A case analysis - Exploring customer attitudes on BMW (PDF)

Master's Thesis from the year 2004 in the subject Business economics - Offline Marketing and Online Marketing, grade: A (1.0), Hawai'i Pacific University, course: Professional Paper MBA, language: English, abstract: "Building a brand is both an art and a science. It is the strategic mix of focus and risk that gives a brand its meaning in people's lives (Dolan, 2003)". Branding has been around for centuries as a means to distinguish the goods of one producer from those of another. Brand elements identify and differentiate the brand. However, many practicing managers refer to a brand as more than that. They define a brand in terms of having actually created a certain amount of awareness and reputation in the marketplace, which distinguishes a small brand from a big brand. Especially strong brands have a number of different types of intangible image associations that link customers emotionally to the brand. Prior research has explored differences in customer perception and evaluation of brands for example through investigating brand equity. More recent research has found out that customers differ not only in their perception of brands but also in how they relate to brands. This suggests that people sometimes even form a relationship with a specific brand (Aggarwal, 2004).
Branding and brand-based differentiation are powerful means for creating and sustaining competitive advantage (Aggarwal, 2004). Highly competitive markets like the automotive market make powerful, strong brands essential to accomplishing growth. According to Agarwal, Dahlhoff & Rao (2004), companies create brand equity by delivering quality products and by creating strong, unique and favorable brand associations. Customer loyalty, larger margins, brand extension opportunities, enhanced perceptions of product performance, and increased marketing effectiveness and efficiency among other things are possible benefits of building up brand equity.
This research paper will look at the brand BMW. BMW, which stands for "Bayerische Motoren Werke", is a major European manufacturer of luxury cars. The headquarters of the multinational corporation BMW Group is in Munich, Germany. The company has built substantial brand equity over the years through the continuous branding efforts for high quality products. The luxury car category includes both traditional and functional luxury cars. U.S. manufacturers mainly produce traditional luxury cars, while functional luxury cars are represented primarily by European manufacturers such as BMW (Bernhardt & Kinnear, 1994).