Marketing Analysis of BMW X5


MarketingAnalysis of BMW X5

MarketingAnalysis of BMW X5

Theimportance of marketing cannot be underestimated as far as theprofitability and sustainability of any business entity is concernedin both the long-term and short-term. Indeed, marketing comes as themost effective ways for ensuring that the commodities and servicesoffered are well known and recognized in the market and that thetarget market does not simply stop at recognizing the goods andservices rather it goes ahead to purchase them and possibly refereven more clients to the business. Of particular note is the factthat not all marketing efforts are successful. Indeed, quite a largenumber of business entities fail simply because they do not match uptheir marketing strategies with the target market and the productsthat they are selling. On the other hand, there are companies thathave mastered the art of marketing to the extent of building theirname not only within their countries but also in the internationalmarket. As much as they have a reputation, however, they would stillneed to market their products appropriately so as to attain profits.This is the case for BMW and one of its latest products BMW X5.


TheBMW X series was launched in 1999, with the X5 model later settingthe standards as far as building crossover SUV is concerned. Thesuccess of the two models in the X5 category triggered theintroduction of more x-series cars in the subsequent years.Unfortunately, the X5 model’s performance in the market was notreplicated by the subsequent models despite the fact that they hadother unique features.


ASWOT analysis comes as one of the most fundamental aspects of themarketing of any product. It underlines a structured planningtechnique that is used in the assessment of the strengths,weaknesses, opportunities, as well as threats pertaining to abusiness or product. Underlining the importance of this technique isthe fact that it would allow the business to eliminate itsweaknesses, take advantage of its opportunities and be ready for anythreats to its profitability and sustainability.


Oneof the major strengths of this product is the fact that it comes withan 8-speed automatic transmission. This offers a considerablysmoother transmission, as well as a more superior power delivery thatwould enhance the comfort and efficiency of the machine.

Inaddition, the vehicle incorporates quite a number of cameras thatoffer a clear view pertaining to any driving condition or situation.This would further complement the safety with which the product comes(Foux, 2006).

Furtherenhancing the comfort of the vehicle is the fact that it incorporatesspacious and elegantly designed interiors. This is complemented bythe passion of admirable off-roading capabilities, as well as thegood brand recall as a result of the marketing and advertisingactivities (Mayzlin, 2006). Indeed, it is well noted that the BMWbrand is well recognized and respected in the market as one of thebest car manufacturers in the world. With such a reputation behindthe product, it goes without saying that the product stands anextremely high chance for conquering the market.


Inspite of its admirable qualities, the vehicle still comes with somedownsides. One of the major weaknesses of BMW X5 is the extremelyhigh handling and maintenance cost since the car is a Sports UtilityVehicle (SUV). This is undoubtedly bound to lock a large proportionof the market out (Mayzlin, 2006). On the same note, the carincorporates a considerably limited share of the market as a resultof the niche segment, as well as the intense competition from othervehicle manufacturers.


Thevehicle has quite a number of opportunities that it could takeadvantage of so as to enhance its profitability, sales andsustainability in the long-term.

First,the vehicle has an incredible opportunity for leveraging theinnovative and updated technology so as to persuade new clients orcustomers. Indeed, the vehicle comes from a reputable company and isintroduced at a time when numerous consumers are seeking sleektechnology, in which case it stands a high chance for exploiting thismarket (Mayzlin, 2006). The innovation could go as far as eliminatingsome of the aspects that make the car a high-handling and maintenancevehicle, thereby reducing its cost in the long-term and possiblyincreasing its attraction to a wider range of consumers.

Inaddition, the vehicle could complement or augment the service anddistribution network in different countries so as to enhance itssales and profits in the long-term and the short-term.

Inaddition, the vehicle has been introduced at a time when there is anincrease in the purchasing capability and per capita incomepertaining to the potential consumer base. This means that there is ahigh likelihood that more consumers will have more money to expend onluxury cars particularly from respected brands such as BMW.

Inaddition, the company and the car are facing an increase in themanufacturing capabilities, which make it possible that there will bean increase in the number and efficacy of the vehicles, as well as apossible reduction in the cost of the same. This would, with nodoubt, increase the possibility that the car will experience highersales in the future.

Threatsto BMW X5

Unfortunately,the opportunities and capabilities of the model to penetrate marketsand increase its sales faces quite a number of threats. First, theglobal market has been grappling with the increasing cost of fuel(Thompson et al, 2006). It is noteworthy that the vehicle isextremely high-fuel consumption. This means that there is bound to bea decrease in the attractiveness of the brand particularly amongconsumers in the lower echelons who would be particularly beconcerned about the price of fuel.

