Case Study 2003

Delivering Customer Value Through Marketing Case Study December 2011 and March 2012

Professional Diploma in Marketing (Level 6)541 Delivering Customer Value Through Marketing

Case Study December 2011 and March 2012

MINI The Chartered Institute of Marketing 2011


Delivering Customer Value through Marketing Case StudyImportant guidance notes for candidates regarding the pre-prepared analysis The examination is designed to assess knowledge and understanding of the Delivering Customer Value through Marketing syllabus, in the context of the relevant case study. The examiners will be marking candidates scripts on the basis of the questions set. Candidates are advised to pay particular attention to the mark allocation on the examination paper and plan their time accordingly. Candidates should acquaint themselves thoroughly with the case study and be prepared to follow closely the instructions given to them on the examination day. Candidates are advised not to waste valuable time collecting unnecessary data. The cases are based upon real-life situations and all the information about the chosen organisation is contained within the case study. No useful purpose will therefore be served by contacting companies in the industry and candidates are strictly instructed not to do so as it may cause unnecessary confusion. As in real life, anomalies may be found in the information provided within this case study. Please state any assumptions, where necessary, when answering questions. The Chartered Institute of Marketing is not in a position to answer queries on case data. Candidates are tested on their overall understanding of the case and its key issues, not on minor details. As part of the preparation for the examination, candidates will need to carry out a detailed analysis of the case material ahead of the examination. Candidates will find that the time available during the examination is sufficient to answer the compulsory questions, but only if detailed analysis has been undertaken beforehand. When compiling their analysis, candidates should only use the information found within the case, supported by their knowledge and understanding of the syllabus. Candidates are encouraged to use a range of analytical tools and models in order to undertake a thorough investigation of the key aspects of the case. This will improve their understanding of the case and the issues faced by the organisation(s) and/or industry sectors to which it relates. Clearly, the analysis required will vary depending on the specific case content but, as a guide, candidates should consider undertaking the following:

analysis of the external environment using PESTEL analysis analysis of the competitive environment using Porters Five Forces model strategic review using Ansoffs matrix and/or Porters generic strategies stakeholder analysis detailed review/analysis of each of the marketing mix elements product/portfolio analysis (eg using product life cycle analysis, BCG (Boston Consulting Group) matrix, GE (General Electric) matrix) SERVQUAL SWOT analysis.

The copying of pre-prepared group answers, including those written by consultants/tutors, or by any third party, is strictly forbidden and will be penalised by failure. The questions will demand analysis in the examination itself and individually composed answers are required in order to pass. Candidates will then need to condense their analysis into a FOUR side summary (a maximum of four sides of A4, no smaller than font size 11. The content of tables, models or diagrams must be in a minimum of font size 8). The analysis should be numbered for ease of reference when answering the examination questions.

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Professional Diploma in Marketing

Candidates must hole-punch and staple their analysis in the top left hand corner. They should have written their CIM membership number and examination centre name on the top of the right hand corner of each page of the analysis. It should then be attached to the answer booklet on completion of their examination, using the treasury tag provided. Although no marks are awarded for the analysis itself, candidates will be awarded marks for how the analysis is used to answer the questions set. Candidates are advised not to repeat or copy the analysis summary when answering the exam questions. It is important that candidates refer the examiner to the analysis summary, where and when appropriate, when answering the questions. Candidates are only permitted to take their analysis into the examination room. Candidates are not permitted to take in the downloaded case study or any other notes. The invigilator will issue candidates with a new clean copy of the case study at the start of the examination along with the question paper. Candidates may not attach any other additional information in any format to their answer book. Any attempt to introduce such additional material will result in the candidates paper being declared null and void. The Chartered Institute of Marketing reserves the right not to mark any submission that does not comply with these guidelines.

Important Notice The following data has been based on real-life organisations, but details have been changed for assessment purposes and do not necessarily reflect current management practices of the industries or the views and opinions of The Chartered Institute of Marketing. Figures used in tables may differ as they have been compiled from different sources, using a range of criteria. Candidates are strictly instructed NOT to contact individuals or organisations mentioned in the case study or any other organisations in the industry. Copies of the case study may be obtained from: The Chartered Institute of Marketing, Moor Hall, Cookham, Berkshire SL6 9QH, UK or may be downloaded from the CIM student website www.cimlearningzone.co.uk

The Chartered Institute of Marketing 2011. All rights reserved. This assessment, in full or in part, cannot be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without prior written permission of The Chartered Institute of Marketing.

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DELIVERING CUSTOMER VALUE THROUGH MARKETING CASE STUDYPreparation In preparation for the examination you will need to analyse the case material provided. You will be given a clean copy of the case study on the day of the examination, but you must bring your analysis with you into the examination. Your written analysis must not exceed FOUR A4 sides and must include your CIM membership number on each page. The written analysis must be submitted as an appendix on completion of the examination and attached with a treasury tag to your answer book. Role You are a marketing consultant with experience in the motor industry. You have been asked by the Marketing Manager of MINI UK, to advise on a number of marketing related issues, including:

brand management; marketing communications to support new product launches and to increase awareness of the brand and its values; marketing activities in relation to sustainability and corporate social responsibility; the consumer car purchase process; customer service; and the role of MINIs dealerships.

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Case Study: MINIIntroduction The automotive industry is truly a global industry, with manufacturers, intermediaries and customers in all continents. The worldwide industry produced 48 million cars in 2009. When these car production figures are combined with those of vans, trucks and buses, the industry turnover is approximately 2 trillion, making it equivalent to the sixth largest economy in the world.1 The car industry is divided into categories based on the size of the cars. Cars in the smaller size categories are generally the best sellers. Cars smaller than the median account for 67% of total sales (Society of Motor Manufacturers and Traders). In 2009, there were 1.99 million cars registered in the UK, according to the Society of Motor Manufacturers and Traders (SMMT), which was a reduction of 6.4% on 2008, mainly due to the economic climate. The industry body reported that in 2010 total sales grew by 1.8% compared with the previous year. Registrations of new vehicles rose by 35,847 units to 2,030,846 in 2010. However, this was the second lowest volume of car sales in the past decade and almost 375,000 below 2007 levels. Private car sales fell by 5.6% over 2009, although business demand was more resilient, with fleet sales increasing by 10.3%. A hoped-for surge in December sales to beat the rise in VAT failed to materialise. In January 2011, SMMT predicted that sales of new cars would fall by 5%. SMMTs Chief Executive, Paul Everitt, said 2010 had been a year of recovery for the motor industry but that conditions would be extremely challenging in 2011. He added, we are in a difficult period in terms of public expenditure, concerns about job losses and tax increases. MINI Against this turbulent backdrop in the car market, May 2009 saw the 50th birthday of the launch of the original Mini. In excess of 25,000 dedicated fans, from over 40 countries, converged at the Silverstone race track not far from the Oxford car manufacturing plant where the MINI is produced, to share in the celebrations. Despite its purchase by the German car manufacturer BMW, the MINI, a premium small car, is seen as an icon of British modernity. History of the Mini The Mini was born in 1959. Its name reflected the design of the car a small and economical four-seater vehicle. This mini car was a new design and category of vehicle and was introduced in response to the Suez Crisis, during which the availability of petrol was severely restricted. Sales of the Mini were slow to take off. It was a very different type of car from those available at the time, and it was regarded by many people as being too small to be taken seriously. However, sales increased in the 1960s, when the Mini was seen to be driven by many celebrities, including the 1960s pop group the Beatles. This changed the image of the Mini to a classless car driven by people who could easily afford more expensive and luxurious cars. People chose to buy a Mini because of the convenience it offered, especially in a city environment. The Mini also became a major motorsport success in the 1960s. It superseded the larger, more powerful opposition in both racing and rallying. The motorsport success was built on a1

