Develop a Consumer Behavior Report to be submitted to the Managing Director of a Medium to High Involvement Brand/product of your choice.
The Bavarian Motor Works or Bayerische Motoren Werke (BMW) began its journey in 1910 as a manufacturer of aircraft and is company that is based in Germany. The logo of the company bears its look from the propeller blades of the plan against the blue sky that shows its true origins (Hwee, 2015). It is also based on the national flag of Bavaria. The company began to manufacture its prototype of car since 1928, which became immensely popular in the market and ensured the survival of the company during the Great Depression. Since then the company began to excel in the sector of car making and provided fast and sporty look vehicles for the customers (Garcia-Villalobos, 2015).
The mission of the company is to be the leader in providing premium products along with the best services on a global manner.
The vision of the company is that they want to become the premium manufacturer in the car industry in a successful manner.
The clients of the company comprise around 45 percent of people who are businessmen and belong to the high income category. Apart from that, people who hold better positions in large companies are also one of the customers of the company. They may belong to middle income families but have a respectable income, which helps them in purchasing the cars of this company. The other clients of the company include the people who provide these cars on a rental basis to other people. These cars are used in a leasing form by renowned rental agencies. The government officials are also some of the clients of the company, as the army and the police in some of the countries utilizes these vehicles due to its agility (Clarke, Friese & Washbum, 2015).
The competitors for the company include other high-end car manufacturers such as Audi, Volkswagen, Jaguar, Maserati, Porsche, Bugatti, Bentley, Mercedes Benz and others. These car companies also excel in making cars that are known for its agility and tend to the high-end customers. These competitor brands are recognized on a global basis that plays a key role in decreasing the sale of BMW (Aldrich & Laliberte Rudman, 2016).
The suppliers also play an important role in influencing the strategies of marketing in numerous ways. Firstly, the shortage of raw materials will create an impact on the items that are required in manufacturing the cars. This creates a problem for the company, as they cannot sell the car without building it in a proper manner, which in turn can result in decreasing its goodwill and brand value. The cost of promoting the cars also is high, which has to be subsidized so that it can help in manufacturing the car by procuring g the raw materials (Grant, 2016).
The channel members also have an impact on the customers with respect to the receiving of their cars. These members are a part of the transportations where the cars are bought and sold to the customers. Since the cars get manufactured in a different country, there is a high import cost along with other calamities such as breakdowns and natural disasters. This requires the company in changing its marketing strategy so that it takes in to consideration the various aspects (Pearce, Robinson & Subramaniam, 2013).
The company also has to understand the buying habits of the consumers so that they can excel in the given markets. The problem of ecology has to be taken in to account such as the issue of global warming and the level of pollution that is present in the country. Apart from this, the factor of pricing is also important, as most of the people prefer cars that are priced low and can be used on an everyday manner. The customers also have the tendency in using smaller cars because of its mobility and are prevalent in the bigger cities (Weihrich, 2015).
The laws in the European Union have become stricter regarding the emission of carbon dioxide due to the impact it creates on polluting the environment. This has created a impact on the automobile industry and especially on BMW, as they have seen that most of the pollution has been caused by cars within the country.
The company invests a large sum of money in the technologies so that it can manufacture the cars that will not pose any harm on the environment. This has helped in changing the political views regarding the manufacturing of the cars, as the carbon footprints have been reduced significantly (Armstrong & Taylor, 2014).
The company launched its first car that is based on hydrogen in the year 2007 so that the emission of CO2 can be reduced. The development of a new type of engine known as Efficient Dynamics has helped the company in fighting the political battle.
The financial crisis that recently took place in the European Union has created a major impact on the sale of the car model, as the power of purchasing among the people has decreased significantly. In the year 2008, the company had made a profit of 351 million Euros before the calculation of tax while in the year 2011 the level of profit before tax increased to 7.3 billion Euros (Segarra-Cipres, Roca-Puig & Bou-Llusar, 2014).
