How to Make the Toyota Brand Greater Than It Is Today - Research Paper Example

Table of Contents Executive Summary 2 Introduction 3 Basic Background Information on Toyota 4 Objectives of this Report 7 Research Methodology 7 Data Analysis on Marketing Issues (e.g. Current Brands, New Product Development, Distribution Strategies etc) 8 Current Brands 8 New Product Development 9 Distribution Strategies 9 Market Segmentation 10 Practical Strategies for Future Plans 12 Recommendations 14 Conclusion 16 References 17 Executive Summary The report contains brief and basic background information on Toyota. This helps in understanding the core purpose, mission, vision, goals and objectives of the company. It also aims to understand what strategies Toyota has been using all these years. This is with the sole aim of identifying if the strategies are working or not. It provides a platform for the formation of ideas on how to make the Toyota brand greater than it is today. This is in line with emerging competitors especially from the United Arab Emirates. Toyota brand is one that has evolved over the years. This is from the day that it was created to the current date. What is to be observed is the fact that Toyota realises the need to employ organizational behaviour and change. There is need for organizations to employ change everyday. The world has new expectations everyday. This is the reason that propels Toyota to ensure that they have embraced new techniques of operations. This is with the aim of ensuring customer satisfaction. Toyota’s strategies have undergone metamorphosis to ensure reduced competition. Marketing strategies which are customer based are hard to fulfil. Toyota has ensured that it has taken time to critically analyse the market. Analysis of the market has enabled them to know what the consumers want. They have then included the consumers’ wants and needs into one package. The package comes in very many colours, designs and shapes. They have then mastered the art of where to place themselves. This gives them a clear cut picture of what they should receive for every purchase of their goods. The team that manages the Toyota brand has taken the time to understand the market. This is the sole reason as to why the brand is very popular all over the world. This is the reason as to why competitors are having a very rough time catching up. Introduction The global trends require an aggressive business environment. Many companies are struggling to stay afloat. Those that do not have the proper channels to stay afloat have collapsed. This is with issues of bankruptcy, insolvency and foreclosure. Toyota is one brand that has undergone tough times. It did not sit back and magically get to where it is. After its inception, a lot has been put in place to ensure that it is where it is today. Employees have gone through constant training to be able them to understand the goods that they produce. Managers have undergone training to ensure that they have the knowledge to manage their employees. Toyota realises that without efficient and effective managers, even the best laid out strategies can never work. Armed with this thought, Toyota ensures that everyone contributes to the strategies created. Once the strategies have been created, it is essential for everyone to understand them. It is only after their understanding can they be applied in a successful business context. Any successful business or organization needs to employ strategies in their operations. The strategies enable them to understand the market. Once the market has been understood, customer satisfaction will be very easy. This will obviously ensure that profits keep coming in. Once the profits are realised, the growth and expansion of the business is very possible. It is clear that business growth and success is a steady chain. It moves from one point to the next. At each point, there is room for the organization’s continued growth (Laermer 2007). Basic Background Information on Toyota In 1937, Kiichiro Toyoda created the Toyota brand. Toyota is a simplification of its name. In the real sense, Toyota was known as the Toyota Motor Corporation. It was abbreviated to TMC. This was then further shortened to Toyota. This was because of people’s ability to remember and acknowledge the first name. The first automobile to be created was in 1924. It was during this time that it was impossible to bring in a new car model into the market. This was because General Motors had thoroughly monopolised the market. Sakichi Toyoda created this first car. This car had the ability to stop when plagued with mechanical issues. It was very popular because of this ability and because of its introductory price. This was as compared to the General Motors and Ford cars (Goldstein 2007). After a couple of years, the first passenger car was created. This was in 1936. The Toyoda family realised that there was a need for a name change. This was based on the realisation that the name Toyoda was not cutting into the market. It was mostly associated with fresh rice puddles. Because of this, the name Toyota Motor Company was born in 1937. The name change worked in their favour. Toyota created small functional cars in 1947. They named the cars Toyopet. In many countries, these cars and the brand name were very common. Toyota rode on the fame of those cars for ten years. During this time, they were planning how they would penetrate the American market (Masaki 2006). Many companies and businesses had dreamt of penetrating the American Market. It was a very demanding market to penetrate. The market comprised of varied needs that needed to be met. It is because of this reason that the Toyota Company worked for a very long time to get into the American Market. They first presented the market with the Toyopet products. As much as they had been received positively in many other parts, they were very unpopular in the States. This is because they were equated to small toys. In some circles they were synonymous with pets. This reduced the number of people who could have contributed to the brand’s growth. Toyota strategically changed the name. This happened in the American Market. In other markets were the Toyopet brand was famous, it was continued. This was a sign that they had a very strategic