The Toyota Company the third largest car manufacturer. The Toyota Company has a reputation for building affordable and convenient vehicles to meet the unique requirements of consumers. It improved its models and designs to fit different requirements. Competition is stiff. These factors made Toyota Company re-think its marketing strategy. Generally, in the last decade, all the major car manufacturers have had to shift their strategies. They have all upped up their efforts to penetrate the market. This has seen them explore the digital and social media advertising, in a bid aimed to improve their visibility.
The biggest challenge that has contributed to Toyota rethinking its marketing includes a damaged reputation. The negative reputation caused acceleration recalls, government fines running into millions and lawsuits. What occasioned this was the fact that Toyota Company released so many car models into the market. The brands could not sell and Toyota had to device a new way of selling cars.
As a result, the car units piled up, creating a situation where Toyota's capital or investment was tied up in stock. Super vehicle models did not sell much as they do today. This placed the Toyota Company in an awkward situation. The cars sold on mere reputation. It manufactures vehicles that are faster and can adapt to most roads. With the recalls began the problem of low sales. Toyota Company feared that it would lose the Camry model, the brand that enjoyed 10-year crown. The Camry brand sold most cars in the USA, followed by the Honda brand. As of 2009, Toyota had sold over 30 million cars in different parts of the world. At the start of 2013, it sold more than 40 million units.
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Toyota Marketing Strategy
In a bid to recover lost market share, the Toyota resorted to the digital and online marketing of its car brands. Online and digital advertising proved cheaper and more reliant than the traditional advertisement. Online and digital marketing provides a larger marketing platform than other forms of advertisement.
Online marketing involves platforms such as Facebook, Twitter, YouTube and websites that Toyota could use to reach many customers. The Toyota estimated that it would save up to $ 70 million dollars in advertisement fees. It aimed to increase its market share. The managing director stated that other media options had failed, prompting the company to consider digital marketing (Miskelly, 2013). Radio, television, and newspapers did not always give full details of all the facts as stated, prompting the company to go online. These hurt sales since most people did not understand the terms and conditions of sales or transactions that they were getting into with the Toyota (Osono et al, 2008). Again, the TV, Radio and Print media audiences were shrinking. This meant that more people could not assess the advertisements, as Toyota had projected before.
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The costs of placing an advert on the print, audio or recorded media were higher, making online marketing to be the most viable option left. As a result, Toyota took an aggressive program within a period of five years to improve its search engine efficiency by a considerable factor. The Toyota improved its website budget, and within a short time, the budget directed towards electronic marketing ran into millions of dollars for the first time. The traditional marketing-the television, radio and newspapers-had never appealed to the Toyota Company. A traditional advertisement was not as precise; they brought low returns and therefore not feasible given the huge budget the Toyota Company pumped into the advertisement. The Toyota also strategized to launch the Orion and Camry models. In order to sell them and have a wide distribution of them, Toyota would have to involve the use of electronic and direct online marketing strategies in order to penetrate the market.
The managing director equally stated the global strategy of the carmaker; to apply the mantra, Kaizen, which basically imply a million steps forward. This would reduce the market budgets for the local market. It would reduce by one percent the advertisement cost of marketing annually. In terms of production, this gave the Toyota a great advantage; a competitive advantage as well (Davies, 2004). Due to the reduced cost of advertisement, the Toyota lowered the prices of its units. This attracted consumers and buyers, and the overall effect was increased in sales. Though, due to logistics, this would not come easily. The Toyota involved about eight communication and advertisement agencies to assist in the expanding its digital marketing. Some of the agencies that the Toyota contracted included suppliers Saatchi & Saatchi, the Hothouse and the Boomerang Integrated Marketing. Online marketing has the following advantages.
High interactive level
The online and digital media held the promise of a high interactive level among users. The Toyota management team reckoned that through this, it would expose its models and brands many viewers through interactive platforms such as Twitter and Facebook. The more referrals they got the better.
Online marketing provided a high consumer target for buyers and sellers of the Toyota units. Of course, the units had distributors, who also the Toyota Company would integrate into the marketing mix through Toyota's mainstream websites that potential buyers could access via the Google Search Engine. They linked the websites with major interactive social media sites such as the Facebook so that when one clicks the access buttons, pop-up links re-directed users into the Toyota Company's websites. The management at the Toyota Company used this to help improve the popularity of the carmaker. Overall, the company increased sales of the newer units and release the unmoving units into the market at lower prices (Hasegawa & Kimm, 2008). This strategy helped the Toyota realize a significant amount of money that it used to bolster production.
The current market is versatile and requires new technologies. As such, the Toyota Company used online technology to sell car units. In a world where most people prefer technology, the Toyota Car Manufacturer considered online marketing as the best strategy it would use to increase market share. Technology made it possible to advertise online with companies such as the Toyota Company. It took the advantage to boost sales (Wimmer & Muni, 2012).
