BMW Case Study

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Which classification of consumer goods does the product belong to and why? Before the recent announcement that BMW will begin distributing its new 1-Series in North America, the majority of consumers considered products with this brand name to be Specialty Items which are mostly unaffordable to many. All of BMW’s products within its product line have characteristics of a specialty item including luxury, comfort and a sleek style that consumers would spend a great deal of time to acquire the particular brand, and no substitutes would be sufficient. However, BMW is striving to diversify its product mix by creating a line extension of its current 3-series model by introducing the 1-series in hopes to penetrate a new North American market; a market that demands the BMW name but could not previously afford it. Although the new 1-Series is cheaper than models that have come before it, it is still high in price (starting at $30,000) and should still be classified as a specialty product for reasons that are easily portrayed through their marketing efforts. First, the 1-series lives off of its BMW name. People associate this car company with excellence and since specialty items such as this one are purchased infrequently and consumer attitudes play a large role in the purchasing decision, the desired and often resulting effect is that consumers will not shop around and compare other car companies to this one. Moreover, the places where you can purchase one of these vehicles are of a limited number. You must visit a BMW dealership that adheres to all of BMW’s standards of excellence to obtain a brand new quality car. Since distribution of the 1-Series in North America will not begin until next year, promoters are continuing to advertise the 3-series (which is the most similar to the 1-series) so consumers will not have to be aggressively sought when the new

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