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1. Explain the various elements of the marketing process
2. Evaluate the benefits and costs of a marketing orientation for a selected organisation

Marketing Elements and Marketing Orientation of Toyota

Marketing principles are the widely used strategies used by organizations for optimizing the market performance of existing products and successfully launching new products (Sok, O’Cass and Sok 2013). The study is provides a complete understanding about the marketing principles adopted by Toyota for getting success in the market. In task 1, the study will discuss various marketing elements and evaluate the marketing orientation of Toyota. In task 2, the study will assess the micro and macro environmental factors of the organization and propose the segmentation and targeting criteria of the same. It will also demonstrate the consumer buying behavior and new positioning of the product. In task 3, the study will discuss the marketing mix of the organization along with its extended marketing mix. Furthermore, the study will also make a presentation on Vodafone UK describing its two different segments, different marketing products and services and international and domestic marketing.

Marketing is the set of business tricks, which are used to promote and sell products and services to the customers and includes market research and advertising. Marketing process involves the activities of analyzing the opportunities of market, choosing target market and forming marketing mix for effective marketing effort (Kumar 2015). The following table defines different elements of marketing process used by organizations.

Elements

Analysis

Situational Analysis

Situation analysis is extremely important for assessing the external as well as internal opportunities and threats on the business of an organization. Based on the situation analysis, an organization can pre-plan its business by exploiting the opportunities and avoiding the threats for getting business success (Sok, O’Cass and Sok 2013).

Marketing Objectives

Marketing objectives are always directed towards the goals of the organization, which helps in achieving the overall organizational goals. Furthermore, marketing objectives set the goals, while promoting products and service of an organization to the customers.

Marketing Strategy

Marketing strategy defines the general plan of reaching out to the people and transforming them into customers of products and services offered by business. It is a long term and forward looking approach to set fundamental goals for achieving sustainable competitive advantage.

Marketing Mix

Marketing mix is the combination of seven elements like product, price, place, promotion, people, process and physical evidence under organizations’ control for achieving marketing objectives (Han and Han 2016). It is usually directed towards attracting customers for purchasing the products and services offered by an organization.

Table 1: Elements of Marketing Process

(Source:Kumar 2015)

Benefits and Costs of Marketing Orientation for Toyota

Marketing orientation defines the organizational philosophy, which is focused on discovering and meeting the customer needs through effective product mix. It sets the business model, which delivers the products and services to the customers as per their customized needs and demands. The following table describes the benefits and costs of marketing orientation for Toyota.

Market Responsiveness

Market orientation helps Toyota in understanding the core needs and demands of the customers in regards to their cars. Hence, the organization can better response to the customized needs of the customers, which leads to competitive advantage for the organization (Kobayashi et al. 2017).

Constant Improvement

Marketing orientation facilitates Toyota in understanding changing needs and demands of the customers and market trends. Hence, it helps the organization in constantly improving their car features as per changing needs of the customers (Han and Han 2016). In this way, Toyota stands out to be unique in the market by offering cars as per changing requirements of the customers.

Long-Term Profitability

Marketing orientation leads to consistent understanding and delivering of customized products to the customers. Hence, such orientation facilitates Toyota in enhancing customer loyalty. Moreover, it turns the one time customers into repeat customers, which enhances the long term profitability of the organization.

Cost of Marketing Orientation

Higher Cost

Investment in marketing research is quite high, as Toyota needs powerful marketing intelligence for responding accurately. Constant investment is also required for investing in new products and product modification, which requires huge cost for the organization (Jindal, Laveena and Aggarwal 2015).

Risk of market Underestimating

Ineffective approach used in the market research process can lead to risk of underestimating the market. In such situation, Toyota can make wrong business decision based on wrong data of the market research.

Table 2: Benefit and Cost of Marketing Orientation

(Source: Created by Author)

Macro and Micro Environmental Factor of Toyota from Automotive Industry

Macro Environmental Factors of Toyota in Automotive Industry

PESTLE Analysis of Toyota

Political Factor

· Stable political condition of United Kingdom can build the business success of Toyota

· Huge Government support of United Kingdom leads to flexible business environment

· Free trade agreement of the country helps Toyota in getting international business success (Jayamaha et al. 2014)

Economic Factor

· Developed economic condition has enhanced the profitability of Automotive industry

· Frequent changes in inflation rate hampers the cost of business operation of the organization

· Higher economic growth leads to higher income of the customers leading to their high purchasing power (Thompson 2015)

Social Factor

· Modern and sophisticated life of the people encourage them to have their own private cars, which increases the sales volume of automotive industry

· Changing preferences of the customers for car models can impose challenges on Toyota (Antara 2016)

· Increasing trends of electric cars has increased the sales of electric cars of Toyota

Technological Factor

· Technological growth of the country helps Toyota in manufacturing cars having modern technical features