The International Organisation of Motor Vehicle Manufacturers, www.oica.netPage 5


sub-brand of the Mini name Mini Cooper. Cooper refers to the very successful Formula One racing car constructor, John Cooper, who successfully made a proposal to the manufacturers of the Mini to develop higher performance models of the car. The Mini Cooper won in many categories and gained large amounts of publicity in consequence. Cars and drivers appeared on UK television programmes that did not normally cover cars or motorsport, mainly because of the international success that was being achieved. In 1969, the Mini Cooper was the major star in the film The Italian Job. The film is particularly remembered for the performance of these cars. The manufacturers of the car at that time gave no financial contribution to the film and sold, rather than gave, the numerous cars used in the film to the film production company, despite the massive amount of publicity that would be gained from their appearance in the film. Even at that time, other manufacturers realised the benefit of providing cars for films either at subsidised prices or even for free. The Alfa Romeo models seen in The Italian Job were provided free of charge. Mini Lifecycle The original version of the Mini continued in production until October 2000. This is a very long production life for any model of car, as the typical lifetime is around six years. The Mini was a pioneer of the limited edition that is now common in the car industry; these models are introduced to increase demand in the later stages of the life of a car. They were first used on a special edition of the Mini released to celebrate 20 years of production. Typically, the limited edition models had a higher specification of interior materials and equipment, and some had higher levels of performance. A replacement car was developed for the Mini, called the Metro, which was launched in 1980. Although the Metro was successful, continued demand for the Mini meant that it went on to outlive the Metro, which was dropped in 1997 after various revisions and updates. BMW One of the most important changes for the original Mini took place in 1996 as a result of the 1994 purchase of Rover the producer of the Mini at that time by the German car manufacturer BMW. The Mini had rarely been a profitable model throughout its production life, because the cost of manufacturing small cars is almost as high as that for large cars, but prices are much lower. BMW reviewed the Mini and increased the specification and price to guarantee its profitability through the final years of its production, whilst a new model was being developed as a replacement. A branding success the BMW MINI In 2001, the Mini was reborn as the MINI, to differentiate the new version from the original car. BMW had sold off most parts of the organisation it acquired when it bought Rover. However, it retained the MINI brand and used it on the repositioned product. The MINI brand gave BMW a route into a market it did not serve with the BMW range of cars the Supermini category. These cars are smaller and have a lower price than the traditional BMW range. Using the MINI brand for an entry to this category minimised any risk that could be inherent with moving the BMW brand downmarket to the category, but enabled the MINI to be sold within the BMW corporate brand to enhance the image of the car. The new MINI of 2001 was designed and built to take advantage of the heritage of the Mini. It was entirely new in every respect compared with the original design, much larger, but visually representative of the original and it maintained many of the elements that had made the original car iconic.

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Jochen Goller, Director of MINI UK, said that the new MINI was introduced as a technical evolution and a branding revolution. The intention was to change the way the brand was perceived, especially in the UK market where the majority of the production of the original Mini was sold. MINI UK wanted to challenge the established brand values and preconceptions about the car, such as it being a small car, with basic features and traditionally associated with the colour of racing green. The shift was to emphasise the emotional attachment that owners have with their MINI. The new MINI rapidly became a great sales success. BMW had to extend working hours in the factory, adding extra shifts until the factory was working at maximum capacity. This was a long way ahead of the original expectations at the time that the car was launched. In addition, the car was a worldwide success, with sales in many countries including the USA, which had traditionally been a market for large cars. Within the BMW Group, MINI is seen as an entirely separate brand from the BMW brand. The identity of the brand is very different, being predominantly black for MINI, so representing a creative/cool colour which is post-modern and emotional. BMW, in contrast, uses largely white colouring for the brand. The new MINI marketing mix Product The new MINI initially consisted of one basic model design but buyers could choose from multiple options of specification based on three levels of engine performance. With all the different options for colour scheme, interior specification and exterior accessories, a buyer could order a car of their own specification from over 250,000 permutations. There are five basic styles of the MINI:

the core model known as the MINI Hatch an open-topped version, the MINI Convertible an estate version, the MINI Clubman the latest version, the MINI Coup the larger version, the MINI Countryman.

Each model is available in different specification levels:

One Cooper Cooper S.

The power and equipment depend on the level, with the Cooper S having the most power and best levels of equipment. Petrol engine versions of the MINI all have 1.6 litre engines. Diesel engines are also available in either 1.6 or 2.0 litre variants. Although competitors are able to offer a greater variety of engine sizes and specifications, few competitors have the ability to create such a customised specification as the MINI provides. This is one of the appeals of the car a customer ordering a new MINI can have it made just the way they would like it. After the initial success of the new MINI, the product range extended to include a diesel engine in 2003, a new body variant in 2004 and an open-top convertible version that commanded a price premium over the closed version. The convertible was available with the whole range of options of the standard car. This further increased the choice open to customers.

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The new MINI was replaced with a revised version introduced in 2007. This matched the product life of other car ranges far more closely than had been the case with the 41-year life of the original Mini. Again, the revised MINI of 2007 maintained the visual appearance of both the original and 2001 MINI, together with other attributes of the brand. To benefit even more from the appeal of the MINI brand, the product range of the MINI has been further extended. Initially, the extended range came from the MINI Clubman, a larger car with a single rear door for easier access to the rear seats, with more space in the rear and an estate-style body for greater luggage space. Prior to the arrival of the new MINI Clubman, visitors to the MINI website were invited to view a film that mysteriously described the other MINI. Although they were unable to preview the MINI Clubman, they were given the chance to book an early test drive, once they registered their interest. The Clubman name was originally used on a variant of the original Mini that had a redesigned front end. The use of names from the original Mini continued with the introduction of the MINI Countryman in 2010. The Countryman is a small Sports Utility Vehicle (SUV) style car to match the lifestyle aspirations of car buyers, and whilst small for an SUV, it is the largest MINI yet produced. It caters for those who want a MINI but need more space. In September 2011, a Coup version of the MINI was introduced, a two-seater, more sporty version of the hatchback, available only as a Cooper or Cooper S. BMW has planned future developments of the MINI. Both the coup and roadster variants of the standard car were unveiled during 2009, indicating that a roadster is likely to be introduced. Trials have been running for an electric version of the MINI (the MINI E) with a variety of people, including members of the public, using the electric MINI and providing feedback to BMW on this important development for the future of cars in general. At the Geneva Motor Show in 2011, MINI showed a new concept the MINI Rocketman which is smaller than the existing MINI models, closer in overall length to the original Mini. Price Building upon the changes BMW introduced in 1996 with the original Mini, the new MINI was introduced as a premium-priced product for its size, reflecting its specification and the association with the premium BMW brand. The MINI range is priced from 11,810 to 27,255 (excluding the Clubman and Countryman), which compares with a range from 10,865 to 17,465 for the Fiat 500, the closest rival to the concept of the MINI. Other rivals include the Citroen DS3, which ranges from 12,100 to 23,100 and the Audi A1, from 13,420 to 21,800. In comparison, a car sold less as a premium product, the Ford Fiesta, ranges from 9,995 to 15,745. Place and Physical Evidence Following the successful introduction of the new MINI, BMW dealerships built special MINI showrooms within their main showrooms to offer a slight separation of the brand, whilst maintaining the linkage between MINI and BMW. This location reflected the standard of customer service offered with the car a premium service for a car in the supermini category of a level usually only provided by luxury brands. The franchise for MINI is separate from that for BMW, but at present all MINI dealerships are BMW franchisees.

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Franchise agreements are time limited, typically for two to five years, although many dealerships have held franchises for longer periods, with the agreements being renewed. MINI is now sold through 147 dealerships in the UK. All bar one of the dealerships are run independently from BMW/MINI under a franchise-type agreement, the one exception being MINI Park Lane in London, which is owned by BMW. All dealerships have a similar appearance, colour scheme and layout, conforming to standards set out by MINI. These standards cover the internal height of the showroom, the type of lighting used, the style of floor tiles and other elements of physical evidence, ensuring a degree of uniformity across different franchises. The majority of franchises use new buildings constructed specifically for selling MINIs. The buildings are all owned independently, with no ownership by BMW/MINI. In addition to the usual considerations of customer comfort, the showrooms are designed with sustainability in mind. BMW Group has been named the most sustainable automotive company in the Dow Jones Sustainability Index 2011, and the company is now encouraging its franchisees to meet these standards too. MINI dealerships keep a small stock of new cars, which they own themselves, and may also have demonstrator cars available, which are owned by BMW MINI rather than the dealership. Because of the potential to tailor the specification to the customers needs, most cars are manufactured to order, with the dealership helping the customer to choose the options they would like. All MINI dealerships have their own website. The website follows the same visual appearance as the main MINI website, but with some local content included and an emphasis on used vehicles. In addition to sales of cars, new and used, MINI dealerships also offer after-sales service through parts and servicing, and can assist buyers with finance for the purchase of cars. Promotion In re-launching the MINI, BMW wanted to distance the car from any previous traditional marketing campaigns, setting the tone for the future of the car rather than focusing on the past. At the time the company at the time wanted to move away from previous associations with The Italian Job etc, and bring the car into the modern day. BMW also wanted to ensure that potential buyers were determined by their attitude not by their gender, as the car appeals to both men and women. The company adopts a global approach to promotion. It is perceived as a global brand with no differentiation required except in the UK, because of the heritage of the original Mini. With the launch of the new MINI, promotion took place both online and offline and in 1999, a dedicated global website was introduced to support the launch of the new car. In all markets, other than the UK, the strapline Is it love? has been used. In addition, each country has some autonomy to develop and implement localised promotional initiatives, including guerrilla marketing campaigns. Whilst a global approach was used, the UK was treated separately because of the heritage from the original Mini. In the UK, a more avant garde approach to promotion was adopted to emphasise its post-modern and highly individualistic appeal, in order to engage with the consumer on an emotional level. All UK promotions for the new MINI were linked through the strapline of A Mini Adventure. Each television advert showed a highly dramatic MINI escapade, compressed into a short space of time. Branding and all print and other advertising followed the theme. In more recent adverts, the adventurous spirit of MINI remains, but the creative idea has often been more about MINI's wonderful individuality.

