BMW segments its customers by their needs in design, prices, luxuriousness, and functionality. The specific segments vary based on these factors. Some people look for cheaper options on the market which are still reliable. This segment divides into groups of consumers who need sport cars like 1 series or the X1 and X3 for consumers who need smaller and less expensive SUVs. Those who are wealthy yet look for functional vehicles with a lot of space to fit more passengers to drive their family or if they need to move things that would not fit into a smaller car. Another segment of BMW consumers is the wealthy customers who do not prefer sporty cars, so to attract them, BMW modified the 7 series with premium electronics. The wealthy group of consumers who still wanted luxurious and showy cars was suggested the convertibles, roadsters, and the 6 series.
This segmentation works for BMW for a number of reasons. First of all, the company has a long history, and the consumers that it has attracted stayed with it over the decades. This happened due to how they adapted to the changes in the market. A great example of this is how they offered more appropriate products to wealthy consumers as they grew up or the mainstream of getting the showiest car has passed.
This brings to the other one of the advantages that BMW has is the loyalty of its consumers. It is one of the aspects that makes any product get more popular – people sharing their experiences of using it (Urban et al., 2017). Even if BMW does not implement the method of telling consumers’ stories of their experiences with the brand in its marketing, the quality of the products that BMW gives to the consumers makes it work on its own. It is important to mention that loyalty is affected by the marketing of the company – BMW puts effort into making its reputation better.
BWM does well in marketing different segments of its consumers. The main positive aspect that can be emphasized in how BMW markets its products to different segments is the dedication of its products to certain categories of consumers. It is considered not only in their development and manufacturing but also in marketing and pricing. For example, for the wealthy segment of the consumers, the BMW created the “BMW Welt” for the purpose of implementing experiential marketing (Atwal &Williams, 2017). In this center, visitors can get in touch with the organization and its employees, and know more about the cars and how they were developed, therefore widening their experience of interacting with BMW.
The company also succeeded in its expansion to the cheaper market, especially in comparison to its competitors (Madić et al., 2021). That success was represented in the increase in their sales during that period. The company was able to expand in the premium segment by releasing new models of the premium cars as they did with X6 model. This caused customers who were searching for something innovative and unique to get attracted to these products. BMW was also able to address the consumers who were searching for eco-friendly options by developing premium green models.
Therefore, BMW’s marketing strategy is mostly directed toward expanding the premium segment by creating new sub-segments in that category and developing cheaper models for the mass market. The results of such a strategy are positive, which is represented in the sales of the company that stably increase (Kukkamalla et al., 2020). Yet, the sustainability of the company’s success is mostly based on the premium market. The company does put effort into expanding in the mass market, yet it is not as successful there as some other companies are. The demands of that part of the market are related to the correlation between quality and price, and the BMW is not known for the best ratio in these terms. Perhaps, if the company tried to orient more towards customers with a lower budget and manufacture reliable cars for the segment and convince the consumers of that reliability, it would close that gap in its marketing.
BMW should change its tagline to better align with the current marketing strategy. On the one hand, the company has a long history, and it is the same for its tagline. This is a part of the cultural phenomenon associated with the company and what makes it recognizable. Aside from it, some may argue that there is no point in changing something that already works well if the success of BMW is taken into consideration. Yet, the tagline is part of the marketing of the company and should represent its values and attract the audience that it is suitable for. The current tagline does not seem to align with it – the automobiles produced by BMW are not ultimate in any of their aspects. They are not the most innovative, reliable, or advanced, though they are not bad in any of these categories. These cars excel in their suitability for certain consumers, specifically in the premium segment. Therefore, BMW should change its tagline, and it should be more related to its prestige or variety of options suitable for every driver.
References
Atwal, G. & Williams, A. (2017). Luxury brand marketing – The experience is everything! In: Kapferer, JN., Kernstock, J., Brexendorf, T., Powell, S. (eds) Advances in Luxury Brand Management. Journal of Brand Management: Advanced Collections. Palgrave Macmillan, Cham.
Urban, G. L., Gosline, R., & Lee, J. (2017). The power of consumer stories in digital marketing. MIT Sloan Management Review, 58(4), 1-6.
Madić, V., Marković, D., & Mijušković, V. (2021). Competitive strategies in premium automotive segment. Teme, 2, 639-659.
Kukkamalla, P. K., Bikfalvi, A., & Arbussa, A. (2020). The new BMW: Business model innovation transforms an automotive leader. Journal of Business Strategy, 42(4), 268-277.