· Advancement in digital and social media help the organization in better promotional activities (Endo and Kurata 2014)

Legal Factor

· Passenger safety act can impose challenge on the organization

· Labor laws of the country also impose certain limitations on the organization

Environmental Factor

· Strict environmental regulation imposes challenges on overall automotive industry (Sok, O’Cass and Sok 2013)

· Toyota has taken enough initiative for adhering to the environmental regulation through launching electric vehicle

Table 3: Macro Environmental Factor of Toyota from Automotive Industry

(Source: Created by Author)

Micro Environmental Factors of Toyota in Automotive Industry

SWOT Analysis (Micro Factors)

Strength

· Strong brand image helps the organization attracting  huge customers

· Wide of car variants facilitates the organization in meeting several types of car needs of the customers

· Hybrid technology and its production like Kanban, kaizen are the benchmark in the manufacturing

· Strong employee base facilitates the organization in its strong product system

Weakness

· High brand image is highly vulnerable to through even for any small issue

· Wide available alternative options encourage the customers in easily switching in another brand

Opportunities

· Huge scope of expanding in international automobile market and launching new cars

· Intense effort in hybrid segment can assist Toyota towards becoming the market leader in electric vehicle market

· Augmenting worldwide service network and distribution system increases market penetration

Threats

· Intense competition in the automobile market leads to market saturation

· Tough competition is forcing the organization in offering innovative car features at less price, which is leading to reduced market share

· Increasing fuel price can hamper the success of the organization

Table 4: Micro Environmental Factors

(Source:Ito 2014)

Segmentation is the marketing process of dividing a broad consumer market into some subgroups of consumers having shared characteristics. Segmentation criteria should lead the market segment, which are quantifiable, reachable, considerable and actionable (Han and Han 2016). The list of segmentation criteria are shown below:

  • Geographic
  • Demographic
  • Psychographic
  • Behavioral

The following table defines the segmentation criteria used by Toyota for choosing market segment:

Segmentation Criteria

Demographic

· Age: 25-60 aged people areselected as the customers of Toyota

· Gender: Both male and female customers are selectedfor the cars

· Income: People having stable income and affordability of having cars are the customers of Toyota

· Education: Mostly educated people are the customers of the organization

· MaritalStatus: Both single and married people are the customer of the organization

· Occupation: Business people, corporate officials, stable job holders

Psychographic

· Attitude: Positive attitude towards life

· Lifestyle: People having modern lifestyle are segmented by the organization

· Hobbies: People having hobbies of car riding

· Personality: People having strong personality

Behavioral

· Brand Loyalty: People having strong brand loyalty are the customers of Toyota

· Benefit Sought: Customers inclined towards attractive discounts and offering are the customers of the organization

Table 5: Segmentation Criteria

(Source: Created by Author)

Micro and Macro Environmental Factors of Toyota

Toyota uses differentiated targeting strategy for it different market segments. The advertising effort of Toyota is aligned with local cultures of the customers in different markets. In this way, the customers feel familiar with the brand. Moreover, the organization uses customized marketing content for multiple consumer segments for meeting their different needs and demands. This is the most preferred targeting strategy for Toyota. While considering the example of Toyota GT 86’s, it can be seen that the organization has prepared the commercial, where a man is ensnared inside the CGI (Computer Generated Imagery) city to discover Toyota GT 86’s from real world, feeling living for the first time and settling on to make his escape. This commercial is actually targeted towards younger European generation. On the other hand, the organization targets to have different hip and cool image for various American generations. In this way, Toyota uses differentiated target strategy for attracting customers in different markets.

Consumer decision making process is extremely important to understand the way in which consumers’ decisions affect the marketing activities (Antara 2016).

  • In the first step, the consumers need to recognize their needs, which would encourage them towards purchasing the specific products towards satisfying their needs
  • In the second step, consumers search for the information about the product through various information sources of Toyota
  • In the third step, the consumers evaluate the specific product of Toyota with their competitive companies like General Motor, Hyundai Motors, Chevrolet and others
  • In the forth step, the consumers take purchasing decision based on the evaluation of alternative products
  • In the fifth step, the consumers seek proper after sales services, which improve customer satisfaction and long term customer engagement.

Increasing inclination of the customers towards online shopping encourage them to search product information through online channels (Olof Lagrosen and Grunden 2014). Hence, the marketers of Toyota have given much focus on online advertisement strategies. Moreover, they have given their major focus on digital marketing and social marketing activities for reaching unique product information to the customers and attracting them towards the products. In the next purchasing situation, the customers evaluate the alternative product options in the market for choosing the best option. In such situation, the marketers of Toyota post attractive discounts and offering in their marketing process for attracting the customers. Moreover, they use unique information about the cars for being unique in the market and influencing the purchasing decision of the customers.

