Social, Ethical, and Legal Implications 1
Social, Ethical, and Legal Implications
Social, Ethical, and Legal Implications 2
The Toyota Motor Corporation is most commonly called simply Toyota is a Japanese auto
manufacturer founded by Kiichiro Toyoda. Toyota is one of the largest vehicle manufacturers in
the world with their factories located in six continents. Toyota Motor company’s sales and
productions make them the largest car maker in the world. Toyota also offers financial services
through their own Toyota financial services Division. The automotive industry is extremely
competitive, and Toyota has strong competition from other automakers. Toyota has always had
an advantage over the competition because of their reliability, pricing, safety, customer service,
and fair financial terms.
In 2008 Toyota was impacted by the economic troubles in the United States. Consumers
stopped spending money which effected the Toyota Motor Company greatly. Other divisions of
the Toyota Motor Company like the financial services and the global presence of the company
kept the company running during the economic slowdown. Later in 2008, Toyota recalled almost
4 million vehicles due to acceleration problems in certain Lexus vehicles and Camry Solara’s. A
global recall was issued by the Toyota Motor Company. There were 2 million cars recalled in
North America,600 thousand in Japan, and 1.2 million across Europe. While the cars were being
driven slowly, they would suddenly accelerate on its own. Due to the slow economy, the recalls
on the automobiles, and lawsuits Toyota was in debt in 2009. Toyota requested a 3-billion-dollar
loan from a Japanese bank.
The associated press released an article stating Toyota admitted to engaging in unethical
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behaviorregarding the investigation the safety of their vehicles. It was reported that Toyota
intentionally delayed their safety regulations and purposely avoided defect investigations and
inquiries by the government with safety concerns. Despite the issues the company faced, Toyota
focused on resolving the issues and making their customer safety the priority.The company
identified what caused the acceleration issues in their cars and develop a way to remedy the
issue. The Toyota Motor company was fined 16.37 million dollars by the US government
because they didn’t immediately notify the national highway safety administration about the
automobile defect. Toyota spent a large amount of money to resolve the issues in their vehicles.
Toyota is globally a leader in the automotive industry. The Toyota Motor Corporation should
conduct a detailed quality check on all vehicles in production. A detailed check can save the
company a lot money that’s associated with recalls, and allow them to remain the number one
automotive company in the world.
UNDERSTANDING TARGET MARKETS
Toyota Motor Company is the largest automotive manufacturer in the world, and the eighth
largest company in the world. Toyota is a Japanese brand founded in 1937 by Kiichiro Toyoda.
Toyota’s name is recognized globally, and well respected in the automotive industry. Currently,
there are over 170 countries where Toyota products is sold, and 28 countries that have
manufacturing companies. Toyota products include Lexus automobiles, Toyota automobiles,
Engines, Marine products, Welcab products, accessories and spare parts.
Toyota Motor Company Mission and Vision Statement
Vision Statement, “Toyota will lead the way to the future of mobility, enriching lives around the
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world with the safest and most responsible ways of moving people. Through our commitment to
quality, constant innovation and respect for the planet, we aim to exceed expectations and be
rewarded with a smile. We will meet our challenging goals by engaging the talent and passion of
people, who believe there is always a better way.” (Toyota Global Vision, 2016) Mission
Statement, “Create vehicles that are popular with consumers.” (Toyota mission for
technologies,2013)
Consumer Analysis
Toyota’s brand has expanded globally, and as the mission statement says they created vehicles
that are popular with the consumers. Toyota has a diverse group of customer that all have
different ages, races, incomes, and automobile preferences. Toyota has an automobile to meet the
specific needs and preferences of all their customers. Consumers who are on a budget can choose
from a variety of base model automobiles. Consumers who are looking for luxury vehicles have
a choice of fully loaded automobiles with all the amenities and advance technologies offered in
automobiles today. Toyota also has a large variety of hybrid, compact, electric, fuel efficient, and
eco-friendly vehicles for the environment cautious consumers. Consumers who are looking to
accommodate large families or groups of people can choose from SUV’s, Van’s, Trucks and
family size vehicles. Individuals and companies continue to purchase Toyotas because there are
products to meet all their specific needs.
