MRK-202 MARKETING MANAGEMENT

FINAL EXAM

Final Project involves two parts, Two Case Studies and one Essay Topic. Paper have to be submitted in
MS Word. For case studies, papers will be minimum 3000 words and for essay topic it will be minimum
1700 words. Papers will be introduction ,cover and reference pages. Deadline is 2nd of July, 2020 at
17:00.

PART 1- Case Studies

BMW

BMW is the ultimate driving machine. Manufactured by the German company,

BayerischeMotorenWerke AG, BMW stands for both performance and luxury. The company was
founded in 1916 as an aircraft-engine manufacturer and produced engines during World War I
and World War II. It evolved into a motorcycle and automobile maker by the mid-20th century,
and today it is an internationally respected company and brand with €53 billion (about $76
billion) in revenues in 2008. BMW’s logo is one of the most distinct and globally recognized ever
created. The signature BMW roundel looks like a spinning propeller blade set against a blue sky
background – originally thought to be a tribute to the company’s founding days as an aircraft
engine manufacturer. Recently, however, a New York Times reporter revealed that the logo,
which features the letters BMW at the top of the outer ring and a blue-and-white checkered
design in the inner ring, was trademarked in 1917 and meant to show the colors of the Free State
of Bavaria, where the company is headquartered. BMW’s growth exploded in the 1980s and
1990s, when it successfully targeted the growing market of baby boomers and professional
yuppies who put work first and wanted a car that spoke of their success. The result: sporty sedans
with exceptional performance and a brand that stood for prestige and achievement. The cars,
which came in a 3, 5, or 7 Series, were basically the same design in three different sizes. The
1980s was also a time when yuppies made Beemer and Bimmer, slang terms for BMW’s cars and
motorcycles, popular names that are still used today. At the turn of the century, consumers’
attitudes toward cars changed. Research showed that they cared less about the bragging rights of
the BMW brand and instead desired a variety of design, size, price, and style choices. As a result,
the company took several steps to grow its product line by targeting specific market segments,
which resulted in unique premium-priced cars such as SUVs, convertibles, roadsters, and less
expensive compact cars, the 1 Series. In addition, BMW redesigned its 3, 5, and 7 Series cars
making them unique in appearance yet remaining exceptional in performance. BMW’s full range
of cars now include the 1 Series, 3 Series, 5 Series, 6 Series, 7 Series, X3 SUV, X5 SUV, X6
SUV, Z4 (Roadster), and M. The redesign of the 7 Series, BMW’s most luxurious car targeted a
group called “upper conservatives”. These wealthy, traditional consumers traditionally don’t like
sportier cars, so BMW added an influx of electronic components such as multiple options to
control the windows, seats, airflow, and lights, a push-button ignition, and night vision, all
controlled by a point-and-click system called iDrive. These enhancements were created to add
comfort and luxury and attract consumers away from competitors like Jaguar and Mercedes.
BMW successfully launched the X5 by targeting “upper liberals” who achieved success in the
1990s and had gone on to have children and take up extracurricular activities such as biking, golf,
and skiing. These consumers needed a bigger car for their active lifestyles and growing families,
so BMW created a high-performance luxury SUV. BMW refers to its SUVs as sport utility
vehicles in order to appeal even more to these active consumers. BMW created the lower-priced
1 Series and X3 SUV to target the “modern mainstream”, a group who are also family-focused
and active but had previously avoided BMWs because of the premium cost. The 1 Series reached
this group with its lower price point, sporty design, and aspiration to own a luxury brand. The X3
also hit home with its smaller, less expensive SUV design. BMW introduced convertibles and
roadsters to target “post-moderns”, a high-income group that continues to attract attention with
more showy, flamboyant cars. BMW’s 6 Series, a flashier version of the high-end 7 Series, also
targeted this group. BMW uses a wide range of advertising tactics to reach each of its target
markets but has kept the tagline “The Ultimate Driving Machine” for over 35 years. During that
time, US sales of BMW vehicles have grown from 15,000 units in 1974 to approximately
250,000 in 2009. BMW owners are very loyal to the brand, and enthusiasts host an annual
Bimmerfest each year to celebrate their cars. The company nurtures these loyal consumers and
continues to research, innovate, and reach out to specific segment groups year after year.

1- How does BMW segment its consumers? Why does this work for BMW?
2- What does BMW do well to market to each segment group? Where could it improve its
marketing strategy?
3-Should BMW ever change its tagline, "The Ultimate Driving Machine"? Why or why not?
4- What makes BMW brand strong? (One part of answers for this question
[Link] )
[Link]

2- MARKS & SPENCER

"There's no need to ask the price - it's a penny" was the proud claim of Marks and Spencer a
hundred years ago. From the start, it had developed a unique position in its market - an emphasis
on low price, wide range and good quality. Over time, the Marks and Spencer position has been
steadily developed, along with its profitability. By the 1990s it looked unstoppable as a retailer,
as it progressively expanded its product range from clothing to food, furnishings and financial
services. The world seemed to be waiting for M&S to exploit, and despite disappointing starts in
the US and Canada, it developed steadily throughout Europe and the Far East. Then, just like any
star who has been put on a pedestal, the media began to savage the company. After a sudden drop
in profits and sales during 1998, critics claimed that the company had lost its position in the
market place. It appeared to be like a super tanker, ploughing straight ahead with a management
that had become much less adaptable to change than its nimbler competitors.

