Introduction

Over the years, Toyota has established itself among the leading car manufacturing companies all over the world. This aspect has been enabled by a very effective and efficient management style adopted by the organization. Toyota’s management style has paved way to the establishment of successful marketing strategies. A lot of factors have contributed to the company’s ability to emerge as a market leader in this niche. The organization’s market structure cannot be stated defiantly. Some tend to consider it as a monopoly while others view it as an oligopoly (Spear, 2006). The monopoly aspect arises due to the company’s dominance in exportation. Going with the differentiation strategy, the organization has been able to establish seemingly monopolistic presence in many developing countries. The essence of oligopoly has been brought about by the presence of other key players like General Motors and Ford. These companies are believed to collude on various strategies deployed in different markets that they operate in (Wells, 2010). The collusion is always aimed at giving each player a share of the profits in the market, without having to undergo unfair competition. This usually happens when new brands are being introduced in the market, and their success is not known. Toyota has been up to the task on all the activities that its competitors are undertaking. The management team that has been devised takes a good look at what other companies in the industry are doing. This helps them to keep in touch with new revelations and remain to be market leaders for as long as they can.

Despite the success that the company has had over the years, operating in international markets has always been a challenge. This is based on the marketing strategies that need to be devised and differences in consumer preference compared to the local markets. Toyota was introduced in United States in the year 1965. In mid 1970’s, the company had already established itself as the best selling import brand in the country. In 1980’s, Toyota started to manufacture vehicles in the country. The aspect was attributed to the growing market share of the organization. Setting up manufacturing plants in the country also reduced the costs involved with importation. By 2006, Toyota had become the second largest car manufacturer all over the world, and third largest in United States (Onkvisit& Shaw2009). At the moment, the company is regarded as the number one manufacturer all over the world. This is based on the sales level and market share that the organization enjoys. Its existence has proved the importance of an efficient marketing strategy.

Marketing Strategy Adopted

Among the marketing strategies that Toyota has established in USA is setting up many branches for distribution purposes. This strategy has been enabled by setting up a large management team to oversee the process. Managers involved with products in the branches have undergone thorough training in their respective fields. Before recruitment, these managers need to have acquired a certain educational level and marketing experience derived from previous operations. The managers are required to deploy competent and skilled workforce in the relevant branches. The effectiveness of the workforce has come along as good marketing strategy due to the consumer engagement process (Orhangazi, 2008). A consumer getsmore satisfied when he or she is dealing with individuals that have good understandingof the product that they wish to purchase. A workforce that shows any form of reluctance is a complete turn off to consumers. Through the interactions, individuals working at the designated branches tend to learn a lot regarding consumer tastes and preference. It is also easy to understand their general feeling regarding the products being offered. Their non-verbal cues and responses can be used to get this information. Once this information is collected, it is presented to the marketing managers. Through the information it becomes easier to assess what consumers want. Favorable strategies are devised to help curb the gap that exists.

Another element of the marketing mix that the company has adopted is the product line pricing. This is a strategy devised to separate brandsin cost categories. The whole aspect is aimed at creating essence of quality levels in minds of consumers. For effectiveness, Toyota has put in sufficient price gaps in between categories so as to inform potential buyers on the difference in quality. Vehicles found in each line of production have different features compared to those in other lines of production (Monden, 2010). The more the features in one product line, the high the higher the price of the vehicles involved. The aspect has enabled the company to derive maximum profits. This is because the organization has the ability of serving consumers with different tastes and economic abilities in the country. Manufacturing vehicles that are only favorable to high income earners would be a bad approach. This is because numerous potential consumers are looked out.

Toyota has also segments its market to some extent. The segmentation process has taken place based on the income level disparity that exists in any economy. The high income earners are provided with heavy vehicles that come along with high price tag and high levels of fuel consumption. The other divide of the market is opposite of this. The aim of this segmentation is to ensure that everyone attains the desire of acquiring a vehicle despite their economic conditions. Recently, the market has been segmented further to those consumers that want environment friendly products and those that do not mind. This has been achieved by manufacturing vehicles that are propelled by electric motors for individuals that are concerned with conservation of the environment(Maxwell, & Drummond, 2010). For those that do not care, cars with fuel propelled engine still existfor them.