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Despite the different straplines and execution, the MINI retains a global brand value and language. 2003 saw a remake of the film The Italian Job. The producers gained major involvement from BMW, which included provision of the cars required for the film (including a brief appearance by an original Mini). BMW promoted celebrity endorsement of the MINI, with the car taking the lead on the endorsement rather than the celebrities the reverse of the 1960s approach. BMW also continued the link with the Cooper sub-brand, making it a key component of the product range and working with the family of John Cooper to produce the higher performance versions of the MINI. In 2010, BMW announced that the MINI would return to world rallying with the MINI Countryman in 2011. This will be the first manufacturer-supported MINI rally team since 1970.

MINI has used national advertising to announce the release of models and to keep people interested in the MINI brand. This includes advertising through online media, press, outdoor, TV and cinema. With 35 million people having access to the internet in the UK, it has become an important communication medium for MINI. Over the years, MINI has created a series of online adverts to attract peoples attention and encourage them to visit the MINI website. MINI also uses flash banners (banners that sit on particular pages of a website) as another form of advertising. Their flash banners incorporate animated images and video, and have been designed so that the viewer can interact with the advertisement. One such example allows the viewer to have a tug of war with a MINI. Finally, MINI has incorporated eye blasters into its advertising campaigns. These are page takeovers or large adverts that appear as a layer over the top of the web page itself. One such example involves a MINI driving across the screen, complete with sound effects. MINI has incorporated the big screen into its advertising campaigns. One cinema advert depicted a MINI driven along a country land and disappearing into the distance. The advert was treated as a feature film, with a classification page and full credits. The film entered the Guinness World Records as the shortest movie ever made, lasting just 12 seconds. Guerrilla marketing has also been used effectively by MINI. This takes the form of unconventional low-budget marketing aimed at maximum impact. All markets for MINI use guerrilla campaigns, which are individual to the country and intended to raise awareness. These campaigns can be run independently within the country without having to gain approval from BMW head office in Munich, Germany. The outdoor advert entitled MINI Christmas Box was produced by Ubachswisbrun advertising agency for MINI in the Netherlands, and was released in December 2009/January 2010. The aim was to convey the MINI brand experience in combination with the low price. The campaign comprised an actual pile of rubbish in the street, the familiar day-afterChristmas street scene, with rubbish bags, Christmas trees and cardboard boxes that presents come in. On top of the pile was a large box with MINIs logo on the outside and a big 99 euro price-tag the implication being that a MINI is an affordable present. The MINI Box was an eye-catcher, with passers-by stopping and checking the box. It spurred conversations and people took pictures and videos. The MINI Christmas Box then spread like wildfire on the internet. The YouTube video was viewed 100,000 times in just six days. The box also appeared on all the leading car blogs worldwide. The campaign was featured in magazines and received outstanding reviews on numerous trend-watching blogs

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and in magazines, resulting in a substantial increase in test drives and car sales in January 2010 compared to January 2009. MINI Undercover was another interesting campaign. Three new MINIs were launched together in early 2007. People who had registered an interest online were sent an email inviting them to see a sneak preview of the new models. The email explained that the MINIs were 'under cover' but that you could release them by pressing 'the right buttons'. The email contained a link that allowed people to click through to a web page where computergenerated MINIs were tearing around in a warehouse under a giant piece of silk. When you pressed a button the MINIs burst out dramatically into full view. In another example of marketing, MINI piloted an advertising campaign in Chicago, New York, Miami and San Francisco, which gave selected Cooper owners the chance to get an RFID key fob in the mail (RFID is radio frequency identification that uses radio waves to transmit information into a product or person for identification and tracking purposes). Users could select a custom message to be encoded on their RFID chip, and when they cruised near an overhanging MINI billboard, their particular message lit up for other drivers to see. Other international examples of creative MINI advertising have included:

a billboard depicting the MINI driving past two palm trees that are curved around the billboard to create an illustration of speed and power a real MINI Cooper hanging from a hand like a yoyo whilst moving up and down a tall building a jet ski that has been designed to resemble a MINI Cooper, to give the impression of a car driving on water a full-size MINI Cooper on display inside a box, similar in style to the boxes used for toy cars billboards in situ on the top of tall tower blocks incorporating a MINI pointing upwards, with headlamps lighting up the sky a real MINI Cooper left hanging from a ski lift.

There are MINI websites in each country where MINIs are sold. This is where all of the credentials for each MINI model are to be found, along with details on financing and insurance. Additional mix elements In the UK, the MINI is available with an optional package that covers all servicing and repairs for the first 50,000 miles (80,000 km) or five years. The package, known as MINI tlc (tender loving care), costs 249, a substantial saving over the cost of individual services for the same period. For an additional 275, this can be extended to 8 years or 80,000 miles (128,000 km). Many of the servicing elements for the MINI can be carried out through the MINI Fast Lane Service, taking no more than 90 minutes. During that time, customers can take advantage of facilities in a customer lounge, including complimentary wi-fi, newspapers and television. MINI dealerships even offer a MINI Spa service, where owners can take their car for a range of cleaning services. Overall, the intention is to provide a painless service for owners to maintain their MINI, even including some elements of fun to encourage repeat purchase. BMW and MINI are the only car manufacturers to publish ratings of their dealership network based on the scores given by customers. The dealership star rating is drawn from customer satisfaction scores from real customers. Information is collated from customer satisfaction surveys conducted by MINI UK for new car sales and aftersales transactions. These ratings

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are shown on the website for every dealership and allow customers to compare the scores of dealerships they may choose from. The ratings also have the benefit of producing an element of competition between the dealerships who all strive to get the highest rating. The MINI Brand Symbolic elements and key associations are important aspects of the MINIs brand appeal. When people were asked to describe the MINI, popular answers included:

fun to be with energetic likes to be noticed cheeky friendly lovable/popular reliable independent entertaining flashy.

Research conducted in 2006 by Simms and Trott2 investigated perceptions of the BMW MINI brand. Customers viewed the MINI as being a unique personality on wheels rather than a car, and it was seen to command technical prowess and promote enjoyment. In relation to three particular areas of the brand they found the following: Brand Image The image of the MINI was portrayed as sporty, fun, fashionable and trendy. The MINI was also considered to be cool, stylish, classy, chic and different. The associations of the MINI with motorsport and the film The Italian Job were key to the sporty and fun, yet chic and classy, image it gleaned. Brand Personality The personality of the brand was found to be based on characteristics (trendy, sporty and attractive), traits (cheeky and fun), demographics (young, British) and the uniqueness of the brand. One area of particular interest from the research was that the image of the brand proved to be far more important than the actual product quality. Brand Associations The heritage of the brand was seen as very important in the research. The MINI was associated with the 1960s, British, Motorsport and The Italian Job. Further associations were related to product attributes such as appearance, handling and the ability to customise the car, as well as its connection with BMW. Sales According to its 2009 annual report, the BMW group sold 216,538 MINI brand cars worldwide in 2009 (-6.8%). The new Mark II MINI Convertible, which has been on the market since spring 2009, recorded sales of 28,303 units, an increase of 22.0% over the2

Simms, C.D and Trott, P. (2006) The perceptions of the BMW Mini brand: the importance of historical associations and the development of a model. Journal of Product & Brand Management, Vol 15 (4).

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previous years sales of the Mark I. At 150,043 units, the total number of MINI cars sold fell 7.5% short of the previous year. The MINI Clubman recorded a sales volume of 38,192 units (-18.9%). In 2009, the MINI brand continued to generate a very high-value product mix. More than a half of customers (53.6%) opted for the MINI Cooper, with 26.2% selecting the MINI Cooper S and 20.2% the MINI One. Conclusion The future of the MINI brand looks assured as a core part of the BMW business. BMW has revealed that in the future, cars at the lower end of the BMW branded range will share major components with those at the higher end of the MINI branded range. The question remains, though: how far can the MINI brand stretch?

