The Anti-laws of Luxury Marketing #3

3. Don’t pander to your customers’ wishes

One of the most respected brands in the world is BMW. This ever-growing brand has been successful in creating a cult, a body of owners that are extremely faithful, devoted and committed to their brand. It is in fact, according to the Luxury Institute, one of the ‘the most admired car companies in the world’. What are the factors behind BMW’s success?

•    A clear brand identity, observed to the letter since 1962, summarized in a slogan never challenged since then, translated into every language – ‘Sheer driving pleasure’.

•    A stable, family shareholding. Since 1959 the brand has been owned by the Quandt family. It believes in letting things take their time and accepts that it may lose clients in the short term to increase the value.

•    A very German enterprise culture, characterized by its engineering and its product cult. Moreover, being descended from pioneers of aviation, there is a tremendous pride in this company.

BMW sells unequalled driving pleasure to people who know how to appreciate it. It has never built cars that were boring to drive. BMW has become an icon of standing and performance; in the 1990s it was the ‘official’ car of every yuppie or successful young executive eager to show off their success. What is less well known, however, is that despite its success, the brand has remained true to itself thanks to its willingness to resist client demands when these did not correspond to the company’s very precise vision as to what made for a true BMW. This does not mean the luxury brand should not care about its clients nor listen to them. However, it should do nothing that threatens its identity.

An example that says a great deal about BMW is that consumers regularly curse each time a new 5 Series car is released, because it is certainly a fact that this model does not give rear passengers enough legroom. According to them, such stubbornness defies reason and good sense. But the makers object that to meet client demands would be to spoil the purity of design of this car, its proportions having been meticulously calculated, as indeed were its aerodynamics! Some may remember the loss of aesthetics that the Jaguar E-type suffered following the addition of two full-size rear seats.

BMW is a good illustration of this principle according to which a luxury brand has to maintain a consistency over time and across its entire range, which guarantees its authenticity, and therefore its attraction, its mystique and its spark. In traditional marketing, the customer is king. Procter & Gamble’s corporate identity relies not on one man, or even on one category of product, but on a methodology that puts the customers’ desires at the heart of the business: P&G does it by listening to its customers – listening to what they have to say or are trying to say – then transforming these wishes into global, or at least regional, products that are then sold through mass distribution channels. The luxury brand, on the other hand, comes from the mind of its creator, driven by a long-term vision. There are two ways to go bankrupt: not listening to the client, but also listening to them too much.

This relationship with the client is typical of postmodern luxury and dates back to the 19th century. Historically, luxury was the creation of a talented craftsman, using the very rarest materials, who accepted commissions from a client or patron. These craftsmen were known in their day, but their fame did not endure. That is how castles and private mansions were built and furnished. In France, everything changed when at the end of the 18th century craftsmen stopped accepting private commissions after someone came up with the idea of making models, before they too were sold. What we were witnessing at that time was a radical reversal of the relationship between omnipotent client and craftsman. No longer was the craftsman prepared to go cap-in-hand to visit the client; instead, people went to them to see their latest collections, their new creations. The age of the nameless craftsman was now long gone – enter now on stage the creative designer and their retinue, their followers. Not to mention the reputation of their name.

Excerpted from: The Luxury Strategy: Break The Rules of Marketing to Build Luxury Brands by JN Kapferer and V. Bastien, in partnership with Kogan Page publishing.

Sponsored By: The Brand Positioning Workshop

Comments

[James Fowlkes]

What do you think of BMW's decision to offer the 1-series version of the BMW. I think it cheapens their brand and goes against what you mention above "do nothing that threatens its identity." It seems the 1-series does exactly that by pandering to customers who can't afford "the real thing BMW". I am interested in your thoughts on this move. Thanks.

[Andrew Lee]

Also, the recent explosion in the number of BMW models. They used to essentially built 4 cars; 3, 5, 7 series and Z3/4.

Now there is the X5, X6, X3, 6 series, 1 series, and the addition of the GT variant bodystyle. Soon, an X1 is expected as well.

Their 'halo' line, the M series, is getting watered down with an M version of the X5, the SUV.

I would say BMW has radically changed their offerings based on consumer demands.

[Bill Herring]

Nice piece that spells out a capability that few companies have, thanks for posting.

Seems simple, staying true to your brand and not threatening your own identity. But so many companies compromise their identities and perhaps cater too much to the whims of a market. Calls for careful decision making based on a brand heritage built over time.

[Jean-Noël Kapferer]

Why launch BMW Series 1?

All brands have to think of their long term future. Now, although BMW brand personality is young ( or may be because it is young ) in the world , the average age of the BMW driver is 46.

It is nice to dream about a brand, but this love cannot stay platonic too long.

Series 1 is a move to make the dream more accessible without eroding the fundamentals of what is a BMW . It should deliver the kind of driving experience and self image people of a younger age are hoping from BMW.

Jean-Noël Kapferer, author of The Luxury Strategy

[Jean-Noël Kapferer]

Why so many models ?

A brand's long term growth relies on its ability to harness growth segments with its own style. The automotive market has dramatically changed.

Yesterday the car market was segmented like a pyramid ( good , better , best ). Now it is fragmented: one should look at it as a matrix with a lot of product types ( from mini van , sedan, breaks, convertibles, speedsters, pick-up, 4x4, SUV, .etc.....) each of them being segmented by price, level of sportiness and luxury ( See more in the book: The new Strategic Brand Management ). Now it does not mean that BMW should address all of these micro segments, but clearly it has to accompany the market evolution of the role cars play in their life, à la BMW .

The main question underlying this multiplication of models is that of profitability: so far BMW has refused to use manufacturing platforms, like Audi did. This is why is it less profitable now than Audi.

Jean-Noël Kapferer, author of The Luxury Strategy