Capital University of Science & Technology Islamabad

Consumer Behavior

Final Project Report

TOYOTA

Group Members:

Muhammad Usman BBA191003

Asad Azeem BBA191004

Haider Ali Khan BBA191027

Waqar Ul Hassan BBA191046

Submitted to: DR. Lakhi Muhamad

Section: 2
Introduction

In 1933 company was founded by Kiichiro Toyoda. In 1934 department of Toyota industries
manufactured first product the product called Type A engine and its first passenger car AA in
1936. Toyota bought some other companies also and own and operates Lexus, Scion, Daihatsu
and Hino Motors and shareholdings in Fuji heavy industry, Isuzu, Yamaha, and Mitsubishi
Aircraft Corporation. All these and some other in total include around 522 subsidiaries. Toyota is
headquartered in Toyota City, Aichi and in Tokyo. Instead of automobile Toyota also provides
financial services through its division Toyota Financial Services and also builds robots for
different industries. Toyota Motor Corporation its financial services and Toyota Industries all
together form the bulk of the Toyota Group and one of the largest conglomerates in the world.
Toyota is worldwide famous and well-known company because of their high-quality
manufactured cars, Toyota is doing very well and growing very fast globally they have their
operations, manufacturing facilities and valuable loyal customers all over the world. The new
technology Hybrid in Toyota cars gave a new pride to Toyota and the sales of Toyota going up
day by day. In last few years Toyota became number one in automotive industry and became a
number one in mostly selling their cars worldwide. Below chart shows the figures of
manufactured cars in 2008 and the chart is showing other companies’ production also.

In 2008 Toyota overtook GM and automotive industry announced Toyota the world biggest
carmaker. But after that complains started arising and more customers stated blaming about the
quality controls because of their rapid expansion. Due to the rapid expansion they recalled more
than eight million cars in year 2009 the brake and accelerator defects and bearing, defending
their selves against 98 lawsuits due to the deaths, injuries and damages happened to customer
who were using their cars. Toyota products were in high demand worldwide and they had a time
when they felt they might not be able to meet the demand of customers but they were selling as
normal routine and increase the production with huge volumes and increase the manufacturing
speed. Contacted and started working with more suppliers for different parts which they are use
to buy from different suppliers. Toyota Executives and Mr. Akio Toyoda had a strong feeling
that working with new and more suppliers might give a bad impact for their quality and they
might not be able to control well. They had very busy and high demand for their cars instead of
finding good solution to cope this situation they didn’t go for more alternatives like booking,
reservation for cars instead of doing this they gave focus on rapid expansion.

Rapid expansion met the demand of customers but on the other hand gradually they started
receiving complaints from their customers. In one period they were aware of the problem but
they didn’t recover it and took it easy which later returned back as a big problem for Toyota and
did huge quantity recalls which cost a lot.
the evolution of the marketing concept:

The target customers of Toyota are in the age group of 30-50 years old with middle-range
income and looking for automotive vehicles with good value for money. When thinking about
Toyota cars, people think of durability, sustainability, quality, safety, reliability, and innovation.
To build this reputation among target customers, Toyota needs a suitable marketing strategy.

A mix of Demographic, Geographic and Psychographic segmentation strategies is used by

Toyota for customer profiling and understanding different customer groups.

Toyota uses differentiated targeting strategy for manufacturing and selling its offerings as per the
customer segments and improve the customer satisfaction.

Value-based and user benefit positioning strategies are used by the company for highlighting the
functional benefits of the offerings of the company.

the relationship between value and customer retention

Starting from an effort to satisfy customers, Toyota will get closer to its customers. Toyota
formulates its strategy based on the perspective of outward looking rather than inward looking.
Marketing orientation also shifts from market orientation which tends to focus on transactions to
market orientation which tends to focus on relational. The shift from the transaction marketing
era to Relational Marketing is a major concern in the context of gaining and retaining customers.
In Relational Marketing there is the meaning of ongoing transactions in other words building
long-term partnerships with customers that can ultimately infer customer loyalty. This long-term
relationship will be more memorable for customers when Toyota also considers the customer
satisfaction factor.

When Toyota is able to create good relationships and deliver products satisfactorily, customer
confidence in Toyota will increase. This situation will ultimately become a strong protection for
the Toyota market. This means that Toyota is able to create restrictions or obstacles so that
customers are reluctant to move to another Toyota. The end result of Toyota's efforts is the
creation of high customer retention so that Toyota becomes irreplaceable and becomes part of the
customer's effort to meet their needs and expectations. The concept of Relational Marketing
focuses on creating value by involving customer interactions to obtain information related to
expectations and levels of customer satisfaction on an ongoing basis. In implementing the
Relational Marketing strategy, Toyota needs to pay attention to several key factors which include
loyalty and satisfaction, profitability, and customer retention. The profitability of a business is
very dependent on the customer making a repeat purchase. Customers who repurchase the
produles or services offered by Toyota will positively support the services and products offered.
In addition, the customer will create a source word of mouth so that it can reduce marketing costs
for Toyota, which in turn will increase the level of profits obtained. Another thing that Toyota
needs to consider in developing Relational Marketing is customer retention because if Toyota is
able to provide quality customer service it will provide value to the customer. In the era of
Relational Marketing there was a change in the conventional outlook from product-oriented to
market-oriented by building long-term mutually beneficial relationships between Toyota and
customers. n the era of Relational Marketing customers became the center of attention so Toyota
focused its strategy one of them on relationship creation rather than on sales but its attention to
customers after sales. Relational Marketing is a form of marketing strategy that emphasizes good
relations and mutual benefits between the interests of both parties, namely Toyota and
customers. The mutually beneficial relationship between Toyota and the customer will have an
impact on the efficiency of marketing costs because satisfied customers, related to the products
and services offered by Toyota, will likely repurchase and recommend it to others. Based on
these thoughts, the researcher formulated the research problem how the relationship between
Relational Marketing and community effects on switching barriers so as to increase customer
retention. From the research problem formulation emerged the following research questions are
Does Relational Marketing have a significant effect on Switching Barriers, Does Relational
Marketing have a significant effect on Switching Barriers, Does Relational Marketing have a
significant effect on customer retention, Does the Community have a significant effect on
customer retention, Does Switching Barrier have a significant effect on Customer Retention.
Another novelty in this dissertation methodologically is that it combines several relationship
marketing, community, switching barrier and customer retention variables.

the objectives of socially responsible marketing

Today, as the world is faced by ever worsening challenges that need responses on the global
scale, such as the changing environment and the spread of infectious diseases, the very value of
companies as members of the global community is increasingly in question.
 Toyota sees that it is time to take concrete action on social contribution, based on our
understanding as a company of what we want to be like in the future. We have identified areas
for increased focus as we seek to achieve the SDGS: encouraging a more harmonious society,
human asset development*, and community co-creation and accomplishing Toyota's goal of
Mobility for All. We will contribute to establishing a global society in which everyone can live a
rich and dynamic life through these four focus areas.

Our approach to the particular issues in each area will include a sense of personal ownership and
action taken on a genchi genbutsu (onsite hands-on experience) basis. We will work with
partners, who share the same aspirations for the future, in addressing issues that are difficult to
solve by ourselves.

The basis of Toyota's foundation was an aspiration to create happiness for all. All of our
corporate activities are driven by the desire to bring happiness to people other than ourselves
through social contribution.

