Amen.....

And doesn't the message (in other posts....) to grind hard on the dealers worsen the situation of having them stay viable businesses?

I certainly see nothing wrong with wanting to get a 'good deal' or 'fair price', we all want that. But there's a point where it goes beyond that and just helps to put someone out of business if they can't cover their costs and make a few bucks on top of that, for variety of reasons, such as capital to reinvest in business, funds to pay for employee benefits, raises, bonuses, etc....not to mention that other expenses go up year over year (insurance, business licenses, utility costs, etc...).

I say this as someone who had his own business for 14 years. Trust me it's not easy to do successfully and/or profitably.

Agree with the point about lack of marketing raised in the article about the dealer lawsuit. Was thinking about it the other day. I remember 8 - 10 years ago, seeing some great, creative, and amusing advertising about MINI's and how they put the fun into driving experience or should I say 'motoring'.....

There was a great billboard with the top half of a fullsize MINI on it....and the 'Let's motor' series, the one with the text "Actual Size", etc.....those really caught my eye and made me think seriously about joining in on the fun and getting a MINI too.......

Where's the fun in MINI generated now?

Even the MINI dealer aesthically is a downer in my eyes....(maybe I'm too sensitive to this as I used to be an architect/designer...), but I drive up to my dealer and the outside is all black and then black inside....bit too somber to my eyes....

Too many of the MINI colors are too somber looking as well....black, dark brown, bronze-y silver, etc.....not saying those are bad colors per se, but not uplifting / fun spirit like the red, orange, yellow, light blues, etc......

Don't get me wrong, I still like what MINI offers, to the point that I ordered a custom build 2 months ago....so, I'm doing my part to support my local dealer and the brand....and really look forward to sitting in my new blue Cooper S in about 2 weeks when it lands at my dealer. Just think that even in this tough market for small cars, BMW/MINI could be doing much more to get people excited again about the brand and its cars....instead it seems like they've just pulled in their horns and hope they can weather the storm......

Anyway, that's just my 2¢......

YMMV

Void where prohibited by law....



Mark

 

You've teased out a good question. What is the fair price and how is that price found?

Perhaps the best test is the willing buyer/willing seller with neither being required to act test. The "right" price will be what the buyer will pay and what the seller will take, neither being required to act. So I offer to pay less than the seller wants, and we take it from there. I figure what makes it fair is that the seller doesn't have to meet my price, if the seller is willing to let me go buy something else. The problem MINI now has is not enough buyers are finding compelling value at the price point dealers want/need.

So I walk into my MINI dealer, knowing his/her gross margin is 6 ~ 8%, and knowing that there may be other compensation that is not disclosed and, quite possibly, not known or knowable to either me or the sales representative. It is one of the most difficult negotiating situations. How does one find the fair bottom in such a circumstance where the manufacturer is doing all they can to conceal and obfuscate actual cost? How does one find real value when the marketing is all about image and young, trim, happy people having fun adventures, overlooking stunning vistas or zipping around trendy urban scenes?

To add to the problem, we are talking about purchasing something that immediately loses substantial price value as soon as a deal is completed. Which suggests to me that the MSRP is an inflated number and does not accurately reflect the car's true value in the marketplace. I leased a new MINI with an 8% gross profit margin for about 12% below MSRP and the MINI sales manager thanked me for my business. So who knows what that means???

MINI is an interesting value proposition. BMW is trying to turn MINI into a trendy fashion object and BMW is trying to place MINI in an interesting hip/premium/trendy niche that is very difficult to isolate. And they are operating in a shrinking market for small cars, and they are selling against feature-laden small SUV's from Korea, Japan, and Detroit. And BMW is trying to hold the high end of the price range for this niche.

And, MINI is trying to figure out how to evolve its marketing -- and they aren't quite certain who, exactly, their target demographic is. Are they selling $40,000 cars to geezers like me or are they trying to catch 20/30 somethings who have a condo and a dog and no kids, yet.