On promotional aspects, Toyota has been spending over $1 billion in its marketing campaigns in United States on various operational periods. The USA market is competitive based on the players involved in the industry, hence the need for aggressiveness. Among the promotional channels utilized is advertising. Toyota advertises its products through various media outlets. It has chosen to go with the media stations that have a huge following in the country. This aspect increases the chances of their advertisements being viewed by a large number of people. These advertisements are usually aired during prime times. This is that period that many people are believed to be following certain media programs or live shows. Buying airtime during this period is usually expensive but the rewards are favorable(Koenig, 2012).

Toyota also makes community building shows and public relation as part of its promotional strategies. The company has been involved in numerous projects that involve the community on most occasions. Among these projects, there has been participation in charitable organizations and offering promotions of different kinds. The organization contributes a lot to charities on many occasions. Funds involved usually come from the organization or fund raising activities (Mendelsohn, 2004). Through this approach, many people have come to realize the existence of the company. It is also involved in various developmental projects targeting different groups in the society. The projects are aimed at improving the lives of the people involved. Many individuals benefit from the projects and tend to promote the company’s products. They do this by encouraging their friend or colleagues to the company’s brands. Toyota also practices some form of personal selling as its promotional strategy. This is mostly carried on organizations that have already established themselves. The company approachesthese organization and offer to sell them cars are reduced price. Such organizations buy vehicles in bulk hence giving them a cut price works best for both parties. They are made to see the advantages that might accrue as a result of this business partnership.

The company uses Just in Time production strategy in its supply chain. So far the strategy has been effective and worked quite well coupled with the organization’s systems. For some time, it has worked as a competitive advantage to the company. However, the strategy also has its disadvantages when analyzed from different perspectives.

Value Creation

Toyota has developed various strategies that have resulted in value creation. Among the process implemented was the manufacturing of hybrid vehicles. This was an approach that went very well with consumers. There are many people out there that are concerned with the environmental conditions that they live in. Before this realization, vehicle’s pollution was out of consumers’ control. However, production of hybrid vehicles by has changed the stance. To this group of consumers, this is a sign of social responsibility from the company. They seem to be interested in conserving their health on many aspects. Recent reports have shown that the company’s print has improved significantly. The level of pollution is significantly low. Such occurrences tend to bring about consumer loyalty (Doole, & Lowe, 2005).

Establishment of developmental projects has also come as a value creation mechanism. Many companies do not give back to the society. This aspect never goes well with consumers. They are decoyed the chance of interacting with their “business partners.” Toyota’s involvement in community projects has helped in many individuals in the society. Some have been able to attain their working levels while others have been able to pursue further education through these programs. Most children in the charity organizations have had a rejuvenated hope based on the efforts that have been brought forward by the organization.

Between 2009 and 2011, Toyota called back many vehicles that were believed to have some deficiencies.These vehicles were believed to have different malfunctions including experiences of unintended acceleration. This was a positive sign on most consumers. Many had argued that it would distort the company’s image. People of this perception would have let the scenario to pass, something which would have been disastrous in the near future. It is the company’s desire to create value and uphold high standards that contributed to the call back. Consumers have become even more loyal since they feel secure while utilizing these products (Donoso, 2012).

Strengths of the Marketing Strategies

The marketing strategies being used by the organization have some strength elements that make them successful in day to day operations. To begin with, establishing manufacturing branches in different parts of the market helps in saving costs. Toyota’s parent company is based in Japan. As part of its international venture, the organization established its manufacturing plants in United States.  This move has helped on reducing costs that used to be incurred. Imports duties were very high based on the levy that was being charged. Consumers are also being served on a timely manner. Delays in delivery could result in loss of consumers if not properly checked (Castro, 2010). The aspect has also enabled employment of local personnel to work in these branches. They have some ideologies and knowledge regarding the people in this area hence have the ability of establishing favorable relationships with consumers. Through the interactions, the company is able to get an idea of what the consumers really want. This way, consumers will also get what they want and repay the organization back with being loyal to its brand.