Consumer Profile
Customers choose Toyota products over other manufactures because there is a wide range of
quality vehicles, and it’s a cheaper alternative to other manufacturers. Segmentation categorizes
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the consumers by their age, income, social class, ethnicity, gender, and family life cycle. The
demographic segmentation, and psychographic segmentation are the two main segmentations the
Toyota company focuses on. In the demographic segmentation, Toyota’s target is the family. The
Middle to upper-class income consumer is who Toyota targets in this segment. The Toyota
Camry, Avalon,4 Runner, and Sequoia are the main vehicles made for the consumer with the
buying power to purchase one of these vehicles. The psychographic segmentation also targets
family, but the lifestyle, social class, and personality are upper class. Toyota has the Lexus
Luxury vehicles for the upper-class consumer.
Current Threats
The Japanese exchange rate rising is a current threat to the Toyota Corporation. The international
markets are where over 48% of Toyotas revenue comes from. Foreign currencies must be
converted to Japanese yen to calculate the revenue, and sent back to Japan. Toyota’s Revenue
and profits depend on the exchange rates fluctuating. Toyota has no control over the currency
exchange rate, so the company is at risk. If the yen rates rise Toyota’s profits will decrease
significantly. This is a threat the company recognizes will be a problem for a few years. Natural
Social, Ethical, and Legal Implications 4
disasters are another threat Toyota faces. Many of the manufacturing facilities and suppliers of
Toyota products are in Japan, Indonesia, China, and Thailand. Earthquakes and other
natural disasters often affect these countries. Natural disasters have a huge impact that results in
major loss for the company. If the company manufactures in those high-risk countries
the threat will remain.
While researching the Toyota Motor Corporation I gained a lot of insight. I found that Toyota
has had a demographic shift and their customers has transitioned from older baby boomers to
millennials. The older consumers have been loyal to the company for many years. The Toyota
Camry was the most popular car among them. The older customers still purchase Toyota
products. The Toyota Scion and Corolla is commonly purchased among the younger 20
something consumers. Toyotas market is more diverse now than ever before.
There are a series of stages in a new product life cycle. The stages are the new introduction,
growth, maturity, and decline. Each stage in the product life cycle is directly associated with
marketing changes and impacts the marketing strategy, and the marketing mix. The marketing
mix is product, price, distribution, and promotion. The introduction stage is the most important
because it’s when the product is launched. The launch of a new product is risky. The uncertainty
of how the market will receive the product. Characteristics of the introduction stages of the
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product life cycle are, the profits are lower, and the investments are usually high during this
phase, the company targets customers for promotions, and there is little competition. Products
are usually distributed in selective places to see how the customers receive the product during
this phase. Many times, marketers experience some failures during the introduction phase. The
growth phase is next in the product life cycle. The growth phase is important to the product
manufactures because the brand is establishing its position in the market. During the growth
phase, sales and profit margins increase. A challenge during the growth phase is sometimes
manufactures must lower prices to get the increase in sales they desire. A benefit of the growth
stage is the product has more awareness, and there is an increase in sales. The Decline stage
follows the introduction, growth and maturity stages of the product life cycle. The decline stage
happens when the market is saturated, and sales start to decline.
It is important to know how to measure and improve marketing. It is more important to know
which marketing metrics to measure to determine the effectiveness. Metrics help clarify the
number of things produced. For example, to measure sales or cost per customer operational
metrics would be useful. The cost to acquire a new customer is an important key metric to track
in marketing. To determine success or failure of the product ROI (return on investment) is the
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most important way to measure it. The ROI can be calculated by measuring how much revenue
was made from the marketing campaign, expenses related to the marketing campaign, and the
profit margin for every item sold.
A non-print media method used to market my product is local radio station advertising.
Advertising on radio stations effectively targets the market of your choice. Radio station has
different audiences depending on their listening preference. I would advertise on the most
popular stations for every genre of music. Radio messages are effective because the messages are
short, and the listeners are often multitasking. The print media method used to market my
product would be online newspapers and online magazines. Millions of people read new and
magazines online daily. Internet marketing is smart and cost effective.
Three elements of product promotion are direct marketing, public relations, and advertising
execution. Direct Marketing happens when a business reaches out to customers through different
channels such as email, phone calls, mail, flyers and personally. Direct marketing is effective for
consumers who choose to opt in different mailing list, and enjoy receiving direct mail. Public
relations are the way an organization communicates in attempt to build solid relationships with
consumers, the public, stockholders, and organizations. Public relations deals with development,
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public affairs, PR location, and investor relations. Advertising Execution is a technique or the
way advertising is presented or carried out. There are many execution techniques for advertising.
