Contemporary Issues in Marketing- Toyota - Case Study Example

Introduction Technology today plays a crucial role in marketing. This is because it has redefined the roles of traditional marketing tools and new modes of communicating and interacting with the consumers have evolved. This has brought the customer closer to the brand and has helped in building a stronger bond with the consumer. Kotelnikov (2010) adds that technology such as the internet and mobile phones etc are at the consumer’s direct disposal at all times and reaching the right target market can be easy and well defined. However, Schrage (2010) argues that with the technological advancements, the markets have also widened which makes marketing trickier as now there is a plethora of markets and every market has its own individual needs. Thus communicating with every market is different and requires the usage of different marketing tools. Clever combinations of these tools with the help of technology can increase sales manifold or mismanagement of these very tools can hamper sales. It is up to the firm how it wants to get their message across to the target market. However, Kim and Smith (2001, pp. 211-222) adds that incorporating technology has now become essential and every firm now needs to excel in it so that it can face competition globally. Marketing communication Toyota is adept at its marketing communications. This is because it has reached at the top as it is the biggest manufacturer and seller of cars in the world. However, as per Liker and Hoseus (2007) marketing communication have to be varied according to the market segment, their demographics and the economic factors etc. for instance when the firm marketed its car Yaris in the UK after their through market research they focused on women aged 25-50. Kotelnikov (2010) explains that they also relied on integrated marketing communications which means using several media together to get the brand message across to the target market. As per Schrage (2010) they had a pre launch gathering where , then trained the dealers regarding the message, developed personal relations with the media and then after the launch communicated their product to the target market with the same message. The result is that the message stays with the consumers for a longer time. A sales promotion is something that the firm doesn’t focus much on because of the product type. They do have regional sales promotions where they sell different models at a discounted price. This is however limited argue Liker and Hoseus (2007) due to the taxes involved in different countries which affect the prices. To increase the sales in the US, Toyota offered 6 of their models with no interest loans and also extended its years free service offer which increased the sales productively. This also initiated competition and other brands were also pushed to offer similar incentives. According to Schrage (2010) direct marketing and dealership marketing is what the firm also focuses on. Dealers are trained to sell the products and have full knowledge of the car features which they demonstrate to the customers so as to attract them to buy the products. This is essential as misinformation on the part of the dealer may result in the customers deterring from the products and Toyota may lose them to the competitors. As per Kotelnikov (2010) technology has really facilitated this and now the firm can disseminate training information to the dealers in different parts of the world via the internet and mobile phones etc. this would have been difficult and much more expensive to do if technology was not incorporated in it. Marketing communication is also conducted via brochures of the firm and its products. The products details are categorized and the customer has the convenience to now see the catalogue on the firm’s website. This would not have been possible before. Thus Kim and Smith (2001, pp. 211-222) add that before going the dealer the customer has the convenience of actually studying the products in detail. However, this also has its disadvantages as the customer can now also make a comparative study of the competing products that are in the market and be more knowledgeable. This increases competition and endangers customer retention. Marketing research To conduct marketing research, Toyota mostly relies on surveys and interviews. This is because the market for the brand is huge and survey and interviews are two methods that can cover large extents of consumers within a limited budget. Toyota often conducts surveys to ensure what the customers want and their level of satisfaction. Moreover, the firm also conducts surveys to know what sort of a product is required in the market and how best to market it. According to Schrage (2010) since October 2009, 8 million Toyota cars have been recalled. To know the level of satisfaction and trust for the brand the even after the recall, the firm conducted a nationwide survey to understand the satisfaction with the brand. It was found that the level of satisfaction was the same as other brands despite the recall indicating that the recall had a trivial effect on the overall market and the consumers were as passionate about the brand. Schrage (2010) as per a national online panel was used for this survey with 58 Toyota owners and 397 owners of other brands. As per Liker and Hoseus (2007) another example of their survey is that when they were going to launch their Prius, they launched it as their green marketing hybrid car but when these cars were recalled, the firm had to survey the effect of this recall so they used the survey method. When they launched Prius, they surveyed the market by conducting the survey and interview method in the European market to find out if the product which is a smaller and cheaper car, would be a success or not. Kotelnikov (2010) adds that since the company could not reach the entire market, they surveyed samples of the market and based their research results on it. These surveys are of a wider scale as they are online. However, Kim and Smith (2001, pp. 211-222) argue that the drawback of such surveys is that the firm doesn’t know who is filling