DIGITAL MARKETING AND COMMUNICATION

ASSIGNMENT - 01

STUDENT NAME CHALUKI MARYANN SUGATHADASA

STUDENT REGISTRATION NUMBER 2157928

WORD COUNT 3,121

DATE OF SUBMISSION 9TH DECEMBER 2022

Executive Summary

Toyota is struggling in the United States due to issues with sales, customer engagement, product
introduction, new customer acquisition, and service quality. Thus, we will use a digital
marketing strategy to strategically address these issues. Plan effectiveness may be measured
using tools like Web analytics and the Net Promoter Score.

Many variables outside of Toyota and the auto industry have an impact on both. Management
must take these factors into account when they plan plans and initiatives to ensure the company's
growth and longevity. Toyota can assure that it continues to be the world's leading firm if its
leaders handle the current challenges with skill.
Contents
Executive Summary ...................................................................................................................... 1

1. Introduction ........................................................................................................................... 4

2. Situational Analysis ............................................................................................................... 4

3. Objectives ............................................................................................................................... 7

4. Segmentation, Targeting, Positioning .................................................................................. 7

5. Digital Marketing Strategy - Ansoff-Product Market strategy......................................... 9

6. Digital Marketing Mix......................................................................................................... 10

7. Evaluation and Control ....................................................................................................... 12

8. Conclusion ............................................................................................................................ 12

9. Bibliography ......................................................................................................................... 13
 1. Introduction

Toyota Group's mother company in Japan is named Toyota Jidsha KK. The Toyota Motor
Corporation and Toyota Jidsha KK are both Japanese firms. When it was first released in 2008, it
was able to overtake GM as the world's largest automobile manufacturer. It has been in that spot
ever since. About a thousand of the companies, it owns through subsidiaries and affiliates are
involved in the automobile, auto-parts, and commercial/industrial vehicle manufacturing
industries. Toyota City is an industrial city to the east of Nagoya in Japan and is also the location
of the company's headquarters. (Liker, 2008).

The current name of the company dates back to 1982, when Toyota Motor Firm and Toyota
Motor Sales Company, Ltd. merged to form what is now known simply as Toyota. A dual-brand
assembly plant owned by Toyota and General Motors was founded in California as New United
Motor Manufacturing, Inc. in 1984. In 1986, this plant marked the beginning of Toyota's
production in the United States.

The U.S. automobile market has only partially recovered from the sales drop that occurred in
2020, despite a strong start to 2021 (up 28.8% from the same period the year before). Because of
a shortage of semiconductors, market activity dropped by nearly 22 percent in the fourth quarter,
translating to about 900,000 fewer deliveries.

Situational Analysis
SWOT Analysis

Strengths - Toyota uses the Kaizen and PDCA methods of continuous improvement to
guarantee the quality of their vehicles. The 3S model of Seikaku, Shinsetsu, and Shinrai, which
can be translated as "accuracy," "care," and "trust," is also used in the company's excellent after-
sales service. Toyota's success in penetrating new markets may be traced back to the company's
many partnerships with organizations that offer complementary products and services. For
instance, the company's partnership with Maruti Suzuki to develop money-making cars for the
Indian market has been very fruitful. Toyota's new Lexus and Mirai vehicles are equipped with
autonomous driving technology that can detect and maintain a safe distance from oncoming
traffic using sensors. The number of accidents involving Toyota vehicles could be drastically
reduced with the help of this technology. (T, 2019).

Weaknesses - All decisions are made at the top of Toyota, and the rest of the company is
expected to follow suit. As a result, workers may become less invested in their work and produce
less as a whole. Thousands of vehicles have been affected by the numerous recalls issued by
Toyota over the years. The company recently made an announcement that it would be recalling
227,000 2019 Camry vehicles and 41,544 Venza Hybrids. Toyota only exports a small selection
of its more affordable car models, primarily small SUVs and hatchbacks, to countries with less
developed economies. As a result, the company struggles to adapt to new circumstances and
misses opportunities in fast-growing economies. (GURL, 2017).

Opportunities - With the electric vehicle (EV) market expected to grow by a massive margin of
94.4% between 2021 and 2030, developing countries like India may provide a particularly
favorable environment for Toyota's EV investments. Toyota is able to put its technical expertise
to use by beginning production of semiconductors by assembling chips in-house. For the
company, this means more quality control and fewer headaches in the supply chain. In the Indian
market, where a whopping 72 percent of consumers favor low-priced vehicles, Toyota has a
great opportunity to broaden its already extensive lineup of eco-friendly, low-cost options.
(Halbright, 2010).

