Bmw Case

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BMW Case 1. What was BMW’s position in the market in 1986? Who was buying BMW and what were they buying? BMW was in a leadership position in the U.S. market as it peaked at 96,000 units sold. Its worldwide performance had continually improved. It was the “high flying” brand of the 1980s, the ultimate “yuppie” status symbol. Generally, younger affluent customers, the most demanding market segment, are buying BMW’s. More specifically, people that make a median income of 100 thousand to over 200 thousand dollars and people with median ages from 39 to 46 are purchasing BMW’s. The trend is that the customer who is younger who makes a lower income buys a lower series of BMW. 2. What caused the unit sales decline from 1986-1991?…show more content…
BMW can effectively compete against Lexus and Infiniti as they continue to change the public’s perception of their brand. They have shown a large growth in sales which is higher than Infiniti’s growth meaning Infiniti is losing market share to companies like BMW. Although BMW has 7% lower growth than Lexus, they are focusing on the customer while Lexus has been slow to innovate. It is believed that as they continue to do this, they will be able to close the distance and compete more effectively against Lexus. 4. What advice would you give to Gerlinger to help him achieve his 100,000 units sales goals? Gerlinger needs to continue to seek to align BMW’s values with that of their customers. Right now the value that BMW customers seek is value orientation, but that might change with more external events. BMW needs to make sure they continually sell what the customer is buying. Also, it is important to continue to implement both the operations that Gerlinger has already put into place as well as those that he has not implemented yet. For instance, the dealer reorientation plan should help to increase sales. Also, a plan needs to be put in place at BMW dealerships to gain more exclusivity for the brand. In addition, Gerlinger needs to keep market expansion a top priority. Although sales volume can be a good indicator of performance, it can hide the loss of market share. To illustrate, the luxury market segment is projected to grow 3-4% annually over the next

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