Bbusiness management Essay Example | Topics and Well Written Essays - 1500 words

Bbusiness management - Essay Example BMW focused on the market trends and strategies in order to get a hold on high share in the market. BMW Case Analysis What main trends are identifiable in the business environment in general and in the automobile market in particular in 2004 that might affect BMW’s strategy? The main trends that are identifiable in business environment mainly include the competition between the different brands of same product category. It is on the basis of the quality and differentiation that is created by every brand. In automobile market the most important trend that is identifiable is the uniqueness in terms of design, price, quality and convenience provided to every customer when it comes to use. Whether it’s for any segment, the prime objective of automobile industry is to provide the ease to use it. According to Porter’s Generic BMW is highly differentiated in the automobile market, and this differentiation was on the basis of brand itself that created different identity in consumers mind. BMW conveys a perception of prestige and dignity for the high-end users. Uniqueness in terms of design seems to be the most important weapon for any company to fight and to move in fast–paced automobile industry. But in 2004 the market for automobile industry became more concentrated and productive. ... ere was no issue of quality in this year because of rapid growth of automobile industry but consumers of North America and Western Europe started demanding cheaper cars due to economic instability which forced them to reduce the spending on non-essential goods, and this adversely impacted the matured car market. On the other hand the market of Asia especially in China the demand of high–end and expensive models increased. Henceforth, quality was not the issue in 2004 whereas every company was focusing on placing their brand on the top of automobile industry. The war was of branding not of quality because the quality was no longer an issue (Mathews, 2006). 1. Using Porter’s five-force framework, attempt an analysis of the competition in the automobile industry in 2004 (adopt the BMW perspective). Consider the time horizon of strategic planning and attempt to identify what future changes are likely for that period in the light of the factors at play in the macro-environme nt. Industrial Rivalry – The competition became so ferocious, there was no room for differentiation and growth was slow because industry was in the mature phase. So, the focus turned to price of the product in automobile industry. Those who set economical prices and uniqueness into their brands were ruling the market. Quality was the weapon and the design too but that no more be considered as factor for choice-making, it was necessary for car makers to look for quality of product. Profitability was affected badly due to various external factors as well as competition. Substitutes – In 2004 automobile industry was facing substitute like motor bike, boats and leisure cruises were immensely used. Potential Entrants – Deluxe cars like Ford entered the market with Jaguar and Volvo models and