BMW and Mercedes Benz Marketing Strategies: The automobile companies BMW and Mercedes-Benz are two organizations that are in constant rivalry. These two firms were chosen because they produce the same products, which makes them competitors all over the world. The purpose of this essay is to compare, contrast, and evaluate the marketing strategies employed by the two different firms.
Marketing, according to the American Marketing Association, can be defined as the activity and process of communicating, creating and delivering offers that have value to customers, buyers, partners, and the public at large. Marketing is a core aspect of any business, without which no sale is possible. The right marketing strategy will win more customers in the marketplace and generate high profits. The aforementioned companies have used a number of similar and dissimilar strategies in car marketing (Banner, 2012).
Both Mercedes-Benz and BMW are known for their consistent production and sale of quality cars and paraphernalia. These two companies have a long history of supplying the automotive market with very sophisticated and efficient vehicles of various types. It is this innovative nature of the companies that has always led to the satisfaction of millions of customers around the world.
BMW specializes in the production and sale of premium segment cars (Dudovsky, 2013). Premium segmentation has allowed BMW to produce well-designed and superior cars, which in turn have attracted the attention of numerous customers in the global market, as well as retained the loyalty of existing customers. Thus, the high quality of the cars led to an annual increase in sales and, consequently, in profits. Mercedes-Benz also practices premium segmentation and has made great strides in developing quality and long-lasting vehicles because of this. However, Mercedes-Benz has made efforts to produce a variety of car models that are geared toward the interests of the younger generation. BMW models, although available in various sizes, are criticized as conservative (Saliu, O. 2012.).
The two car companies have been longtime rivals since the early ’90s; each trying to emulate the other. For example, in the mid-’90s, both companies used the media, particularly Hollywood, to globally promote their cars. In 1995, a BMW model was featured in the James Bond movie GoldenEye. Thanks to this movie, audiences were able to see the speed and power of BMW cars. Competing with it, Mercedes a year later made a deal with Universal Pictures to have its model featured in the movie The Lost World (Ken, 2014).
In an era when Japanese car companies entered the market with more luxurious car models, such as Lexus, both BMW and Mercedes were forced to change their marketing methods to counter this external rivalry. In doing so, the two German companies have abandoned luxury advertising, as the Japanese do, and have instead focused on car quality and value. In addition, the duo considered lowering car prices, which quickly helped them retain acquired customer loyalty and increase sales.
BMW’s marketing strategy is unique in origin and approach. One aspect of this uniqueness is the formation and support of a strong dealer network from different countries. A dedicated dealer marketing service (DDMS) assists the company in local marketing and sales through various promotions and advertising (BMW 2). Dealers usually have quality images of the cars that are directly communicated to customers on behalf of the company. In addition to these great images, dealers are in constant contact with customers to ensure quality service and customer loyalty. Little is known about Mercedes’ ongoing customer contact program.
In addition to the above, BMW also uses a wide range of other advertising techniques, which include branding and new model launches. A feature of all BMW advertisements is that the main focus has always been on the product of interest – the car. Such ads are usually accompanied by bold appeals to persuasion, such as “at BMW, the idea is everything.” Car models come in a variety of sizes, from the 3-series to the 7-series. They are also painted in a variety of beautiful colors to suit the taste of a wide range of customers. BMW uses magazines and print publications such as Monocle to showcase its one and only product.
BMW sponsors sporting events such as the Olympic Games to create a good image of the company and increase its visibility. In 2012, BMW sponsored the Olympic Games and used the event to promote the company. The company also sponsors the BMW Championship golf tournament, which is held annually. Mercedes-Benz is not actively using sponsorship as a marketing method.
BMW’s pricing strategy, called “premium-ization,” has greatly polarized the automobile market (Dudowski, 2013). Premium-ization has been effective in inducing customers to pay high prices in exchange for high quality cars, and this strategy has been partially replicated by Mercedes.
According to Luxury Daily, Mercedes-Benz was very dynamic and embraced the digital marketing world (Li, 2004.). In advertising, Mercedes made full use of social media such as Facebook and Twitter to reach many customers of the younger generation. Mercedes’ Facebook page has about 2.5 million brand images, videos and other relevant links for customers. This is the kind of social media page where the company and customers freely interact and close deals. Customers post on the company’s Facebook wall and get instant answers to their questions. Mercedes also encourages the use of videos to communicate with valued customers, who feel a personal touch in return. You-tube videos about car models have also greatly benefited the company (Saliu, 2012). BMW is not yet considering addressing the digital generation in this way.
Mercedes-Benz models, like BMW, are also advertised in print magazines and publications aimed at technology-savvy buyers. Mercedes is the leading luxury car manufacturer in Asia.
On closer inspection, these two German car companies have yet to reach some parts of the world with their marketing. BMW should join Mercedes in marketing on social media and targeting the next generation. Both companies should consider lower prices to gain more market share in developing countries. Spare parts for the models have not been readily available, and this has caused some potential customers to turn away. In conclusion, the above considerations should be taken into account and included in advertising.