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APPENDIX ONE Registrations of new cars in the United Kingdom by marque YEAR TO DATE Company Audi BMW Citroen Fiat Ford Honda Mazda Mercedes-Benz MINI Nissan Peugeot Renault Toyota Vauxhall Volkswagen 2010 99,828 109,418 73,317 53,093 280,364 63,652 45,449 74,977 43,894 89,681 109,324 95,608 87,396 247,265 174,655 % market share 4.92 5.39 3.61 2.61 13.81 3.13 2.24 3.69 2.16 4.42 5.38 4.71 4.30 12.18 8.60 2009 91,172 98,683 72,450 60,337 316,369 74,819 47,934 72,281 39,866 77,924 102,574 63,174 102,612 237,840 161,137 % market share 4.57 4.95 3.63 3.02 15.86 3.75 2.40 3.62 2.00 3.91 5.14 3.17 5.14 11.92 8.08

http://www.smmt.co.uk/2011/01/new-car-registration-figures-full-year-2010/

Registration figures for Great Britain, Northern Ireland, the Isle of Man and the Channel Islands December 2010 2009 % change Mkt share 2010 Mkt share 2009 Total123,817 150,936 -18.0% -

Diesel62,507 64,649 -3.3% 50.5% 42.8%

Petrol59,918 85,312 -29.8% 48.4% 56.5%

AFV*1,392 975 42.8% 1.1% 0.6%

Private52,083 83,319 -37.5% 42.1% 55.2%

Fleet64,003 60,885 5.1% 51.7% 40.3%

Business7,731 6,732 14.8% 6.2% 4.5%

Year-todate 2010 2009 % change Mkt share 2010 Mkt share 2009

Total2,030,846 1,994,999 1.8% -

Diesel936,407 832,456 12.5% 46.1% 41.7%

Petrol1,071,574 1,147,580 -6.6% 52.8% 57.5%

AFV*22,865 14,963 52.8% 1.1% 0.8%

Private958,005 1,014,304 -5.6% 47.2% 50.8%

Fleet973,233 882,415 10.3% 47.9% 44.2%

Business99,608 98,280 1.4% 4.9% 4.9%

http://www.smmt.co.uk/2011/01/new-car-registration-figures-full-year-2010/ *alternatively fuelled vehicle.

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Registration figures for Great Britain, Northern Ireland, the Isle of Man and the Channel Islands continued

1 2 3 4 5 6 7 8 9 10

Best Sellers December Astra Corsa Fiesta MINI Focus Polo Golf Qashqai Insignia 3 Series

5,377 4,737 4,560 4,236 3,831 3,724 3,267 2,841 2,587 2,477

1 2 3 4 5 6 7 8 9 10

Best Sellers Full year 2010 Fiesta Astra Focus Corsa Golf Polo 207 3 Series MINI Qashqai

103,013 80,646 77,804 77,398 58,116 45,517 42,185 42,020 41,883 39,048

http://www.smmt.co.uk/2011/01/new-car-registration-figures-full-year-2010/ Society of Motor Manufacturers and Traders reproduced with kind permission www.smmt.co.uk

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APPENDIX TWO

Volume of UK cars

Units Absolute Size Growth Volume Consumption per capita (population)

2005

2006

2007

2008

2009

2010

(000) New 2,439.7 2,344.9 2,404.0 2,131.8 1,995.0 2,031.0 registrations % -3.9 2.5 -11.3 -6.4 1.8

New registrations

0.0405

0.0387

0.0394

0.0347

0.0323

0.0326

Volume of UK Cars (Estimations)

Units Absolute Size Growth Volume Consumption per capita (population) (000) New registrations % New registrations

2011 2,042.0 0.5

2012 2,112.5 3.4

2013 2,186.1 3.5

2014 2,252.7 3.0

2015 2,345.4 4.1

0.0326

0.0335

0.0344

0.0352

0.0364

Source and copyright: Mintel, Cars UK 2011, Mintel Global Market Navigator, 2011

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APPENDIX THREE

Product category segmentation A B C D E F G H I Mini eg Smart Supermini eg Nissan Micra, MINI Lower medium eg Ford Focus Upper medium eg Vauxhall Insignia Executive eg BMW 5 Series Luxury Saloon eg Rolls-Royce Specialist sports eg Porsche 911 Dual purpose (4x4/SUV) eg Honda CR-V Multi Purpose vehicle eg Renault Espace

Society of Motor Manufacturers and Traders reproduced with kind permission www.smmt.co.uk

APPENDIX FOUR

Forecast UK sales of small and alternatively fuelled cars (AFVs), 2004-14 New registrations of mini cars 000 36.2 27.2 23.3 21.5 28.1 55.0 60.5 69.8 77.7 88.7 96.3 52 75 New registrations of superminis 000 839.6 732.8 753.9 770.6 726.0 885.0 867.7 924.0 910.3 942.4 963.3 5 9 New registrations of alternatively fuelled cars (AFVs) 000 4.2 6.3 9.4 16.6 15.8 14.4 16.2 19.5 24.0 28.1 32.2 243 124 Total 000 880.0 766.3 786.6 808.7 769.9 954.4 9,44.4 1,013.3 1,012.0 1,091.8 1,091.8 8 14

Year 2004 2005 2006 2007 2008 2009 (estimated) 2010 (forecast) 2011 (projected) 2012 (projected) 2013 (projected) 2014 (projected) % change 2004-09 % change 2009-14

Source and copyright: Mintel, Small Green Cars and Alternative Fuels, Market Intelligence, December 2009

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APPENDIX FOUR continued

Volume sales of UK new and used cars, 2004-14* Year 2004 2005 2006 2007 2008 2009 (estimated) 2010 (forecast) 2011 (forecast) 2012 (forecast) 2013 (forecast) 2014 (forecast) New cars (million) 2.57 2.44 2.34 2.40 2.13 1.83 1.74 1.79 1.94 2.05 2.10 Used cars (million) 7.73 7.58 7.58 7.49 7.16 6.66 6.71 7.09 7.37 7.48 7.54

Source and copyright: Mintel, Purchasing of New and Second-hand Cars (The), Market Intelligence, October 2009

Total value of UK car sales, 2004-14* Year 2004 2005 2006 2007 2008 2009 (estimated) 2010 (forecast) 2011 (forecast) 2012 (forecast) 2013 (forecast) 2014 (forecast) Current prices (billion) 62.4 64.5 66.3 69.2 65.1 60.9 60.7 63.6 68.3 72.2 75.3

Source and copyright: Mintel, Purchasing of New and Second-hand Cars (The), Market Intelligence, October 2009* Please note this is only part of the original article.

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APPENDIX FIVE Top five best sellers by segment (UK) 2009 Supermini Model Ford Fiesta Vauxhall Corsa Peugeot 207 MINI Toyota Yaris Segment Total Registrations 117,296 84,478 48,037 39,866 30,040 742,153 Market share 15.8% 11.4% 6.5% 5.4% 4.1% -

Society of Motor Manufacturers and Traders reproduced with kind permission www.smmt.co.uk

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APPENDIX SIX

Sales volume of MINI vehicles by model variant in units Change in % 7.5 1.7 4.2 3.9 Proportion of MINI sales volume 2010 in % 66.5

2010 MINI One Cooper Cooper S Total MINI Convertible One Cooper Cooper S Total MINI Clubman One Cooper Cooper S Total MINI Countryman One Cooper Cooper S Total MINI total

2009

44,268 76,520 35,053 155,841

41,180 75,213 33,650 150,043

4,525 16,613 11,542 32,680

186 16,565 11,552 28,303

0.3 -0.1 15.5

14.0

2,973 19,551 8,793 31,317

2,291 24,265 11,636 38,192

29.8 -19.4 -24.4 -18.0

13.4

1,733 7,770 4,834 14,337 234,175

216,538

8.1

6.1 100.0

Source: BMW GROUP, Annual Report, 2010.