Most of the customers in today’s market are inclined towards purchasing products online. Hence, the marketers of Toyota have started to use online shopping availability for customer convenience. Post purchasing evaluation and decision always matter in consumer buying behavior. Customers always want to share their feedback on the usage of a particular product for getting improved product in future (Saunders, Barrington and Sridharan 2015). In such situation, the marketers of Toyota maintain effective communication for getting their feedback of their usage of products. In this way, the organization modifies their products as per customers’ needs and demands and gain high level of customer loyalty.

Segmentation and Targeting Criteria

New positioning is the act of designing the offerings and image of an organization in a unique way, which helps the organization in creating distinctive place in the target market. New positioning is extremely important for creating a unique value of an organization in mind of customers (Christanti and Sri WidowatiHerieningsih 2017). The following tables demonstrate the factors of new position for Toyota towards creating unique image in the target market.

New Positioning

Factors for New Positioning

Toyota should use affordable price for their cars for being market leader in automobile industry

Luxurious Look

The organization should concentrate on new design for giving luxurious looks on the cars for attractive premium customers

Special Safety Features

Toyota can incorporate more advanced and safety features for providing more safety to the passengers

More Concentration of Improving Electric Cars

The organization should improve the quality of electric car vehicles for being leader even in electric car market

Table 6: New Positioning of Cars

(Source: Created by Author)

Competitive advantage is the unique value and leverage gained by an organization over its competitors through offering unique and greater product value to the customers (Djordjevi? 2014). HSBC offers wide variety of products and services offered to the customers all around the world. The bank has divided its products and service range into different categories like private banking, investment banking and global banking, wealth management and retail banking and commercial banking. According to Naheem(2015), HSBC offers excellent retail banking, personal loans, internet banking, international credit card with flexible terms and condition. The bank also offers effective financial planning for the customers towards their proper savings, which enhances its customer volume. On the other hand, Hossain and Khan (2016) opined that HSBC has an effective corporate relation by providing attractive corporate finance, trade facilities, corporate deposit and cash management. Moreover, excellent products and service offerings of this bank meet the unique saving needs of the customers, which help it in bringing competitive advantage.

Distribution is a significant part of marketing mix, which ensures convenient delivery of products and services to the customers. Followings are different types of distribution channels used by HSBC for better customer convenience.

HSBC is the largest bank in the world in terms of its assets capacity. The bank has opened 6600 offices in at least 85 countries around the world. The operation of the bank is active in all around the world, which has spread in the continents like North America, South America, Europe, Africa and Asia (Ghosh and Ghosh 2017). The banks are set up in such location, which can provide best possible services to the customers.

Huang (2015) pointed out that HSBC offers easily approachable internet services to the customers for providing banking services round the clock twenty-four hours a day. It provides excellent customer convenience to the customers in accessing the banking services. Furthermore, Hardouin and Hardouin (2017) opined that the ATMs of HSBC bank are set at strategic locations at main points so that customers can easily access the ATM services.

Consumer Behavior and Buying Process

Different banks have extended the offline service, where experienced and knowledgeable banking staffs visit the customers when they need appointment.  The door to door service has been extended for the customers. Furthermore, such service is actually provided to the customers, who are unaware of the banking services and need assistance (Huang 2015).

Right pricing strategy assists an organization towards maximizing its profit and achieving long term success. Different types of pricing are explained below:

Competitive pricing is the setting of prices for the products services based on the pricing strategy of the competitive companies. In such pricing strategy, products are offered to the customer in such prices, which maintain good profit margin and keep up competition (Christanti and Sri WidowatiHerieningsih 2017).

Premium pricing is the practice of keeping the price of the products and service high for encouraging favorable perception of the customers. Such pricing is used for maximizing the profit level, where customers are willing to pay more for the specific product (Hossain and Khan 2016).

Penetrative pricing is the practice of keeping the price of new products and service low towards luring the customers away from the competitors. Such pricing increases market share and customer loyalty (Huang 2015).

HSBC always operates in competitive market both in its domestic as well as international market. Hence, the pricing policy of the bank is highly dependent on market trends and changing policies of the rival banks. According to Ghosh and Ghosh (2017), HSBC offers value added pricing policy for all its products and services towards maintaining customer base. In such pricing strategy, the bank offers prices based on perceived value of the customers regarding the products and services. On other hand, O’Sullivan and O’Sullivan (2017) opined that HSBC does not charge any fee for opening a bank account for attracting the customers. Under the scheme of credit cards, the bank charges minimum amount for attracting the customers.

HSBC uses extensive promotional strategy for creating awareness among the customers regarding the products and services. According to Naheem (2015), HSBC places its advertisement on billboard, business magazines and newspapers for reaching the customers. Furthermore, the bank also uses informative commercial telecast at regular interval on the television for making the customers familiarized with the banking policies and strategies. On the other hand, Huang (2015) opined HSBC uses social media and digital media advertisement for properly reaching wide customer groups. Furthermore, the bank acts as sponsor for various events for increasing customer awareness about the banking products and services.