Labor and human rights 2.14% of all workforce are disabled people

  Quality Control (QC) circles have been instituted at Toyota to increase the vitality of people
and workplaces. As of March 2015, approximately 4,100 circles involving approximately
 
36,000 members were active in Japan, and approximately 13,000 circles involving
Health and safety approximately 99,000 members were active abroadToyota conducts genchi genbutsu safety
inspections regularly to ensure the safety of employees and visitors to the company.

Environmentb) water Rainwater collection has been implemented by Toyota to reduce the amount of water usage
consumption in its plants

  Toyota engages in recycling in the following four directions:

c) recycling (1) utilization of eco-friendly materials; (2) making use of parts longer; (3) development of
recycling technology; (4) making vehicles from the materials of end-of-life vehicles.
 
The company aims to improve the global average fuel efficiency by 25% by FY2015,
 
compared to FY2005
 
As of December 31, 2013, use of Toyota hybrids* had resulted in approximately 41 million
  fewer tons of CO2 emissions

  “New Vehicle Zero CO2 Challenge,” initiative aims to reduce vehicle CO2 emissions by 90

d) CO2 emissions percent in comparison with 2010 levels, by 2050

Supporting local  Toyota promotes local purchasing globally

communities

Gender equality and As a result of relevant set of initiatives the number of women in managerial positions has
minorities increased from 16 in 2004 to 111 in 2015.Toyota aims to increase the number of women in
managerial positions in 2020 by three times the number in 2014

Other initiatives Toyota has initiated a number of road safety education programs which include issuing
nearly 134 million copies of traffic safety picture books to preschool and kindergarten
children around Japan, and nearly 1.5 million copies of traffic safety picture-card sets.
Moreover, TeenDrive in the US and White Road Campaign in Thailand are among road
safety educational initiatives launched by Toyota outside of Japan.CSR workshop and
education programs are organized for suppliers in Japan and abroad participation in which
 is voluntary

To understand how the Internet and related technologies improve marketing transactions by
adding value that benefits both marketers and customers.

Its strategies vary across different practicing areas at several levels including national, regional,
and global levels. They take action based on the assessment involving the target customers’
choices, purchasing capacity, and the market condition in a specific area. They are the key
elements in designing Toyota’s marketing strategies.

Toyota is also guided by the concept of continuous improvement including the principles of
Kaizen, Challenge, and Genchi Genbutsu. Kaizen is a way of thinking referring to make
continuous small improvements to business processes, which is likely to contribute to Toyota’s
use of social networking sites.

Challenge principle infers acting bravely to complete the mission when a challenging task is
encountered. The last principle stands for retracing with a self-checking process to ensure that
you have the necessary knowledge to achieve. 

“Before you say you can’t do something, TRY IT!” says Kiichiro Toyoda’s father, Sakichi
Toyoda who is also a Japanese inventor and industrialist. 

As the internet has become more accessible in the last decades, social media and digital
campaigns have gained great importance. Toyota, as an innovative company, shares attractive
content on its social networks and creates digital campaigns contributing to enlarge its customer
base by engaging more people to convert them as their customers. 

Here we summarize the most favored lessons to learn from Toyota’s digital marketing strategy
including the focus on creativity and imagination, audience engagement through social media, an
eco-friendly approach, and attractive commercial films.

Toyota social media posts follow the current trends in many respects. To increase the trust and
engagement with its customers, the company attempts to develop emotional appeals for its
vehicles through its approach focused on who to reach and how to.
Rather than only sharing the pictures of their cars and trucks, Toyota social media strategy is
based on interaction with followers by asking open-ended questions and talking about their
experiences with Toyota. The more you interact with customers, the more feedback you get to
boost your performance and customer retention.

Toyota highlights the expectations and needs of its target audience through creative social media
posts making the brand more approachable without being advertisement-like. 

Toyota’s Pinterest account has 10m+ monthly viewers and helps the company improve brand
appeal through this platform. The concept of mobility through short videos repositions the brand
in the marketplace. People have an opportunity to observe the exclusive Toyota experience and
decide what they desire when they get a car or truck. 

understand the interrelationships among customer value, satisfaction, and retention, and
technology’s revolutionary role in designing effective retention measures and strategies.

There are four main elements that use to determine customer satisfaction on Toyota Motor
Company which is Toyota products quality, Toyota products price, Toyota products innovative
and creative; and Toyota services. The respondents were exposed to the question regarding the
specific brand that they like and they like to purchase. This four elements is the most important
factor that influence or affect customers decision making while consider to purchase Toyota
products. Data were assembled on asking question from the users of the Toyota that whether they
are satisfied with the Brand they are using. The results of the quantitative research are showing at
below according to different element.

To understand consumer behavior as an interdisciplinary area, consumer decision-making, and

the structure of this book

The worldwide automotive market is highly competitive. Toyota faces intense competition from
automotive manufacturers in the markets in which it operates. Although the global economy
continues to recover gradually, competition in the automotive industry has further intensified
among difficult overall market conditions. In addition, competition is likely to further intensify
due to continuing globalization in the worldwide automotive industry, possibly resulting in
further industry reorganization. Factors affecting competition include product quality and
features, safety, reliability, fuel economy, the amount of time required for innovation and
development, pricing, customer service and financing. Increased competition may lead to lower
vehicle unit sales, which may result in a further downward price pressure and adversely affect
Toyota’s financial condition and results of operations. Toyota’s ability to adequately respond to
the recent rapid changes in the automotive market and to maintain its competitiveness will be
fundamental to its future success in existing and new markets and to maintain its market share.
There can be no assurances that Toyota will be able to compete successfully in the future. That’s
the risk connected with every business activity. Through this uncertainties Toyota has to deal
with a top-notch management.

Each of the markets in which Toyota competes has been subject to considerable volatility in
demand, so the risk is becoming even higher year after year affecting all business decisions.

Demand for vehicles depends on social, political and economic conditions in a given market and
the introduction of new vehicles and technologies.

As Toyota’s revenues are derived from sales in markets worldwide, economic conditions in such
markets are particularly important to Toyota. In Japan, the economy gradually recovered due to
increasing personal consumption and last-minute demand encouraged by the increase of the
consumption tax. In the United States, the economy has seen constant gradual retrieval mainly
due to increasing personal consumption and the European economy has shown signs of recovery
too. In the meantime, growth in emerging markets slowed down due to weakening currencies of
emerging markets, increases in interest rates of emerging markets to protect the local currencies,
and political instability in some nations. The shifts in demand for automobiles is continuing, and
it is unclear how this situation will transition in the future.

To understand the interrelationship among market segmentation, targeting, and positioning and
how to select the best target markets.

Demographicsegmentation is followed by Toyota mainly while the main markets

forToyota are the upper class, mid-class people of the society or may be defined as
highearning or average earning people throughout the world. For example, the Lexus brandis
mainly targeted to the upper class of the society, when the own brands like corolla or Avanza
are promoted to the mid-class
Psychographicsegmentation is done by Toyota when it promotes the cars for prestigeand for
elite people such as Land Cruiser or Lexus cars

Behavioralsegmentation is followed by it when it targets the customers who

areconcern for energy saving cars and environment friendly cars such as plug in
hybridvehicle, EV hybrid vehicle etc.So, the proposed segmentation criteria for Toyota
to segment its market should befocused on the social classes and the psychographic
recognition felt the customers.

how to position, differentiate, and reposition products

Brand differentiation is basically differentiating your brand from products addressing the same
needs of the target market. In the mind of the target market how will your brand stand out in the
minds of the market from similar products or service providers. Toyota differentiate it selves in
the automotive industry by its lead on. Successful differentiation on the basis of superior design
and quality.  This has led to Toyota being able to create a brand image that is very strong and one
that brings to mind quality, long lasting cars when a potential customer sees it. 
Brand positioning would simply be finding a competitive place of preference in the mind of the
consumer for your brand to consider your brand and not the brand of the competitor.

