Marketing Communications for Toyota Motors - Essay Example

INTEGRATED MARKETING COMMUNICATIONS FOR TOYOTA MOTORS al Affiliation INTEGRATED MARKETING COMMUNICATIONS FOR TOYOTA MOTORS Introduction In the contemporary business environment, integrated marketing communications (IMC) has become an important aspect of marketing plan. Integrated marketing communication is defined as all activities that a company utilizes as channels for brand messaging to promote their products within the target market. Integrated marketing communication has become an important topic as researchers seek to identify the value of this strategy in establishing long-term success of an organization. While there is a concession that this approach has worked well for many companies and that is the major cause for success in increasing sales and maintain high customer awareness, companies are still struggling on the best approach to impact product communication. This article take special attention on the IMC strategy that Toyota Motor Company has deployed, it impact and drawbacks. While the company seems to have benefited from effective marketing strategies, it is clear that the company is still facing a great threat from companies that have engaged more effective strategies in pushing their products within different market segments. Therefore, this article will conduct an analysis of the Toyota’s IMC and provide workable recommendations that the company marketing manager can engage to push the organization to the top position. Company Background Toyota Motor is a Japanese company that has ventured in the international automobile industry since 1937. The company deals with the design of automobile and other vehicles wholesale and automobile parts (Toyota Motor Corporation, 2015). Since its launch, the company has branded itself a medium class company that targets the average class customers. The company’s vision was to produce reliable vehicles and sustainable development of society by employing innovative ad high quality products and services. For the company, marketing has been an important part of its organizational strategies as embedded in its mission statement. The company’s mission has been to provide the best customer experience within the company as one way of winning their loyalty. The company expenditure on marketing is approximately 4% of the total value of the amount that all automobile companies use in media advertisement. The company operates in a competitive market and the sales are considerably affected. Therefore, the company has already experienced a big challenge in the market as competing companies such as Honda, Nissan and Mazda realize considerable growth. Moreover, the company’s image has been adversely affected by a number of issues that have come about in the company. For instance, in 2009, the company faced the “recall crisis” in which the company had to recall about 7.5 million vehicles ad suspended the sale of eight of its brands. As a result, the company lost about $54 million a day which was a great loss economically, and a great blow for its public image as the largest and most profitable company (Toyota Motor Corporation, 2015). Therefore, the company has big challenge in ensuring sustainable development in the complex dynamic automobile market. SWOT Analysis of Toyota Motors Strategy Toyota Company is one of the company’s that enjoys a good reputation due to its marketing campaigns that are customer related. The company strength hails from its ability to launch a conscious brand communication strategy in the international market. The company has loyal customers from all 170 countries where the company has ventured through brand positioning (Berry & Parasuraman, 2004). The company is a leader in manufacturing and production of automobiles being the largest and most profitable company. The implication is that Toyota Motors is a popular brand whose products speak for itself. Putting customers at the forefront has become an important aspect of its marketing campaigns. Strong customer services have become an internal strength and an effective pull strategy that attract customers to their automobile stores. Nevertheless, the company has a number of weaknesses that come from its internal structure. The company has faced a wide range of criticism due to its high product recalls in the 2009 and 2010, which created a bad image of the company (Toyota Motor Corporation, 2015). The company has suffered a wide range of criticism for this failure, which has affected their reliability as a quality producing company. Therefore, the management is under pressure to launch new marketing strategies to clear the bad image and reposition the company in the market (Fitzgerald and Arnott, 2000). Additionally, the company low marketing budgets have become a point of weakness as companies allocate more budgets to push their companies to the market. While this may be a cost-reduction strategy, it is one of the reasons that the company has failed in penetrating the marketing in an effective manner. Secondly, it marketing campaigns have remained traditional relying more on media than current technology of product communication. Nevertheless, the company has an opportunity to engaged innovative brand communication strategies that rely on technology. Secondly, innovation and technology has become more available to develop new products that target the luxury markets (Duncan & Moriarty, 1998). Models such as Toyota Prius and Lexus have become market winners and the company has an opportunity to invest