marketing team. The American Market continued consuming the same product under a different brand name. They small cars became increasingly popular in the 1970’s. This was because of the worldwide fuel crisis. Their small capacity was a worldwide attraction. Therefore Toyota amassed huge profits because of this. Toyota used the profits to create a very rich line of luxury cars. This was in the 1980’s. They realised that many of the consumers had very diverse needs. They therefore created many products to cater for their diverse needs. This led to the creation of the Lexus. This was the first luxury car created in 1989. Many people loved the luxury cars. The company having realised this created many other luxury cars. The corporation’s success was also seen when it finally penetrated the European and the United Kingdom markets. It listed itself in many of the local and international stock exchange programmes. This created more room for them to enjoy the profits that they were generating. They also used the profits garnered to ensure that they had products for their markets in many of the countries (Miles 2003). It was in 2002 that Toyota finally entered the French market. It collaborated with their companies to ensure that they created an effective formula one car. This merger was successful. Its success was seen in 2002. It was ranked as the world’s most profitable company by the Forbes magazine. In 2008, it still held the position as the largest and most profitable automobile company in the world (Masaki 2006). In a survey conducted in 2011, Toyota was ranked among the first 50 corporations worldwide. It is also a very huge employer. Many of the employees are spread out in many parts of the world. This is because the company has its products sold in many of the countries in the world. Currently, many of the roads in the world are filled with Toyota products. As much as there is competition from other motor companies, Toyota has created a brand name for itself. In many of the continents all over the world, there is a Toyota plant present. This gives rise to many Toyota cars all over the world. This gave rise to the famous quote “The car in front is always a Toyota”. Many of the roads are represented by a variety of its brands. They include Toyota corolla, NZE, Vitz, Hillux, Lexus amongst very many others. Toyota is also making very many considerable technological steps. Currently, they are developing the first electric car. The car will substitute fuel use for electricity use. This is seen as a plan to reduce the global over reliance on fuel. At the same time, Toyota has been planning on an effective strategy. The strategy aims at introducing a solar car into the market. This will use natural solar energy to drive the car. Toyota wants to channel the natural products to their ultimate use. This greatly reduces the normal reliance on fuel. This is because the fuel is also becoming a very scarce natural resource in many areas (Berzon 2010). Objectives of this Report To identify why the Toyota brand is were it is today. To find out the marketing strategies that are employed by the corporation to ensure that it meets consumer demands. To find long lasting solutions to the many challenges experienced by the corporation. This is with strong emphasis to competition from other emerging markets. To dram logical recommendations that will ensure that the corporation continues to grow irrespective of the competition. Research Methodology The operation framework used in this report concentrates on information provided in various sources. The sources include newspaper articles, websites and books that contain diverse information on the Toyota brand. The methodology includes not only the research methods. It also considers the logic that has been used to carefully select the sources. It should be noted that the general process of data collection includes careful selection of specific sources and their analysis. This is based on the fact that Toyota is a brand that is discussed in many information materials. The information materials were able to provide Toyota’s activities, its mode of operation since inception, staff and clients. The research aimed to understand what strategies Toyota has been using and what it can do to ensure that the strategies work in their favour. This is in relation to stiff competition from the upcoming UAE market. Data Analysis on Marketing Issues (e.g. Current Brands, New Product Development, Distribution Strategies etc) Current Brands Any market requires the application of very many issues to ensure that it thrives. It is not important to just create goods and services. It is important to ensure that the goods and services that have been created satisfy the consumer always. Consumer satisfaction includes the products ability to be at the right place at the right time. The products should be pocket friendly coupled with the ability to represent customer needs. Toyota has so many brands. All these brands were created as a result of the clientele’s needs and wants. There are so many people who want so many different things in a car. They should be able to get the different things that they require. This is the role that a business should play in the lives of people (Phillips 2002). From its inception, Toyota has tried to diversify its brands. The process of diversification is based on customer needs. In 1937, it created a car brand that could stop once plagued with mechanical issues. There were so many people who enjoyed the brand. The Toyopet brand was also very popular. This is because they are very many consumers who required small functional cars with limited engine capacity. There were many who enjoyed the luxury brand, while others wanted a car that would help them in their day to day duties. This was the Toyota pick up. Currently, the market dictates one to have a sleek car that has low consumption. Toyota has provided the Toyota NZE, Premio and many others. The ability of the TMC to provide what the people want ensures that it remains at the top. New Product Development Current brands are as a result of new product developments. Once a need has been realised, Toyota takes it upon them to develop new products to fill up the identified vacuum. Toyota realised that taking into consideration