The Comparison execution can directly or indirectly compare the product against the completion.
Price and Channel Strategy
Many companies today target their customers near and far. Companies will sometimes market
directly to the customer, or they use intermediaries to do it for them. Company distribution is a
big competitive advantage for a company. Companies try to reach various markets for an
improved gross margin and larger turnover due to the rising cost. To reach those markets, there
must be proper distribution strategies in order. The three P’s of the marketing mix -Product,
Price, and Promotions are used by companies to decide the distribution strategies. However,
distribution strategies are based on the company, and the level of penetration they hope to
achieve.
Distribution strategies that can be used by companies are intensive distribution, selective
distribution, and exclusive distribution. Intensive distribution strategy is used when the company
needs to cover a lot of ground for a mass market. Selective distribution strategies are needed
when there is a limited amount of markets. Branded companies like Gucci use selective
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distribution strategies. The exclusive distribution strategy is used when a company assigns a
large region to one exclusive distributor. It is an agreement between the retailer and the supplier
to give the retailer the exclusive rights to the product from the supplier. The distribution
strategies used will depend on the different products the company has. One company could have
many product lines and each has their own individual distribution strategy.
Dynamic/Static Pricing Strategies
With Dynamic pricing, a price isn’t set; but will change depending on increases in demand,
market conditions, and the customer. Businesses that provide services such as transportation
business and airlines use this pricing strategy. Prices adjust based on the marketing and demand
conditions. Dynamic pricing is becoming more popular because many internet purchases use a
form of dynamic pricing. With static pricing, all prices are offered to customers at the same
price. Static pricing is good for consumers who don’t want to deal with a price increase and
appreciate a uniform price. The main disadvantage of the static pricing strategies is competitors
can match or undercut the static price.
Daily Pricing, Promotion Pricing, List Pricing
In marketing, a pricing strategy is used to identify the best price for a product. The pricing
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strategy is very important part of the marketing mix. Generating revenue for the company is the
focus of the pricing strategy. Companies use discount prices for product promotion and to
attract new customers. Discounted prices give the product added attention and the buyer might
purchase other items. The daily price is the same as the market price. The market price is the
daily price the item is being sold in the open market. Promotion pricing is lowering the price for
a short period when a new product is being launched, or as a sales incentive for
customers. The list price is the retail price suggested by the manufacturer. Supply and demand is
used to determine the list price for products. The list price is often referred to as the starting
price, and may not be the price the customer pays for the good. For examples, when a customer
is purchasing a home the list price is usually the price to start negotiations for the house.
Positioning Within Channels
Products become good products with good channel strategies. A good channel strategy
makes sure the customer knows the value and benefits of the product. A good channel strategy
also assures the customer has the support they need after they purchase product. Positioning
within channels can be issue sometimes. Marketing and sales pitches are always clear and the
customers don’t always understand your position. It’s important to clearly define your position
with consumers. The price should penetrate the channels as you enter the position in a long
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way.
Marketing Communication and Brand Strategy
Situational Analysis
The vision and mission are terms often confused due to them being used interchangeably. They
are both directly related to the purpose of the business or organization. The vision paints the Big
picture of what the organization hopes to achieve in the future. The mission is a statement
addressing how the organization plans to make the vision a reality. The mission statement is a
clear, detailed statement of exactly what the organization wants. Once the vision and mission are
in order, the strategic objectives should be set. Strategic objectives are important goals set by the
organization to secure the future. The goals can be to improve the volume, improve profits, or
become more stable business. The principles and believes of the organization that dictates their
actions and behavior is the organization’s values.
The SWOT analysis stands for Strengths, weaknesses, opportunities, and threats. The primary
job of the SWOT analysis is to identify the strengths and weaknesses of an organization. The
strengths are the areas of the organization that operates smoothly and more efficiently than
others. Strengths should be considered from the customers point of view as well as the
businesses point of view. Weaknesses are the areas within the organization that need
improvement. It is just as important to know the strengths and weaknesses of your competitors as
it is your own. Collecting data and primary research are ways to learn the strength’s and
weakness of the competitors. Examples of primary research are surveys, test marketing,
questionnaires, and behavior observations. A good marketing strategy can identify the strengths
and weaknesses of the competitors.
