BMW invests ‘hundreds of millions’ in digital transformation

The car brand is investing hundreds of millions annually over the next five years as it looks to create a seamless digital experience for customers.

BMW has committed to an annual marketing investment of hundreds of millions until 2025 to digitise its sales and marketing operations, as it looks to create the best customer experience in the premium automotive sector.

The spend will be in addition to existing budgets for marketing and media, Pieter Nota, BMW board member for customer, sales and brands tells Marketing Week.

A new sales and marketing strategy will see BMW build on contact-free sales processes that were developed last year during the Covid-19 outbreak.

Sales staff in more than 60 countries are now able to advise customers and sell BMW and Mini vehicles from any location, and these features will be rolled out to retail partners in further markets during 2021.

Customers will experience the new platform for the first time with the forthcoming launch of the iX and i4 electric models.

Nota says the digital system will enable it to target customers very precisely. “A very important element in our marketing strategy is to generate a high amount of highly qualified leads, customers that are interested in our vehicles,” he explains. “We can play the right messaging to them personally.”

This precision marketing approach will be facilitated by BMW’s ‘agency constellation’ known as The Engine, which launched last year. The partner network is made up of MediaMonks, the Serviceplan Group and Berylls Strategy Advisors. BMW had previously been working with more than 80 agencies, with Nota saying the investment in a more streamlined approach is “benefitting our entire portfolio”.

All change: The complex route ahead for automotive branding

Upgraded digital experience

BMW now plans to let customers buy individually-configured vehicles entirely online and have them delivered to their homes, in a seamless customer journey. However, it says its dealer network will still play an important role in sales and servicing.

The company is optimistic about future performance after strong demand in the fourth quarter of 2020. It now plans to double the sales of its fully electric vehicles with the launch of new ranges, and to increase its total sales of electrified vehicles by 50%, which includes plug-in hybrid models. Electric vehicle owners will be able to specify vehicles and charging plans, to reflect whether or not they have a home charging station, for example, entirely online.

BMW will also extend the range of vehicle functions available as digital aftersales upgrades. Features such as driver assistance systems, light and sound packages, and even suspension set-up will be configurable by digital upgrade.

These packages will be available for limited periods to suit customers who lease their cars, or who want to use a particular feature for a limited period, such as switching on in-car cameras for a family holiday.

It hopes the strategy will increase the long-term profitability of cars. “Even a used car customer can do that once they have purchased that car… we don’t quantify it at the moment, but we are certainly looking at significant business potential there. It might be that a certain customer has not activated [a particular feature] and we can successfully sell it to the second owner,” says Nota.

Customers will also be given the option to share their personal data with BMW Group to optimise their experience. Doing so will enable features such as using a mobile phone as a car key and integrating Amazon Alexa with their car.