BMW Z3 BMW Z3 RoadsterRoadster
Case Study:Case Study:
Traditional Vs Non-Traditional Vs Non-Traditional MethodsTraditional Methods
Case ObjectivesCase Objectives
Innovative product launch marketing Innovative product launch marketing Marketing execution Vs StrategyMarketing execution Vs Strategy Role of new Marketing ParadigmsRole of new Marketing Paradigms
NT ideas to break clutterNT ideas to break clutter Differences in methodology – NT vs. TDifferences in methodology – NT vs. T Understanding risks and controlUnderstanding risks and control
THEORYTHEORYThe Story Behind Non-Traditional MediaThe Story Behind Non-Traditional Media
The Rise of NT mediumsThe Rise of NT mediums
Traditional Medium: AdvertisingTraditional Medium: Advertising Tools and techniques developedTools and techniques developed
Effectiveness: e.g. AIDA HierarchyEffectiveness: e.g. AIDA Hierarchy Metrics: Reach/Frequency/ExposureMetrics: Reach/Frequency/Exposure Evaluation: Wearout/Recall/RecognitionEvaluation: Wearout/Recall/Recognition
Paradigm Shift to Non Traditional Paradigm Shift to Non Traditional MediumsMediums
The Rise of NT MediumsThe Rise of NT Mediums
Reasons for Paradigm ShiftReasons for Paradigm Shift Rising cost of Media Rising cost of Media Loss of control Loss of control Change in Marketing StrategyChange in Marketing Strategy
Three main CategoriesThree main Categories Product Placement: Control through Co-opProduct Placement: Control through Co-op Place Promotion: Control through LocationPlace Promotion: Control through Location Sponsorship: Control through PatronageSponsorship: Control through Patronage
DIFFERENCESDIFFERENCES
PhilosophyPhilosophy
TraditionalTraditional DisciplinedDisciplined QuantifiedQuantified PlannedPlanned BudgetedBudgeted Regulated Regulated ControlledControlled Strategy ledStrategy led
Non TraditionalNon Traditional FlexibleFlexible EvolvingEvolving AdaptableAdaptable External controlExternal control IntuitiveIntuitive ChaoticChaotic Execution ledExecution led
Communication ProcessCommunication Process
Awareness
Interest
Desire, Preference
Purchase
Excitement
Awareness / Visibility
Word of mouth, Buzz
Involvement / Infatuation
Purchase
ConsumerAdvocacy
Non Traditional Traditional
OthersOthers
CredibilityCredibility NT can be more credible have more impact and more NT can be more credible have more impact and more
efficient when it works.efficient when it works. BudgetingBudgeting
NT costs can be uncertainNT costs can be uncertain Traditional advertising costs can be better forecasted.Traditional advertising costs can be better forecasted.
Target marketTarget market Can be well targeted through mass mediaCan be well targeted through mass media NT relies on audience self selectionNT relies on audience self selection
MetricsMetrics Traditional advertising = measurable, reach GRP, Traditional advertising = measurable, reach GRP,
frequency = more easily measured by market research.frequency = more easily measured by market research. NT is more difficult to evaluate.NT is more difficult to evaluate.
Benefits and Risks Method Benefits and Risks Method usedused
BenefitsBenefits CredibilityCredibility
More credible than More credible than paid for advertisingpaid for advertising
Efficiency through Efficiency through word of mouthword of mouth
• Focus on awarenessFocus on awareness• Leverage the buzzLeverage the buzz• Create ExposureCreate Exposure• Build into ConversationBuild into Conversation• Weave the brand into Weave the brand into
Everyday lifeEveryday life
RisksRisks Loss of controlLoss of control
TimingTiming Target audience Target audience Brand ImageBrand Image Brand MeaningBrand Meaning ExposureExposure
Challenge of Challenge of translating translating awareness into awareness into sales:sales:
Difficult to Difficult to measure impact:measure impact:
EVALUATIONEVALUATION
BREAKBREAK
Evaluation of Case :Evaluation of Case :
ParametersParameters
Evaluate the caseEvaluate the case
Strategic SignificanceStrategic Significance Benefits and RiskBenefits and Risk Measuring SuccessMeasuring Success Translating Excitement into SalesTranslating Excitement into Sales Post script and wrap upPost script and wrap up
SO WHAT HAPPENED?SO WHAT HAPPENED?Strategic SignificanceStrategic Significance
Strategic Significance of Strategic Significance of the Launchthe Launch
Motivate and Stimulate dealer Motivate and Stimulate dealer networknetwork
Expand FranchiseExpand Franchise Underrepresented TargetsUnderrepresented Targets Gen X Vs Baby BoomersGen X Vs Baby Boomers
Fill Capacity at new PlantFill Capacity at new Plant Target : 100,000 unitsTarget : 100,000 units Initial foray into USA. Initial foray into USA.