Another factor is the rise in the prices of crude oil, which has increased the cost of sales for the company. The increase has been 9.5 percent, which has been reflected in their financial statements for the year 2010-11.
The population in the European Union has increased when compared to the 2010 census. This has resulted in increasing the life expectancy of the older generation due to the advancement in the medical facilities.
The shift by the company in adopting the greener technologies has helped the consumers in adopting the new style so that it can help in making the surrounding environment safer in nature (Grant, 2016).
The adoption of the new technologies by the company will help in developing the business from all the aspects. The constant look out by the company has helped the company inn adopting the technologies that will lead to sustainable existence of the cars. The use of the latest technologies will help the car company in gaining a competitive advantage over the rival companies (Clarke, Friese & Washbum, 2015).
The BMW i-series has been marketed as a product that will give high performance at low costs.
It runs on battery exclusively and the engine is known for its high performance. The extensive way of designing the car has made it more appealing to the customers (Weihrich, 2015).
The high cost of the cars has made it limited to a certain section of the market, as they only have the capacity to pay such a high amount.
The channel of distribution for the car is small along with the spare parts that are too expensive for the customers to spend (Armstrong & Taylor, 2014).
The government of the countries is pushing the car manufacturers in adopting the technologies that will help in making the car fuel-efficient. There is an increasing opportunity for the company to expand especially in the economies that are growing. The company needs to capitalize on the increasing levels of consciousness among the upper class regarding safeguarding of the environment (Aghdaie & Alimardani, 2015).
The high cost of the car model will inhibit the customers from buying the car. There is a lack of major outlets in most of the countries to charge the battery on an emergency basis so that the car can reach its destination. There are major competitors that are operating in the market and may provide similar models at a cheaper price (Pearce, Robinson & Subramaniam, 2013).
The major markets for the company is Europe, Japan, the USA, Germany and the Pacific region that accounts for most of the sales for the company. The Italian and the French markets are also growing, as the demand for these cars have increased to a great extent. The consumers who have an income of more than $200,000 per year can afford to buy the car after saving a certain sum of money. Apart from that, the maintenance of the car is also huge if the car meets any kind of accidents. The consumers belonging to age group of 30-45 can afford to purchase the car in spite of their gender and race. The consumers have to be of managerial level of well-known companies so that it can help them in purchasing the model (Magnani, Zucchella & Floriani, 2017).
The customers have to have a full-time and secured job so that they can afford to spend a large sum for the car. The lifestyle of the customers have to be active and has to be regular in the in attending various events such as sports, business parties and theatres. They need to exhibit snobbish type of life so that they can show off their sense of flamboyancy and the lavish expenditure according to the style they carry (He et al., 2016).
The customers who will be buying the model will drive the car to almost all the places including the dinner parties or dropping their kids at school. The status of these people in the society is that they are respectable and have the power to influence the group. They mostly belong to the upper class of the society and are well-known in the community. Most of the customers are oriented towards latest technologies, as it helps them in easing their work. This has helped the car company in attending to their needs by providing them most of the luxuries packed inside the car (Buyukozkan, Mukul & Uzturk, 2016).
The customers are mainly from the European markets, as they have a high purchasing power as compared to the other countries.
Decision making process
The customers have to recognize the brand related to the quality of the product that the company is providing to them. This will help them in opting out to purchase the car depending on the quality that they want. Since the model is being introduced in the market, it will be in the first stage of the product life cycle (Kaul & Wu, 2016).
The customers after recognizing the model of the car that they want to purchase has to search all the related information from the internet so that it can help them in getting a better image about the type of car that they are going to purchase. The customers will also see the easiness through which the correct information about the product can be gathered from the external sources. The perceived risk related to the product also has to be taken in to account by the customers while checking the information about the product. The consumers can also gather the knowledge about the product from t he reviews that are given in the newspapers and the magazines, which will help in influencing their decision (Buerki et al., 2014).