If you check out the photos for the 2020 Clubman, a "family" is featured, loading their fashionable Clubman. They apparently live in hip housing, wear hip clothing, are multi-ethnic blended hipsters with kids... And then an old white guy like me rolls up to the dealer in a Range Rover and says, "I was gonna buy a Bimmer but I think it might be fun to drive a MINI. I've got no credit issues, I am ready to buy today, oh, and I want a killer deal. I walked out of the other MINI dealer because they wouldn't give me that last thousand off I needed to get in order to say yes" I can only imagine the dealer's thinking, "This clown is driving a $70K Range Rover and he wants to grind me on a $42K MINI????" But the second dealer met my terms for an ordered car built just the way I wanted it and, two months later, off I motored. Yup.

 

YEARS ago I had a dealer tell me he made little from selling cars

all his profit came from the service bays . . . .

***************

dd recently bought an F-57 .... saw a decent internet price then went to 'buyer service' offered by insurance who got a good junk off that number as well . . . car wasn't local but seller even had it delivered via flatbed to her front door. They were anxious for the sale!

 

Since many of the dealerships are publicly owned now, information on profitability is readily available. See https://www.forbes.com/sites/jimhenr.../#6cff78361e6f

 

From one ol' geezer to another, you make a lot of good points....

Agree that MINI/BMW seem to be a bit confused about their target market.

Or perhaps they're now trying to appeal to too many different market niches at one time?

 

Indeed. And MINI's response for 2020 is to raise prices in a falling market and add a bit more "value" with additional content -- yet these boards are filled with comments from die-hard MINI enthusiasts who want manual trannies and none of the added froo-froo stuff. I mean, nav is nice, but the map app we get for free in our smart phones is better. And I say that as a customer who likes all the bells and whistles. But 50 grand for a MINI??? The new fully-kitted JCW Clubman and Countryman are approaching that price point. So, you bet I'm gonna grind hard.

 

More good points....

And if MINI/BMW were smart, they'd have someone looking over the posts on these boards, wouldn't they?

They'd get a lot of good inputs for a lot less than the consultants they probably hire or their in-house marketing folks....

 

Or worse: they've decided their niche is "everyone" - a common problem in marketers but usually not in big brands like this.

I can't see any targeting in their brochures or websites. The updated brand is woefully anodyne. It isn't engaging to anyone; at least the original MINI brand from 2001 was attractive to someone even if it wasn't for everyone.

And "Minimalism" as a brand value when the cars are bigger than ever, and loaded up with gadgets and add ons? Is anyone at MINI brand marketing actually paying attention?

MINI's sales may be suffering from inexpensive gasoline and the American love of truck-styled vehicles. That's a legit trend that affects all car makers. But they haven't articulated why MINIs are a compelling alternative to those vehicles in years.

There are any number of ways they could engage. Nostalgia (it sells Mustangs and Chargers by the boatload). Fun (ditto). Not going along with the crowd (remember zig zag zug?). Flexibility (four door hatches are the best of all worlds). Urban chic (BMW describes MINI as it's city car brand, so go with it). Efficient (the 3-cylinder is pretty great and the MINI E is on the way). Tribal affiliation (urban hipsters, rebellious punks, whatever floats your goat).

Look at MINI USA's home page. It's a pile of service advertisements with a small side of "neat car eh?". No compelling value, no cultural component to get propel to identify with it.

(the forum software seems to have eaten my GIF. Trying again below.)



That is the very model of a boring-a** website that won't offend anyone and won't inspire anyone.

 

gif is working now.

Excellent discussion going on here.

Thought I'd add another gif here because it recalls the more avant garde side of MINI marketing from years ago,
glad to see they can still be irreverently cheeky and fun ...


...but adverts are only part of the equation, the icing on the cake as it were. I think the core problems run much deeper and sadly I'm afraid MINI has a good chance of becoming extinct much like my one time favorite marque Saab --- off to the eleysian fields of orphanhood.