Threats - Among Toyota's many competitors are Hyundai, Volkswagen, and GM. Worldwide
sales for GM in 2021 were $127 billion, an increase of 3.7% from the previous year, and a 15.5%
share of the US market. One potential threat is that the conflict between Russia and Ukraine
could disrupt production and delivery of chips, a vital component in vehicle assembly.

PESTEL Analysis

Political Factors - The manufacture of automobile components is subject to strict regulations in

most nations to guarantee the safety of drivers and passengers. A business's license could be
revoked if it doesn't meet these standards. It can be costly for the company to conduct extensive
testing before a launch. The government is trying to curb the use of environmentally damaging
fossil fuels. (Bathla, 2022).
Economic Factors: Earnings are rising for most people in economically stable and developing
regions. The result is an increase in their discretionary income. This is a major factor in the
increasing popularity of car ownership. As the price of luxury goods has increased due to taxes
levied in many countries, some consumers may be dissuaded from making a purchase. It could
lead to a decline in the demand for high-end automobiles in some regions. However, if numerous
manufacturers introduce low-priced vehicles, demand could increase. Vehicle costs will increase
in tandem with increases in the cost of their constituent parts. The need for automobiles may be
reduced. (Rahman, n.d.).

Social Factors - Motor vehicles are also status symbols. When developing new automobiles,
manufacturers should keep customer tastes in mind. It may fall out of favor and fail to sell. Sales
of automobiles are influenced by the dispersion of populations. Increased sales of sport utility
vehicles can be expected in a state where the population is dense, and families tend to have
several members. The automotive market is not immune to cultural and social shifts. There may
be fewer car owners in nations that have reliable bus systems. Automobiles are commonly found
in developed nations. (Bathla, 2022).

Technological Factors - Automobile safety relies heavily on modern technologies. Upgraded

technology will make autos safer. Companies must cut emissions. Modern technology may
reduce emissions. Self-driving automobiles are available. Future demand may be substantial. The
corporation should advertise self-driving and electrified automobiles to win consumers.

Environmental Factors -In light of the government's and environmental groups' concerns over
vehicle emissions. Vehicle emissions can be reduced by using modern technologies to produce
battery-powered or electric vehicles. Greater international acceptance of environmental rules to
curb pollution means that car manufacturers must conform. It could reduce earnings for the auto
industry. When it comes to testing, the R&D department at automakers must be rigorous. If it
can pass the pollution tests, they should deploy it.

Legal Factors - Air pollution can be mitigated by reducing the number of cars on the road,
which is why many countries have implemented such regulations. The company could be sued if
a forensic investigation into an accident reveals that faulty parts or airbags contributed to the
incident. Companies that manufacture vehicles worldwide are subject to various international tax
and environmental regulations.

2. Objectives

❖ If all goes according to plan, we should see a rise in sales from $100 million to $150
million by the following year, 2023.
❖ Increase the total volume to 100 million units by the following year (2023), up from 170
million units before.
❖ Reduce the cost of new client acquisition by fifty percent by the following year, 2023.
❖ To retain 28% more customers by the year 2023, improve your customer service.

3. Segmentation, Targeting, Positioning

Segmentation

Toyota Demographic Segmentation

Toyota's primary demographic target is made up of middle-aged adults (30-50) who are
interested in purchasing a car. This is applicable to both men and women at the same time. When
it comes to selling cars, Toyota targets a wide range of consumer segments with its various
makes and models. A popular example is the Toyota Camry, a mid-size car that's practical for
families. To attract affluent city dwellers, Toyota offers the Prius, while the Yaris caters to the
brand's younger, wealthier clientele. (Lin, 2002).

Toyota Geographic Segmentation

Japan and North America are Toyota's two most important markets, but the company's name is
well-known and respected in a wide variety of countries around the world. Over the span of a
year, from April 2021 to March 2022, nearly 2 million Toyota automobiles were purchased by
Japanese customers. As of that same time, North America was Toyota's most important market,
with sales of nearly 2.4 million vehicles. (Musyoka, et al., 2007).