out these forms and whether they are actually being filled by the consumer or not. Thus although the surveys online can accommodate more consumers, the results are not as reliable. With technology, data compilation, conducting surveys and reaching consumers has become easy. Many times Toyota doesn’t have to research out to consumers or conduct surveys. They can simply find the data on social marketing tools like Twitter and face book. The firm also conducts telephone surveys. To conduct these, call centers are utilized and such technology saves the firm time and effort plus the results are more accurate. Interviews can also be conducted online via voice or video conferencing. Moreover, text messaging is another way of conducting short surveys. This type of survey takes less time and quick and prompt replies can be collected to conduct such surveys. Emailing, faxing and texting etc are much cheaper means of collecting marketing data. However, the results are not as reliable as the traditional sources but it covers a larger market and is a lot quicker. Branding and brand development The brand Toyota has been built around reliability. The brand claims to be reliable irrespective of which product it is. This has created a problem for the whole Toyota brand as recently many Toyota cars have been recalled and the very reliability they were talking about is now questionable and has affected the brand image. However, the brand has several slogans which differ in different markets. Toyota has also varied its slogans over time for instance: "Oh, what a feeling!" (1978–1985, in the U.S.),"Who could ask for anything more" (1986–1989), "I love what you do for me, Toyota!" (1990–1997), "Everyday" (1997–2000)", "Get the feeling!" (2001–2004), and "Moving Forward" (2004–present). (Kotelnikov 2010). They have also used clever quips like “old days of travel for Avalon which defines a lot about the product. As for the products, they have built the sub brands of different products cleverly. Like Lexus is targeted for the upper end market and that is how the brand has been developed-highly priced with premium quality material and style. They were able to do this by using state of the art technology for their product and that is how they helped their brand get a competitive edge. According to Liker and Hoseus (2007) Cuore is a small budget car designed for the price conscious consumer keeping the economic downturn in perspective. It lacks the technological advancements like power staring and automatic gear yet Corolla is another product aiming the middle and the upper middle bracket of the consumers. Thus different products have been focused for different markets and their brand image varied depending on the technology applied to the product. Toyota has also developed hybrid cars which incorporate technology. Their brand image is that of environmentally friendly cars which has raised the esteem of the whole brand in the eyes of the consumers. Recently the brand of the firm has been severely affected because of the recall and the customers are losing trust in it. To regain the trust the firm has to work on building the brand again and improve its reputation with tactful marketing so that the sales are not affected in the long run. Conclusion Technology has become very essential especially in marketing of products. Whether it is communication of the products, their research or their brand development. To reach the consumers firms now have to use innovative techniques so that their attention can be attained. As per Schrage (2010) Toyota has been using technology effectively however; there are still many improvements that they can make. For instance, they can build customer relations and provide impeccable after sales services. This can be done by keeping in touch with them online. Moreover, customer complaints need to be handled more effectively as it directly affects the, market efforts the firm is making. In tough situations like the recall of cars, Toyota has to use the media more effectively and clarify the situation or else its marketing efforts are useless. Sales promotions and promotional offers should be increased as they increase sales. Marketing plans should vary with every market and should not be generalized. This is important as competition is increasing and the customers have become more demanding as they have more knowledge of the market because of technological advancements. The firm should customize their marketing efforts and focus on customers and what media they are exposed and thus market them accordingly. According to Schrage (2010) for now Toyota is doing well but it has to incorporate technology at every level o its marketing efforts. Focused and integrated marketing efforts are a key to retain its number one position. The firm needs this so that the brand remains in the minds of the consumers and they are able to recall the products and build a connect. Integrated marketing will help in reaching the customers at a closer level and be able to hold their attention and focus for a longer time helping them to buy the brand. This is especially necessary so that the firm can send the same message across from the different mediums. Lastly Toyota needs to be more transparent and use technology to resolve their crisis issues. The recalls have a bad effect on the brand which they can correct if they had used technology to reach a wider market and clarify their mistakes using media like television and internet etc so that it may have the least effect on the brand’s reputation. References Liker, J and Hoseus, M 2007, Toyota Culture: The Heart and Soul of the Toyota Way, McGraw Hill Professional. Kima, C and Smith, M, 2001, Consumer evaluation of vertical brand extensions and core brands, Journal of Business Research, vol. 52, no. 3, pp.211-222 Kotelnikov, V 2010, Toyota’s Global Competitive Advantage, on 14th June 2010, available at :http://www.1000ventures.com/business_guide/cs_efficiency_toyota_ps.html Schrage, M 2010, The Toyota Brand: Struggling Online and off, accessed on 15th June 2010, available at: http://blogs.hbr.org/schrage/2010/02/the-toyota-brand-struggling-on.html Read More