Toyota’s uses both differentiation and low cost as generic strategies to try and gain a competitive
advantage over their competitors in the automotive industry. 

1. Identify a specific target. The Toyota automobile target market is vast and target with its
specific products for different products. Specific target will depend whether it is its low price
Toyota Corolla line of cars to the high priced luxury line of cars and SUVs with Lexus,
Toyota has something for everyone.
2. Define the Toyota brand market. The market scope that Toyota uses is a broad one that
encompasses nearly every type of customer that is in the market to purchase an automobile.
Toyota provides vehicles for all price ranges. From the
3. Really understand your targets’ needs The Toyota Brand understand the customer needs
hence the different products in terms of cost and low maintenance, reliable and safe and
concern for the environment. The Toyota brand is very innovative they think outside the box
and have almost every year a new model.
4.  See brands through consumers’ eyes.   The Toyota is valued by the consumer very as per the
graph by BrandZ below.
Chapter 3

To understand the dynamics of motives, needs, and goals and how they shape consumer
behavior.

To hire a competent employee is not a simple task but after that, how to make your employees
work efficiently, happily and being enthusiastic in contributing to Organizational goals are even
more challenging. This article will try to analyze and explain what methods are practiced in
Toyota to motivate its employees by using motivation theory models such as Maslow’s hierarchy
of needs & Goal setting theory

First, we will analyze how Maslow’s hierarchy of needs is applied in Toyota.

Maslow’s Hierarchy of needs:

Basically, Maslow’s Hierarchy of needs is pyramid of different levels of needs. The base at the
lowest is Physiological needs, the next is Safety needs, Love & Belonging, then Esteem and the
highest level is Self-Actualization (Please refer to Figure 1 for more details). Only when lower
levels of needs such as physiological and safety are satisfied, then employees can achieve higher
levels such as esteem and self-actualization, which make them work more efficiently, with more
drive and more innovative ideas.

For Physiological & Safety needs:

According to Liker (2004, p.210), all employees of Toyota are satisfied in lower level needs,
they are well paid, their jobs are secured and the working environment is safe and organized.
Besser (1995, p.390) also stated that Toyota provided child care and recreational facilities
available on site for employees. All these benefits were provided to ensure their employees are
safe and secured to work for a higher level of needs, which brings more results.
To understand self-image and its impact on consumer behavior.

The brand Toyota is perceived by press and public as an innovative marque. From one side new
vehicles are conceptualized by taking risks. On the other, future products are studied to find a
new futuristic way of transportation. For example recently in 2008 the (i-Real “Personal Mobility
Concept”) was introduced. Making an impression on Medias that was very good for Toyota’s
brand image but on the other hand because this mobile chair was so far ahead of its time, was not
comprehended by the public. This concept gave an insight of how modern cities could probably
have probably dealt with mobility. Imagine the total absence of vehicles in city centres and the
possibility to move with i-Real. The vehicle itself, battery powered could have gradually lowered
the rear wheel and therefore inclined backwards the entire seat to a maximum speed of 18.6 mph.

Chapter 4

To understand the elements of perception and their role in consumer behavior.

2 To understand why consumers process only a small amount of the information they receive.

3 To understand how consumers organize consumption-related information.

4 To understand why and how consumers “add” biases to stimuli and the implications of this
tendency for marketing.

To understand the elements of consumers’ imagery

. 6 To understand how consumers determine the quality of products and services.

7 To understand consumers’ perceived risks and how they handle and reduce those risks.

oyota organizations are the first to build the Toyota Production Systems (TPS) and implemented
the lean manufacturing in their systems. Lean manufacturing was included in the TPS to
eliminate waste, prevent the most optimum flow and assembly of material, from raw material to
finished goods (Perrin, 2006). There were 7 principles that have been installed in Toyota’s
production system which are reduced setup time, small-lot production, employee involvement
and empowerment (Kaizen), quality at source (Jidoka), equipment maintenance, pull production
(Just-in-Time Production) and suppliers production (Toyota Motor Corporation 2003). After the
Toyota recalled accident in early 2010, the company was worried about the future sales of the
company (Booth & Teather, 2010). But they already taking the precaution steps on overcome the
issues and now to gaining back the customer trusts worldwide. Therefore, Toyota wants to
identify any feedbacks on customer’s perception when they are purchasing Toyota car so that
Toyota are able to understands and focus more in this information and fulfil their customers’
needs and wants.

Safety
According to the Maslow Hierarchy of needs, car can be categorising in the security level. This
security or safety issue are very important to the customer in purchasing a car. In this level,
people tend to be more complex as they want to control and order their lives for survives from
any harms such as against incident and injury (Venkat, 2008). For the recent survey, most of the
customer is more focus on the safety of the car rather than fuel consumption of the car. Customer
are try to understand the additional attributes in the car’s security before they buying it.
Customer will like to test drive the vehicle to understand more about the handling, stability of the
car and how the anti-lock brakes work. Customer’s act is necessarily so that they are well-known
about their car security capabilities and comfortable to drive on the road (Holmes, 2010). The
table below show the most important factors for customer to buy a car.

As for Toyota, their cars are well-known worldwide and one of their model Prius, have won the
Car of the Year awards not only in Japan itself but also in the United States (US) and Europe. It
has been given five starts for its safety from the European New Car Assessment Programme or
EuroNCAP (Husain, 2004). From this perception, customer has more confident towards Toyota
car and the sales of the Prius are the top rank in Japan for the June market (AP, 2010). Other than
this, the safety of the car also become main concern for customer nowadays said Narith which is
the managing director of Naritat Motorcare Cambodia Co Ltd.

Quality
The quality of car in Toyota is undeniable. Even thou they have encounter serious problem to
recall back certain model of their cars such as Toyota Avalon and Highlander, Lexus GS300 and
Lexus IS250 to replace the brake master cylinder seal that cause the dimness of the brake
warning lamp rather than keep silently about the error in their product (TMS, 2010).

The quality of Toyota car are said to be proven because they have few principles that make the
condition of the car assured. Firstly, Jidoka principle focus on the functional areas of
manufacturing and production areas which Toyota concern the most about their quality and
improving in their quality works. Jidoka, which are the principles about the quality must be
‘concern and be built in’ during the manufacturing process (Fred, 2000). Jidoka was a method to
detect any defective production and stopped the working process from being continuous until
they solved it down. When a quality or equipment problems occurred, the machine will detected
itself and stopped. As a result, only goods products that are fulfilled the quality standards will be
use in the next activity on the production line. This contributes to save cost of resources uses
because the systems avoid defective product from being produce again and again (Liker, 2004).

For the following principles, Kaizen which in Japanese term meaning is ‘continuous
improvement’ refer to the regularly process of cultivation for the better sake of the organization
and their workers. Inside these principles, Kaizen was mainly focus on improvement of their
workers whether made by small groups or individual workers (Liker and J.K, 2004). Training
that provided by organization to the workers provide them to be more self alert, open their
mindset, tackling the solution of the problems by themselves without counting on supervisors
and discussion among members will contribute or lead them to the leadership’s perspective. For
achieving higher Kaizen standards, it also needs them to accomplish greater standards and
maintain their capability to meet those standards on continuing basis (Greg, 2009). Other than
that, the workers are allowed to give viewpoint that can suggest to an important and remarkable
idea about the quality improvements or working process improvements and most importantly in
the decision making process.