in this new target market. However, competition has become the greatest threat for the company in the past ten years. The company has faced stiff competition for all it products which has limited their economic growth. For instance, the Honda Insight has become a market winner against Toyota Prius, which has greatly reduced its sales in the UK (Toyota Motor Corporation, 2015). Companies such as Nissan and Mazda are targeting the same economic class with Toyota, which is further constraining the market. The global market saturation has become another threat as government seeks measures to control the increase in the number of vehicles within the country. For instance, many countries are advocating for more transport vehicles rather than private car to ease traffic congestion within the country. As a result, the company is facing a big challenge as the market becomes harsher and the incentives of purchase are declining. Toyota Motors Integrated Marketing Communications Toyota Motors is one of the company’s that has leveraged different methods of market communications to push its products to the company. Toyota Corolla’s marketing campaigns in the US and UK markets forms a good ground for the analysis of the company’s marketing campaigns. Toyota Motors has consistently emphasized on the need for strong customer relationship strategies within the target market to ensure that customers are aware of the product values and the qualities (Urban, 2003). In the global market, the main aim of the company’s marketing campaigns has been to promote their products, rebuilding the company image and retain customer loyalty (Westwood, 1990). The Toyota Corolla Corolla model was released as an economic, high quality vehicle. The company intended to make the model an elevating feature to ensure that it rebuilds its image after it was dented by the high recalls of 2009 and 2010 (Toyota Motor Corporation, 2015). Evidently, the company deployed different integrated marketing communication strategies in the two different markets a hence a great different in the brand performance within the two regions. In the US, the marketing campaigns for Corolla targeted the millennial generations especially the middle age customers who were in need for an economic means of transport. The company used show rooms to create a strong customer experience for the new launched product. One important marketing communication strategy was the use of direct selling approach where the customer has a one-on-one interaction with the sellers (Yadin, 1994). This was an important approach to ensure that the customer could communicate freely with the customers. The company used this approach to deliver information to the customers and to market their products features and qualities. On the other hand, the company would listen and respond to customer concerns as soon as they arrive. On the other hand, the company’s strategy in UK was totally different, while direct selling was essential, the showroom experience was slightly distorted and the customers did not have the opportunity to interact with the marketers (Varey, 2002). The company’s few and congested show rooms was a great hindrance to the communication with the customers (Toyota Motor Corporation, 2015). Therefore, the company relied more on customer-to-customer information sharing for its sales. The company believed that since the brand was already popular, their loyal customers would attract more. The Elevate campaign that Toyota started in the US was part of its intention to create product awareness. The slogan of the campaign was “style never goes out of style” to communicate the Toyota Corolla stylish features and how it would bring the same experience to its users (Toyota Motor Corporation, 2015). The company’s intention was to elevate this brand and to push it to the customers. However, these strategies were less featured in UK, as the company greatly depended on it global image. The company launched the product rather unceremoniously and fewer campaigns were evident. The company failed to inform the customers of the product as cost-minimisation strategy. In both countries, media advertisements were more common with the show of many funs of the company celebrating these new models (Rossiter and Danaher, 1998). The company spent a heavy budget on advertisements. Creating a strong out of home awareness was part of its IMC strategies in both countries. Banners and posters were popular across all major highways and within the urban centres. The main objective of the company was to create product awareness and to support customer loyalty. Besides the push strategies, the company has engaged in a number of pull marketing strategies. Pull promotional strategies are used to attract customers to the purchase and to establish loyalty from them. One of the product pull strategies the company has deployed in price-cuts for direct sales (Toyota Motor Corporation, 2015). In both UK and US, the company provided a price cut as one way of attracting the customers. All the price-cuts were communicated through the media and pamphlets and magazines that were availed within the public domain. The company aimed at ensuring that the model was fast moving since offers would help the members of public rush for the purchase of the market. Integrated marketing communication in Toyota Motors has become a winner strategy when analysed from different perspectives. First, it ability to create a strong brand image has become an important aspect. The company has successfully created “products