Brand Awareness (was: "old design was oilheads-digest V1 #47")

[Steve Makohin <wateredg@xxxxxxxxxxxx>]

On 1/7/04 10:00 AM, rennsport@xxxxxxxxx rennsport@xxxxxxxxx wrote:

[big snip]
>Lets forget market share and look at brand awareness for a moment...

Okay. I've changed the thread's subject to reflect this.



>I think we can agree that a company can achieve B. A. and not increase 
>market share and increase profit...

Apple Computer, Inc., is a classic example of this.



>There are people out there that do 
>not know that BMW even makes motorcycles (how many of these are 
>potential customers is questionable). When I have told people that I 
>ride a motorcycle, the usual response is; "You ride a Harley?" Maybe 
>BMW wants to remain a niche player selling underpowered motorcycles at 
>inflated prices...

I will stop you here to interject and reposition your statement in a more 
accurate fashion, thus: "Maybe BMW wants to remain a niche player selling 
motorcycles at premium prices that do not compete on a peak horsepower 
basis."

Your statement that BMW motorcycles are "underpowered" is entirely 
subjective. All current BMW motorcycles deliver more than enough power to 
provide an exciting and enjoyable ride, and much more power than is 
necessary to cause a rider serious injury or death. At 130 crank hp, the 
K1200RS (or GT) can hardly be called a slouch. Even a 98 crank hp R1100S 
is more than quick enough for spirited riding with the machine's 
capabilities far surpassing that of most motorcyclists. Are there 
motorcycles with more power? Sure! Are there motorcycles with more power 
for the same engine displacement, or the same motorcycle weight? 
Absolutely! But these are entirely different matters than labeling BMW 
motorcycles as "underpowered" (e.g., BMW R1100S will not win a race 
against a Suzuki GSX-R1000, quarter mile on flat pavement, because the 
R1100S is underpowered for its weight). Imagine a novice motorcyclist 
telling his MSF instructor "I just bought a BMW R1150R so I can learn to 
ride. Don't worry. It's really safe. It's underpowered." LOL!

Also, your reference to BMW's prices being "inflated". How so? I 
recognize that they are higher than a number of other motorcycles, but so 
what? Sony electronics are more expensive than JVC. Does that mean they 
are sold at "inflated" prices? Hardly. If one takes an introductory 
course to marketing, one will learn that there is not a tight correlation 
between the actual cost to manufacture an item and its selling price. 
Market price is dictated primarily by market forces (i.e., what the 
market will bear). If you compare the prices of two identical items in 
identical markets, and one price is higher than the other, then you can 
say it is "inflated." If the markets differ, such as buying a Maine 
lobster in Hawaii versus in Maine, it's much harder to accurately label 
the price as being "inflated" because it is higher in Hawaii. Ditto for 
comparing two different products such as motorcycles that are made by two 
different manufacturers, especially when each manufacturer is aiming at a 
different market.

If you care to argue these points, lets start a different thread so that 
other list members are free to ignore us. Additionally, if nobody on the 
list asks us to keep this discussion online, consider taking it off line.




>...The difference between Ducati and BMW who both have 
>high prices on their high end models is that Ducati delivers a bike 
>with significant power, not so for BMW...

There are many other differences, too. And upon examination of these 
differences, we will see that both Ducati and BMW Motorrad are 
"justified" in their premium pricing. For example:

  o Ducati is a multi-time race winner, and as such, has earned a lot of
    prestige amongst motorcycle fans who are interested in performance
    (or looking like the guys who win races).

  o Ducati is also perceived as The Ferrari Of Motorcycles. There is a
    lot of "Exotic" prestige associated with the Ducati brand of sports
    bikes.

  o BMW motorcycles are perceived to be very reliable, and very durable.

  o BMW motorcycles share in the brand prestige of BMW automobiles.

If we were to look at power as being the justification of a higher price, 
then we should expect Suzuki GSX-R1000s to be amongst the most expensive 
motorcycles, because they *can* be. And that is not the case. It is clear 
that power delivery, in and of itself, is not a clear justification for a 
higher market price when you step outside of a single brand product 
line-up.



>...As far as sport touring models 
>go, Ducati's ST4 is less expensive than BMW K1200RS or R11RS. The same 
>goes for Aprilia, another niche player.

In one of your examples, we are making an "apples to oranges" comparison 
of a 130 hp 4-cylinder BMW K1200RS versus a 117 hp 2-cylinder Ducati 
ST4s, so I am not sure what your point is. Yes, I can buy a BIC pen for 
CAD$1 or a Mont Blanc pen or CAD$130, but does that mean the Mont Blanc 
pen is sold at an "inflated" price? It caters to a different market, and 
it is a substantially different product constructed from fine lacquers 
and gold trim. The people buying a Mont Blanc pen feel justified in 
spending that kind of money for that sort of product. There are other 
premium pens (including a Harley-Davidson brand pen and a Porsche brand 
pen), but Mont Blanc continues to sell pens even though their ink is not 
darker than the others, and in spite of their premium price.

Subjectively, you are free to say BMW's are "inflated" prices. 
Objectively, there is no doubt that premium pricing is in effect for 
premium products.

So what exactly is the point you want to make in your posting? BMW's 
bikes are underpowered and overpriced because other manufacturers make 
products that have more power and are "just as good or better" for a 
lower price? If that's your argument, you are ignoring the reasons why 
most people buy BMW motorcycles. The reasons vary, far and wide, but I am 
confident that "has more power than the others" and "lower price" were 
not high on the list of reasons. For more information on this subject, 
review your archives from the "other" list where people responded to the 
question "why do you ride a BMW motorcycle." It seems that the good folks 
at BMW Motorrad marketing are in tune with what the respondents were 
saying.

- -Steve

 Oakville, Ontario, Canada
 2000 R1100S/ABS, Mandarin


____________
Steve Makohin is an opinionated old codger of 43 years who prides himself 
on being a pragmatist, and for being able to separate facts from 
emotional issues. Even so, he bought his BMW motorcycle for entirely 
emotional reasons without having taken it for a test ride, and after not 
owning a motorcycle for many years. Although a pragmatist, Steve 
recognizes that emotions are powerful human drivers.

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End of oilheads-digest V1 #51
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