Brand, price and design

Toyota has come out with many models of car and all of the models such as Prius, Yaris, and
Tacoma that are fulfilling the customer requirement such as environmental friendly, considerable
in price and the design of the car was nice (Vasilash, 2004). The table above show the brand’s
that likely to be purchase by customer. Toyota becomes the first rank in customer loyalty
because Toyota’s brand was trusted worldwide. Furthermore, Toyota also customizes the car
according to customer needs. Without this, Toyota is not able to develop brand image across the
markets because it’s are not able to produce a car that fulfil the customer preferences and
environment in major markets (Strumpf, 2010). This is because each nation has differences
culture, geographical indication and others.

Under the factor of price, customer will begin to think whether to buy the car or not. It always
happens to anyone when they want to purchase something. For example, customer start to think
is it worth to buy the product such as Toyota car, can the customer himself afford to pay back the
instalment loans that they borrow, depreciation of car over the year and many others. From the
chart below, customer are willing to pay for the price around $20,000 to $30,000 for them to own
a car. Toyota is more likely to be choosing because of their reasonable and affordable pricing
that would attract customer to them (TMC, 2009). Toyota is being able to maintain the car price
down because of the principles that they use to eliminate any waste resources (Fred, 2000).
Being fully aware of their competitors such as General Motors, Honda and other make Toyota
capable to come out with new innovation and strategy in the automotive market and maintain
their competition prominent. Toyota sales were growth 40% as in March 2010 after its offer
discounts about the recall. This also help Toyota gain back customer trust and loyalty as the
company are willing to retrieve problems on their cars and giving a lot of incentive to retail
customer.

To understand consumers’ perceived risks and how they handle and reduce those risks
Last year, Toyota Motor Corp. effectively turned a sterling reputation for producing high-quality
automobiles and a loyal customer base into a brand  associated with defective cars and failure to
inform owners of life-threatening flaws with accelerators and brakes.

Now Toyota has stumbled again.

This time, the Japanese automaker is running out of parts, forcing plant shutdowns around the
world despite its famously reliable and efficient production processes. How is this possible?
Start with the obvious: the massive March 11 earthquake off the coast of Japan, that resulted in a
huge tsunami striking the country and awful pictures filling television screens around the world.
A large swath of the nation was devastated. Worst was the crippled Fukushima Daiichi nuclear
power plant, but death, destruction, and disruption temporarily brought much of the country to a
standstill.

With its renowned resourcefulness, Japan is returning to normality. Yet the havoc inflicted will
continue to impede the public and private sectors' ability to function. Toyota, among the
Japanese-based companies that have been severely affected, will continue to struggle for months
to come. The company reports that although its 17 plants in Japan were relatively undamaged, its
factories there have been operating only at half capacity; its overseas operations are running at a
40 percent capacity. The domestic production schedule is expected to remain as is for some
months, while production in North America will soon be reduced by 75 percent. The situation is
so bad that the company anticipates that it will not be able to get back to full production until the
end of this year.

How could such a massive problem occur, especially when the company's manufacturing plants
in Japan didn't have much damage and the overseas plants weren't involved in the disaster at all?
One would think Toyota recognized the risks of earthquakes and related problems that they could
cause. The scope of this natural disaster was extraordinary, yes, but earthquakes are well known
in Japan. Even Toyota's executive vice president in charge of production has referred to Japan as
a "quake-prone country."

Where Was the Risk Management?

Toyota has succeeded in many areas, among them its highly respected just-in-time inventory
system. The system is designed to keep investment in inventories low, providing parts and
assemblies to the production line as needed. It seems to have been working extremely well—
until now. The company says it faces shortages of 150 parts, many of them specialty products
that meet the company's exacting specifications. And with damage to its supplier base, the parts
simply aren't available as needed.
If you ask anyone involved in manufacturing—from the CEO right down to plant managers and
workers on the production line—they will readily say that the last thing they want to see, or
expect, is a production shut-down due to lack of parts. For that reason companies have well-
established plans for obtaining needed resources from a range of sources, both physically
disbursed and spread among suppliers.

Why does it so often occur that actions are taken by companies after they suffer a major blow,
rather than anticipating what could happen and taking relevant actions to mitigate the risk?

Even manufacturers that forge a long-term partnership with one specific supplier have a “Plan B”
in case the primary supplier for some reason is unable to provide what's needed. That's not to say
there will never be disruptions, especially where parts such as micro-controllers customized to
particular automobile models are involved. But one would expect, depending on risks and costs,
disruptions should be short-lived without causing long-term production shut downs. Toyota's
competitors, by the way, seem to be doing better, with Honda's CEO reportedly saying in early
April he hoped production will return to normal “within a few months” and Nissan's COO saying
in late March that he expected full production within “weeks, not months.”

Another Toyota executive vice president reportedly said the company is now planning to review
its centralized parts sourcing, including determining whether it can use more commonly
available parts, and will reassess its dependence on single-source suppliers in Japan.
Interestingly, he added: “Even in cases where we thought we had more than one supplier, it
turned out in many cases that [those suppliers] procured sub-components from just one firm …
We're also looking to increase local procurement overseas as we discovered a high reliance on
Japanese-made sub-components.”

All of this makes eminent sense but begs the question: Why wasn't this done long before the
devastating natural disaster hit? Why does it so often occur that actions are taken by companies
after they suffer a major blow, rather than anticipating what could happen and taking relevant
actions to mitigate the risk?
To be fair, one could ask whether this is one of the “black swan” events, like those assessed by
financial companies in their value-at-risk models and now the subject of broader risk
management discussions—a highly unlikely event that could have a severe effect on a company.
The answer lies in the likelihood that an earthquake and tsunami could cause serious damage to
the company's supply chain. Seismologists and other scientists are better equipped to provide
that information, although it would appear that the chance of such disasters is higher than many
took into account in whatever they were doing to identify and manage risks to supply chains. 

A Troubling Pattern in Dealing With Risk

As we look back over Toyota's problems—first with production quality and compliance failings,
and then not having enough parts to maintain production schedules—one wonders whether any
relationship exists between the two. One would need to be inside the company to know with
certainty, and we're looking in from the outside based on media reports. With that said, it's
difficult to believe there isn't a common problem here.

Looking at business objectives, among the most critical to an auto manufacturer are: maintaining
a high level of quality, especially concerning the safety of the company's cars; acting in a way
that provides consumers with confidence that the business complies with all regulatory
standards; and ensuring supply chains provide needed parts on a timely basis to the production
process.

With these objectives, an effective risk-management process would identify what events or
circumstances could occur to obstruct the achievement of those objectives, then analyze those
risks, and finally determine appropriate responses to mitigate them. Yes, a cost-benefit
relationship must be weighed, and it can be challenging to determine where to draw the line in
expenditures to manage low-likelihood risks. This gets down to the company's overall risk
appetite, and its tolerances in specific risk areas.
It's hard to imagine that Toyota's shareholders, and presumably its board, would accept a risk
appetite so high where the company could produce cars that seen as being unsafe, hide
information from regulators, and have to slow production to a crawl due to lack of parts.