that speak for themselves” in the market. Resultantly, the demand for the company’s product in the US and UK are already high and this becomes an important marketing strategy. The customers are aware of the qualities that the company vehicles offer and the lasting nature of their products. Secondly, the company’s performance in the market over years has been part of its brand positioning strategy (Porter, 2000). As IMC theories suggest, brand positioning is dependent on the awareness that a company makes through the value that its products offers in the market. Secondly, the use of media as an advertisement platform in the US and UK was essential considering the current differentiation of the market segments. However, there is enough evidence that the two markets are completely different and that the company needed to use different messages to launch their products in this market. In the US market, the concept of “style” is more relevant than I the Up, and hence more credible. It is indisputable that the credibility of marketing messages is an integral part of IMC strategies. Therefore, Toyota IMC was more suitable for US but less suitable for the UK, and this explains the low sales of Toyota products in the UK (Toyota Motor Corporation, 2015). UK customers are more concerned with quality and associate this feature with the prices of the products. Therefore, using the same messages in the Up and US was part of the company’s failure to create market awareness in the two different markets. The failure to construct a two channel communication strategies in the Up was another problem with Toyota’s IMC (Amasaka, 2009). The company ignored the consumer messages which would have been essential in winning loyalty from the customers. In the US, direct and personal marketing helped the company to persuade the millennial generation to purchase the Toyota Corolla model. This shows the value of using a two communication channel where both customers and sellers can represent their ideas. As expected, the UK market was less fruitful and there was low volume of sales within this market. From a different perspective, the company IMC was poorly constructed due to its failure to leverage on the modern technology that has become more economic and efficient within the market. During a competitive era, technology has become a crucial tool for international marketing due to its unlimited access across the globe (Ford, Saren & Saren, 2001). Currently, social media has become an important marketing tool for many companies due to its popularity that has been ignited by the proliferation of internet and computer technology (Kotler & Armstrong, 2010). According to the integrated communications theory, a shift from the traditional methods of market to digital market paves way for effective marketing in the modern business environment. Therefore, companies that stick media advertisement are bound to lose constant customer contact at a time where the public are technologically connected and the media is highly specialized. Therefore, over reliance in radio and television advertisement was a weakness in the companies IMC strategy. Recommendations From the analysis of the integrated marketing communications of Toyota Motors Incorporation, there is evidence that over focus on traditional communication strategies has become a source of weakness in the company. The company needs to understand the characteristics of the target customers while establishing their marketing campaigns. For Toyota Corolla, the company targeted the millennial generation, who comprises the young generation who have medium income. The company’s intention was to bring a sense of “style” within the young population through a high quality style-conscious, low-priced model. From a close analysis, the Millennial are among the internet-aware generation who trend more commonly within their online presence (Shimp, 1997). The millennial use the internet more often than traditional media, which makes them more responsive to television and other broadcast methods. On this ground, Toyota Motors should have adopted online marketing in both the US and UK markets. Since the US and UK young generation have a well-established online presence, using this platform would have been a plus for the companies IMC strategies. During the current century, the social media role in product communication has increasingly become more important (Duncan & Moriarty, 1998). In both countries, the adoption of internet and mobile technology has been massive, which explains why companies such as Ford have become more vigilant of online advertising (Komenar, 1997). Toyota should follow the same suit while targeting the young generation. From this perspective, the company should consider creating a strong online presence using both the web platforms and social media advertising. The social media platform would help the company to market its products at a lower budget, which would important for their low-cost pricing model. At a time of price competition, reducing advertising expenses helps to optimize profits. Secondly, social media would be effective in targeting a broader market as more people can share the company’s pages and express their concerns over this platform. Consequently, the company can increase its online sales and reduce its advertising budgets in both countries. Additionally, the company needs to consider the use of customer-centric models of communication within the UK market. A customer-centric model ensures that the customer and company interact