The BMW Winter Tyres MMS campaign earned 45 million - yes million in new business to BMW

They ran a campaign of under 120,000 MMS picture messages. And that miniscule mobile phone campaign resulted in 45 million - million - dollars in additional business. Business that wes directly attributable - and accurately attributed - to the 120,000 mobile phone messages.

Must be them mad Koreans eh, or the weird and wacky Finns, or the simply different Japanese, eh?

No, this was in Germany. The company who made 45 million dollars out of a tiny messaging campaign was not a pornographer, or a crazy tones subscription provider, nor a phony voting scam on TV, nor some outrageously addictive social networking phenomenon.

It wasn't even a digital business, and the provider was not known for digital innovation. It was that ultimate driving machine company from Bayern, yes BMW. As conservative and "bricks-and-mortar" business as can be, in Germany, far from the leading edge of mobile telecoms.

We've blogged about this amazing mobile marketing campaign, and I have said many times that it is an excellent example of excellence in mobile marketing and advertising, and deserves to win awards this year. It is also a perfect example of engagement marketing, and shows you don't have to create a fantastic mobile social networking service like a Cyworld or Flirtomatic to be able to do engagement marketing well.

So now, our friend Ajit Jaokar, who blogs at Open Gardens, has done a nice analysis of the mathematics and economics of the campaign (with some help from the industry guru Romi Parmar, as well as some very intelligent discussions we saw at Forum Oxford). Ajit breaks it down like this:

The campaign went out to only those BMW new-car buyers who bought their Beemer in the summer season in Germany. Out of all cars sold in 2007, BMW sold 117,000 to private citizens in the summer period (anyone who bought a BMW as part of a fleet, would have bulk buyers for their winter tyres)

The campaign sent out 117,000 MMS picture messages. These cost a total airtime cost approx 60,000 US dollars

The BMW campaign received a 30% conversion rate (ie people actually showed up in a store, and made a purchase) - truly amazing, a brilliant number (internet advertising is happy if they get 5% click-through rates..)

The average cost of a set of winter tyres is 700 dollars, and average cost of tyres plus rims 2,500 dollars. Average customer would spend approx 1,300 dollars.

Multiply that by 30% of 117,000 and we get 35,000 customers who received the MMS message, who appeared at a registered BMW dealer, and bought tyres (or tyres and rims) for their new cars.

Total earned by BMW out of this campaign - 45,500,000 million dollars.

45 MILLION earned by one campaign that cost 60,000 to run.

The return of investment per single MMS ad transmitted was a stunning 758 dollars.

Check out Ajit's full analysis and calculations (and his related postings about the utility - and sometimes lack thereof - of MMS marketing)

But yeah, if you can make 45 million more business using a mobile phone campaign that had transmission costs of 60,000 dollars, then any CFO, CMO and CEO will suddenly question the sanity of running television campaigns that cost millions and newspaper and magazine ad campaigns that run hundreds of thousands, with no way to measure their effect.

Gotta love this business.

Comments

[Romi Parmar]

Tomi, thanks for the mention

...on the other hand you have Ferrari selling €130 million of new cars (499 x Ferrari Scuderia Spider 16M's at €260,000 each) by including (as standard) a touch screen ipod generously loaded with photos, videos and engine soundtracks...

Make the jump over to Engadget Spain for a picture of Apple's touch screen adorning the gorgeous carbon fibre dashboard: http://es.engadget.com/2008/11/09/ferrari-scuderia-spider-m16-posiblemente-la-base-para-el-ipod/

To my mind it's just a great shame it's not the iPhone - i can't think of a single reason why in these tough times the car manufacturers are letting Maybach steal such a considerable lead with their integrated concierge services and matching mobiles? http://www.timesonline.co.uk/tol/driving/features/article3861010.ece

[Tomi T Ahonen]

Hi Romi

Hey, cool stuff, yeah ! And totally agree, why not the real iPhone (am sure its a network thing, couldn't negotiate good deal with iPhone exclusive network and then offered iPod Touch instead. It is silly, every car owner has a phone and most who will appreciate the looks - and extreme performance at the cost of some options - of a Ferrari - will appreciate the iPhone, but a customized Ferrari iPhone, wow, even I would want one of those ha-ha..

Thanks for writing

Tomi Ahonen :-)

[Gidseo]

I'm interested to see what the campaign consisted of - the link in the post doesn't work...

[Tomi T Ahonen]

Hi Gidseo

Thank you for commenting, and I'm sorry the link was broken.

I don't know why, but occasionally a link on the blog does not work - and this was to our own posting earlier this year - which is still live - I don't know why it happened, but I've now re-established the link and it worked at least when I tried it. Please try the link again.

Tomi Ahonen :-)

[Romi Parmar]

If Blyk can put a free SIM and monthly minutes & texts into the hands of ANY young adult in the UK surely someone would supply individuals who can afford a new Ferrari with a $200 unlocked phone and a prepaid annual contract even if they lived on the moon?

Attach a few permission based advertising strings to the offer and I'd say there would be a queue of marketers fighting to reach this affluent demographic.

Challenge for mass market car makers (ie. not the Maybachs etc who should already be doing it!) in 2009: who is going to be the first to say "would you like a Mobile with that?" to all new buyers?

Regards,

Romi

PS. I actually think i saw Vodafone doing something like this a few years ago in Spain or Italy with a bright red (with white gofaster stripes) painted limited edition Ford Fiesta.

[Tomi T Ahonen]

Hi Romi

Yeah, we've seen something like it for a while, in selected markets. And on the simpler side, the Finnish MVNO (Mobile Virtual Netork Operator) Hesburger - a hamburger restaurant chain which is a big domestic rival to McDonald's in Finland - offered a hamburger with a free phone subscription as a bonus..

And the idea is not far from the fashion phones we see with Prada, Armani, Dolce & Gabbana etc. And is not far from the Ferrari branded notebooks, or the Marlboro clothing lines, etc. So yeah, we'll see that for sure.

Let us know if you spot any, I'll also look for it, and we'll blog about any we find here.

Tomi :-)

[cheap ugg boots]

Just wanted to say a big huge CONGRATS on the book! I look forward to reading it, and I love your blog and your column. Can't wait for the new blog

[tiffany]

Thank you for commenting, and I'm sorry the link was broken.

[tiffany jewellry]

thank you for giving us a comment place.
i support your idea.hope you everying goes well.

[linksoflondon]

I have read this article!

[Wrought Iron Furniture]

I read this and its a great article and good brands bmw and iphones!

[Personal Concierge]

nice article , new brands and new businesses are entering new markets and so are the concierge services .

[ptlue.com]

nice share good articles

[Personal Concierge]

With growing demands the cost for concierge service is minimum , its affordable by different classes in the economy , hence its the chance to be the part of modern adopted services .

[Edinburgh Cleaner]

I have just read your article and can't believe the result of their MMS campaign! I guess everything is becoming digitalised...

[carpet cleaning edinburgh]

Great artical! thanks for sharing it with us!

[derek]

good post

[Carpet Cleaning Edinburgh]

"45 MILLION earned by one campaign that cost 60,000 to run." geesh talk about a huge amount of money in return! Id like to meet the person who made up that campaign and get some ideas for my carpet cleaning company haha :)

[Carpet Cleaning Edinburgh UK]

Oh I also forgot to mention that I believe BMW is the most profitable car business in the world. Good way to clean out the competition. :)

[Tomi T Ahonen]

Hi All

Several of the comments seem generic, possibly machine generated, but where there were real people, thank you for the comments.

Carpet Cleaning - thanks. And yes, thats a great way to clean out your competition haha..

Tomi Ahonen :-)