Reference no: EM132610998

Question - Case Discussion

BMW is the ultimate driving machine. Manufactured by the German company, Bayerische Motoren Werke AG, BMW stands for both performance and luxury. The company was founded in 1916 as an aircraft-engine manufacturer and produced engines during World War I and World War II. It evolved into a motorcycle and automobile maker by the mid-20th century, and today it is an internationally respected company and brand with €53 billion (about $76 billion) in revenues in 2008. BMW's logo is one of the most distinct and globally recognized ever created. The signature BMW roundel looks like a spinning propeller blade set against a blue sky background-originally thought to be a tribute to the company's founding days as an aircraft engine manufacturer. Recently, however, a New York Times reporter revealed that the logo, which features the letters BMW at the top of the outer ring and a blue-and-white checkered HSBC also targets consumer niches with unique products and services. It found a little-known product area growing at 125 percent a year: pet insurance. The bank now distributes nationwide pet insurance to its depositors through its HSBC Insurance agency. In Malaysia, HSBC offered a "smart card" and no-frills credit cards to the underserved student segment and targeted high-value customers with special "Premium Centers" bank branches. In order to connect with different people and communities, HSBC sponsors more than 250 cultural and sporting events with a special focus on helping the youth, growing education, and embracing communities. These sponsorships also allow the company to learn from different people and cultures around the world. The bank pulls its worldwide businesses together under a single global brand with the "World's Local Bank" slogan. The aim is to link its international size with close relationships in each of the countries in which it operates. HSBC spends $600 million annually on global marketing, consolidated under the WPP group of agencies. In 2006, HSBC launched a global campaign entitled "Different Values," which embraced this exact notion of multiple viewpoints and different interpretations. Print ads showed the same picture three times with a different interpretation in each. For example, an old classic car appeared three times with the words, freedom, status symbol, and polluter. Next to the picture reads, "The more you look at the world, the more you realize that what one person values may be different from the next." In another set of print ads, HSBC used three different pictures side by side but with the same word. For example, the word accomplishment is first shown on a picture of a woman winning a beauty pageant, then an astronaut walking on the moon, and finally a young child tying his sneaker. The copy reads, "The more you look at the world, the more you realize what really matters to people." Tracy Britton, head of marketing for HSBC Bank, USA, explained the strategy behind the campaign, "It encapsulates our global outlook that acknowledges and respects that people value things in very different ways. HSBC's global footprint gives us the insight and the opportunity not only to be comfortable, but confident in helping people with different values achieve what's really important to them." HSBC earned $142 billion in sales in 2009, making it the 21st largest company in the world. It hopes its latest campaign and continued position as the "World's Local Bank" will improve its $10.5 billion brand value, which placed it 32nd on the 2009 Inter brand/Business Week global brand rankings.

Questions -

1. What are the risks and benefits of HSBC's positioning itself as the "World's Local Bank"?

2. Does HSBC's most recent campaign resonate with its target audience? Why or why not?