moriiiiiiiiiiiiiii final bmw and mercedes

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The Race Is On Between BMW and Mercedes Benz

AMIR HABIBI 1091200086

MORTEZA TABASSI 1081200585

MARKETING MANAGEMENT

GROUP ASSIGNMENT

Lecturer:

DR. ABU BAKAR BIN SADE



The market share of National andhe market share of National andNON-National cars in Malaysia

2007 2008



Passenger cars market share

in Malaysian Malaysia

6.8%

42.4%7.3%

32.6%



THE BEST TWO MODELS BETWEEN LUXURY CARSAS A SYMBOL OF WEALTH AND EXTRAVAGANCEACROSS MALAYSIAN SOCITY

MERCEDES-BENZ

.

BMW 0.5%



Market Trend

Changing Consumer Behavior

Increasing Purchasing Power

Chan in of Culture/Lifest le



SWOT AnalysisWOT AnalysisWOT AnalysisWOT Analysis

• The overall evaluation of a company’sperformance.

• It involves monitoring marketingenvironments.

Internal – strength & weakness

External – opportunity & threat



Strengthstrengthstrengthstrengths

• Brand e uit – S ort look attractive

design and superb car handling.

oriented engine.

• Price is comparative lower than Mercedes-

Benz.

• Complimentary of BMW Service + Repair

Inclusive for 3 years.



Weaknesseseaknesseseaknesseseaknesses

•

.

to repair the engine.

• Limited dealers and service centers.

•Less aggressive in on-line promotion.



Opportunitiespportunitiespportunitiespportunities

• -

of younger successful executive with betterpurchasing power.

• Innovator and creative designer.

• Environmental practices – introduction of

s ags p ser es se an a runson liquid hydrogen.



Threatshreatshreatshreats

•

(Jan~June 2007) to 2.4% (Jan~June 2008)*.

• Price rising of fuel oil.

• Over-emphasized of the brand as the

paragon of performance driving – “The

* Malaysian Automotive Association (MAA) 2007/2008 Passenger Car Registratio



Strengthstrengths• Brand equity – Reliability and safety

Strengthstrengths

.

• Strong brand loyalty among successful and

wor y us nesspersons.

•

2003.

nationwide - Mercedes-Benz Service



Weaknesseseaknesses

•

Weaknesseseaknesses

•

engines.




•

(Jan~June 2007) to 3.8% (Jan~June 2008).*

• Back up by skillful technician from the

Apprentice Training Centre – 450 traineesave gra uate .

–the nearest showroom.

* Malaysian Automotive Association (MAA) 2007/2008 Passenger Car Registratio




Mercedes-Benz Malaysia Sdn BhdLevel 48 & 49, Menara TM

a an anta a ru59800 Kuala Lumpur.Malaysia.Tel: (+603) 2246 8888Fax: +603 2246 8899Website : www.lowemotors.mercedes-benz.com.my



Threatshreats

•

Threatshreats

cars esp. BMW.

• Brand barrier – less attractive for young

and successful executive.• Price rising of fuel oil.



Tar et Market

According to our research anddevelo ment de artment our TARGETMARKET is safety, handling, elegant,

luxurious. Companies such as BMWan o t e r est w en t eychoose their target markets cautiously

programs.



Segmentation

We divide our customer into several parties:

The men and women a e between 20-34 who are lookinfor luxury and indulgence car. BMW series 6, X6, Z3, Z4,Z8, Z9… And BENZ series C, CLS, SLK, SLR…..

The men and women age between 35-60 who aresearching for safety, luxurious, guaranty, and handling

and after sale service.

The group of people who earn above 4000 $ per month.

BENZ and BMW. For instances BMW series 7, 6, 5 andBENZ series S, ML, E



Question 1

Who are involved in the decision rocess to urchase luxur car

What role does each participant play?

Reference: http://www.udel.edu/alex/chapt6.html



Purchasing Decision Processesurchasing Decision Processes

Need recognition

Search for informationPre-purchase

Pre-purchase evaluation

of alternatives

PurchasePurchase

ConsumptionPost purchase

evaluation

Reference: http://www.nssa.us/nssajrnl/24_1/10-Moser-CombatingPost-PurchaseDissonanceOnline.htm



Factors Influences To Purchaseactors Influences To Purchase

Cultural factors

Social factors

Personal factors




Factors Influences To Purchaseactors Influences To Purchase

Cultural factors Cultural factors

fundamental determinant of a person’s fundamental determinant of a person’s wants and behaviors wants and behaviors

•• it acquires values, perceptions,it acquires values, perceptions,

through family or other institutions through family or other institutions

organization image, upper organization image, upper management management


must drive a luxury car must drive a luxury car



Factors Influences To Purchaseactors Influences To PurchaseSocial factorsSocial factors

•• Consumer wants influenced by opinionConsumer wants influenced by opinionleaders eg. reference groups, socialleaders eg. reference groups, social

c assesc asses

•• Reference groups influence on values andReference groups influence on values andattitudes eg. advice about brand categoryattitudes eg. advice about brand category

••

similar social ranksimilar social rank




Factors Influences To Purchaseactors Influences To PurchasePersonal factorsPersonal factors

•• demographics factors eg. age, genderdemographics factors eg. age, gender

•• situational influences eg. price basedsituational influences eg. price based

offers during purchaseoffers during purchase

•• personal desires eg. occupation, incomepersonal desires eg. occupation, income

statusstatus

•• psychological factors eg. motives,psychological factors eg. motives,


,,



Users

o es n decision making

o es n decision making

Approvers Influencers

Deciders




What is a luxury car ??What is a luxury car ??