Strategic Significance of Strategic Significance of the Launchthe Launch
Rejuvenate and Redefine BMW Rejuvenate and Redefine BMW ImageImage Made in Germany to Made by BMWMade in Germany to Made by BMW Bavarian Mystique to American IconBavarian Mystique to American Icon Precision Engineering to Fun to DrivePrecision Engineering to Fun to Drive
SO WHAT HAPPENED?SO WHAT HAPPENED?Benefits and RisksBenefits and Risks
Issues FacedIssues FacedTypical to the CategoryTypical to the Category Loss of controlLoss of control
TimingTiming Target audience Target audience Brand Image: Brand Image: Bond/BMW GridBond/BMW Grid Brand MeaningBrand Meaning ExposureExposure
Challenge of translating awareness Challenge of translating awareness into sales: into sales: The excitement/time GridThe excitement/time Grid
Difficult to measure impact:Difficult to measure impact: Success CriterionSuccess Criterion
Brand & BondBrand & Bond
German
UltimateDrivingMachine
English
Hero
Drives an Aston
Sexist
Fast cars
Adv. Technology
Sophisticated
Brand Dilution in Case of Movie FailureBrand Dilution due to ClutterBrand Dilution due to Negative Association
SO WHAT HAPPENED?SO WHAT HAPPENED?Measuring SuccessMeasuring Success
Measuring Success: Measuring Success: Overall Overall
Phase 1 : Unqualified ingoing Phase 1 : Unqualified ingoing objectivesobjectives
Sales-Cost Ratio QuestionableSales-Cost Ratio QuestionableIntro year exp. sales
(units)
Launch ad support
(millions)
Spend/car
BMW Z3 9k waitlist for 3.5 months =
30,000 p.a
$20 $667
Land Rover Discovery
14,085 $9 $667
Infiniti I-30 15,194 $35 $2304
1998 units (000’s)
1997 units (000’s)
1996 units (000’s)
Z3 / Total BMW 20.6 / 131.6
19.4 / 119.3
10.3 / 102.4
Boxster / Total Porsche (selling price = $40K)
9.7 / 17.2
5.3 / 11.5
Na / 6.8
Measuring Success: By NT Measuring Success: By NT elementelement
Element Objective Reported results
Neiman Marcus WOM, Buzz 20 units over 3.5 month Christmas season
100 orders placed. 2days6000 orders by Xmas
Central Park event Media exposure and Buzz 2000 media reps attended. # of Z3 editorials in leading publications can be counted.
Jay Leno WOM, Buzz Unpredictable, all we know is “it worked out very well” Role for campaign evaluation research to measure awareness impact.
Radio DJ • Unstated Statements like “Amazing Credibility,” “Had 3 times the WOM of other events. What does this mean in terms of measurable effects on sales?
Dealer Ad& Promo • Generate Dealer Motivation Local publicityTraffic in dealerships increased (300%)
TV and Print •Reinforce Movie placement 15% Recall . 50% higher than Mercedes E class launchIs that good enough
Success CriterionSuccess Criterion Great Buzz !Great Buzz !
What buzz?What buzz? 3 Times the word of mouth3 Times the word of mouth
Quantifiable?Quantifiable? 50% less than SOM/SOV rules 50% less than SOM/SOV rules
Impact of Traditional media with comparable Impact of Traditional media with comparable spend?spend?
Dealer Traffic upDealer Traffic up Influence of new product introduction?Influence of new product introduction?
9000 cars sold – Expected was 50009000 cars sold – Expected was 5000 Validity of Estimation?Validity of Estimation?
EXCITEMENT TO SALESEXCITEMENT TO SALESObjectives and MediumsObjectives and Mediums
Excitement to SalesExcitement to Sales
Objectives of Phase 2Objectives of Phase 2 Sustain wait list customer interestSustain wait list customer interest Maximize conversion rateMaximize conversion rate Maximize customer acquisitionMaximize customer acquisition
Mediums?Mediums?
AND THEN?AND THEN?
PostscriptPostscript
By Jan. 1996 BMW had to scale down their marketing efforts to By Jan. 1996 BMW had to scale down their marketing efforts to avoid potential consumer backlash by not being able to meet avoid potential consumer backlash by not being able to meet demand.demand.
Tactics shifted to maintaining consumer interestTactics shifted to maintaining consumer interest Cinema advertising (60 sec. Teaser placements)Cinema advertising (60 sec. Teaser placements) In flight videos targeted at business travelers.In flight videos targeted at business travelers. Dealer sponsored direct marketing programsDealer sponsored direct marketing programs Limited corporate sponsored direct marketingLimited corporate sponsored direct marketing Dealer funded retention programsDealer funded retention programs
Launch date March 1996. Selling price in 1997 = 30k to 36k.Launch date March 1996. Selling price in 1997 = 30k to 36k. Sales in 000’sSales in 000’s
1997: 19.4 (Mazda Miata: 17.4 Porsche Boxter: 5.3)1997: 19.4 (Mazda Miata: 17.4 Porsche Boxter: 5.3) 1998: 20.6 (Mazda Miata: 19.8 Porsche Boxter: 9.7)1998: 20.6 (Mazda Miata: 19.8 Porsche Boxter: 9.7)
PostscriptPostscript
Tie up for Tomorrow never DiesTie up for Tomorrow never Dies BMW cruiser bikeBMW cruiser bike
AwardsAwards Promotion of the yearPromotion of the year Marketer of the yearMarketer of the year Brandweek : Model of effective cross Brandweek : Model of effective cross
promopromo USA Today : Marketing CoupUSA Today : Marketing Coup
PostscriptPostscript
BrickbatsBrickbats Went too farWent too far OverdoneOverdone License to Overkill License to Overkill James bond – ‘ International Man of James bond – ‘ International Man of
Sales’Sales’
Types of Product Types of Product placementplacement
CorporateCorporate Lenovo in KBCLenovo in KBC
GenericGeneric Rayban in MIBRayban in MIB
ServiceService ICICI in BKCICICI in BKC
IdeaIdea Movie promo in a serial Movie promo in a serial
Types of Product Types of Product placementplacement
HistoricHistoric Air India in moviesAir India in movies
InnovationInnovation Introducing a productIntroducing a product Swift in Bunty aur BabliSwift in Bunty aur Babli
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