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APPENDIX SEVEN MINI RECYCLING. HARD FACTS. Design for recycling In the early stages of product development, MINI specialists ensure that hazardous materials are excluded from all parts and components. The strategic use of recyclates for component production leads to the reduction of the amount of resources required. Environmentally-friendly recycling processes already exist for metallic components, and it was possible to develop similar recycling processes particularly for the ever-increasing number of plastic parts. In terms of weight, 10% of all plastic parts used in the MINI are made up of recyclates. An optimum recycling quota for the materials used in the construction of the MINI is achieved by placing emphasis on recycling-friendly construction of all components at a very early stage of development. Design engineers are supported by specially developed standards that guide recycling-friendly vehicle construction. Optimised joining techniques and material selection make the economical dismantling of many of MINI components possible. For example, the outer cover of the instrument panel and the shelf below make up a one-material system consisting of . The loading shelf and the seat panelling covers are examples of pure materials. The loading shelf cover is fastened by only an expanding rivet, and can be detached from the MINI within seconds. After a side screw has been loosened, the front seats rear panel can be levered from its clip and rivet joints. These components can then be recycled completely. Overall, the stringent implementation of the "Design for Recycling" philosophy at MINI Development ensured that, as soon as production had begun in 2001, the MINI had already met the recycling quotas stipulated by the EU directive on end-of-life vehicles for 2015. The depollution process Pre-treatment first starts with deployment of the airbags and other pyrotechnic devices. The MINI then gets moved on to what is known as the depollution rig, where the majority of the work is carried out. To simplify this process, the MINI has easily accessible drainage screws and marked drilling points to allow quick and easy access to the operation fluids. Refrigerant and air conditioning gases are drained off. Brake fluid, cooling fluids, engine and transmission oils and any remaining fuels are then removed using a number of specially designed suction tools and intrinsically safe drills. The different liquids are then filtered and cleaned for reuse, where possible. Pyrotechnical components Pyrotechnical components, such as airbags and seatbelt pretensioners, are triggered using a standardised activation device. This neutralises them, eliminating any risks they may have posed during the rest of the recycling/dismantling process. Battery After the battery has been unclamped and removed, it is sent to a specialised recycling plant, where it is shredded completely. The plastics are removed and regranulated,

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with the regranulate used to manufacture new plastic parts. The lead in the battery is melted down and made into blocks. These lead blocks are then used as raw materials for the lead-processing industry. Oil Discharged oils can be refined and reused in the production of new oil. Petrol In the course of dismantling, petrol is removed from the MINI by drilling a hole in the tank at the deepest point, suctioning off the petrol and then sealing the hole. The petrol is either burned for energy production or to refuel other cars. Brake fluid The discharged brake fluid can be purified via vacuum film evaporation in order to reduce the amount of water it contains. The output can be used for brake fluid again. The dismantling process Reuse and recovery increases the recycling quota of end-of-life vehicles. For metal parts, reuse or recycling is already a well-established process. Ferrous metal is the principal material in a MINI and as such accounts for the vast majority of recycled material, and is directly supplied back into the metal industry. Parts and components can be disassembled to be used for the same purpose for which they were originally conceived and manufactured. Glass and many plastics can also be recovered and recycled either at the dismantler or after the shredding process. Engine Depending on its condition, the engine of the MINI is either disassembled or torn out using a manipulator. It is then either sold or sent to the MINI exchange parts production unit. Here, the engine is dismantled and cleaned, and any worn parts are replaced. It is then reassembled and is available for customers as a replacement engine. Alternatively, the engine and transmission are used as metal-rich scrap. The scrap is shredded and sorted, and the metal fractions (iron, aluminium and magnesium) are then reused in metal production. Catalytic converter The MINIs catalytic converter is removed using hydraulic shears, and the precious metals (e.g. platinum, rhodium, palladium) are returned to the materials cycle. They are used, among others, for the manufacture of new catalytic converters for the MINI. Glass During the dismantling process, the MINIs front windscreen is removed using sawing or milling equipment, and the rear and side windows are knocked out. The glass is then sent to a sheet-glass recycling plant. The pieces of glass are then ground down. The pea-sized pieces of glass are sorted, with tinted glass and any foreign bodies being shot out with air blasts. Recycled glass is an integral part of the glassmaking industry, with most of it being used in the manufacture of bottles and jars.

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Alloy wheels During the dismantling process, the wheels are removed from their axles and the rims and tyres are separated. The alloy wheels are then melted down and recycled to form secondary aluminium. Bumper trims After the bumper has been removed from the MINI, it is separated into metal and plastic parts. Rapid dismantling of the large bumper trims, which are made of plastic, is already guaranteed in the early stages of the product development process. All fastening elements are easily accessible, and the construction of the trims enables economical dismantling. The aluminium parts of the bumper trims are sent off to be recycled, and the plastics are ground down, stripped of their paint finish and regranulated. The recyclates are used in the manufacture of parts, such as wheel housings (in terms of weight, 10% of all plastic parts used in the MINI are made up of recyclates). Rear seat panelling After being dismantled, the rear seat panelling in the MINI is shredded and then melted down to form plastic regranulate. Instrument panel cover The instrument panel cover and shelf are made of one-material systems consisting of . These components are destined for economical recycling, aided by a joining technique with quick-release torque screws. The instrument panel cover is shredded, melted down, filtered and then granulated to form plastics regranulate. All plastic components are labelled with the materials they are made of, for rapid identification for separation and optimum recycling. The shredding process The remainder of the MINI is transported, often partially crushed or flattened, to the shredder. Here the hulks are fed through a variety of mechanical and physical shredding and cutting processes as part of a mixed feed. They are finally sorted into their different metal fractions, sizes and remaining materials including plastics, textiles, glass and foam. Body The shredder reduces the hulk to palm-sized pieces. An air separator is used to sort light plastic parts, leather, carpets and textiles, which are then used for energy production. Parts containing iron are separated using a magnet. The remaining non-iron parts will be broken down in a specialised plant in float/sink reprocessing units into aluminium, copper and magnesium fractions, and then used in metallurgical processes. www.mini.co.uk

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APPENDIX EIGHT The Car Purchase Process

1. Purchase triggers

2. Defining needs (brands/models)

3. Budget/finance search

4. Scoping for additions/alternatives

5. Feature/benefit analysis

6. Opinion reinforcement

7. Brand/Model refinement

8. Value search

9. Further options 10. Dealer search

11. Negotiate 12. Purchase

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The Car Purchase Process (funnel stages) A brief description of each of the funnel stages is included below. 1. The purchase triggers or hot buttons (reasons for funnel entry): a. b. c. d. e. f. g. h. i. j. k. l. m. n. Desire for change, time for change Change of job/unemployment Purchasing or selling a property Moving in with partner/getting married The birth of a first or subsequent child Inheritance Current car becoming unreliable Peer pressure Need for improved fuel economy (high fuel prices) Purchase a car with greater safety protection Owned car coming out of warranty Car mileage reaching a certain level Car written off following accident Manufacturer/dealer promotion (discount finance offer)

2. Defining needs At this early stage, car buyers begin to evaluate their requirements for the type of car they require in terms of size, colour, specification, fuel type and price. 3. Budget availability The budget a car buyer has available is the primary factor that determines whether a new or used car is purchased as well as the brand and model choice. The majority of car buyers determine the budget early on in the purchase process and this includes searching for credit finance if they are not purchasers using cash savings. If searching for credit finance, a significant proportion of the research time spent in the purchase process is devoted to finance and trying to find the lowest cost finance as this will ultimately determine the budget available. 4. Scoping The process of determining the budget can often result in awareness of wider brand and model choice. If a consumer realises they can raise more funds than originally envisaged, it can open up a wider choice of brands and models available within an enhanced budget, especially in terms of monthly finance repayments. This is where more emotive elements can enter the purchase process, as consumers begin to think about other potential brands and models they might be able to afford. This is also the stage where the car buyers default brand and model list can begin to be enhanced or rearranged. As the consumers receptive capacity becomes susceptible to outside stimuli, the brain becomes more open to suggestion and almost fantasises about brand and model possibilities. This may be stimulated by seeing a car on the road or in a car park that they may not have considered as being a candidate within their default list. The stimulus could be an attractive design or style they had not really seen before or seeing someone they respect in a car they hadnt considered before.

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5. Cost feature/benefit analysis This is the stage where the rational/emotive trade-off begins as the consumer rationalises their emotive brand choices with the practicalities of issues such as running costs Id love a BMW but I couldnt afford the higher servicing costs. The extent to which the emotional right brain overrides the rational left brain or vice versa will depend on the persons personality type and probably whether they are more introverted and thoughtful or more extroverted and impulsive. An introverted person is more likely to invest time in analysing features and benefits, whereas a more impulsive, extroverted person may not want to invest time in feature benefit analysis and prefer to make a decision based on feelings rather than judgement. Brand values may have a greater influence on the extroverted or impulsive car buyer who relies on their perceptions of a brand to influence their decision. 6. Opinion enforcement When the consumer has arrived at a full choice of models and brands which includes their default choice supplemented by emotive choice additions, they may then begin the process of reinforcing their brand and model choices from external expert recommendations. This might include reading car reviews or seeking peer group reactions to their brand choice to see if their choices are socially acceptable. It may also include talking to the garage that services their current car. 7. Brand and model refinement the shortlist At this stage, consumers begin to reduce their enhanced list down to a shortlist of desirable brands or models (or possibly just a list of models as the brand decision may already have been made in stages five and six). This stage will include beginning to visit dealers to see cars in the flesh and look round them and sit in them to see how their self-concept adjusts or feels adapting or being seen in this new environment. 8. Search for best value Having viewed models, the search then begins to find the best value and at this stage the final choice of brand/model may not have been finalised. Often it will be affordability aspects that determine the final choice of model or brand. This is where the internet is employed to compare prices and specifications of cars for sale at different dealers to arrive at a value bargain. 9. Further brand model options An internet search can sometimes result in unexpected brands and models entering the purchase process which may require further consideration. This may result in the car buyer coming out of the purchase funnel and re-entering at a higher level to re-evaluate their brand and model choices. 10. Dealer selection When they have finalised their brand or model choice, they then identify dealers to contact based on their search for best value. The dealer may then be visited to begin discussions and negotiations over car prices, discounts, enhancements and delivery. This is the stage where the dealer either makes or breaks the sale and will depend upon factors such as the trust the car buyer has with a particular salesperson and how engaging the salesperson is with the car buyer.