Is a $50,000 Ford a luxury? What about a $20,000 BMW?

It is probable that no strict financial criterion can be applied.

Rosecky and King (1996)

Unique characteristics :

- consistently premium quality

- craftsmanship

- recognizability- exclusivity

- reputation

- distinctive variation

- a c ear re ec on o persona y, va ues, an er age

- association with a country of origin that has an especially

strong reputation as a source of excellence in the relevant product

”

(Nueno and Quelch, 1998, pp. 62-63).



The Penang Island Jazz Festival presented byDaimlerChrysler



Production a

Table 1 Luxury brands of the top 12 auto manufacturers

Company (parent, alliance, or group) m on,2007)

Origin Luxury brands

General Motors 11.7 USA Cadillac, Hummer, Saab

Ford 7.8 USA Aston Martin, Jaguar, Land Rover,Lincoln, Volvo

Toyota 7.5 Japan Lexus

Renault-Nissan 5.9 France & Infiniti

VW Group 5.0 Germany Audi, Bentley, Bugatti,Lamborghini

Daimler-Chrysler 4.8 Germany & Mercedes-Benz, Maybach

PSA 3.3 France -

Honda 3.2 Japan Acura

Hyundai-Kia 3.1 South Korea -Fiat 2.0 Italy Alfa Romeo, Ferrari, Maserati

Mitsubishi 1.5 b Japan -

BMW 1.3 b Germany BMW, Rolls-Royce, Mini

Notes : a PriceWaterhouseCoopers (2007); b International Organization of Motor Vehicle Manufacturers (2007)



ANALYSISANALYSIS

MERGER

Date 6 May 1998, new DaimlerChrysler company valued at $75 billion.

OBJECTIVE• lower costs through volume purchases

• slashed redundancies

• Daimler-Benz’s key advantages in quality, innovation & exclusivity

• Chrysler’s success on size, rapid decision-making, and flexibility

(Smith, 1998).

OUTCOME

Blending of luxury and mass-market automobile brands in one corporate

,

potentially fatal brand corrosion.

Consumer perceptions…..

Luxury brands vs. mass-market brand (commonality)



COMPETITIVENESSCOMPETITIVENESS

Global Marketing

- Self-contained markets - linked global markets

- Product life-cycles shorten / global competitors contest

Brand reinforcement

- Innovations

- Consistency

Analyzing needs & trends

- Global vs. local (economic, social-cultural, political-legal,technolo- Market evolution

Marketing strategies revival

- . .

current profitability- Systematic program of culture change

[ “the best or nothing” – first espoused by Gottlieb Daimler more than a“ ”cen ury e ore – was rescr p e o e es or e cus omer



Question No.2

Based on product attributes, what wouldyou suggest to Mercedes and BMW fordeveloping appropriate positioningstrategies?



Product Attributeroduct Attribute

•Feature1

•Function2

• ene s

•Use4

•Quality5



Positioning Strategiesositioning StrategiesDifferentiation Cost

Leadership

1. Product 1 Cost ControlDifferentiation

2. Service

Differentiation

2. Scale- Efficient

Plant

3. PersonnelDifferentiation

4. Image

3. Efficient Value

Chain

erent at on



Product Differentiationroduct Differentiation

•Focus on innovation technology

Example: The “Engines” of Tomorrow

•Focus on safety

Example: 1)Intervehicle communication using

wireless LAN networks2)Accident research unit

•Expand product range



Service Differentiationervice Differentiation

•Tailor comprehensiveprogramme or women

driver

•Traffic safety programmed

young drivers.



Personnel Differentiationersonnel Differentiation

•Hiring and training better people

•Maintain relations to internationally recognized

scientific institutions, colleges and universities

worldwide



Image Differentiationmage DifferentiationUltimate innovation safet drivin machine

•Advertisement

•Product Placement

•Sponsorship



-Positioning Strategy

Strengthen Partnership•Duty Structure under Common EffectivePreferential Tariff (CEPT) Scheme for AFTA

•Increase price competitiveness

Expand production capacity•Increase ASEAN market exposure




Increase Product Range •Target different age group (approximately33% from 20-50 age group in Malaysia)

•Example: Mercedes-BenzC class and E class




Product Positioning •Explore future automobile thru R&D

•Example: Mercedes Bionic Car,economical and environmentally friendly



ummary

• ,

(+32% in 2007 vs. 2000) compare with Mercedes(-5% in 2007 vs. 2000)

• Malaysia Market Share for Mercedes is still

-, – Consumer Perception

– Market Positioning



References

http://www.stealingshare.comhttp://www.udel.edu/alex/chapt6.htmlhttp://www.nssa.us/nssajrnl/24_1/10-Moser-CombatingPost-

.www.livemint.com/MercedesBenz-BMW-fight-it-ou.html

www.ibscdc.org/Case_Studies/Strategy/.../CCA0008.htmwww.benzworld.org/1346619-2007-audi-rs-4-2008-mercedes.html

. . .www.carpages.co.ukhttp://www.autospies.com/news/Audi-BMW-and-Mercedes-Benz-s-China-Sales-Soar-in-September-Audi-Remains-Market-Leader-48574/

- - - - -. .benz-three.htmlwww.globalinsight.com/SDA/SDADetail17458.htmwww.thetruthaboutcars.com/mercedes-benz-bmw-in-ev-talks-with-magna-

www.resources.bnet.com/topic/marketing+and+mercedes-benz.html

moriiiiiiiiiiiiiii final bmw and mercedes

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