Inaddition, the model has to compete with other products from othermanufacturers that offer the same level features albeit at a lowerprice. This would mean that the consumers would be making somesavings while getting the same level of services probably from carsthat even have lower maintenance costs (Leigh et al, 2006). This is,undoubtedly, bound to eat into the market of the BMW X5.

Onthe same note, there are numerous product innovations, as well asfrugal engineering done by the competitors all in an effort toincrease their share of the market. This heightens the level ofcompetition and threatens to reduce the market share of the brandeven among the existing consumers.


Theanalysis of the aspects pertaining to the marketing mix strategy iscrucial to the identification of the true drivers of any desirablemarketing performance. Indeed, marketing mix can be used in theidentification of the drivers affecting business performanceincluding loyalty, promotions and advertising. The analysis of BMWX5’s model’s success necessitates an analysis of the 4Ps ofmarketing.


Currently,the model’s cost ranges from $52288 to around $67296, ranking the3rdposition put of the 19 midsize luxury vehicles that are available inthe United States. As much as the vehicle’s base price in theglobal market is slightly higher compared to its rivals, it stillleads as a result of its high-tech features, elegant interior styleand powerful engine. A close analysis of the pricing policy revealsthat the price is fixed in a way that allows for attracting themiddle income and high-income group (Thompson et al, 2006). On thesame note, the state-of-the-art technology and elegant interiorswould attract the rich, while the on road performance and highreliability would attract the middle-income consumers.


Productsare usually defined by their range, line, brand popularity, designand quality. It is noted that BMW X5 has attained an apt blend ofthese features through providing the appropriate USP to theconsumers, thereby earning the company numerous loyal consumers. Theinteriors of the model incorporate top-quality material, whichcomplement the comfortable back and front seats and high tech designthat has earned the admiration of the consumers. Further, the modelincorporates power adjustable front seats, moon-roof navigation,iDrive controller, night vision system, as well as leather upholsterythat incorporates 360-degree view camera. These features havesustained the brand popularity long after it was launched (Thompsonet al, 2006). On the same note, slight modifications are madeannually thereby enhancing the high-tech nature of the vehicle’sdevices and increasing the satisfaction of the consumers.


Thecompany has earned the impressive reputation through the provision ofafter-sales services alongside the warranties. It is noteworthy thatthe BMW X5 incorporates a 5-year limited warranty, as well as a12-year limited rust perforation warranty. In addition, the model iscomplemented by numerous other promotional programs such as BMWRoadside Assistance, BMW Assist, as well as Real Time TrafficInformation, which not only provide timely help to the consumers butalso promote the company’s products with regard to luxury andreliability (Mayzlin, 2006). In addition, BMW has enhanced thedistinguished nature of its products via diverse advertisements. Inthe case of X5, there were the horse-trailer ads that were immenselyhelpful in enhancing its popularity.

Ofparticular note is the fact that the company modifies its X5marketing strategy on a yearly basis through modifying thepromotional tactics. After the horse-trailer ad, the company craftedthe “Eagle”,“Serengeti”,and “Pleasedo not repair”promotional campaigns. Further, the company crafted the “TheUltimate Driving Machine”advert, which was quite a sensation among the young consumers(Mayzlin, 2006). On the same note, the company has established itspresence in the web through the use of social media platforms likeFacebook and Google. These portals have allowed the company toconstantly pass information to its global users pertaining to the newproducts, improvements and services offered to its products.Thousands of visitors have been attracted to the company’s socialpages by the colorful pictures of the products and the descriptionpertaining to the varied campaigns (Mayzlin, 2006).


Thecompany has gained an edge over its competitors with its deliveryservices and global infrastructure as shown by the systematicanalysis of its inventory control and location, transportation,warehousing and storage facility. The numerous delivery channelscoupled with the presence of its international dealers in every partof the globe allows the company to deliver the products to consumerswithin the appropriate time and place (Mayzlin, 2006). Indeed, thecompany always promises that it would deliver the products within oneweek, which depicts the availability pertaining to internationalfactories and dealers. This matches the company-promoted tagline.


Fora large number of consumers, purchasing a BMW car is tantamount toinvesting money on efficiency, quality and engineering expertise.Indeed, the marketing tagline “the ultimate driving machine”which has been used for more than three decades is a reflection ofthe consumer behavior in purchasing the brand. Of particular note isthe dynamicity of consumer’s tastes, which allows them to slice themarket into segments that are more focused. The persistent shiftingof the market makes the satisfaction of the consumer demand with newbrands and products a strategic risk.

Inthe 90s, the company divided its market into four segments includingupper conservative, modern mainstream, post-moderns and upperliberals. The upper conservative group was composed of thetraditional and rich individuals who usually purchased luxury carssuch as Jaguars and Mercedes, before they started switching to BMW asa result of its driving performance and comfort (Muniz et al, 2007).The modern mainstream individuals who usually bought thenot-so-premium brands such as Honda and Volkswagen had their needsmet after the introduction of Mini cases, although the model waspriced more expensively compared to the normal-upper class cars thatwere in the market.