Chapter 5

To understand the elements of learning in the context of consumer

behavior
. 2 To understand behavioral learning, classical conditioning, and the
roles of stimulus generalization and discrimination in developing and
branding new products.
3 To understand instrumental conditioning and the objectives and
methods of reinforcement.
4 To understand the role of observational learning in consumer
behavior.
5 To understand the elements of information processing, including
receiving, storing, and retrieving consumption-related information.
6 To understand cognitive learning as a framework for consumer
decision-making.
7 To understand consumer involvement and passive learning, and their
impact on purchase decisions and the retention and recall of promotional
communications.
8 To understand how to measure the results of consumer learning.
Toyota was established in 1937 by Kiichiro Toyota. It is an automobile giant from Japan, and its
headquarter is in the Aichi city. By revenue, it is one of the largest corporations in the world. In the
year 2014, the estimated count of the employees of this company was more than three hundred
thousand. It is also to be known that, Toyota was the largest automobile producer in the world in
2012, beating Volkswagen and General Motors by a fine margin. Moreover, it is the only car
manufacturer to produce more than ten million vehicles in a year.

Segmentation of Toyota according to consumer

behavior
• This automobile giant has segmented all the countries on the globe as its potential customer
markets.
• Vehicles manufactured by the company focus on different consumer segmentation.
• The consumer segmentation is based on gender, buying power, customer requirements, and living
standards, etc.
• The vehicles are designed according to requirements, status, choice of the target customers.
• The company utilizes the behavioral and psychographic approach to target its potential market.
Consumer Behavior of Toyota Prius
The consumers look for a car that is health conscious and environment conscious. The consumers
who want environmental friendly vehicles which have high-performance rate and consume lesser
gas. The consumers of this car are concerned about the safety and health of their families.

Consumer behavior of Toyota Tendra

The consumers of this Toyota are conscious about performance and activity.
Consumer behavior of Toyota Lexus
The consumers of this car want luxury driving experience no matter what the cost is. These are the
middle aged customers who look for such drives. It is why the company targets middle aged
customers who focus on their living standard, safety and class.
Customer Behavior of Toyota Trucks
The consumers who look for a professional drive and look for space and prefer performance over
the looks drive the Toyota trucks. Mostly the people with families purchase the trucks. The company
has positioned itself as in quality, services and price it is second from Lamborghini and Hyundai
come third.

Overall consumer behavior

Here are the locations where the company majorly do business:
• Japan 25%
• Asia 11%
• Middle East7%
• North America 34%
• Europe 14%
• South America 4%
Seventy different type of vehicles are sold with the name of Toyota
• Toyota Vans are: Sienna, Privia, Tarago and Estima
• Trucks by Toyota: Tundra, Tacoma
• Sedans by the company: Prius, Camry, Corolla, Echo and Avalon
• SUVs: Land Cruiser, Highlander, 4Runner, Rav, Highlander Hybrid
• Wagons: Prius V, Prius C and Prius Plug-in.

The consumers of Toyota are diverse. As it is a multi-national company it has consumers all over the
world. The consumers in the Asian religion do not prefer the stylish looks and the high performance.
They just look for mileage. The consumers in the countries like India or Pakistan are not very rich.
The consumers also do not look for purchasing the sports cars. The consumers here just want the
cars for driving and nothing else.  Only a small percentage of people in Asia look for high
performance and sports cars. Vehicle consumers are majorly looking for good looking vehicles with
high performance rate and value for money. Most of the consumers look for a family drive instead of
performance.

Whereas, the consumers in the Europe and America prefer all sorts of cars. The teenagers like the
sports cars. Their behavior is towards purchasing a car which has brilliant shiny looks and design
features.  They also prefer purchasing the cars which are only for two people and not for the family.
The middle age consumers look for the family cars. They like to buy the cars which provide more
space for travelling.

Chapter 6
To understand what attitudes are, how they are formed, and their role in
consumer behavior.
2 To understand the tri-component attitude model and its applications.
3 To understand the structures of multi-attribute models and their use in
altering consumers’ attitudes.
4 To understand how to alter consumers’ attitudes by making particular
needs prominent.
5 To understand the role of cognitive elaboration in altering attitudes.
6 To understand how attitudes can precede behavior in the form of
cognitive dissonance and the resolution of conflicting attitudes.
7 To understand the ways people assign causality to events and apply
this knowledge to consumer behavior.
Toyota has been the market leader in automobiles specially hybrid and electric
automobiles. It has been operational in Pakistan since 1989. As of September 2018, it
was the sixth largest company in the world in terms of revenue. The economic
conditions however have not been very favorable for the automotive industry. The
economy of Pakistan and the consistent increase in dollar rates has taken a huge toll on
the sales of the multinational manufacturer. Focus group analysis show that majority of
the people preferred Honda over Toyota due to several reasons including near to none
change in the designs of Toyota Corolla’s variants. Another factor was that Toyota was
seen more as a car for the rural areas which was best suited for a rugged terrain.
Although the general perception is that Toyota has better car suspension and fuel
efficiency, people would still prefer Honda and other Japanese cars. Respondents said
that advertisements played a crucial role but they do not compel the customer to buy a
product like a car, there are other factors that are taken under consideration.
Pakwheels and olx were the first two online platforms that they mentioned when asked
about their go to online source. Family and friends advice played a major role in
deciding which car to buy. According to the research conducted by our group through
questionnaire, a regression was done and seen that the general perception that a
reduction in prices will increase sales was not true because people usually associate low
prices with low quality products. According to the regression, only advertisement and
product have a significant result. All the variables are positively correlated with each
other and less than one and positive indicating a formative relationship to the
dependent variable. Branding has an insignificant positive relationship with purchase
intention because consumers are only considering three competitors; Honda, Suzuki
and Japanese cars.

Chapter 7

To understand the elements and persuasive capabilities of

communication, as well as the barriers to effective communication.
2 To understand the distinctions between broadcasting and
narrowcasting.
3 To understand how to design persuasive messages effectively.
4 To understand the effectiveness and limitations of prominent
advertising appeals.
5 To understand how to measure the effectiveness of advertising
messages
Global Presence: Toyota sale and operates in more than 190 countries
globally with an array of the strong product portfolio. It manufactures
automobiles and its related spare parts through 50+ overseas manufacturing
companies in more than 28 countries worldwide.

Production System: One of the major competitive advantages that the Toyota

has is its ability to provide world-class products at low prices. Its globally
recognised production system which focuses on Just in time concept and
Jidoka (which means an immediate stoppage of work when problems arise)
has helped the company in controlling its costs and becoming more efficient
Toyota operates in Automotive and financial services business segments.
While automotive business is its mainline business, financial service is the
supporting function. Both its businesses are stars in the BCG matrix.

Distribution strategy in the Marketing strategy of Toyota –

The group is extensive using its dealership networks, authorised showrooms,
service centres, E-commerce sites and direct selling agents to make its
products available to the customers.

Toyota vehicle is sold through a channel of more than 175 distributors in 190+
countries and regions around the world.

In its home place Japan it has a network of 280 dealers out of which 15 are

owned by Toyota.

Brand equity in the strategy of Toyota- Toyota motor corporation is the world’s

6th most valuable brand and is ranked 10th in the list of global 2000 companies
as per the Forbes Magazine. The automotive brand has been valued at $ 177
billion on the basis of market capitalization 

Competitive analysis in the Marketing strategy of Toyota –

The automotive market is overcrowded with a large number of automotive
companies eating up each other’s market share. Factors affecting the
competition in the industry are product features, price safety, fuel
economy, customer service standards, Downward demand, a decrease in
prices and competition in automotive financing resulted in shrinking margin
due to which there was no significant growth in the company in the year
2016.   It competes with a company like Suzuki, Honda, Nissan, Ford, General
Motors and many others in the automotive industry in one or more segments. 