customers needs will propel them into new heights. Product development entails the creation of specifically designed goods for a particular market. If the market needs strong luxury cars with no concern for capacity, Toyota’s team of experts have the mechanisms and capacity to do so. If the market wants the development of other specific brands, Toyota has gone to great extents to ensure demands are met (Gupta 2005). This is in all continents all over the world. Toyota is currently in the final phase of developing the first electric car. This will require charging unlike the normal cars that require fuel. There were talks of developing the first solar powered car. This is in line with the very many environmental issues discussed. This project is still at the stage where ideas are created. Hopefully, one day Toyota will create the first solar car. Distribution Strategies Toyota has many representatives all over the world. This was possible because once Toyota broke into the market, it never looked back. It set up many of its plants in different countries. This then allowed it to communicate with the mother company. This distribution strategy has worked in its favour for very many years. They set mini companies which have a rich source of expertise. They work to ensure that the company continues to produce the best goods. This is based on customer expectations. The distribution mechanisms ensure that goods are presented where they are needed. Many of the countries that represent Toyota do not have the manufacturing plants. This is however not a limitation. There are effective communication strategies that are created from its main headquarters. The headquarters then talk to their representatives in many of the countries to ship in any model of car that is needed. Sometimes they just ship in new models. This is with the aim of testing the market. Once they realise that the product is very popular they ship in high concentrates of the model in question (Berzon 2010). This is the reason why there are so many countries that have high concentration of one car model on their roads. A good example currently is the Toyota Vitz. It is very popular in many third world countries. This is because of its size and the engine capacity. The Toyota Probox is also very popular especially in the country side. This is because of its size and its storage capabilities. Toyota realised that the global market needs a company that has the ability to deliver. Its aim is to ensure that once goods are needed in an area, they are taken there immediately. This ensures that Toyota grows tremendously in relation to aspects of reliability. It not only creates the goods needed, but it also takes them to the market. Market Segmentation One of the most important marketing issues that I choose to focus on is the market segmentation. Market segmentation includes the ability to exploit diverse market characteristics to ones advantage. As has been described above, there is no one market with the same characteristics. It is necessary for organizational managers to realise this. Once they have, they will come with different products to suit varied clients and their characteristics. Toyota has tried to segment their market. This way, they will have the ability to meet their markets expectations all the time (Goldstein 2007). In many instances, Toyota has continued to produce products that are unlike the rest. They provide an array of motor vehicles that many others have not thought of. This has enabled them to stand out. Despite this, Toyota has maintained its overall goal. This is the goal that requires it to deal with motor vehicles. They have not changed their area of expertise; they have constantly changed the goods that they produce. These changes are positive as they continuously lead to the creation of goods and services that are required by the market. Toyota started segmenting the market as early as 1967. This was after its penetration to the American market. This is after it realised that there is an urgent need to do so. It mastered the art of developing various car models for diverse clients. They continued with their strategies of positioning themselves in line with the market. When the world faced a world fuel crisis, they developed products that suited that specific situation. It should be noted that the American market had already rejected the Toyopet brand name. In line with the crisis, they embraced the car brand and many other small capacity cars. This was because of their fuel capacity which was affordable for many. This was as compared to other car brands (Goldstein 2007). In many ways Toyota has tried to apply market segmentation in development of its products. A survey conducted in 2003 showed that the majority of the brand’s clients are averagely 47 years of age. Toyota has a general aim to ensure that they have attracted young clients into their products. This is because globally the youth contribute to the highest percent of people. The survey was intended to understand what they want in their products. This will ensure that the products are created according to their needs and wants (Goldstein 2007). Toyota is currently trying to do all it can to satisfy the global youth. This is with the realisation that it is necessary to study the market. After the study, it will be very easy to produce what the market needs. This will obviously translate to the stability and accumulated profits for the brand. Practical Strategies for Future Plans The future has very many things in store for very many companies. This is seen in the way that they conduct themselves and their affairs. Strategic planning will ensure a current company’s success or failure (Gupta 2005). In future, Toyota should ensure that it has an aggressive positive market segmentation strategy. This is the one that will ensure that the company travels far and wide to cater for different market mixes. It is necessary for them to create channels that look at the financial ability of the continents that house many of their plants. They should create products that can be comfortably consumed by their selected market segments. In many developing countries, the need for cars is still high. Toyota could create low cost, small capacity engine, environment friendly cars for this