MM II - Section A - Group #6

Anu Garg M008-20
Debasish Sahoo M018-20

Launching The BMW Ishit Chaturvedi
Kunal
M028-20
M038-20
Periyasamy N M048-20
Z3 Roadster Shreya Sarraf
Faizan Ahmad
M058-20
D001-
BMW Group International
BMW was a global company with a significant position in the luxury/performance segment of the U.S.
Automotive market.
Headquartered in Munich, Germany.
Has operations in 150 countries.
Cars Produced: BMW, Mini and Rolls Royce.
Main office building as Attractive “Four Cylinder Tower”.

Major highlights of case-How Non- Traditional marketing helped BMW to increase sales of their new
launch
Aim: To expand BMW Franchise and further rejuvenate brand by positioning Z3 squarely in American
culture and settling into hearts of American public.
Question 1
What Factors underlie BMW’s desire to shift to a “non-traditional” marketing venue for
the Z3 Launch.
Augmenting their market size in
America Cost Effective
As claimed by “James McDowell”, it
The eagerness to position Z3 squarely in
would have costed 3 times more to
American culture and settle into the hearts
generate same buzz if they relied solely on
& minds of the American Public.
Traditional Media.
etter way of creating excitement

Delivering a broader base
While Traditional Marketing advertising
While Traditional Media were sold more on
focuses on fantasy and fun, demographics, non-traditional advertising
Non-Traditional marketing can generate a delivered a broader base.
buzz with Multimedia Communication Example: Placement of the BMW Z3 in
Strategy. Goldeneye movie would give BMW an access to
two audiences that are hard-to-reach through
network TV or print.
Question 2
Do you agree with McDowell that the Z3 launch qualifies as a "paradigm shift"
in marketing for BMW? For marketers in general?
50% lesser spend based

Yes, it would qualify share-of-market rule using
as a paradigm shift non traditional marketing
and advertising.
Creating a hype with Increase in dealership
Bond movie franchise traffic
Focus on a broader range of
Increase in sales of the
potential customers
product
Z3 launch was not addressing heavily
9000 pre-bookings as compared the wealthy middle aged male buyer
to a projected 5000 by rather Generation X population of well
December 1995 educated and relatively affluent males.
Question 3
McDowell claims that he will never go back to traditional marketing after getting a taste
of the non-traditional venue. Do you agree?
40/60 Split in budget There can be no clear cut forecast of budget

-Traditional and Non Traditional in such mediums as also mentioned by norm
marshall we could see Exhibit 13 shows-Ford
elements and also for promoting the
Media(30.6M)expenditure was less than
brand to older demography traditional BMW(87.5 M) still made more
media would be needed sales(120,191) that BMW(84,501)
No
Traditional marketing cannot be Although non traditional marketing can

completely replaced by non-traditional act as a support to traditional marketing
marketing since we have enough and can help in exponential growth yet
evidence how in past traditional to make prospective consumer aware
marketing has helped brands to grow traditional marketing is best
Question 4
Was the Z3 launch successful? How do you know?
From 1986 to 1992 World Wide Sales US Sales

(Only negligible
From 1992 New Non-Traditional Marketing US Sales
impact was there)
Retail Price of BMW Car = $28750 to $40000

Average Retail Price= $34375
After Z3 launch, Projected BMW Cars Sales= 5000 units
Projected Gross Sales= 5000 units X $34375 = $171,875,000 = $171M

Question 4
Was the Z3 launch successful? How do you know?
Cost of Manufacturing the Car = Unknown Challenges:

But, Approximate Average Marketing Budget (Traditional + Non-Traditional) = $20M Finding Right Agency
Product Replacement
60/40 Split ---> Traditional/Non-traditional
From Exhibit-1, US Gross Sales= Price of the Car X US Sales= $87.5M Projected Sales→ 5000 units
Large increase in gross profit after 1991 is observed Actual Sales→ 9000 units
Also, Gross Profit doubles in coming years
Neiman Sep 11, 1995
•100 orders within 2 days
Non Traditional Marketing is 3 times cheaper than Traditional Marketing •6000 orders by Christmas
50% less expenditure in share of market
BMW Internet Site

Central Park Press Launch •Hit from 35000 to 125000 /
•Extensive coverage in broadcast, Yes! Z3 Launch is Successful in Phase I. day
print and news They should continue to use similar •Apple also approached for
•Cartoons in news paper 40/60 approach! rights to reference
Question 5
Helmut Panke has engaged you as a Consultant on Design of the Phase II Plan.
What specific objective(s) would you set?
What budget and media plan would you propose?
Phase II Media Plan:

Organise Track Days (NASCAR Weekends)
Phase II Objectives: Reinforce Message (Avoid Dissonance) - Luxury Magazine Ads
Retain & Convert 90% (Orders → Sales) Reduce Wait Fatigue (Keep Excitement High)
Generate Order Book - Maintain Pace Phase II Media Budget:
(Current Order 9K / Target 5K) Average Introductory Year Sales (US Luxury) = 16,210 Units
Annual Target - 100k (Last Year 94.5K / Average Launch Budget = $ 26.1 Million
Deficit 5.5K) (Push 10%)
Phase I Expenses = $ 7.25 Million
Average Media Expense Per Luxury Car Sold = $ 982
Dry Powder = $ 7.08 Million - $ 18.85 Million (Capacity

Constraints)
THANK YOU

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Anu Garg M008-20

Debasish Sahoo M018-20

Headquartered in Munich, Germany.

Has operations in 150 countries.

Cars Produced: BMW, Mini and Rolls Royce.

Main office building as Attractive “Four Cylinder Tower”.

etter way of creating excitement

50% lesser spend based

40/60 Split in budget There can be no clear cut forecast of budget

Traditional marketing cannot be Although non traditional marketing can

From 1986 to 1992 World Wide Sales US Sales

Retail Price of BMW Car = $28750 to $40000

After Z3 launch, Projected BMW Cars Sales= 5000 units

Projected Gross Sales= 5000 units X $34375 = $171,875,000 = $171M

Cost of Manufacturing the Car = Unknown Challenges:

BMW Internet Site

Phase II Media Plan:

Dry Powder = $ 7.08 Million - $ 18.85 Million (Capacity

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