New Positioning of the Product

All the international banking activities of HSBC are actually governed by the head quarter established in United Kingdom. According to Ghosh and Ghosh (2017) HSBC follows standard formats, as it has to abide by the rules set by them. The e-outlet process of the bank helps the customers in performing their needed banking activities through online services.

Hossain and Khan (2016) opined that knowledgeable and well-trained banking employees of HSBC apply flexible approach in offering banking services to the customers. Such trained employees are highly capable of provide effective banking service to the customers.

The business cards, paperwork, furnishing are extremely flexible in this bank as per customer requirements. The customers can easily approach within the bank in its separate department.

Reference List

Antara, A.P.K.B.K., 2016. A Comparative Study of Consumer Purchase Decision Between Consumer of Toyota Vios And Honda City. JurnalBerkalaIlmiahEfisiensi Volume, 16(04).

Christanti, R. and Sri WidowatiHerieningsih, M.S., 2017. The Correlations of Advertising Exposure and Communication Competency of Sales Marketing with Buying Interest of Toyota All New Sienta. Interaksi Online, 5(3), pp.1-9.

Djordjevi?, B., 2014. The importance of global marketing. MSET Journal, 2(1), pp.116-124.

Endo, Y. and Kurata, Y., 2014. Flagship facilities of Toyota: The suitability of collaborations with tourism industry. CAUTHE 2014: Tourism and Hospitality in the Contemporary World: Trends, Changes and Complexity, p.198.

Ghosh, A. and Ghosh, A., 2017. How do derivative securities affect bank risk and profitability? Evidence from the US commercial banking industry. The Journal of Risk Finance, 18(2), pp.186-213.

Han, C.M. and Han, C.M., 2016. Global identity strategy and its efficacy for Asian brands: Is Toyota global or Japanese to consumers?. Asia Pacific Journal of Marketing and Logistics, 28(5), pp.862-877.

Hardouin, P. and Hardouin, P., 2017. Too big to fail, too big to jail: restoring liability a lesson from HSBC case. Journal of Financial Crime, 24(4), pp.513-519.

Hossain, S. and Khan, M.R., 2016. Corporate Social Responsibility (CSR) in Banking Sector: An Empirical Study on the Hong Kong and Shanghai Banking Corporation (HSBC) Limited. IOSR Journal of Business and Management, 18(4).

Huang, J.Y., 2015. Effectiveness of US anti-money laundering regulations and HSBC case study. Journal of Money Laundering Control, 18(4), pp.525-532.

Ito, H., 2014. Toyota as an environmental model city: Is its eco-policy recognized?. Journal of Sustainable Development, 7(2), p.70.

Jayamaha, N.P., Wagner, J.P., Grigg, N.P., Campbell-Allen, N.M. and Harvie, W., 2014. Testing a theoretical model underlying the ‘Toyota Way’–an empirical study involving a large global sample of Toyota facilities. International Journal of Production Research, 52(14), pp.4332-4350.

Jindal, S., Laveena, L. and Aggarwal, A., 2015. A comparitive study of crisis management-Toyota v/s General motors. Scholedge International Journal of Management & Development ISSN 2394-3378, 2(6), pp.1-12.

Kobayashi, M., Tomino, T., Shintaku, J. and Park, Y., 2017. Demand fluctuation and supply chain integration: case studies of Japanese firms. Perspectives on Global Development and Technology, 16(5), pp.564-586.

Kumar, V., 2015. Evolution of marketing as a discipline: What has happened and what to look out for. Journal of Marketing, 79(1), pp.1-9.

Naheem, M.A., 2015. AML compliance–A banking nightmare? The HSBC case study. International Journal of Disclosure and Governance, 12(4), pp.300-310.

O’Sullivan, P.J. and O’Sullivan, P.J., 2017. Regulatory relationships and incentives: from Riggs Bank to HSBC. International Journal of Law and Management, 59(5), pp.729-739.

Olof Lagrosen, S. and Grundén, K., 2014. Social media marketing in the wellness industry. The TQM Journal, 26(3), pp.253-260.

Saunders, S.G., Barrington, D.J. and Sridharan, S., 2015. Redefining social marketing: beyond behavioural change. Journal of Social Marketing, 5(2), pp.160-168.

Sok, P., O’Cass, A. and Sok, K.M., 2013. Achieving superior SME performance: Overarching role of marketing, innovation, and learning capabilities. Australasian Marketing Journal (AMJ), 21(3), pp.161-167.

Thompson, A., 2015. Toyota’s generic strategy and intensive growth strategies. Retrieved April, 27, p.2016.

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