need. The future also requires the production of goods of the best quality. Quality products sell on their own. Toyota should limit the chances of lowered standards in the goods that they produce. This will ensure that they remain in the market for a very long time. This is despite the fact that they experience stiff competition from the United Arab Emirates and many other areas. Despite the fact that Toyota is a household name, it should roll out an aggressive advertising campaign. The campaign is aimed at ensuring that people remember all the things that the company has done. Advertising is aimed at showing what products are available, their advantages and their overall cost. This is with the aim of attracting as many clients as they can. This will definitely create a new market segment for the Toyota products (Miles 2003). Communication is a very essential component in any business. It is very necessary for the corporation to have active communication channels. This will ensure that actual and potential customers can access the available products. This is through the information collected on the said products. They will also have a platform to collect information about the many issues that they are dealing with. This is in relation to the cars that they have purchased or are planning to purchase. They will also use this form of communication to know of basic issues. The issues range from the where to get proper service for their cars. All this is crucial for the overall success of the corporation (Laermer 2007). Recommendations Toyota should have Toyota representatives all over the world. This will be beneficial if they have manufacturing or sales plants in those countries. The representatives should be well versed with the products that they are representing. The show rooms should have representatives who have the ability to intelligently communicate about the product (Berzon 2010). Their main aim should not be sales only. They should have the ability to stand out and listen to the wishes and demands of their consumers. A representative in the states for example, will have the ability to paint a picture of what the clients there require. A representative from Kenya, Uganda or India will also have adequate knowledge on what products these countries need. This will create the appropriate channels for satisfaction of the needs of these particular segments. In the past Toyota has recalled very many cars. This affected the credibility of the corporation. Many segments lost faith in the Toyota brand. At this point the future should incorporate an active testing kit. The kit should be manned by professionals. After the manufacture of a car, they should test it before introducing it into the market. They should test all the essential features. These include the brakes, clutch and many others. From the Toyota recall, it was evident that that company had relaxed. This was in relation to the issue of quality. Quality must be maintained. This is the key for any successive venture. The recalling of thousands of cars sends panic to consumers who had invested in the car. It also discourages potential purchasers of the good. This is definitely not good for business (Berzon 2010). It is important to note that from time to time mistakes are made. Toyota led by example by accepting that it has made manufacturing mistakes in some of their cars. They recalled them back and the issue was sorted. Despite the fact that it was a mistake, many market segments respected Toyota for that act. This shows that it is prudent to correct mistakes once they happen. It is also highly important for the mistakes to be avoided at all costs in future. The production of quality products is also an advertising strategy on its own. It is necessary for Toyota Corporation to put in place measures that will revive its advertising. This should be through websites and social media. This has the best chances of reaching the global audience. Once the global audience is reached, Toyota will be guaranteed of continued profits which will enable its global growth and expansion (Phillips 2002). Conclusion It is important for many businesses and corporations to realise that competition will always be there. Toyota will not face stiff competition from the UAE only. Many companies and corporations are coming up with strategies to topple its success. It is essential for the corporation to realise and appreciate this (Berzon 2010). Once it has, it will ensure that it has first improved what it has been creating all these years. It will appreciate its growth since 1937. Once it has consolidated this, no one will change its fortunes. The second thing that it needs to concentrate on is the development of quality products. Quality will sell and attract many other parties in the process. The development of the products should be based on collected information. The market segmentation and identification of needs is best applied here. This will ensure that goods are created for all the existing clients. TMC is a household brand. It should ensure that it continues doing what it has been doing. The only difference is that it should make its strategies more foolproof. This will create an avenue for it to triumph over emerging competitors. References "Prius Panic: Are Toyota Recalls Creating Mass Hysteria For Drivers?" . Berzon, A & Kahn, G 2010, "Toyota Complaints Surged After First Recall," The Wall Street Journal. Davis, P 1999, The Long Run – Toyota: The first 40 years in Australia, Type Forty Pty Ltd: South Hurstville. Goldstein, D 2007, “What is Customer Segmentation?” MindofMarketing.net, May 2007. Gupta, S & Lehmann, DR 2005, Managing Customers as Investments: The Strategic Value of Customers in the Long Run, Pearson Education/Wharton School Publishing: Upper Saddle River, NJ. Laermer, R & Simmons, M 2007, Punk Marketing, Harper Collins, New York. Masaki, S 2006, ‘Toyota Production Systems: The 'Toyota Way' and Labour–Management Relations’, Asian Business & Management, vol. 5, no.4 viewed from Miles, R 2003, Organizational Strategy, Structure, and Process, Stanford University Press, Stanford. Phillips, N & Hardy, C 2002, Discourse Analysis – Investigating Processes of Social Construction, Sage Publications, Thousand Oaks. TOYOTA. Viewed 27 Sept. 2011, from Read More