critical for brands to achieve that, Jobber (2010). The quality factor, the positioning or repositioning strategy, the long term perspective of the brand, being First as pioneering the market, Well Blended Communications with its consumers and Internal Marketing as of investment in staff training. After analyzing the company, the examples given, theories and elements I have come to my conclusion that BMW has exceptionally succeed in those fields, and thats the reason why it has such a strong positive Brand Equity.

When those factors are placed together the user will react very differently to a BMW branded vehicle as if he would if the vehicle had a different brand. This is what makes a user loyal, insensible to price changes, the reason behind the high volume of sales and success of the brand. If BMW can keep developing and sustaining those factors, I can only see a future, full of innovations, successes and breakthroughs for the company, and who knows what the next “ultimate driving machine” can reveal!

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