Market analysis in the Marketing strategy of Toyota –

Volatility in oil prices, currency exchange rate, increasing the bargaining
power of customers and suppliers, rising labour costs, rising infrastructure
costs, and government regulations are some of the factors affecting the
operation of the companies in the automotive market. 
Customer analysis in the Marketing strategy of Toyota –
Customers of Toyota are from age groups of 30- 50 years. Toyota focuses
middle-income group customers and produces value for money automotive
vehicle.

Chapter 8
To understand the strategic superiority of impression-based (eyeballs)
targeting over segmentbased targeting.
2 To understand Google’s targeting and advertising capabilities and its
value to both consumers and marketers.
3 To understand the dynamics of social media and its strategic and
promotional advantages over other media.
4 To understand how consumers use mobile media and their reactions to
mobile advertising.
5 To understand how to measure the effectiveness of advertising in
traditional and social media. 6 To understand the advancement of print
and broadcast media into electronic communications
The Toyota Motor Corporation is an international automobile manufacturer founded and,
thus, headquartered in Japan. The company manufactures all kinds of automotives that can
be used for all purposes ranging from leisure to racing, and carrying heavy cargo. Having been
founded in Japan around 1937, the company can be said to have grown in leaps and bounds
over the years given that it has become a worldwide brand associated with the production
and marketing of automobiles including luxury and commercial vehicles, as well as engines,
spare parts and motorbikes. Considering that it is an international manufacturer of
automobiles, the company has about 300,000 employees across the various locations around
the world in assembly plants, manufacturing plants and dealerships among others
(Brownsell, 2010). The company also offers financial services such as banking, financing and
leasing services to its consumers across the globe, thus making them a one stop solution for
all their car needs.

Considering Toyota's performance in the recent past, it would be impossible to ignore the
product recalls and the global recession. Just like many other business organizations, Toyota
had to deal with the momentary crisis in the global economy but as if that wasn't enough,
there also was the issue of flawed accelerators. However, these two factors together would be
enough to bring down even an empire as powerful as Toyota except that there was an equally
powerful mitigation strategy set up by the organization. This strategy happened to be the
social media as a tool of engaging the consumers and getting the loyal ones to defend the
brand's authenticity. Therefore, the consumers were the company's largest asset in their road
to recovery after the recall crisis. The company also continues to take advantage of their
expansive reach in the market to attract even more loyal consumers.

The social media as a marketing tool has been the Toyota's greatest strategy since the recalls
crisis gave the attention that the company channeled towards these tools and just how much
efforts were paid off. When the recalls crisis had just started unfolding, the company had a
very slight presence online in terms of social media response (Brownsell, 2010).They had
pages on Facebook and a Twitter handle, but they didn't have the internal commitment to
engage their customers as much as they did during and after the crisis. Currently, the
organization has a full time presence on five social media platforms including Facebook,
Twitter, Instagram, YouTube and Pinterest. In all these platforms, the company focuses on
engaging the customers and obtaining their thoughts and expectations on various products
while obtaining their experiences and feedback to encourage other consumers to buy those
products as well. Unlike the traditional marketing options previously used by the
organization, including print and broadcast media, the social media was used to do more
than to inform masses. The company used it to create an open communication channel
through which they listened to the consumers more than they actually had the consumers
listening to them. In this way, the social media became the most efficient option for the
consumers to get their views to the organization. The company capitalized on this and
created a social media response team for real time interactions with the customers on the
social media platforms. This ensured that all their questions and concerns were answered by
qualified individuals. Making the social media platforms fully active at all times opened the
company to more customer interest. They were very efficient and interactive in
communicating with their customers than many other automobile companies. It can be
stated that Toyota discovered the significance of the social media and have, thus, continued
to use these platforms effectively to further their market presence and domination globally.

The company, however, doesn't use all the platforms in a duplicative manner, but rather uses
each platform based on its potential. Facebook, for example, is used to enroll the customers
and get their feedback and concerns while Twitter is mainly about giving updates on
products and events, as well as generating conversations with the company's executives.
YouTube is, on the other hand, used to post adverts and customer interviews, as well as other
videos related to the company and their products. The overall approach towards the social
media is, however, customer engagement with the aim of creating and maintaining loyalty.
 Use of Individual Social Media
Marketing Tools

Facebook
Facebook is basically an online social networking site that allows people to connect with their
friends, family and interests and share information on anything. As a social media marketing
tool, the site allows companies to reach out to their clients globally with information on their
products, as well as to obtain feedback and generally engage with the customers (Srinivasan
& Mittal, n.d). At the Toyota Company, Facebook continues to be a major social media
platform considering that they have both a global official fan page and numerous localized
pages for the dealerships. The official Toyota page on Facebook has over 1.5 million likes and
the company uses the platform in many different ways.

The page is very colorful in terms of pictures and videos about the various products sold by
the company. This means that they use the platform to create awareness on the available
products while also evoking the customers to foster loyalty in the long term. The company's
Facebook page is more of a fan page where the loyal Toyota customers interact and share
their experiences with the numerous products, giving each other maintenance tips and
recommendations on which new products to try out. In this way, it can be stated that Toyota
uses Facebook to create an online family of loyal customers who not only understand the
brand, but also trust in its authenticity given their experience of the products.

The page also features videos on interviews with nostalgic customers who may at one time
have made a memory with the brand. These interviews are meant to compel other customers
to purchase the products or, at least, assure them of the brand's reliability. Other videos
represent the dealers and employees in a bid to give the organization a good public relations
rapport.

Twitter
Twitter has been considered a great place to start viral conversations online and engage
millions of followers. The company uses this platform to direct the course of discussions on
their products by setting the record straight and enabling the customers to get the real
information without having to wade through speculation and propaganda in the other media.
The company's Twitter handle has over 150,000 followers and they major tweets are retweets
from the organization's executives and other business partners, as well as loyal customers
(Howsocialble, 2014).
Considering the layout of Twitter, it is natural that the organization only uses it for passing on
information and directing conversations by providing the facts as opposed to the speculation
of outsiders. In the immediate aftermath of the recalls crisis the company had the executive
officers engaging with the public in a way that had never been seen before. Since then, the
platform has been used to conduct important conversations with the general public on
matters affecting the organization.

The site also features videos and links on new products and services offered by the Toyota
Motor Corporation and their business partners. This ensures that the site is not just for public
relations, but also for the marketing of specific products as released by the company. Twitter
is, thus, a platform used more for raising awareness than anything else.

Instagram
Instagram is mainly used for sharing videos and images to show the world what the company
is up to. Toyota uses this site to share its various product models and get the customers to
talk about them on other sites like Facebook and twitter. This means that the Instagram
profile is mainly for distributing the images of the car models in order to influence the desire
of the customers. The images posted on this site are often very high quality close up shots
that bring out the best in the cars being showcased.

As for the videos shared on Instagram, they are mostly about customer experiences with
Toyota products. As a brand,the Toyota family has been in existence for longer than most of
the customers. It means that some of the customers have life long memories with the Toyota
brand name. The company takes advantage of this fact to implore their nostalgia and get
them to buy the products if only for the sake of their memories.

The company also posts videos showing the products being taken for test drives, being
endorsed by celebrity personalities, and simply being discussed by car experts. The idea
behind sharing such videos is to influence the desire of the customers by giving them the
strengths of the products through the eyes of other customers and experts in the automotive
industry. Thus, it can be stated that at Toyota, Instagram is a social media marketing tool that
is mostly used to influence the desire of the customer by imploring their memories and
getting the third parties to endorse the products on the company's behalf. The videos and
photos are also meant to excite the customers and get them curious about the products in
question.