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Large potential audience
Online marketing and digital marketing offer the promise of reaching many potential customers. The Toyota Company saw this beforehand and invested in this marketing strategy in a bid to bolster sales and improve returns. Given that the online marketing offers 24-hour availability the Toyota Company considered it the best marketing strategy. It offered a more and improved seller-buyer interaction for the company. The Toyota Company management reckoned that online marketing was the best marketing strategy since it held the prospects of high information exchange among potential or serious buyers and the marketing support team. The Prius audience communicated through a range of means with the support staff. The means through which they communicated included email, Skype and voice dials.
These means of communication were more interactive than the traditional means of advertisements, the Toyota reckoned. Another advantage for the Toyota car manufacturer is low production costs in the designing and hosting of the web pages on their search engines.
Toyota Company hosted most advertisements on their web pages whose domains they paid for beforehand. Owing to improved marketing strategies, the Toyota Company saw the sale of Corolla units shoot by 5%. The integration of online and digital marketing also saw the sale of Camry units plummet by a significant margin.
Toyota developing strategy for growth
The Toyota evaluated the potential strategy it could use to capture potential markets. Ever since the Toyota entered the US market, some time back in 1967, the Toyota has undergone significant transformations in its business portfolio; it had many car brands that suit different conditions and budgets as well. The Toyota Company released the Lexus and the Scion as the most exotic brands into the market. The Toyota uses online marketing as a platform that allows it to attract customers and expand its range of products in other segments of the market. When the Toyota cars first got into the US market, Toyota's competitors did not consider them a threat, since buyers considered their vehicles less attractive. Other car manufacturers felt that Toyota vehicles posed no significant threats in the market.
However, with good marketing strategies, it became a force to reckon with. The aggressive marketing of the Toyota cars in the USA was fueled by strategic planning and marketing (Wimmer & Muni, 2012). But when the competition became stiffer, the Toyota Company resorted to online marketing, as well as the digital marketing. It sold more cars since the cars were cheap and fuel-efficient; more efficient than the American cars and they were also environment-friendly. It used the online marketing strategy to market the Lexus as a separate entity. This gave it an edge over the other car manufacturers, as they stood out with their Lexus design that it sold rather cheaply than the ones built by its competitors. It marketed its luxury models separately to give it a competitive edge over the other car manufacturers.
With time, with the evolution of newer and "youthful" models, Toyota began experiencing problems. The Toyota focused primarily on youth-oriented media such as MTV, late-night programming and the Rolling Stone. The Toyota Company used these as a platform to highlight its brand philosophy. It engages in corporate sponsorship to improve its visibility. A strategy that the Toyota developed is targeting the youth market. Through these moves, the Toyota encourages young buyers to purchase, but it is also likely to influence the Nissan and the Honda to bring in new youth-oriented cars to provide a variety for their cars and improve its portfolio.
The success of Toyota is attributed to its ability to spot growth and development opportunities. It then develops the best marketing strategies to capture the growth opportunity. Some of the opportunities the Toyota company takes advantage of is the youth market, the emerging trends and the evolution of elegant but luxury cars. The latest opportunities the Toyota identified include the creation of the Scion and the Lexus brands.
They proceeded to market them through digital and online platforms so that they reached the intended market population, with the youth as the main target. The Toyota took advantage of the fact that young people are trendy and flashy, and that they would like the car designs. They used the online platforms to reach a sizable market, making most of their sales on the platform that they produced less-fuel consuming and economical vehicles. It identified new opportunities that allowed for developments in the market. The Toyota Company can downsize their products such as the MR2 and the Celica.
The online marketing strategy has made their products-cars of different designs and usability-more visible and deeply penetrated in the market. The Toyota Company uses online technology, digital media, and massive youth-based products based on their trends and tastes to market their cars. It collects opinions online as well on the designs and qualities of cars that best work for them.
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Online marketing was instrumental in seeing the growth of the Toyota car manufacturer, to its current state. As a result, the Toyota Company made a turn-around from near-collapse of its current successful state. It realized the possible fall when it posted poor returns on tax. The Toyota management looked at possible causes of the poor performance. Through extensive study of the market, Toyota decided that it had failed due to poor visibility. It re-strategized and let go of the old traditional advertisement it had used previously-the newspapers, the radio, and TV-since the platforms were expensive; cumbersome to deal with, and they left out crucial information such and sales policies, terms and conditions of sales.
On the contrary, online marketing allowed Toyota to acquire new customers, mostly the youth, due to the fact that the youth are trendy and flashy and these cars matched their specifications. The online marketing allowed for an improved connectivity and clients could easily find information and answers they needed on the Toyota websites.
Proper and timely use of the online marketing strategy worked for the Toyota. Despite a false start, it investigated the possible causes of the decline in sales and reacted to correct the situation. As a result, the Toyota invested in online marketing strategy. With time, it had curved a niche of the market among the youth, their main target, and it was on the way to full recovery. It used Toyota web pages, Facebook and Twitter to boost sales. It improved sales and marketing to achieve growth and development.