Society for Case Research MBAA 2023

Experience level: 
Beginner
Intended Audience: 
Faculty
Authors: 
Steven M. Cox, Cara O. Peters, Bradley W. Brooks

BMW’s Subscription Business Model: Good for Business or Not So Much?

Luxury performance vehicle brand, BMW, had implemented a new subscription-based policy for customers to access certain features on their vehicles such as high beam assist, heated seats, and heated steering wheel. BMW’s brand appeared at risk as consumers expressed their displeasure about paying for accessing features that were already built-in to their vehicles. Members of the media agreed, and lawmakers even considered legal actions. BMW now faced questions of how the brand would be affected and whether the subscription-based model was the best approach. This critical incident is well suited for graduate and advanced undergraduate courses in branding, consumer behavior, marketing communication, and marketing management. Although not the focus of the incident, an instructor of a course in ethics might also want to utilize this critical incident.