Last winter, German ski legend Rosi Mittermaier had passed on some racing tips at Austria's Zillertal to a group of 10 students who shared one common thing: they all owned a BMW 7-Series sedan. Coincidentally, BMW, famed for producing high-end luxury cars to woo car enthusiasts, also began offering perks last year in a bid to win the loyalty of its most profitable clients. This initiative is also being referred to as “offering perks that money can't buy to owners.” BMW's arch-rival, Mercedes-Benz, too, joined the bandwagon with a similar initiative of its own. Notably, the respective initiatives taken by both premium car makers were in-line with response to increased sales of more exclusive Maserati and Jaguar brands. With competition intensifying to new extremes in the automobile market, the aim of these premium car makers has no doubly shifted towards retaining their most elite customers and winning their loyalty to prevent them from reaching out to other luxury brands. Thus, such programmes that are being heralded by these auto makers seem to be pretty logical. BWM is also striving for the same noble cause and want to keep its biggest spenders engaged for a lasting impression and relation.
Both BMW and Mercedes, with their respective alluring preferred-customer programmes, are trying to strengthen their relations with potential customers who are able to afford any car they want. Furthermore, these initiatives, as seen from BMW's and Mercedes-Benz's perspectives, are aligned with their eagerness to flourish as the world's leader in upscale cars.
As arrangements are made by BMW, any person who buys a 7-Series will automatically become the member of the exclusive BMW Excellence Club that started back in July 2012. However, such an opportunity is currently being offered only in Germany. This programme allows members to be entitled to attend events like skiing with two-time Olympic ski gold medallist Mittermaier. Club members also entitled to benefits like a chance to attend the private golf tournament ahead of the BMW International Open or an exclusive opportunity to spend evening, which will be hosted by Thomas Gottschalk, a television celebrity from Germany. Stephanie Boeckler, Project Manager, BMW Excellence Club in Germany, had reportedly said, "The aim is to retain these customers, and we think we have an attractive package that encourages them to stay. It's important to be in contact with buyers of the brand's flagship model.”
It must be mentioned that such high-profiling of customers and luring initiatives do reflect the fact that there is a lot at stake for BMW and Mercedes-Benz. Notably, Mercedes has committed itself to surpass BMW in terms of sales and profits earned by the end of this decade. On the other hand, BMW too would not like to dissipate its advantage to its rival. From this perspective, a strong market presence is certainly a key for both auto makers.
Notably, luxury sedans and coupes together generate a profit of about 15 per cent of the sales price while other across premium segment average margins are around 9 per cent. These vehicles also add a distinguishing mark to higher volume models like smaller sedans, wagons and compact models. Juergen Pieper, a Frankfurt-based analyst with Bankhaus Metzler said, “Above and beyond the profit impact, the luxury segment has a strong halo effect on the brands. That’s especially the case for Mercedes, which is the traditional leader in sales for top-of-the-line luxury cars.”
