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Marketing Strategy of BMW

BMW is a German manufacturer of automobiles, motorcycles, engines and bicycles. The BMW Group includes such brands as BMW, Mini and Rolls-Royce Motor Cars (BMW Group Official Website, 2012). In 2011, German carmaker reported the record sales and intends to maintain market leadership this year in the segment of luxury class cars due to the strong demand in China and the United States.

Thus, in the third quarter of 2011, the net income of the German automaker grew up to 1,08 billion euros, and its revenues – up to 16,5 billion euros (BMW Group October Sales Report, 2011). The company managed to sell 1,23 million vehicles in nine months (an increase by 16%) (Sannia, 2011). On a whole, the sales of the car brands BMW, MINI and Rolls-Royce in the past year increased by 14,2 % up to 1,67 million units (BMW Group October Sales Report, 2011). In particular, the sales of Rolls-Royce reached their highest level in the 107-year history of the brand and made 3,538 cars, rising by almost 31% (Sannia, 2011).

In the U.S., the company’s largest market, the BMW Group sold 27,228 units only in October 2011, which is 17,5% more than a year earlier (BMW Group October US Sales Report, 2011). In Germany itself, the second largest market, the sales of BMW Group grew by 4,9% reaching 24,364 units in October (BMW Group October Sales Report, 2011). China, which is the third market by size in terms of sales of the BMW Group, showed in October an increase of 33,5%, which in absolute terms equals to 18,346 cars (BMW Group October Sales Report, 2011). The largest markets of BMW sales in Europe today are: Germany (285,202), UK (170,691), Italy (72,511), France (70,400), Spain (30,167) and Russia (28,165) (Sannia, 2011).

Currently the largest market for premium cars is in Germany, but due to rising demand an increasing number of such cars is made in Latin America, India and China (‘Luxury cars: The new high Rollers’, 2011). Also in 2011, BMW took the lead in the market for luxury car in the U.S., surpassing Toyota brand Lexus and Daimler of Mercedes-Benz. In general, the U.S. sales of BMW in this sector over the past year rose by almost 15 percent (BMW Group October US Sales Report, 2011).

Since January 2012 the sales of BMW brand rose by 13.6 percent compared with 2010 and amounted to 1.13 million vehicles (BMW Group Official Website, 2012; BMW Group Annual Report, 2010). BMW started the year 2012 with a very good package of orders and a very young model range, which should give a boost. According to experts, the European car market will grow steadily this year, and the U.S. and China have all the prerequisites for rapid growth (Avery & Bergsteiner, 2011; Papasolomou & Kitchen, 2011).

BMW has expressed great optimism regarding the prospects for their growth in the American market. While the German market is unlikely to please with a large increase in the coming years, the American market was the largest until the financial crisis in 2008 when the demand for new luxury cars collapsed (Schlegelmilch, 2010). However the demand for BMW products in this region is gradually increasing indicating the market recovery (BMW Group October US Sales Report, 2011).

According to analysts, the world market for premium cars in 2012 will grow by more than 8 percent – twice as fast as the car market in general (Roy et al., 2011). In addition, sales growth will accelerate in the second half due to the release of a new generation of BMW “third” model to the market, which accounts for one third of sales of the company (Papasolomou & Kitchen, 2011). High hopes may also be attributed to the further development of green cars by BMW (Ba et al., 2012), especially on the Chinese market showing great interest toward BMW electric cars and luxury production in general (‘Consumer goods: The mystery of the Chinese consumer’, 2011). Nowadays, Chinese market and Asian markets in general should be one of the main objectives for expansion by BMW Group in terms of high capacities of these markets.

 

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