YouTube
YouTube is a site for sharing videos, and the company has a channel on this site. The Toyota
channel has over 30,000 subscribers who are always keen on getting what the company is
sharing on the site. It means that they have thirty thousand diehard fans who are consistently
interested in their activities on the social networking site (Harrington, 2014). As for the posted
videos, the company has received over 50 million views meaning that the world is indeed
interested, and that the site is really effective in getting their message to the masses
(Howsocialble, 2014).

Videos posted on YouTube include test drives for the various products in the market, as well
as interviews with the company's executive staff on matters concerning the organization and
its stakeholders. The Toyota Motor Corporation has divided this site into a number of
categories depending on the kind of content that is posted. The adverts include real
commercials for the various brands on offer including the 'Swagger Wagon' campaign for one
of the Toyota mini vans. The interviews section is, on the other hand, dedicated to
discussions on issues affecting the communities and the efforts of the organization towards
making a positive impact. There is also a section dedicated to tutorials on how to solve
various problems associated with the Toyota brand. The idea here is to enable the car owners
to fix minor issues by themselves as opposed to relying on their mechanics and making their
vehicle maintenance very expensive.

Therefore, YouTube is a useful platform for Toyota with regards to creating loyalty. The
channel is able to generate the long term interest of the customers given that it provides not
only product insights, but also maintenance tutorials for self care. With over 50 million views
on this site, it is no wonder that the Toyota brand continues to outdo most of the other
automobile brands across the globe.

Pinterest
Pinterest consists of boards on which companies can pin information and contests to engage
their customers. On Toyota's Pinterest account, the most popular board is the Infographics
where the company generates the interests of the customers by providing them with relevant
information and pictures on the Toyota products and how they work. This account has about
1600 loyal followers and so far the company has created more than 10 boards (Howsocialble,
2014).

Another significantly popular board is the Dream Car Art contest in which the Toyota Motor
Corporation allows its youngest fans to design their dream cars and have the followers check
them out. The cars are often fantastical in that they are entirely imaginary and that some may
never be actualized. The customers are nevertheless entertained and impressed by the kind
of cars that these young fans create, and they are always keen to find out what the latest
fantasy car is.

Pinterest may not be as popular as Facebook and twitter or even Instagram, but the company
has over the years managed to use it effectively to interact with their customers. The account
not only gets the followers interested in the company's activities, but also gets the company
informed on the thoughts of their customers with regards to the future product development
as inspired by the dream car contest. It is, thus, a useful marketing tool; it helps to raise
awareness and encourage trial of the products on offer.

Chapter 9
To understand the credibility of reference groups and their influence on
consumer behavior.
2 To understand the persuasive power and credibility of spokespersons,
endorsers, celebrities, salespersons, vendors, and media
. 3 To understand the dynamics and measurement of opinion leadership
and word-of-mouth.
4 To understand the strategic applications, advantages, and potential
perils of word-of-mouth. 5 To understand the process for diffusion of
innovations, and adopter categories as distinct market segments.
In 2003, it [Toyota] launched its new Scion brand, aimed at a hip young audience of 20-
something drivers, using a marketing campaign designed primarily to generate word of mouth. 
Sales reps in goatees and sunglasses were dispatched to bohemian neighborhoods in cities like
New York and San Francisco to distribute Scion-branded CDs, clothing gift certificates, and
copies of alternative lifestyle magazines like Urb and Tokion — all to induce young people to
take a test drive and talk about Scion with their friends.
Toyota has retained and expanded this edgy marketing approach.  When it introduced a new
Scion model — the boxy Scion bB — in December 2005, the company initially pretended it was
launching a new MP3 player to compete with Apple’s iPod.  Flyers and stickers implying as
much blanketed urban neighborhoods to fuel rumors.  Toyota even outfitted salespeople at 54
HMV music stores in Japan with shirts and bags carrying the bB logo.  The truth didn’t come out
until the car was unveiled on December 26, 2005 at a Tokyo club — complete with a new pop
single that a local band dedicated to the vehicle.
Now, Scion is going even further to genereate buzz — into what online gamers call the
metaverse.  In July 2006, Toyota announced that the new Scion xB was being “released” for sale
in Second Life and Whyville, two popular online fantasy communities — the first automaker to
infiltrate these worlds.  Avatars (online personas created by real-life, game-addicted humans)
who “live” in these worldscan buy Scions, take out loans to help pay for them, customize their
vehicles, and take their virtual friends for rides around cyberspace.  Not even a single dollar (or
clam — the official currency of Whyville) ever enters the coffers of Toyota from these fictitious
sales.  But the compnay hopes the strategy will generate even more talk about their brand…and,
perhaps, real-world sales.
Chapter 10
To understand the family as a consumer socialization agent.
2 To understand family decisionmaking and its members’ consumption-
related roles.
3 To understand the role of the family life cycle in market segmentation
and targeting.
4 To understand the consumption patterns of nontraditional families and
non-family households. 5 To understand the impact of social
stratification on consumer behavior.
6 To understand how to measure social class and segment consumers
accordingly.
7 To understand the demographics, lifestyles, and consumption patterns
of America’s social classes.
8 To understand how to employ geo-demographics to locate target
markets
No executive needs convincing that Toyota Motor Corporation has become one of the world’s
greatest companies because of the Toyota Production System (TPS). The unorthodox
manufacturing system enables the Japanese giant to make the planet’s best automobiles at the
lowest cost and to develop new products quickly. Not only have Toyota’s rivals such as
Chrysler, Daimler, Ford, Honda, and General Motors developed TPS-like systems, organizations
such as hospitals and postal services also have adopted its underlying rules, tools, and
conventions to become more efficient. An industry of lean-manufacturing experts have extolled
the virtues of TPS so often and with so much conviction that managers believe its role in
Toyota’s success to be one of the few enduring truths in an otherwise murky world.
Like many beliefs about Toyota, however, this doesn’t serve executives well. It’s a half-truth,
and half-truths are dangerous. We studied Toyota for six years, during which time we visited
facilities in 11 countries, attended numerous company meetings and events, and analyzed
internal documents. We also conducted 220 interviews with former and existing Toyota
employees, ranging from shop-floor workers to Toyota’s president, Katsuaki Watanabe. Our
research shows that TPS is necessary but is by no means sufficient to account for Toyota’s
success.
Quite simply, TPS is a “hard” innovation that allows the company to keep improving the way it
manufactures vehicles; in addition, Toyota has mastered a “soft” innovation that relates to
corporate culture. The company succeeds, we believe, because it creates contradictions and
paradoxes in many aspects of organizational life. Employees have to operate in a culture where
they constantly grapple with challenges and problems and must come up with fresh ideas. That’s
why Toyota constantly gets better. The hard and the soft innovations work in tandem. Like two
wheels on a shaft that bear equal weight, together they move the company forward. Toyota’s
culture of contradictions plays as important a role in its success as TPS does, but rivals and
experts have so far overlooked it.
Toyota believes that efficiency alone cannot guarantee success. Make no mistake: No company
practices Taylorism better than Toyota does. What’s different is that the company views
employees not just as pairs of hands but as knowledge workers who accumulate chie—the
wisdom of experience—on the company’s front lines. Toyota therefore invests heavily in people
and organizational capabilities, and it garners ideas from everyone and everywhere: the shop
floor, the office, the field.