Many observers had commented on the fact that the company did not have a marketing
department until 1998. Marketing, at least in terms of advertising the brand, had become so
important to its competitors, but had never been high on Marks & Spencer's agenda. According
to Media Monitoring Services, M&S's total media spending between Dec 1997-Nov 1998 was
just £4.7 million, almost a drop in the ocean compared to the spending of Sainsburys (£42.1m);
Tesco (£27.5m); and Woolworths (£21.5m). While other retailers had worked hard on building a
brand image, M&S has relied on the quality of its stock to do the talking. The argument was that
everyone knew what they were getting with M&S underwear or shirts - good quality at fair, but
not cheap, prices. Similarly with food, M&S's offering was about quality rather than price. M&S
believed its customers knew what the brand stood for and advertising was much less important
than ensuring that it could obtain the right products at the right price.

In 1998, M&S looked to marketing to help turn around its performance, describing its new
marketing division for UK retail as "a significant development in our retailing philosophy".
Many suspected that M&S's conversion to marketing had been encouraged by the example set by
the star of modern retailing, Tesco. There are many similarities between the problems facing
M&S and those which Tesco faced a decade previously. In the early 1990s Tesco was a brand
which looked like it had seen better days. The retailer's format was tired, its stores poorly laid
out and the positioning of the company was still based on its founder's principle of 'pile it high
and sell it cheap'. Its arch-rival, Sainsbury's, was regarded as the more upmarket store for the
middle classes, who shopped for quality food in a more pleasant environment. Since then, Tesco
had innovated with improved store designs, petrol stations, coffee shops, a new fascia, the Tesco
Clubcard and 24-hour store opening. The list of Tesco's marketing initiatives seemed to be
unstoppable, in an attempt to keep one step ahead of its competitors.

In contrast, M&S had failed to keep pace with customer service. In many issues of retail
development, such as out-of-town shopping centres, Sunday opening and loyalty cards, it had
lagged behind its main competitors. While it has stood still, the likes of Tesco and Sainsbury's
marched ahead until there was no longer much that felt exceptional about the M&S shopping
experience. Analysts argued that M&S had failed to make its store layouts help shoppers bring
clothing together to make outfits. In a typical M&S store, all jackets would be located in one area
and all cardigans in another, for example. Its competitors had made much greater progress in
bringing together co-ordinated sets of clothing which would encourage shoppers to spend more.
M&S has also been criticized for making things difficult for customers by not accepting payment
by major credit cards.

In response to its current troubles, the newly created marketing department of M&S launched its
first national campaign for retail towards the end of 1998. The ads followed an initial attempt at
regional TV advertising earlier in the year, which the company was said to be very pleased with.
The newly appointed Chief Executive claimed "It's not that people don't like what we're selling,
but that we haven't got the message across. There are an awful lot of people who love us for our
knickers, but they don't love our home furnishings because they don't even know they are there."
Many critics thought the problems were much more deep-seated and blamed the store's problems
on the fact that its autumn fashions were seen as dull and uninspiring, and out of touch with
consumers' preferences. Greater authority was pledged to the marketing department when it came
to new product design.

In response to its pledge to listen to what its customers wanted, new designers were brought in to
try and give the company's ranges more sparkle. The company even thought the previously
unthinkable by proposing to stock manufacturers' own branded products, instead of relying
entirely on M&S's own label products. If customers wanted to obtain variety at M&S, the new
thinking was that the company must adapt and offer it. Another area identified for development
was direct marketing of fashion products - an area where the company had begun to lag behind its
rivals who had developed interactive web sites.

Serious questions remained about the company. How quickly could it change in response to its
changed environment? The company had not been known for speedy decision making, so
probably a major structural overhaul was essential before it could get down to the serious
business of adapting to customers' changing needs. Also, there was a great danger of changing
the company's position too far and too fast, thereby alienating its traditional customers without
gaining sufficient new ones. As a warning of how not to change, M&S's rival Laura Ashley had
repositioned itself so radically from its original format that it now failed to gain the support of
any major group. M&S had itself tried to become more fashion conscious during the mid-1980s
with similar effect, and had to make a hasty retreat to its traditional, more staid image.

1. What do you understand by positioning, and what tools are available to Marks and
Spencer to give it a positioning advantage?
2. There has been a lot of debate about whether the existence of a marketing department
can actually be harmful to services companies because it absolves everybody else of
marketing responsibilities. What then, do you make of M&S's decision to introduce a
marketing department?
3. What are the dangers to M&S of moving its market position too far and too fast? How
can it try to alleviate these problems?

PART 2 – Essay Topic

1- Please write your opinions with following essay structure about “The importance of
Digital Marketing”.