The next stage involves the search for the alternate options. The consumers will look for other car manufacturers who will provide the same benefits as per the requirement of the customers at a cheaper price so that they can spend less and gain better product. The customers will look for options in companies in Tesla that offers competitive prices and will provide the product with all the benefits. They also have to consider the compensatory functions such as the performance of the car has to be the main evaluative criteria rather than the price of the product, which is a non-compensatory offset (Miecinskiene, Stasytyte & Kazlauskaite, 2014).
The next stage is that the customers will be making the decision to purchase the product, as they are unlikely to get the alternate options that they are looking for. This will help them in spending the amount in purchasing the car. The customers will have the trait of committed purchase, as they will invest in the product for one time due to its high cost of purchase (Bhasin, 2014).
The last stage includes the evaluation of the product after purchasing it. This stage requires the customers to provide feedback to the company regarding the performance and the capability of the product. This will help the company in modifying the errors that has been pointed out by the customers (Kaul & Wu, 2016).
The retail factors such as the model of the car are available in all the retail outlets that the company has all over the world. The retail outlets play an important part in supplying those customers who have made a booking of the car. If the car is not available, then they inform the head office so that it can be shipped within a fixed period, as discussed with the customers.
After the product has been purchased, most of the customers are happy with the product, as they get all the facilities and the technologies that have been promised to them by the company. The goodwill of the company is maintained among the customers, as they spend a large amount in purchasing the product.
The view of the customers is that they are content with the product and the marketers have delivered the product that has been promised by them to the customers. To maintain a better relationship with the customers, the marketers ask for a feedback form to be filled up by them so that it can help the company in understanding their position in the market.
Social influences on buying behavior
Families of the customers play an important role in persuading them to make the purchases, as they are concerned regarding the safety of the members of the family. The technologies that are provided by the company help the families to travel in a safe manner. Apart from that, the influence of the family plays an important part as well, as they like to be respected among the community and show their statuses among the common people.
The consumers of this product belong to upper class and have a social life. This helps them in mixing with the same class of people in the society as well. Most of the people belonging to that society will have a luxury car that will help them inn sporting a high-end car model. Thus, the customers may be influenced by the social class that they belong to so that they can remain a part in the group (He et al., 2016).
Most of the customers for this product comes from affluent backgrounds and has a high level of income owing to their positions that they hold in the organizations. To show their status in the community, the consumers are willing to spend a certain sum of money so that it can help them in motivating the other people that are present in the organization. This will create an impact on the other customers of the same stature to get involved in the buying process of these high-end cars.
The other factor is that these customers have a personality that they want to create within the society. This helps them in taking prompt decisions in purchasing the product (Kaul & Wu, 2016).
The age plays an important part in making the purchase, as they want to avail the comfort that they would get after the product is purchased. Since they have reached a certain position within the organization, they would like to get access to the level of comfort so that they can show their leadership skills.
The other factor is the personality that they carry within the organization and the society. The purchase of the item will help them in increasing their status within the society, as they will be respected by the other people as well (He et al., 2016).
Marketing strategy recommendations
The product is of high quality due to the image that the brand carries in the market. It will be made available to the people who have a certain level of income due to the huge cost that is associated with the product (Bhasin, 2014).
The brand manufactures the products that are of high quality for which the price is also very high. This has resulted due to the technologies that have been incorporated within the system (Qiu, 2014).
The car model will be available in most of the places due to the strong presence that the brand has in the market. The countries such as Europe, USA, UK and Japan will help in increasing the sale for the company, as they have the purchasing power, as the level of income is high in these markets (Jin, Kim & Kim, 2015).
The company will promote the model extensively through the newspapers and the magazines. It will also place its advertisements through banners and hoardings apart from the social media so that the customers can be informed about the product (Bhasin, 2014).
Therefore, it can be concluded that the company has targeted a certain section of people in the market who are willing to spend the amount on adopting the latest technologies that are provided in the car model. The extensive promotion through the magazines and newspapers will be beneficial for the company, as the customers who want to purchase it can get all the information through all the available media platforms.
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