Market segmentation has been done in marketing for many years. It is when potential customers
are divided into segments or groups based on their characteristics. The main goal is to create a
marketing mix that is conducive to the customer’s expectations in the targeted segment. There
isn’t plenty of companies that are large enough to satisfy the needs of the entire market. Most
markets demand need to be divided into segments, and the company that can handle the demand.
There are four market segmentation strategies, and they are based on demographic,
psychographic, behavioral, and geographical differences.
Product, Place/Distribution, Promotion, and Price Strategies
Regardless the type of business, the brand image should be displayed front and center. The
brand image is the color, logo, and infographic style that represents the business. In order to
create the brand image, there should be a solid foundation. The brand image requires serious
creative thoughts. In order to create the brand image, the target audience must be identified first.
The business goals should also be identified. It can sometimes be difficult to maintain the brand
image once it’s been created. Consistency is the key to maintaining brand image. The brand
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image is how the customers see your brand. Customers pay attention to the style, value, and
reputation of the brand. The brand image is not always easy to control because it’s based off the
opinion of the consumers. The brand should stand out and easily be identified when next to the
competition.
A media strategy is a strategy or action plan that helps the organization reach out to their target
audience. The demographic being targeting must be identified when creating the media strategy
for it to be successful. A solid marketing budget should be determined in the media strategy. A
solid budget will help avoid wasting thousands of dollars on unnecessary things. There are many
different types of media strategies. To implement any of the strategies the target audience must
be identified, clear goals and objectives must be set, and they should be measurable and
obtainable. Media strategy can completely change a business.
Executive Summary
Toyota has one of the top marketing programs in the automotive industry. They have used
various marketing strategies to maintain their position a leader in the manufacturing industry. To
remain number one, a marketing brand a plan must be made to monitor and control marketing.
The first step is keeping thorough records of all marketing initiatives such as cost, media used,
return on sales, sales generated, and the responses. The marketing initiatives can be confusing.
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It’s important to understand external factors like the economy may affect the results. Feedback is
one of the easiest ways to track marketing efforts. Since the recalls a few years ago, Toyota has
marketed themselves with quality and safety, and had great success with that marketing program.
For many years, Toyota, has made the great cars and products. The Lexus is Toyotas luxury
vehicle. The Lexus is known for comfort, safety, and luxury. Since the late 90’s JD Power and
associates have ranked Lexus “ The Best Overall Car” in four consumer reports seventeen times.
Toyota has something for everyone and stands by the quality automobiles they market.
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References
Positioning Within Trading Channels and Following Breakouts. (2017, January). Binary Tribune, (), Retrieved from http://www.binarytribune.com/day-trading-academy/positioning-within-trading-channels-and-breakouts/
Wrendon, N. (Yea2003r, May 13).Advantages of Dynamic Pricing. DMN NEWS.Retrieved from http://www.dmnews.com/digital-marketing/advantages-of-dynamic-pricing/article/80877/
C. Anderson, n.d. How Do Market Intermediaries Affect Business? Retrieved from: smallbusiness.chron.com/market-intermediaries-affect-business-10402.html
Kotler, P.T. & Keller, K.L. (2016). Marketing management (15th ed). Upper Saddle River, NJ: Pearson/Prentice Hall.
Blunt, L. (n.d.). Houston Chronicle. Types of Marketing Channels. Retrieved on January 15, 2017 from http://smallbusiness.chron.com/types-marketing-channels-21627.html
Small Business. (2016). Retrieved from http://smallbusiness.chron.com/benefits-promotional-pricing-strategy-59438.html
Product life cycle. (2016). Retrieved from http://productlifecyclestages.com/
Lake, L. (2016). Thebalance.com. Retrieved from https://www.thebalance.com/what-is-a-media- strategy-and-how-do- you-create-your-own-2295517
Communiquepr. (2014). Retrieved from http://www.communiquepr.com/blog/?p=8422
Johnson, K. (2014, November). Examples of Strategies Vs. Tactics in Public Relations. Central, (), Retrieved from http://yourbusiness.azcentral.com/examples-strategies-vs-tactics-public-relations-21216.html
Ervin & Smith (2013). Brand Message Strategy. Ervin and Smith.com. Retrieved on January 23rd, 2017 from http://ervinandsmith.com/blog/branding/message-strategy-quick-steps-to-finding-a-relevant-idea-you-can-own/
Thebalance.com. (2016). Retrieved from https://www.thebalance.com/what-is-a-media-strategy-and-how-do-you-create-your-own-229551
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