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11. Negotiation With the majority of dealer sales staff operating on commission, their willingness or not to negotiate the amount of commission they stand to make on the transaction may determine the outcome. If the salesperson is regarded by the car buyer as being inflexible, the car buyer may well just say Ill think about it and walk away. As part of the sales process, the question of finance is raised. This can also be a deal clincher or deal breaker. Many dealerships rely on the profit contribution from finance and try to negotiate the car buyer into taking dealer finance at a high rate. This can cause the buyer to walk away and start negotiations at another dealer. 12. The purchase When all of the buyers criteria have been fulfilled in terms of car specification, price, delivery and finance, the sale is closed and completed. Source and Copyright: Mintel, The Purchasing of New and Second-hand Cars, Market Intelligence, October 2009.

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APPENDIX NINE The Perceptions of the BMW MINI Brand: The importance of historical associations and the development of a model3 Research methodology Given that it was the aim of this research to develop an understanding of the key components of perceptions of the Mini brand, a qualitative approach consisting of in-depth interviews was considered most appropriate. The interviews would allow stakeholders to express their perceptions and feelings at length in their own words, therefore obtaining insight and understanding. It was also possible to develop insight further through individual probing. A similar approach was adopted by Grace and OCass (2002) in their study of brand associations. This first stage of research consisted of 12 exploratory interviews with opinion leaders. The second stage of the research was to collect information from a number of key stakeholder groups to the Mini brand. Information was collected through depth interviews with guides designed individually for each stakeholder group. Many studies examine consumers perceptions of different well-known and familiar brands (e.g. Grace and OCass, 2002; OCass and Frost, 2002; Chen, 2001). The following stakeholders were sampled for the second stage of the research:

ten new Mini owners; ten classic/old style Mini owners, who were also members of the Mini owners club; ten opinion leaders car enthusiasts working in the Motor trade; ten opinion formers racing drivers, car magazine editors; and three BMW Mini dealerships John Cooper garage and BMW Mini dealers.

Owners of both new and old Minis (who were also members of Mini owners clubs) were clearly considered to have high brand awareness and their perceptions likely to be essential to the brands continuing success. Senior salespeople at Mini dealerships were interviewed because of their influence in shaping the opinions and attitudes of other customers, potential customers, and other stakeholders to the Mini brand. In addition to the preceding stakeholder groups it was also considered important to interview other stakeholders with high brand awareness and knowledge, and whose opinions were likely to shape others, a number of research papers highlight the importance of opinion leaders and formers in these functions (Katz and Lazarfeld, 1955; Flynn et al., 1994). Qualified and experienced racing drivers and car testers were considered important stakeholders due to their high product and brand awareness, as well as their perceived authority and expertise, allowing them to serve a role as opinion formers in the car industry. The opinion leaders and opinion formers groups provided an alternative view of the Mini brand because unlike owners and dealers they had no association with the brand. The size of the four main samples were restricted to ten in the light of the findings of Hastings and Perry (2000) who when following a similar line of research identified that many more interviews resulted in a convergence of themes, and hence basically result in a zero sum game.

Data were collected through in-depth interviews where the interviewee was allowed to lead the dialogue. The interview dialogue was analysed for key words and themes, a similar

3

Please note this is only part of the original article. Members can see the full article via the Emerald collection at www.cim.co.uk/elibrary

Page 28


approach for analysing the results of a qualitative study was adopted by de Chernatony and DalOlmo Riley (1997) and Grace and OCass (2002). Where scales were utilised, a sevenpoint (-3 to +3) differential scale with bipolar labels that had a semantic meaning were used to identify the strength of stakeholders perceptions of particular elements of the Mini brand. The results of the scales were analysed to identify trends and central tendency. Findings Stakeholders began the interview by describing the Mini brand in terms of an overall image, using a number of short descriptive words. These were then elaborated on in terms of many key associations that were important to their perceptions of the brands image. Additional and probing questions then revealed the importance of many of these key associations to perceptions of the brand. The results are summarised in the following sections. Table I identifies that the Minis brand image is described in terms of six primary components (displayed in Figure 1), which have been grouped into three categories in line with the themes identified during the interviews. The brands image was primarily described as sporty and fun, and the results of the interviews revealed that this can be seen to be largely a result of the cars sporty handling, which was frequently described as like a go kart, its connections with Motorsport and John Cooper Racing, as well as the film The Italian Job. These key associations were clearly key to perceptions of the brands image and respondents also described how important these were in making the brand unique. The Mini was seen to have a particularly fashionable and trendy image, which was also described as cool. The brand was also described as having a particularly stylish image, and this style was related to the brands fashionable appeal. The results revealed that this element of the brands image was largely a result of the cars aesthetics, and historical associations relating to the 1960s, celebrity and chic owners of that age, the brands connections with motor sport, and the film The Italian Job. The cars aesthetics were clearly key to this stylish image, which had in turn aided in making the brand fashionable and trendy. The cars aesthetics were described as stylish, cheeky, small, cute, different, modern and classic, again these descriptions are clearly to the brands overall image. The brands history was also key to this part of the brands image, in particular the brands connections with the 1960s, or as three respondents described it the fashionable and trendy 1960s, as well as celebrity and chic owners of that age, including Twiggy and the Beatles. These associations were also key to the brands image being described as chic and classy. Again the brands connections with motor sport and the film The Italian Job were key to this element of the brands image. The Mini is also seen as quite different for a car of its type, due to its heritage, which has given it such a unique image. The Minis image also has some appeal at a practical level, with the brand having an image of providing value for money and quality.

As has already been described in some of the preceding findings, stakeholders associate the Mini brand with many things (see Table II), and most of these associations can in fact be divided into two main categories (displayed in Figure 2). As has been described in the preceding text key associations relating to the product (aesthetics and handling), as well as the brands history and heritage are key to perceptions of the brand. These perceptions have shaped both the brands image and personality. The Minis heritage is of particular importance to the brand and was directly stated as an association by 27 respondents. In addition many other respondents considered particular elements of the brands history and heritage as associations with the brand. The brands connections with the 1960s, as well as celebrity/chic owners of that age, are clearly key

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associations. The brands British origins and Motorsport heritage are also key associations from the brands history, as well as its role in the film The Italian Job. Key product attributes and benefits are important associations with the brand, in particular the cars looks and handling, as well as its ability to be customised. The cars handling and looks have already been highlighted as key to perceptions of the brands image, as well as its personality. The cars ability to be customised was also seen by some to be key to its uniqueness. In addition to these two main categories of associations the Mini is also associated with numerous owners clubs, and the brands recent takeover by BMW. The interviews identified that the Minis personality formed an important part of stakeholders perceptions of the brand. The results presented in Table III identify that the Minis personality was seen as quite unique and is made up of three key human characteristics and two personality traits by which the brand was described, as well as three demographic characteristics (displayed in Figure 3). Stakeholders primarily described the Minis personality in terms of human characteristics and personality traits. The brand was described in human terms as being trendy, sporting and attractive. Probing revealed that the sporting element of the brands personality was related to the cars drive and its connections with motor sport. The brands attractive personality largely resulted from product attractive aesthetics, but also the brands aspirational appeal related to its heritage, which made it attractive to own. The brands trendy personality was related to its connections with the 1960s and celebrity owners of that time. The Minis personality traits were described as cheeky and fun or fun loving, as well as outrageous. Probing again revealed that the cars handling had contributed to the brands fun personality. The brands cheeky personality resulted from the cars aesthetics, its connections with the film The Italian Job and the celebrity Michael Caine. A key element of the Minis personality is its demographics, in particular the brand is seen as young, British, and a brand with an appeal to all ages and people of all types. Some owners described how owning a Mini kept them young, because of its youthful and always fashionable image. This fashionable image was also seen to make the brand appeal to people of all ages and all walks of life, also leading some to describe it as classless. The brands British origins were also a key element of this personality, with stakeholders describing the brand as typically British. The results of the interviews identified that the brands personality is a key element of the brands overall image, the two are clearly closely related and interlinked in the minds of stakeholders.