Just in Time systems also work as strength factor in the company. Competitors in the industry are yet to adopt this system and integrate it into their marketing mix. Being able to uphold this in Toyota’s supply chain has seen the total costs reduce significantly. Reduction in total costs has accrued due to reduction in the holding costs. By using the Just in Time production, every product is manufactured as and when its demand arises. This means that the company does not have to hold the inventory before a viable buyer comes around. All the costs involved in holding such inventory are avoided hence the organization’s profit increase. Consumers are still served on time Toyota is a technology and innovation driven organization. It is now possible for them to manufacture a car within 5 days.

Product line pricing has also come as strength to the organization. The economy has some forms of disparity in it. It is comprised of high income and low income earners. These groups of consumers have different tastes and preference. Their choices are curtailed by their social values and ability to purchase. By using the product line pricing, Toyota has been able to capture a large market share. This is because it serves the low income earners and high income earners. As a result, more sales revenues are realized (Cooney &Yacobucci, 2007). This contributes to increased profits. Using the product line pricing also enables in getting more revenues from the high income earners. Automobile with more features usually go at a high price. There are those consumers that purchase products since their prices are high. To them is a matter associating with the brand rather than getting the true value to their money. Product line pricing has enabled Toyota to set up this approach so as to entice this type of consumers.

Weaknesses of the Marketing Strategy

Despite the Just in Time system working as strength to the organization, it also comes along to be a weakness.When using Just in Time system, all individuals involved in the process must work efficiently. Failure on side of operation might derail the process. To some extent, it might result to temporarily calling a process off. This would amount to delays in the manufacturing of products. As a result, customer orders are not fulfilled on time.

Having a large team of management is also another form of weakness. Establishing numerous branches has come along with deployment ofa large team of management. When the management is large, it becomes difficult for efficient operations to be initiated. There is a lot of bureaucracy in each department. An issue must pass through several stages before it is passed or agreed upon. This might be detrimental to the organization, more so in the marketing area. This field is dynamic and changes from time to time. It requires some level of flexibility in decision making for sufficiency purposes. Derailing the process through lengthy consultations might result in market failure.

Based on the promotional aspects that Toyota is adopting, it seems to concentrate more of digital advertising. This is a weakness since there are individuals that are potential consumers and might not be reached by the information since they have not embraced technology. They have opted to remain analogue despite the current trends. Their own perceptions and desire have prompted this actualization. Concentrating more on the digital arena, might lock out these consumers (Cameron, 2006).

Strategic Approach for Increasing Profitability

The automobile industry has a large market share based on the consumers that derive its products. For this reason, the market is very competitive since every player wants to get a share from the market. Profit maximization is the ultimate goal for every organization. For Toyota to increase its profitability, several strategic approaches shouldbe devised. Among them is establishing a favorable relationship with the suppliers. Based on its Justin Time production system, the company tends to put a lot of pressure on the suppliers. In the long-run, this might affect the company’s profitability prospects. Creating positive relationships will ensure that the suppliers bring quality products. This is because they want to work for as long as possible with the organization. The prices they will charge on the raw materials will be prudent (Bowen, 2011). Sometimes when the relationship is not favorable between these two parties, suppliers tend to inflate the prices of raw materials. When the prices are favorable, cost is reduced hence the profitability prospect rises.

The company also needs to adhere to all the rules and regulations set forward by the government and other relevant bodies. Most of these are related to environmental matters and vehicle safety. There is a requirement that the company calls back any vehicles that do not meet the standard threshold.Failure to meet these requirements might result to high fines. This would come as an increased cost reducing the levels of profits.

