Market Penetration:
The market penetration strategy implies selling more
of your products in your existing markets. Toyota sells
in 190 countries which shows its high level of market
penetration. The leading two markets of Toyota
Motors are North America and Japan. The US is the
leading market for Toyota in North America. In 2019,
the company sold 10.6 million vehicles in North
America and 9.5 million vehicle units in Japan. Coupled
with its cost leadership strategy, deeper market
penetration in the key automobile markets and the
overall automobile industry has helped the brand
achieve a very high level of sales and find profitable
growth. This has been Toyota’s strategy since its
foundation and the company has established a large
and efficient global distribution network to sell its
products all around the globe. Market penetration is
one of the key intensive strategies used by global
brands to grow their market share and expand the
customer base.
Market Development:
Market development is the strategy of entering new
markets and adding new customers to your existing
customer base. However, Toyota has already achieved
global expansion and therefore it used the market
development strategy during its initial phases of
growth. However, the market development strategy
has remained key to ensuring the success of its overall
business strategy. Some of the leading markets of the
world where Toyota has achieved extensive
penetration are its domestic market Japan, the US, and
China as well as India, Malaysia, and the leading
European automobile markets. Now, that the company
has achieved its market development objectives, it
mainly relies on the other two intensive strategies to
secure growth and grow sales throughout the world.
Product Development:
Toyota is known worldwide as an innovative brand
of automobiles. Apart from innovation in
production and supply chain, the company also
focuses on rapid product innovation to bring more
fuel-efficient and safer vehicles to the market.
Therefore, the company continuously invests in
research and development so that its product
portfolio continues to stand out amid the heavy
competition. Apart from improving passenger
safety, the company is also investing in automated
driving technology. Through product development,
the company has continued to evolve its product
range and business model to achieve superior
growth in a highly challenging industry
environment.
Diversification:
Diversification also has two perspectives: concentric
diversification (related goods and services) and conglomerate
diversification (unrelated goods and services). Toyota financing
its vehicles is an example of the concentric diversification policy
where Toyota offers services related to its core business. The
multitude of other ventures which include Toyota Roof Garden,
Toyota Financial Services Corp, Prefabricated Houses, Toyota Bio
and others are examples of the conglomerate diversification of
Toyota away from its core business. Diversification is usually
used as a means of reducing the risk associated with business
failure. The belief is that once diversified if a certain industry
loses its potential and falls the damages suffered due to the
failure could be cushioned via the success of other businesses
the company is involved it. In the case of Toyota diversification
has further boosted the company’s success has also been used
as a promotional tool. Much of Toyota’s businesses are
manufacturing related and are often perceived in a negative light
by environmentalist and other social activist groups. Toyota has
used diversification in the form of Toyota Bio , Toyota Roof
Garden and Good Life Design (medical support services) to
mitigate such criticisms and develop healthy public relations.