Usually cars are sold as finished and complete products. Consumers do not expect new cars to improve or change once they get driven out of the dealer’s premises. Only rare maintenance, software updates or repairs are carried out to keep the vehicle functional. To stay competitive, car manufacturers present new models to market every four to seven years and these models are refreshed with minor functional and cosmetic changes around halfway through their life cycle (Lyrra & Koskinen, 2018). Tesla is challenging this status quo. Just like a smartphone, Tesla issues frequent software updates to improve and change the functionality of the cars they design and manufacture, thereby modifying cars continuously after the point of sale. MKTG 396v8 Assignment 2 February 2, 2018
The market share of Tesla is continuing to grow quickly, as it is a first mover in electric car industry. For this reason, they don’t have many competitors either. However, the electric car industry has seen a lot of growth in the past several years, as brands such as Nissan have come out with electric cars like the Leaf. One of the long-term global goals for climate protection is zero emissions. This is a huge challenge but is also a business opportunity for many companies. The future is green (and digital), and this kind of green and environmentally friendly product will gain a lot of support from government and it will lead the company to dominate the market. BMW is a German company which currently produces automobiles and motorcycles around the globe, and also produced aircraft engines until 1945. The company was founded in 1916 and is headquartered in Munich, Bavaria. BMW first entered the automobile manufacturing business in 1928, when it bought the rights to build the Dixi car . It has obviously grown since then, and is now one of the most dominant brands in the luxury car industry. However, BMW does not necessarily fit into any specific stage of the product life cycle. As it has established dominance in the industry, it would most likely be considered to be in the late majority stage, but they are still coming out with products and models that each have their own unique product life cycle. Jim McDowell, vice president of marketing at BMW says " If a product is declining, we would prefer to withdraw it from the market, as opposed to having a strategy for dealing with the declining product." To say this another way, the maturity and decline stages do not usually exist in BMW's product life cycle. Before products reach the maturity stage, characterized by declining sales rate and decreasing profit, BMW pulls it out from the market. BMW cars typically have product life cycle of seven years. The best sales numbers are often seen in the sixth or seventh year after product introduction. Furthermore, the BMW car has only two-stages of product life cycle, introduction and growth stages. To give an example, the X5 series and the 3 series were introduced in 2000 and 2001, respectively. Based on BMW's MKTG 396v8 Assignment 2 February 2, 2018
product life cycle, both of these series’ were in the Growth stage. BMW then introduced three different versions for each model of the 3 series. The X5 also satisfied different customer preferences with three
You've reached the end of your free preview.
Want to read all 14 pages?