Increasing the Market Share

Increasing the market share is not an easy task for any organization. For Toyota to attain this, it has to establish some strategic approaches. Among these approaches would be manufacturing limited edition vehicles. These are those vehicles that come only once in a life time. Consumers will always scramble for such products. This is because most of them like being uniqueand want products that are limited in the market. The aspect creates an essence of loyalty since many consumers will be waiting for such occurrences. They tend to get in touch with the company’s affairs so as to know when these products are available in the market. As a result, the company increases its market share since other consumers from the competitors will be enticed by such offerings (Bell & Morse, 2008).

Toyota should also proceed with its aspects of enhancing social responsibility towards the consumers. This has been the company’s blue print ever since its inception. There should be more investments on research and analysis process. This will improve the innovation prospects of the organization. Through the research it will also be easy to identify what consumers want and make available to them. To consumers, it feels when a business understands and upholds their needs. The consumers will keep on recommending the company’s brands to their colleagues and friends that have not embraced them. In the long-run, Toyota will keep on increasing its market share.

Increasing Sustainability

For Toyota to increase sustainability there is need to establish favorable organizational culture and staff development.Employees are always regarded as valuable assets to any organization. Their efficiency usually results to success of the company in one way or another. An organizational culture is always vital if any success is to be realized in any working environment. Employees need come through a certain routine of doing things. This aspect helps in creating uniformity among the employees (Allen, 2012). All employees adhering to the organizational culture tend to work in partnership. If Toyota is able to enhance this, they will be able to bring social responsibility aspects to the consumers. The company’s strategy of embracing technology and being the leaders in this field will also get a boost. Development of employees can be enhanced by adopting various strategic management systems that include training and development systems. Efficiency from employees will enhance sustainability for a long time.

The company also needs to invest a lot on promotional activities. This includes advertising and other techniques being used by the organization. The industry is very competitive hence needs aggressiveness in creating consumer awareness. Toyota should be on the look out of the promotional strategies being used by the competitors. It might copy from them or come up with something better. The more people see something being promoted, the higher their chances of being potential consumers. This would enhance sustainability since the company will remain profitable for a long time.

Increasing Value Creation

There are many strategic approaches that Toyota can adopt so as to increase value in its operations. Among them is using technology that is reliable, tested and serves the processes and people intended. At all times the technology that is adopted should be there to help employees and not to replace them. Lying off employees usually comes as a negative publicity to the general public. To avoid this, Toyota should be very cautious on impacts brought by any technology that is adopted. Technology that is difficult to standardize should also be avoided. Technology of such nature disturbs the flow of the processes and calls in for additional supervision of employees (Borowski, 2010). The organization should also take the initiative of modifying or rejecting technologies that conflict with the company’s culture. This is because the results might be unpredictable hence making the organizationdeviate from its objectives. Such an occurrence might diminish the organization value.

Another way that Toyota can increase its value is by getting more involved with community development. There would entail participation in various social event and other profitable ventures to the society. This helps build the company’s image and becomes more valuable to the consumers’ eyes.

Conclusion

Toyota is recognized among the leading automobile manufacturers in the world. Efficient management has been vital in this realization. Over those years, operating in the USA market has not been easy. However, the marketing strategies that have been adopted have enabled the company to survive amidst the stiff competition posed by other players in the industry.  Among the strategies adopted by the organization is setting up several branches for distribution purposes. The company has also been able to introduce product line pricing in its marketing mix. This has been very helpful in capturing of substantial market share. Toyota practices some form of segmentation where it differentiates the high and low income earners. There is usage of the Just in Time production system for efficiency purposes. Several strategies have also been adopted in the promotional process. They range from advertising to personal selling. All these strategies have their own strengths and weaknesses. The company needs to start manufacturing of limited edition brands in order to increase its market share. Establishing a favorable organizational culture and staff development would work to enhance sustainability. Use of appropriate technology on the other hand, would help in value creation.

 

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