In addition to the preceding main areas of perception, additional questions were used to identify other possible relevant areas of perception. Of the other areas of perceptions investigated, the interviewees perceptions of the typical owner/user of the brand were particularly marked. Based on the results of the research this would seem to be a middleaged female manager, who is good looking and out going, however, opinions were particularly split (Table IV). However, the most marked perception of the typical owner was that they are likely to be anyone, and in fact owners described that the brands appeal and accessibility to all types of people, from rich celebrities to poor students as one person described, was key to its success. Interviewees were also questioned about their perceptions of the brands culture and values. The Mini brand and the producer of the Mini are seen to have a fun, modern and cool culture (Table V). In this section of the interview it also became clear that the brand itself was associated with the fun loving and fashionable 1960s culture, during which it was particularly popular. However, a significant number of respondents did not consider the

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brand or producer to have a culture, or that this was particularly relevant to their perceptions. In addition it was clear that the majority of respondents did not perceive the brand or producer to any specific values (Table VI). The results in Table VII identify that stakeholders saw the Mini as a particularly unique brand, and the factors used to describe the brands uniqueness clearly highlight the importance of the brands image, personality and associations. In particular this section highlighted the importance of the brands history in making it unique, as well as the brands overall symbolic image. The results presented in Table VIII clearly highlight the importance of the Minis image, respondents consistently rating the Minis image as equally or frequently more important than product quality (with an overall mean of 2.59 for image, compared to 2.04 for quality). Table I Key elements of the Mini brands image Leaders Symbolic Fun Sporty Exciting Stylish Fashionable/trendy Classy/chic Cheeky Classic Modern Different Aspirational Iconic Cult car/following 3 4 3 1 1 2 2 1 Formers 2 5 3 3 2 2 1 1 1 New Mini 6 5 1 1 1 1 2 2 2 1 2 Classic Mini 3 4 1 3 2 1 2 1 2 2 Dealers 2 1 3 1 2 1 1 2 1 Total 16 19 4 9 10 7 3 6 4 8 2 3 5

Functional Value for money Quality

1 -

2 -

1

3 -

1

6 2

Figure 1 Summary of the key elements of the Minis brand imageSporty (19)

Fun (16)

Fashionable/Trendy (10)

Image

Stylish (9)

Classy/Chic (7)

Different (8)

Note: Figures in brackets refer to number of times factor was mentioned by interviewees

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Table II Key brand associations for the Mini Leaders Heritage History/heritage Motorsport 1960s The Italian Job British Michael CaineChic/celebrity owners

Formers 8 2 5 1 3 1 2

New Mini 6 3 2 3 2

Classic Mini 7 3 5 4 5 4 2

Dealers 1 1 1 -

Total 27 11 12 9 12 9 9

5 2 2 2 3 1 3

Product Looks/style Handling Go Kart Customise Other BMW Owners clubs

3 7 2 -

6 3 1 -

4 3 1 2

4 9 2 -

2 3 2

19 19* 6 4

4 -

2 -

3

1 3

2 -

9 6

Figure 2 A summary of the brand associations of the Mini1960s (12) Celebrities (9)

British (12) History/Heritage (27 direct) Motorsport (11) Italian Job (9) Associations Product Related Attributes/Benefits Aesthetics (19) Handling (19) Customise (4) Go Kart (6) Michael Caine (9)

BMW (9) Owners Clubs (6)

Note: Figures in brackets indicate the total number of times that this brand association was identified * [sic]

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Table III Key elements of the Minis brand personality LeadersHuman Characteristics

Formers

New Mini

Classic Mini

Dealers

Total

Trendy/cool Attractive Sporty Personality traits Fun/fun loving Cheeky Outrageous Demographic Young/Youthful Bridges age gap British Classless

6 3 1

7 6 3

2 2 2

2 5 1

3 1 4

20 17 11

6 5 2

7 2 2

5 5 -

5 3 2

1 1 1

24 16 7

5 2 2 -

7 3 5 -

2 2 2 -

4 2 5 3

2 2 1 1

20 11 15 4

Other Unique

4

3

2

4

-

13

Figure 3 Summary of the elements of the Mini brands personalityTrendy/Cool (20) Sporting/Fit (11) Characteristics Attractive (17)

Cheeky (16) Traits Fun/Fun Loving (24) Personality Young (20) British (15) Bridges Age Gap (11) Unique (13)

Demographics

Note: Brackets indicate the total number of times that this element of the brands personality was identified

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The development of a model of stakeholders perceptions of the Mini brand Based on the results of this research the following model of the Mini brand is proposed. Perceptions of the Mini brand comprise three main components or levels (Figure 4). The primary component of stakeholders perceptions is the brands image, detailed in the middle of the diagram, which comprises of functional and symbolic elements. These elements of the brands image relate to the brands rational and emotional appeal, which is detailed to the right of the diagram. In the case of the Mini it is clear that the brands image appeals particularly at an emotional level. The brands image has developed from a number of specific associations, which are detailed to the right of the diagram, in the case of the Mini the key association can be grouped into three key categories; the brands personality, product related associations, and the brands history/heritage. Based on these key findings a model of the brand is presented in Figure 4. The model is specific to the Mini brand and identifies the key interrelated elements of stakeholders perceptions of the brand. The model presented in Figure 4 supports much of the existing branding literature. As is shown in Figure 4, the Minis image may be broken down into functional and symbolic elements, which supports the existing brand image literature (e.g. Bhat and Reddy, 1998; del Rio et al., 2001). The functional and symbolic elements of the brand provide the brand with its rational and emotional benefits and appeal. As del Rio et al. (2001) suggest that the symbolic and functional elements of a brand allow it to serve a number of key functions. In the case of the Mini it is clear that at a functional level the brand serves as a guarantee of product quality and value for money. However, the symbolic elements of the Minis image are clearly of great importance to stakeholders overall perceptions to the brand. Stakeholders identify with the brands image at a personal level due to the appeal of the brands sporty image and drive. As del Rio et al. (2001) model suggests the aesthetics form an important part of the brands symbolic image/appeal. However, in the case of the Mini the cars handling also forms an important part of this image and appeal, providing experimental benefits making the car fun and sporty to drive (which Park et al. (1986) identify as an important type of benefit). The brand also serves a function in social identification with customers wanting to associate themselves with the aspirational 1960s and celebrity lifestyles and the brand acts as a communication instrument of a cool, stylish and fashionable image. It is therefore clear that the symbolic lifestyle elements of stakeholders perceptions of the brand must be effectively managed, in particular the brands heritage is clearly key to stakeholders perceptions of the brand, and marketing communications could be utilised in order to maintain and enhance these perceptions.

Based on this research it is clear that in the case of the Mini brand, its symbolic image is of greatest importance to perceptions of the brand, which can be seen from the diagram (Figure 4). From this research and the model that has resulted it is clear that the key elements of the brand that influence its image and appeal relate to the product itself and the brands heritage. Based on this it is important that activities are targeted at maintaining or enhancing the brands existing image, targeting marketing activities on product attributes, the brands heritage, and developing the brands unique personality. The importance of the product itself to the success of this brand can therefore not be underestimated; it is from the product that most of the brands success has resulted, in particular its sporting handling, connections to celebrities, and motor sport success. Marketing activities could also be focused on enhancing perceptions of the brand at a functional level, targeting perceptions of the brands value for money or quality appeal.

