BMW’s Product life cycle Essay
BMW’s Product life cycle
Any product has four stages of life cycle: introduction, growth, maturity, and decline. However, this concept does not quite fit with BMW’s products. Jim McDowell, vice president of marketing at BMW says ” If a product is declining, we would prefer to withdraw it from the market, as opposed to having a strategy for dealing with the declining product,” In other words, Maturity and Decline stages do not usually exist in BMW’s product life cycle. Before a product reaching the Maturity stage that characterized by decreasing sales rate and declining profit, BMW pulls it out from the market. BMW cars typically have product life cycle of seven years. As we see in Figure 11-1 any product has bell-shape curve of duration of life cycle, but BMW cars has half shape life cycle, including introduction and growth stages. Thus, the best sales number is often achieved in sixth or seventh year after product introduction.
BMW car has only two-stage of product life cycle, introduction and growth stages. The X5 series and the 3 series were introduced in 2000 and 2001, respectively. Based on BMW’s product life cycle, these two series are both in the Growth stage. BMW introduced three versions for each model of the 3 series. The X5 also has three different versions that satisfied different consumers’ preferences. BMW’s website provides a great access for its potential customers in addition to the regular dealerships. From its website, customer can easily identify BMW’s promotion strategy. It also shows the competitive difference, such as the luxury car, the safest car, and the most drivable car. For BMW 3 series, advertising campaign focuses on the concept of the luxury car under fair price. For BMW X5 series, advertising campaign focuses on the technology for overcoming bad climate and rough road situation and the joy of driving.
As mentioned before, BMW’s car has only two life cycles and it requires a special marking and managing strategy. By modifying the product, BMW successfully maintained the products in the introduction and growth stages. BMW constant introduce new models for each series and it keep the entire series “new.” For instance, 3 series, BMW continuously introduced new models each year such as sedan, the coupe, to the convertible and the station wagon. BMW constantly tries and makes the cars meaningfully different and new about every three years, and that involves adding features and other capacities. Thus, modifying the product becomes the main policy for BMW to manage life cycle of each car series.
BMW has a distinctive branding system and manufacture branding. BMW has five series, 3 series, 5 series, 7 series, line Z and X series, respectively. BMW all series followed by the product line and the motor type. For example, “328” means that the car is in the 3 series; the engine is 2.8 liters in size. This naming system is clear and logical and can be easily understood. Moreover, the system has a big advantage in global market. A name, such as “328” can be used in different countries, without considering the language and cultural difference.
“The BMW website is an integrated part of the overall marketing strategy for BMW,” says Carol Burrows, product communication manager for BMW. BMW website provides unique features to potential customers to” Build Your BMW” and that gives the customers a sense of unique and special. That implies the BMW is the car that only fits you, not somebody else. . In these features they can design a car to their own specifications, and get all the information about the car, from price to a specific feature. The average price of BMW cars is above $50K and customer who buy a BMW’s car not only for safety and joy of driving, but also showing their social status. BMW’s car mostly fall in luxuries category so its potential customers are more likely to be high-income, professional and high education level.