more actively and that they can together create value for the company (Rosen, 2000). Evidently, customers are attracted to companies that value their information input than those that do not. In Up, the company failed to provide the same customer service that they offered in the US. As a result, the company failed to win customer loyalty as customer could not access information on the Toyota Corolla which was new in the market. The company seems to have ignored the value for positioning each product within a customer target segment. This was a wrong strategy considering that the model was released at a time when the company’s image was severely injured and there was need to recreate the company’s image. Creating the best customer relationship within showrooms in the UK would reassure the customers of product reliability and hence regain their trust for the product. Lastly, the company needs to consider the customer preferences in each market and find strategies to satisfy each market separately. Behavioural theories of marketing shows that customer behaviour must be considered while considering marketing strategies. Each customer segment is characterised by different tastes, which explains each customer segment responds differently to the same product. Notably, a comparison of the US and UK market shows that the two markets are different and they have different attitudes to the messages created about products. While the US customers are more attracted to a sense of “style”, the UK customers are keener on quality (Pickton, 2001). Therefore, it is essential for Toyota Motors Corporation to conduct thorough market research to understand the dynamics that make each market unique. It would have been valuable for the company to brand itself as a “quality” provider model to win customers for its Corolla model. However, appealing to the stylish feature of the company was a turnoff for UK customers and did not contribute to value in the country (Möller & Halinen, 2000). As a result, the customer’s response was low and the purchases showed the same trend. On this ground, it is essential that the company focus on quality while launching its products in UK. Conclusion In conclusion, integrated marketing communication is the back bone of modern marketing strategies. Toyota Motors Corporation is one of the countries that have used strong IMC in the introduction of the Toyota Corolla model in the UK and US market. However, there evidence of a great difference in its IMC strategies in the UK and US and hence the difference in customer purchase in the two countries. In the US, the company was more vigilant in optimising the customer relationship through effective creating of awareness and heavy budget allocation in the US. However, in the UK, the company used a limited approach keeping the cost low through passive engagement of promotional campaigns (Komenar, 1997). The minimal customer contact in the UK explains why sales in this market remained relatively low. In the US, the performance was much better, though a number of weaknesses were evident. The inability of the company to use social media and online advertisement while targeting young generation was a drawback in its IMC strategies. In future, the should understand the target market before designing the marketing communication methods. Engaging technology would be crucial to reduce the marketing budgets and win young customer who are more popular within this platform. Using research to identify customer preferences will help the company to use effective IMC strategies to position their brands to higher level at a period of increased market competition. Bibliography Amasaka, K. 2009. The effectiveness of flyer advertising employing TMS: Key to scientific automobile sales innovation at Toyota. The Academic Journal of China-USA Business Review, 8(3), 1-12. Berry, L. L., & Parasuraman, A. 2004. Marketing services: Competing through quality. Simon and Schuster. Duncan, T., & Moriarty, S. E. 1998, A communication-based marketing model for managing relationships. The Journal of marketing, 1-13. Fitzgerald, M, and Arnott, D, 2000. Marketing Communications Classics. London:Business Press, Thomson Learning Ford, D., Saren, M., & Saren, M. 2001, Managing and marketing technology. Cengage Learning EMEA. Komenar, M, 1997. Electronic Marketing. Canada: Wiley & Sons, Inc. Kotler, P., & Armstrong, G. 2010. Principles of marketing. Pearson Education. Möller, K., & Halinen, A. 2000, Relationship marketing theory: its roots and direction. Journal of Marketing Management, 16(1-3), 29-54. Pickton, D, 2001. Integrated Marketing Communications. Harlow: Prentice Hall Porter, M. E. 2000, The strategic role of international marketing. Journal of Consumer Marketing, 3(2), 17-21. Rosen, E, 2000. The Anatomy of Buzz. London: Harper Collins Business. Rossiter, J. and Danaher, P. 1998. Advanced Media Planning. Dordrecht, Netherlands: Kluwer Academic Publishers. Shimp, T. A. (1997). Advertising, promotion, and supplemental aspects of integrated marketing communications. Harcourt Brace College Publishers. Toyota Motor Corporation, 2015, The Automobile Industry, Toyota and the World 1997. Aichi, Japan: Toyota Motor Corporation, International Public Affairs Division. Urban, G. 2003, Digital marketing strategy: text and cases. Prentice-Hall, Inc.. Varey, R, 2002. Marketing Communication. London: Routledge. Westwood, John. 1990. The Marketing Plan. London: Kogan Page Limited. Yadin, D, 1994. Creative Marketing Communications. London: Kogan Page Limited. Read More