 

Lease is about up on my current MINI. Dealer I did that deal with has contacted me. Found out their MINI store is now "combined" with their BMW Center. The other MINI dealer I visited back in 2016 has also consolidated with their sister BMW Center. Two for two here in a very saturated and competitive SoCal market.

 

Maybe some of these look familiar?

And the last is to remind us of where the MINI spirit came from....

Enjoy!

 

From a reliable source, we are informed that there are still a lot of remaining 2019 MINIs in dealer inventory and sitting wherever unsold new MINIs sit. The theory is that until the 2019 herd is thinned a bit more, MINI will slow-walk enabling MINIUSA web site 2020 builds.

Of course, production has shifted to 2020, so the only way to actually receive a custom build of a 2019 is if somehow a built one that matches your custom build can be located and delivered to you.

A local SoCal dealer told me they have build info for 2020, but can't actually "see" a car they have built. Just build codes.

If you go into a USA MINI dealer and tell them the specs of a car you want, either they find one out in the world that's already built and sitting,or they translate your 2019 build into a 2020 build and order it. If they order it as a Priority 1 build, your new 2020 MINI gets built very soon. If they manage to find a 2019 they can deliver to you that's close enough to what you want, it should be delivered for an insanely good price, IMHO.

Maybe someone can 'splain why this is a good business/marketing strategy.

Donno

 

FYI:

https://www.northamericanmotoring.co...ml#post4484092

 

So lame. My wife is wanting to build a custom 2020 JCW Convertible, we want a 2020 because she wants the new 8 speed transmission. However, she wants to use the online building process so she can see the new interior offerings...and as the closest MINI dealer is on another island, we can't just drive down there to look at a book if they have one :-(

 

Best guess is August for the build feature on the MINIUSA site to be up and running. Just for giggles, you can entertain yourselves on the German or UK versions of the MINI build feature, as both of those allow building of 2020's. Try searching MINI.de or MINI.uk.

 

Received the following from MINIUSA on July 25, 2019, in response to my written inquiry:

"2020 MINI models began production at the beginning of July and should begin arriving on the lot at authorized MINI dealers any day now to view in person. Our web team is also working diligently to update the website and hope to have the website fully updated within the next five to six weeks."

 

It's 2019 guys, you expect us to believe you all haven' been working on this for months? Reply acts like they came into work today and were like "crap, 2020s will be at dealerships soon, we should probably start thinking about updating the website like we do, you know EVERY YEAR".

 

"lure more customers to Mini by adding crossovers"

Is this from 2010? That sounds like what they said when they introduced the Countryman.

Doing the same thing that has been failing for the past five years doesn't strike me as a viable strategy.

 

For July, MINI USA reported 2,827 vehicles sold, a decrease of 34.2 percent from the 4,296 in the same month a year ago.
MINI Certified Pre-Owned sold 1,114 vehicles, a decrease of 16.5 percent from July 2018.
Total MINI Pre-Owned sold 2,585 vehicles, a decrease of 11.9 percent from July 2018.

 

July numbers not so good. But look at inventory for 4 cylinder Cooper S 2 doors across all three main DC area dealers. They can't sell what they don't have. I watch almost daily, and any halfway decent 2 door S they get in is sold immediately (unless it was a customer order and never really available?). Point is, they are selling almost every 2 door Cooper S they can get. And Countrymans are sitting around the lots. Its probably good for me, makes me less likely to impulse buy. But if they ever had a decent color 2 door S with silver (not black) wheels and a non-black interior with navigation, I'd be so tempted. Hope they can weather the storm and stay around for a 20th anniversary in the U.S.!

 

Hard to analyse car sales without looking at the other companies. Here is some reports (Hyundai +)

https://autoweek.com/article/car-new...ers-and-losers
https://www.bloomberg.com/news/artic...o-sales-update

Hyundai is putting out a low cost product and surprise they are winning big.

MINI thinks the weak electric car will save them, I can't see how. Unless they sell enough and the Chinese production is so cost effective that they make big bucks on each one.