Toyota Behavioral Segmentation

Most people who buy a Toyota continue to care for it for years afterward because of the brand's
reputation for quality and dependability. Among the top 10 models in terms of how long buyers
tend to keep them, four are manufactured by Toyota. The Toyota Camry comes in second place,
trailing the Ford Explorer by just a few months in terms of average ownership time, with a figure
of 9.5 years. While the North American market is larger overall, Toyota makes more money in
Japan. The Japanese market contributed nearly 16 trillion yen to Toyota's total revenue in 2022,
while the North American market contributed 11 trillion yen and the Asian market contributed
6.5 trillion yen. (Wells, et al., 2010).

Toyota Psychographic Segmentation

Toyota has built a loyal customer base thanks to its innovative products, which are revered for
their efficiency, dependability, quality, and cutting-edge Japanese ingenuity. Toyota's approach
to market segmentation reflects this by targeting consumers based on their personalities. Toyota's
target demographic is looking for electric cars with low operating costs and high resale values.
Some people place a higher value on luxury and aesthetics than others do on convenience, safety,
and functionality. (Gilbert & Warren, 1995).

The luxury Lexus brand, which is owned by Toyota, is the one and only exception. During the
first half of 2022, over 1 million Toyota vehicles were sold in the United States and Canada,
while only about 130,000 Lexus vehicles were sold. This suggests that the demographic that
Lexus is aiming for is a relatively small subset of Toyota's target market as a whole.

Targeting

There are several factors that have an impact on the operations of businesses operating in the
automotive industry (Fraga, et al., 2003). Some of these factors include fluctuations in the price
of oil, the rate at which currencies are exchanged, an increase in the bargaining power of
customers and suppliers, rising labor and infrastructure costs, and increasing government
regulations (Walsh, 2009).
Positioning

Many hours and dollars are dedicated to developing and implementing a company's marketing
strategy in the modern day. To stand out, many successful companies employ strategic marketing
approaches. Toyota uses a wide range of marketing and PR channels to spread word about its
wares. The company promotes itself using both non-traditional and traditional channels, such as
direct sales and public relations. The local vehicle dealership is an integral part of Toyota's sales
strategy. Distributor salespeople are responsible for promoting their company's products to
increase sales.

4. Digital Marketing Strategy - Ansoff-Product Market strategy

Diversification

Toyota is participating in horizontal diversification when it decides to create and launch new
goods that are unconnected to the company's present products. However, advancements and new
product releases for items that share the same economic backdrop as the guests are encouraged.

Market Penetration
When a company believes it can increase its share of a given market, it employs a market
penetration strategy (Kalyanaram & Gurumurthy, ). In today's business world, you need to think
like a salesperson to accomplish this. Increasing sales frequency, communicating with customers
directly, strengthening the dealer network, lengthening the time between purchases, spending
more per customer overall, and increasing the customer's lifetime value and basket share are all
effective methods for breaking into a market. The Ansoff Matrix is an effective method for
assessing the strategies of one's rivals. The Ansoff Matrix can help Toyota's upper management
evaluate the pros and cons of various strategies for increasing the company's bottom line, such as
entering new markets, developing new products, or diversifying the company's current product
line. (Armstrong & Brodie, 2005).

Market Development
In order to expand sales of existing models, Toyota focuses on gaining new customers and retail
outlets. Increasing product demand can be accomplished in a number of ways, such as by
entering new domestic or international markets or by forming strategic partnerships with
complementary businesses. (Calvert, 2008).

Product development
Toyota is able to make modifications and enhancements to current products in order to give
buyers more desirable choices. Naturally, this will lead to an increase in product demand and
sales. Toyota is actively engaged in the process of discovering and creating cutting-edge
products. The company then undergoes a new product development (NPD) process, during
which time it develops and releases fresh offerings to consumers. This allows Toyota to broaden
its customer base and penetrate new markets. Toyota routinely invests in research and
development, especially studies that shed light on market tendencies and buyer habits. Toyota
has been able to maintain its competitive edge by spending heavily on R&D, which has resulted
in the introduction of ground-breaking new products and enhanced marketing, operations, and
financial management. (Krishnan & Ulrich, 2001).