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Table IV Perceptions of characteristics of typical Mini owner Typical MiniClassic Leaders Formers New Mini owner/userMiniSex

Dealers -

Total 6 9

Male321Female441Age Young Middle-aged Older Job position Management Skilled Housewife Personality Image conscious Outgoing Other Affluent Anyone

4 4 -

5 2 1

1 -

-

1 -

9 8 1

6 1 2

3 2

1 1

-

1 -

11 1 5

4 2

1 2

1

-

3 2

8 7

2 2

2 3

1 5

10

1 2

6 22

Table V Perceptions of the brands culture Brands cultureFun

Leaders 4 1 1 1 2 1 3 4

Formers 3 2 1 1 4 5

New Mini 2 2 1 1 4

Modern Cool Dynamic Professional 1960s Exhibitionist No* [sic]

Classic Mini 3 3 6

Dealers 1 1 1 1 1 2

Total 10 7 5 4 4 8 3 12*

Table VI Perceptions of the brands value Brands valueTotal Quality2 Style2 VFM1 No38

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Conclusions and implications The results of this study have identified that the Minis distinct brand image is clearly key to its differentiation; this is supported by the literature on brand image (e.g. Keller, 1998; Bhat and Reddy, 1998). The Minis brand image has developed from a number of key associations, which as Aaker (1991) suggests have given the brand its meaning. This research highlights a number of important associations to the Mini brand, including product attributes, benefits, personality, users and celebrities, and these associations are identified in many elements of the literature (e.g. Aaker, 1991; Keller, 1998; Plummer, 1985). In particular, the research highlights the importance of product-based associations and the brands personality to perceptions of the brand (see Figure 4). The Minis brand demographics are a key aspect of the brands personality, as Thakor and Kohli (1996) and Batra et al. (1993) suggest, and the brands British origin is of particular importance to stakeholders perceptions of the brand, this is particularly salient because of the brands long heritage. However, the preceding literature review on brand image does not highlight the importance of historical associations to a brands image. This research has identified the importance of a number of historically based associations to the Minis symbolic image (see Figure 4), and as Laverick and Johnson (1997) suggest the brands appeal is primarily at an iconically intangible/emotional level, based on the brands history and heritage, although the cars aesthetics and handling are also important to perceptions of the brand. Previous studies of brand perceptions and associations identified in this paper do not fully account for the importance of a brands history to perceptions of a brand, in fact only de Chernatony and DalOlmo Rileys (1998) model makes any direct reference to a brands history. There is therefore a need for further research in order to identify the importance of historically-based associations to perceptions of a wider variety of established brands.

The research carried out for this study did not support the importance of a brands culture and values to stakeholders perceptions of this brand, as suggested in Kotlers (2000) model. However, interpreting the data (Table I) in terms of this model the brands values may be seen in terms of the key elements of the brands image; style, fun and sportyness. Based on these results it may be suggested that the brand values concept does not have as much meaning to stakeholders as brand image (for example), thus the use of words such as values and culture may not be appropriate for interviews, whilst image and personality are of more relevance to their perceptions. As de Chernatony and DalOlmo Rileys (1998) double vortex model illustrates, the Mini brand is made up of a number of important elements, which we have already highlighted. Although the brand is associated with a name, capabilities, personality and risk reducing elements, as their model suggests it is not these constituent elements that are key to stakeholders perceptions, but rather the rational and emotional responses they elicit. Thus, as Murphy (1990) suggests, consumers react to their perceptions of the brand as a whole, in the case of the Mini largely eliciting emotional responses to the symbolic elements of the brands image. The model presented in Figure 4 is specific to the Mini brand; however, the model could be adapted to be applied to the analysis of other brands. The model presents different perspective on a product brand by linking specific brand associations to the image that is developed in the mind of the consumer or stakeholder, and finally linking this to how the image appeals to key stakeholders. Through this perspective it links the brand associations proposed by Aaker (1991), the symbolic and functional image of the brand (e.g. Keller, 1998), and finally the appeal or functions of the brand (del Rio et al., 2001). The model also develops an understanding of how the key associations, which in this case are categorised as being part of the brands history or relating to the product, link to perceptions of the brands personality which is a key element of brand perceptions. By linking together different elements of academic literature relating to brand perceptions this model provides a

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more comprehensive insight into the brand image concept. The basic elements of this model can be adapted to be general to other brands and should [be] tested through further studies, in order to relate the different areas of the literature on brand perceptions and to develop and refine a comprehensive model of brand perceptions. This study highlights the importance of the Minis British origins to perceptions of the brand; based on the importance of this heritage the brands now German ownership will present a future challenge to the management of perceptions of the brand. Based on this research, the decreased number of perceptions of the brands value for money by new Mini owners (compared to old Mini owners), and an increased number of perceptions of the brands quality, suggests that the brands appeal is changing from value for money and towards quality, as a result of BMWs ownership and the launch of the new Mini. Based on this research it is clearly important that the Minis history and heritage are protected to ensure the brands continuing success, it is also important that the brands sporty, fun and stylish appeal is retained. Based on these results, marketing activities should be targeted at monitoring the changing perceptions of the Mini brand caused by these changes in ownership and product offering, and maintaining perceptions of the key elements of the brand image identified in Figure 4.

Table VII Factors identified as making the Mini unique Leaders Formers New MiniImage

Classic Mini 1 4 1 1 1 2 2 4 1 2 3 3 1 3 1

Dealers

Total

Image Fun Sporty Style/stylish Classless Famous/iconic Cool/trendy Young/youthful Traditional Cheap

3 2 3 3 1 1 3 1

5 3 1 3 1

1 1 1 -

11 4 12 9 3 6 6 3 6 3

Product-related Sporty/fun handling Small Stylish looks Associations Name History/heritage British Chic users Customise

3 2

1 2 4

2 2 2

5 1 2

1 1 1

12 6 11

6 1 -

8 2 1 -

3 5 -

1 5 4 -

1 1 2

4 25 7 2 2

Table VIII Importance of brand image versus product quality Importance of image -3-2-10 against quality Image---1 Quality1-11Page 37

1 3 4

2 9 14

3 31 23


Figure 4 A model of the stakeholders perceptions of the Mini brandAppeal/Function Image Associations

Symbolic Benefits/Appeal: Personally identify with Ownership Experience Aspire to be Associated

Relative Price Aesthetics Features: Handling Product RelatedDifferent Fun Sporty Symbolic Classy /Chic Stylish

Relative Quality Characteristics Traits Personality Demographics Typical Owner Era: 1960s

Fashionable/ Trendy

IMAGEFunctional VFM Quality

Functional Benefits/Appeal: Reassurance Affordable

History/Heritage

Origin: British

PurchaseEvent/Application: Motorsport

Film: Italian Job

Simms, C.D. and Trott, P. (2006) The perceptions of the BMW mini brand: the importance of historical associations and the development of a model. Journal of Product and Brand Management, Vol 15(4), pp228-238.

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APPENDIX TEN Mini points to revamped BMW image By Jorn Madslien Business reporter, BBC News, Frankfurt The buzz around Mini's launch of new models at the Frankfurt motor show last week brought fresh hope for the future for factory workers in Oxford. The models may also point to the future of parent company BMW. The two-seater coupe and convertible roadster are both concept cars, though their future as production cars has already been decided. Both will be produced alongside existing Mini-derivatives, the standard hatchback, the convertible and the Clubman. But first, production of a four-door 4x4 cross-over model will begin this winter. "We will open up a new segment with this car," says Ian Robertson, BMW Group sales and marketing director, though he expects the coupe and the convertible to remain niche products. Mini's growing model range is doing much to firm up Mini's role as a marque in its own right within the BMW Group, Mr Robertson tells BBC News in an interview. And "there are plenty of other ideas" for forthcoming models that will further extend the brand, which has already sold 1.5 million cars since its relaunch in 2001. Evolutionary process Both the coupe and the convertible have lower roof lines and a lower centre of gravity than previous Minis. As such, they are taking Mini in a new design directions [sic]. When BMW's first Mini was launched a decade ago it had been designed by Frank Stephenson, who went on to design Fiat's retro-model and Mini-rival, the Fiat 500. "In practice, the Mini had been left unchanged since the first model in 1959," Mr Stephenson, who now works for McLaren, tells BBC News in an interview. So to come up with a model that looked right for the turn of the century, he "designed a Mini for 1969, one for 1979 and one for 1989, the way they would have looked had the brand gone through an ordinary evolutionary process", he explains. The 1999-design was then chosen for production. Electric Mini A decade on, Mini is emerging as a test-bed for BMW's Project I, an autonomous division within the group which is working to identify what the future will bring for the motor industry both in terms of how cars are powered, as well as in terms of new materials, how cars will be used and how they are paid for. In the past, for example, "engines and vehicles aged together", Mr Robertson explains. This may no longer be the case in the future, in particular in the case of electric vehicles such as

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the Mini E which is currently being marketed to customers prepared to take part in research. Like Mini's new coupe and convertible, the Mini E is also a two-seater, largely because the rest of the car is taken up by its huge battery. "There hasn't been a two-seater Mini for a long time," says Mr Robertson. "The last one was a pick-up." This seems to make the coupe and convertible ideal hosts for the company's electric car ambitions, though Mr Robertson will not confirm this. Instead he focuses on how "battery manufacturers are advancing so fast at the moment" so "batteries are getting smaller and less heat generative", hence it is not a given that they will still take up so much space in the future. The crossover has also been mooted as a likely electric model; its elevated stance could help make space for batteries. Story from BBC NEWS: http://news.bbc.co.uk/go/pr/fr/-/1/hi/business/8262255.stm Published: 2009/09/20 15:41:40 GMT BBC MMX

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APPENDIX ELEVEN MINI United Kingdom Corporate Communications Media Information 4th August 2011 FULLY CHARGED: MINI PUBLISHES RESULTS OF UKS MOST IN-DEPTH ELECTRIC VEHICLE TRIAL

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