BMW Meets MTV in X3 Launch

Entering new terrain, BMW is seeking active twentysomethings with an estimated $30 million-plus push for its first compact SUV, the X3.

The effort, breaking New Year’s Day via Fallon in Minneapolis, consists of an ambitious stew of media, including some new elements for BMW. This is the car maker’s biggest launch since it introduced the X5, its full-size SUV, four years ago.

The campaign’s core element is a 45-second commercial that blends the exotic New Zealand scenery seen in Lord of the Rings with Matrix-style effects. “There are so many different ads in that category—of which we are a small and new voice—we wanted something to stand out that would draw peoples’ attention and attract a younger audience,” said Jim McDowell, vp of marketing for BMW. “We wanted something that a 25-year-old would say was pretty cool when they saw it on TV.”

The spot, directed by Paul Streets, forms the campaign’s creative template. An abstract X slices a running shot of an X3 into four continuously rotating quadrants, making the vehicle appear to be simultaneously tackling different terrains and seasons. The tagline is, “Any weather. Any corner. Any pace. Any passion.”

“For X3, we are appealing to consumers more visually hip than the typical BMW customer,” said Bruce Bildsten, chief creative officer at Publicis Groupe’s Fallon. “We wanted to appeal to more visually sophisticated people who have grown up used to things moving faster, who can visually process more. There’s a lot of SUVs out there and a lot of similar imagery, and we wanted to do something unique.”

The ad was shot in high-definition format, a first for BMW, and versions of it will run across a range of media, including TV, cinema, the Internet and JumboTrons.

Another first for BMW is a media buy, via sibling media network Optimedia in New York, that encompasses all five Bowl games, with the car maker sponsoring half-time shows at the Capital One, Orange and Sugar Bowls; X3 signage will be seen during in- studio commentaries.

TV focuses on primetime appointment viewing, with a return to sports buys during the NCAA’s Final Four basketball tournament. In print, BMW will appear for the first time in youth-appeal magazines such as Rolling Stone, Blender and Backpacker. Online, the TV spot will run on various lifestyle and business sites in the first quarter.

McDowell said the vehicle, which starts at around $30,000 (about the entry price for the BMW 3-Series sedan) is targeting upwardly mobile, younger consumers.

McDowell said the X3 will serve as both a conquest and a stepping-stone vehicle, the absence of which has cost the company. “We noticed we have happy 3 Series customers who leave the BMW family to get a small sports utility vehicle, then after they have done that, they come back and get a 5 Series,” he said. “We think this is the perfect product to help stop that.”

He added, however, that BMW expects the majority of X3s will go to first-time owners of the brand. “We have profited handsomely with X5, but not everybody needs a vehicle that big, and not everyone can swing the price point,” McDowell said. “This makes it possible for the guy with a first job at McKinsey to get a BMW.”

The commercial will break in movie theaters in late January and run for one month. In February, the spot will appear on JumboTron screens in New York’s Times Square, Herald Square and Midtown Tunnel, and on the Sunset Strip in Los Angeles. As it did with its Internet shorts series, “The Hire,” BMW will run wallscape murals in cities including L.A., New York, Chicago and Atlanta.

BMW hopes to sell roughly the same number of units that the larger X5 delivers annually, about 40,000 vehicles. The leading compact SUV is the Honda CRV, which sells more than 120,000 units annually, but it is priced considerably lower than the X3. A closer comparison may be the Lexus RZ-330, which sells approximately 50,000 units annually and “is a little larger, but a serious competitor,” said David Cole, chairman of the Center for Automotive Research in Ann Arbor, Mich. “When you look at the pricing on luxury SUVs across the size range, there isn’t that much difference.”

Cole noted that BMW’s strong brand equity will be key in what he described as the “ruthless” category of car-based SUVs. “There’s such diversity, it’s easy for customers to like everything they see and get confused about what they want,” he said. “[BMW has] a wonderful brand, and it’s probably less risky with a new product for BMW than just about anybody.”

Consultant Todd Turner of Car Concepts in Thousand Oaks, Calif., was also gung ho about the X3’s prospects. “BMW is trying to capitalize on the success they’ve had with the X5 in the midsized luxury-SUV segment,” he said. “They can leverage their expertise and experience and marketplace superiority in the entry luxury-sedan segment as well. The 3 Series dominates that category, so there’s no reason why BMW can’t do the same with the X3. It’s a slam-dunk.”

The New Year’s Day campaign launch is designed to bring in preorders. “We have a remarkable situation that we have two X3s at every dealership prior to normal production,” McDowell said. “So we expect a lot of orders on Jan. 2.”

This year has been BMW’s busiest, with its most dense array of model launches, most in the second half. But “X3 is our single most important launch out of this series,” McDowell said, “and in 2003 we have saved our marketing budget until we needed to launch all the new products.”