Brandingfor BMW X5

Brandingunderlines the marketing practice pertaining to the building of adesign, name or symbol that would identify and differentiate aproduct from the varied others in the market. Of particular note isthe fact that the BMW X5 branding is not aimed at targeting everyother segment in the automobile industry and market rather it focuseson the premium market (Muniz et al, 2007). The avoidance ofhigh-volume middle-priced road vehicles has allowed the company toestablish a unique brand for itself in the global market.

Tokeep the BMW X5 in all stages right from the introductory stage tothe growth stages, the company is persistently experimenting with newmodels in the same series without compromising the freshness of theseries (Singh et al, 2008). Indeed, it is noted that within a 5 to yyear period of the product life cycle, the company is constantlytrying to come up with cars that are different and new at least onceevery three years (Dobele et al, 2005). Of particular note is thefact that this also involves the addition of unique features, as wellas other additional fittings. As a result of the constantmodification of the brand image, BMW modification of the brand image,the BMW X5 usually experiences heightened sales particularly aroundthe 5thor 6thyear. On the same note, the company has recognized that the brandingmay increase or shorten the lifecycle of some products in the market,in which case it takes up new strategies every year so as to be inline with the constantly changing market scenario.


Thepromotion mix of any business underlines a specific blend oftechniques that are used in marketing one product or even a family ofproducts. Promotion mix comes with quite a number of elementsincluding direct marketing, point of sale displays, merchandising,broadcast advertising, as well as personal selling. Of particularnote is the fact that the distinctive blend of promotional variablesthat marketers choose would assist the company in reaching andreaffirming its goals (Dobele et al, 2005). BMW comprehends the logicpertaining to marketing its products on the global market and servingconsumers on the basis of their needs. Indeed, it chooses to sell itsproducts to consumers who incorporate high standards for luxury andquality since its products are crafted on these very attributes. Thecompany has managed the promotion strategy through the integration ofemotional marketing perspectives that undergoes a synergisticinterchange so as to maintain the leadership position of the brandand the company in the automobile industry (Singh et al, 2008). Thecompany makes use of varied advertising techniques in the promotionof its products including new car launches, outdoor campaigns,publications and magazines, as well as branding campaigns. On thesame note, the company has in the recent times taken to websites andsocial media to expand its reach. It uses its website as well asYouTube to offer breathtaking videos and pictures of the brand in use(Dobele et al, 2005). The incorporation of the slogan “UltimateDriving Experience” goes a long way in cementing the position ofthe brand in the market.

Inconclusion, BMW X5 is one of the world’s most respected cars thatusually targets the wealthy and middle income individuals. Indeed,the features and innovative technology incorporated in the car mainlytargets individuals in the upper echelons of the society.Nevertheless, it is the marketing strategies that have ensured thatthe company and its products remain at the high stature and that thereputation of the products is maintained in both the long-term andthe short-term (Muniz et al, 2007). Marketing analysis has allowedfor the determination of its strengths particularly emanating fromthe respect that the brand is accorded in the market, as far as themanufacture of highly efficient and quality cars is concerned. Thisreputation has allowed it to withstand the threat of increasing fuelprices and increasing innovativeness and engineering that gives riseto cheaper cars from other brands.


Dobele,A., Lindgreen, A., Beverland, M., Vanhamme, J., &amp van Wijk, R.(2007). Why pass on viral messages? Because they connect emotionally.BusinessHorizons,50(4), 291—304.

Dobele,A., Toleman, D., &amp Beverland, M. (2005). Controlled infection!Spreading the brand message through viral marketing BusinessHorizons,48(2), 143—149.

Foux,G. (2006). Consumer-generated media: Get your customers involved.BrandStrategy, 38—39.

Mayzlin,D. (2006). Promotional chat on the Internet. MarketingScience,25(2), 155—163

Muniz,A. M., &amp Schau, H. J. (2007). Vigilante marketing andconsumer-created communications. Journalof Advertising,36(3), 35—50

Leigh,Thomas W., Cara Peters, &amp Jeremy Shelton (2006), “The ConsumerQuest for Authenticity: The Multiplicity of Meanings Within the MGSubculture of Consumption,” Journalof the Academy of Marketing Science,31 (4), 1–13.

Singh,T., Veron-Jackson, L., &amp Cullinane, J. (2008). Blogging: A newplay in your marketing game plan. BusinessHorizons,51(4), 281—292.

Thompson,Craig J., Aric Rindfleisch, and Zeynep Arsel (2006). “EmotionalBranding and the Strategic Value of the Doppelgänger Brand Image,”Journalof Marketing,70. 50–64