 

Thanks for the links.....

Apples and oranges me thinks.......as you say Hyundai is putting out a low cost product......which also means a different end product and high volume mass production to help get to low cost....

Also, the autoweek article you linked to had the following important info in it:

Puts things in a different perspective when you read this......there's a much wider industry phenomenon going on impacting car sales in general...Hyundai and some others may be the exceptions......

Still wondering where's MINI's marketing campaign for their cars, I don't see it......

Think it would be great if they put some great commercials and billboards out there like they used to....

 

Had a long chat with one of MINI's top local General Sales Managers. Here's what I learned:
MINI USA has tightened margins, so the gap between invoice and MSRP is getting ever-smaller. Around 7%
The MAXIMUM available through the MINI USA holdback system is 2.5%, meaning, if a dealership hits the required benchmarks for satisfaction and sales and whatever else is on the checklist, on a $40,000 car, the dealer stands to get an extra $1,000 in back end money.
Dealerships that used to sell 100 cars/month are lucky now to sell 60 cars/month. Dealers are still fuming that MINI spent millions on a Super Bowl ad which generated no noticeable new business while, at the same time, as others have pointed out, the great ad campaigns that distinguished the brand in the past are nowhere to be seen.
Factory financial support is tightening. Support for lease residual rates and super-low interest rates for purchases, and loyalty programs is not there right now.
There is a large unsold inventory of 2019 cars, and some dealers are not taking their full monthly allocations.

If you are willing to buy or lease a new 2019 MINI from dealer inventory, you can probably snag an aggressive deal. $5,000 discounts, including incentives, are happening. Maybe even more on some slow-movers.
If you want to order a new 2020 MINI, there is currently no incentive support and lease money factors and residual rates are the same as 2019 cars.

Dealers are fighting with the corporate people regarding availability of historically popular colors and customization options, which are currently more limited.

The San Francisco MINI dealer that recently closed is reportedly netting about $300,000/month by leasing out the building. Collecting rent on the building is much more profitable than selling MINIs in San Francisco.

More MINI stores are moving into BMW centers, sharing back office and service areas to reduce overhead.

One stand alone MINI store in the crowded Southern California region (where there are several MINI dealerships) is turning into a Volvo showroom!

And, finally, the first electric MINIs will be available in the USA in Spring of 2020. Originally, the plan was to give the cars an 80 mile range, but the dealers shouted that idea down.

And, here in the states, the rumor is that the slow-selling Clubman is on life support. I ordered a 2020 this week, hoping for a late September production date and delivery before whatever Brexit nonsense might come down.. Keeping my fingers crossed that there will be some sort of incentive in place by my delivery month. As of now, the best I can hope for is about $2,500 discount from MSRP, which, if my dealer is eligible for all the back end holdback money, will yield a $1,600 gross profit before sales overhead. If the dealer sold all their cars with $2,500 dealer discounts and no factory incentive support other than holdback, they would be out of business in 6 months.

So, if you want a new 2019, and you're flexible as to color and options, deals are happening on existing inventory. If you order a 2020 now for fall delivery, plan to pay more.

 

Whoa....that's quite the info you got the manager to share!

And thanks for sharing the 'good news'.......not.............

When manager refers to 'corporate people', is this MINI corporate or is it really BMW people?

As for electric, I know that if MINI had a good product with decent range, and eligible for the commuter lane sticker, it would be a hit in the SF Bay Area where I'm located. Otherwise, will likely be a dud.
See tons of Teslas, Prius, Bolts, and 500s here because of the sticker as well as perceived environmental status, etc....

Suppose in some ways doesn't matter, but interesting to know how much if any, autonomy does MINI have regarding brand strategy, etc.

Let's hope that the wisdom/message of the dealers gets heard by corporate people, sometimes necessity is the mother of invention, and that MINI pulls a rabbit or something good out of its hat......

I think with some decent leadership the brand can still do well.