Launching the BMW Z3 Roadster

Situation Analysis
Objectives of the launch
To use Roadster to motivate and stimulate the dealer network to
meet higher standards to qualify for the roadster
To build an order bank to enable the new Spartanburg plant to build
specifications of BMW customers
To counter sales decline, the company repositioned itself from Yuppie
Status Symbol to a more quality oriented Ultimate driving machine in
1992
BMW wanted to be the best in class rather than the biggest
No products on the market at that time delivered their positioning
Segmentation Psychographic method used
Target Market Lover of Life mindset and a propensity to seek unique
expressions of individuality
Communication
40:60 - Traditional: Non-Traditional media
Wants to include Multi-media
Requires agencies willing to integrate across each other in an atypical
team environment
Therefore they chose Fallan Mc Elligott
SWOT Analysis
STRENGTHS
1. BMW is not the biggest but the best car company in the world as it is more into
youth targeting.
2. Increase in sales: Their franchise expansion seems to be more promising way to
incremental sales to the brand.
3. It influences consumers strongly through Media and film industry.
4. It is Innovative and Impactful.
WEAKNESSES
1. Their corporate image is too serious and tradition-bound
2. Plan Execution was complicated.
3. Z3 was perceived to be German-made car not an American made-car.
OPPORTUNITIES
1. The cars are not as expensive as German manufactured cars.
2. It is the first Auto plant outside Europe.

THREATS
1. Competition from Mercedes.
2. People not accepting a German car in US.
3. New players in the market. The partners or sub- partners may turn into rivals.
4. Government regulations

Exhibit Analysis
Exhibit 1: BMW Units Sales history (U.S and worldwide)
Perfect for the Z3 launch because people were getting familiar with BMW
products.
Unit sales showed up to an upward trend and actually increased during the given
period (1984-1985), which showed that BMW had its global strategy.
Comparatively in the US, Sales figures showed an increase as well as decrease for
the same period. Between 84 to 86 it actually increased by approximately 37%, and
from then on till 91, it was down by approximately 40%, but again the sales picked
up from 92 to 95 recording almost a 45% jump, perfect for the Z3 launch because
people were getting familiar with BMW products.
Exhibit 2: Notable movie product placement Examples.
Gauging from the movie product placement examples, there have been many
movies in the past, which have acted as a springboard for launching a new product
with responses being mostly favorable at times for the company.
For Example when Tom Cruise sported Ray ban sunglasses in Risky Business, Ray
bans sales tripled. When Apple laptops were shown as an integral part to solving an
intrigue plot in Mission Impossible, Apples long terms sales increased.
Exhibit 3: Time line of Key events.
The key events followed pre-launch from 1992 onwards followed BMW s strategy
to position and market the z3 appropriately. During the year 1994, they tied up with
MGM for the product placement through the movie Golden Eye.
Exhibit 4: Z3 Roadster Neiman Marcus Christmas catalog
A part of BMWs strategy to pursue the audience to check out the new Z3 roadster
while shopping for Christmas. It highlighted the fact that its now James Bonds
BMW
Exhibit 5: 1996 Apple Corporate Print Advertising referring BMW Website
It was a positioning that BMW was looking out for. They wanted the American
public to know about its superior technology. What better way to showcase it than
associating itself with a true blue American tech brand like Apple
Exhibit 9: Comparative Launch advertising Campaign Expenditures and
Introductory year sales
It actually analyses figures for all the cars in all segments launched in that period
(90-95), and they finally come out with figures for the average launch reach goal,
which is 75-90% with the average frequency being 2.5, which is exactly what BMW is

looking for to promote the Z3.

Exhibit 10: 007 licensed to sell dealer promotional kits
Associates BMW with the legend of 007, and these are kits for dealers who are the
connect point of the customers, which means the customer will also have the movie
in mind while driving.
Exhibit 11: Box office draws for Noteworthy Product Placement Movies
It shows the opening week ticket sales for notable product placement movies and
Golden Eye is in the top 5 which is good news for BMW
Exhibit 12: Sample Product Reviews from Major Automotive Magazines
Automotive magazines tend to be the consumers guide before buying a car. So,
everybody takes them seriously. For the Z3 to receive good reviews from the
automotive.
Exhibit 13: 1995 Unit Sales and Advertising Spending within the U.S Luxury/
performance Segment
This was the time when the car was being prepared to be launched, and BMW was
doing good to be at No.3 in that list which considered total sales. But BMW shrewdly
went about its Media expenditure, far below its capacity

Developing the communication strategy

Target - Lover of Life mindset and a propensity to seek unique expressions

of individuality
Communication Objective
o Brand awareness of Z3 Roadster
o Brand attitude of BMW as an American Car
o Brand Purchase intention
Message Strategy Sensory and Ego Satisfaction + Result of Use
Creative Strategy Transformational Appeal as can be seen from Exhibit 4
Message Source Bond Movie Protagonist
o Expertise in technology displayed by protagonist
o Likable character- Hero of the movie
o Trustworthiness due to the personality of the character
Congruity will be in favor of BMW
Communication channels used
o Personal Expert Dealers of BMW
o Non Personal GoldenEye, Advertisement, TV, PR Radio etc.
Marketing Communications Budget
o The case mentions Share of Voice/Share of Market
o They are using a comparative parity method
o They are using non traditional communication methods to reduce the
budget
Communication Mix used
o Advertisements Print and TV

o Sales Promotions Dealer Promotions

o PR Launch event, Jay Leno Show, Radio Shows
o Events and Experiences Golden Eye
o Direct and Interactive marketing - Website
o Word of Mouth Website
Factors in setting the marketing communication
o Product Lifecycle Z3 is being launched in the market and is in the
introduction stage. Advertising, Events and Experience and Publicity
has been used to have high cost effectiveness
Measuring results
o 9000 orders were pre-booked by December 1995 as compared to 5000
projected

Integrating the Marketing Communication

Sept Neiman Marcus Catalog Initial Awareness

Oct Website for experience
Oct Press launch at Central Park
Nov Tonight Show with Jay Leno
Nov Radio Program Road Events
Dec Video Go: An American Road Story
Dec TV and Print Advertisement
June 95 to March 96 Dealer Advertising and Promotions

Analysis of the strategy

Objective was to portray the Americanness

Bond is an English Character
From Exhibit 11 Mission Impossible would have been a better option
MI is an American movie with American Secret agents
MI launched in May 1996 so immediate impact
MI opening week ticket sales of $56.8 Million vs Bond had $26.2 Million

Recommendations
The main issue in this case is that, in the context of a new product launch, how bmw
will structure its marketing mix and manage its launch?
It should have an approach to open plants in other top strategic parts of the
globe other than Spartanburg plant at the same time.
It was not necessary for BMW to stress so much on the American culture and
settling into their minds and hearts because that may have hampered its
recognition and success in other parts of the world. Rather, it could have
addressed the general public all over the world.
It may have pre-produced more cars than the number of dealers for preselling promotions.

The agreement between BMW and MGM should have been more complex and
strong enough to last long.
BMW should have analyzed the situation and predicted at least a figure that
was close to the number of orders it had received by Christmas. (Neiman
Marcus Catalog Offer)
Non traditional methods can help the company in the short run as they
capture the attention of the people in the short run
Traditional methods will be more effective in the long run as they leave a more
lasting impact
Indian Example: Provouge used a similar strategy in the movie Wake up Sid
for promoting its line of clothes. It created a special line of clothes based on
the theme of the movie. The protagonist is seen sporting that apparel line in
the movie.