5. Digital Marketing Mix

Product - In this assortment of products, Toyota autos are by far the most sought for. The
corporation is known for producing high-end goods, including the exclusive Lexus brand of
vehicles. On the other hand, Toyota's Welcab series consists of cars that have been adapted to
meet the needs of disabled and elderly passengers. In addition to producing autos and maritime
equipment, the firm also produces yachts and engines, as well as replacement parts and
accessories for both types of products. The fact that Toyota sells such a broad variety of products
demonstrates, according to this component of the marketing mix, that the company can tap into a
larger market and lessen the impact of market-based risks (Dominici, 2009).

Price - Toyota's pricing strategy is market-oriented, therefore it takes into account both the
present market situation and the prices of Toyota's competitors. The vast majority of Toyota's
offerings, from automobiles and trucks to other categories, adhere to this pricing strategy.
However, in addition to that, the company utilizes a pricing method known as value-based
pricing, which bases prices not only on the real worth of the product but also on how customers
perceive that value.
Place - Most sales transactions are conducted at Toyota dealerships. However, some merchants,
such as businesses that offer auto supplies, also sell items made by the corporation. These
products include replacement parts and accessories. This component of the marketing mix
illustrates how strongly reliant Toyota is on dealerships to sell its goods to the demographic that
is being targeted (Gutierrez-Leefmans, 2016).

Promotion - Personal selling is a tactic that Toyota employs via its dealerships' salespeople, who
individually pitch items to prospective customers. Additionally, advertisements for the firm may
be seen in a variety of different media, including television, newspapers, and online platforms. In
addition, the company promotes its wares via public relations activities, such as the Toyota
TogetherGreen program, which gives financial assistance to organizations working to improve
the environment, and the Meal Per Hour program, which provides the Food Bank with donations
of edible goods.

People - The company's goal is to provide all of its employees with more agency in the
company's service and production lines. Because of this, the company's employees have grown
more imaginative and accommodating toward customers. Because of this, it has improved both
the company's sense of self-image and its capacity to meet the expectations of customers. Some
of the people in a company that are counted on to promote the company's image, as well as the
products and services it provides, are the front-line employees and the managing director of the
company.

Positioning - At the beginning of the 21st century, the company had already adopted highly
modernistic models for the production of its automobiles. As a result, the company's most recent
hybrid vehicles were able to easily colonize the market in the United States. It currently holds
more than 15% of the market share in the United States, where over 2.5 million vehicles are sold
annually. Over three hundred and fifty thousand people work for the company on a global scale,
and an additional one hundred million people are indirectly affiliated with it through major
garages and repair operations across the world.
Processes - As a result of embracing a lean production model, Toyota is now able to produce
products on a just-in-time basis. Waste and production costs have been cut thanks to responsible
management, which has led to an increase in overall productivity. This has made it possible for
the company to secure a significant portion of the market.

Performance - Many businesses believe that the relationship between a customer and a
manufacturer is over once a business transaction has been completed because they view this as
the "end of the interaction." Despite this, Toyota has been successful in maintaining a tangible
presence in the market and a consistent dealership with both its new and existing customers.
Because of this, it has been guaranteed that clients will continue to receive services from the
manufacturer if they have a need for those services. A rise in product sales has occurred as a
direct consequence of an improved perception of the reliability of the company among its
clientele.

6. Evaluation and Control

The Net Promoter Score (NPS) is a metric used to assess customer satisfaction and project future
business success. Using web analytics, you can see how users interact with your website. It's the
entire procedure of accumulating, examining, and presenting information gleaned from visitors'
actions on your website. Web analytics software generates reports that help webmasters and
marketers make sense of user interactions. The reports detail the users' actions on the website,
such as the amount of time they spent there, the pages they viewed, and any links they clicked or
forms they submitted.

7. Conclusion
The company might decide to concentrate on product development in order to seize opportunities
in the market. To take advantage of opportunities presented by economic external factors, Toyota
can also improve its business operations and market presence. Nevertheless, Toyota is required
to address threats that are based on external factors such as a widening wealth gap and an
increase in the frequency of cybercrime. Taking technological steps and coming up with
innovative ideas for products might be helpful in this endeavor. The S.W.O.T. analysis
conducted by Toyota identifies key issues, such as the effects of competition and the company's
weaknesses based on its organizational structure and culture, among other things. Toyota needs
to maximize its competitive advantage based on its innovative capabilities to address the threats
that are based on the competition. In addition, the company can make additional adjustments to
both its culture and its structure in order to maximize the flexibility with which it approaches
decision-making and the resolution of problems.

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