CHAPTER 11
To understand culture’s role, dynamics, evolution, and impact on
consumers’ priorities and behaviors.
2 To understand language, symbols, and rituals as expressions of a
learned culture.
3 To understand how to measure the influence of culture on consumer
behavior.
4 To understand Americans’ core values and how to apply them to
persuasive communications.
5 To understand green marketing and ecologically responsible
consumption.
The main aim of this study is to contextualize sustainability and call for its
consideration in firms’ management, namely via green marketing and green
brand. Although the concept of sustainable development appeared in the
1970s, only recently has it been incorporated by firms. Development, to be
sustainable, has to satisfy the needs of current generations, without
compromising the ability of future generations to satisfy theirs. This requires a
balance in managing social, economic and environmental aims, both current
and future. Given the increasing evidence of environmental problems, the
awareness of the need for sustainability has been expanding, at the individual
and at the corporate level. Environmentally responsible firms obtain multiple
benefits, such as cost reduction (due to the lower resource consumption, such
as water or energy), profit increase (from recycling and residuals reuse),
production process enhancement (given the cleaner and more efficient
technologies), corporate image upgrading, improvement of brand awareness
and value as well as performance. Oppositely, firms associated to non-
sustainable actions are impaired in those areas. In the scope of a green
strategy, a green brand obtains attributes and benefits related to the reduction
of the brand's environmental impact. As such, it should promote the
perception of an environmentally healthy brand and disclose such benefits to
the more environmentally aware consumers. We present the case of Toyota, a
brand with patent and acknowledged efforts in what regards sustainability. It
is a worldwide reference of corporate responsibility and of a successful use of
green marketing. The brand's challenge to reach important environmental
goals until 2050, demonstrates its commitment and endeavor in multiple
crucial aspects of sustainability management. Therefore, Toyota is in a
prominent position as a “global green brand”.

Chapter 12
To understand the subcultures within the United States and their
relationships to American culture.
2 To understand the influence of nationality and ethnicity subcultures
on consumer behavior.
3 To understand the impact of religious affiliations on consumer
behavior
. 4 To understand the influence of regional characteristics on consumer
behavior.
5 To understand age and generational influences on consumer behavior.
6 To understand the influence of gender on consumer behavior.
Toyota’s target population is towards the car lovers, and the younger generation do not seem to have
slight interest in car. Akio Toyoda, the president of Toyota, is confused that value of the car in teenager’s
eyes has worth less than the past. The incentive of purchasing a car has driven by their financial
situation, which is the largest barrier in their age. The competitors of Toyota is not other car industry,
but cell phone company. Even though the price of car worth more than phones, in teenagers’
perspective, the value of phone is greater than car because phone is considered relatively practical while
car is not a necessity. Another problems is the design. The plain and moderate design has no longer
intrigue the expectation from the teenagers. In this circumstance, buyer’s power has enforced Toyota to
change its design in order to satisfy young generation’s self-esteem.  The introduction of FRS, the new
sport car for Toyota, is not enough to reach most of young generation’s standard since there are no
more varieties for them to choose. 

Chapter 13
To understand how to study the values and customs of different cultures
in order to develop effective marketing strategies.
2 To understand how to decide whether to customize products for
global markets or to sell standardized ones.
3 To understand how to identify global marketing opportunities.
4 To understand how to apply psychographics to segmenting
multinational markets.
Toyota is, arguably, one of the best car manufacturers on the planet. The Japanese multinational
automotive has been making innovative vehicles for nearly a century, but its position has been
maintained very well. Toyota was the tenth-largest company in the world by revenue in 2019.
It is not just about the company's quality; the Japanese pride of good products can be seen
everywhere with Toyota. Everything is measured to achieve perfection, even the noise the car doors
make when they close and open. As details are closely inspected, good workers perform vehicle
inspection app thoroughly to ensure an amazing manufactured automobile.
Steadily, Toyota gained the top position in the automobile industry. It wasn't quick or glamorous; it was
efficient. And the company is proud of its principals and achievements, which is reflected in the
marketing strategy. Toyota operates internationally, so it needs to adopt different marketing tactics to
succeed in different locations. In this article, I'm going to give you an inside look at Toyota's
marketing strategy and how it made the whole world recognize the quality Japanese can
deliver.
According to the corporate responsibility of Toyota, the company promised to be
environmentally friendly, carving a way to create cleaner engine emissions. This act
created a great brand image in the public's eyes with the help of environmental groups
to promote the company's products. Another viable prospect of Toyota is that it will
invest in solar power, which is lined up with the trend of electric automobiles.

Toyota has many chances to regionalize and specialize the worldwide operations which
can enhance the multinational operations. Also, the bold investment in technology and
existing innovations capabilities on automobiles will provide an opportunity to make a
better scope in the market than competitors.

Recently, Toyota announced that it is going to build a prototype city of the future at the
base of Mt. Fuji in Japan. Called the Woven City, it will be an ecosystem that is powered
by hydrogen fuel cells - green energy. This opens opportunities for Toyota to be more
than just an automobile manufacturer, an innovator for the future.
Marketing strategy is the course of action that an organization intends to implement in
order to achieve certain marketing objectives. Toyota's marketing strategy varies
depending on the market requirements of different geographical locations. It also has a
large dealership network to provide products globally and a culture of innovation to
keep every automobile at high quality. But, most importantly, Toyota always put the
customer's best interests on the highest priority for the marketing strategy. This can be
the secret to the company's long success.

In this section, let's see the core marketing strategies of Toyota, as well as some
noteworthy campaigns, and see if the company is the role model that other automotive
companies need to learn.

Chapter 14
To understand the consumer’s decision-making process.
2 To understand the dynamics of buying gifts.
3 To understand how innovative offerings gain acceptance within
market segments and how individual consumers adopt or reject new
products and services.
Many employees outside Japan who have joined Toyota after working for another
company have had to face the challenge of learning the Toyota approach to problem
solving and decision making. Because Toyota’s process of consensus decision making
deviates so dramatically from the way most other firms operate, it is a major
reeducation process. New employees wonder how an efficient company like Toyota can
use such a detailed, slow, cumbersome, and time-consuming decision-making process.
But all the people I have met who have worked for or with Toyota for a few years are
believers in the process and have been greatly enriched by it—even in their personal
lives.

For Toyota, how you arrive at the decision is just as important as the quality of the
decision. Taking the time and effort to do it right is mandatory. In fact, management will
forgive a decision that does not work out as expected, if the process used was the right
one. A decision that by chance works out well, but was based on a shortcut process, is
more likely to lead to a reprimand from the boss. As Warren explained in this chapter’s
opening quote, Toyota’s secret to smooth and often flawless implementation of new
initiatives is careful, upfront planning. Underlying the entire process of planning,
problem solving, and decision making is careful attention to every detail. This behavior
is associated with many of the best Japanese firms and Toyota is a master at it. No stone
is left unturned. In fact, every stone is inspected under a microscope. 

Chapter 15
To understand the meaning and importance of marketing ethics and
social responsibility
. 2 To understand how marketers can exploit consumers by targeting
children and encouraging overeating and other forms of irresponsible
buying.
3 To understand ethically questionable practices such as covert
marketing, manipulative exposure to advertising, and truth-inadvertising
issues.
4 To understand the nature and consequences of provocative
advertisements.
5 To understand how marketers abuse consumers’ privacy and the
measures that can stop such practices.
6 To understand how marketers can advance society’s interests by
advocating socially beneficial conduct and discouraging adverse
behavior.
Corporate social responsibility (CSR) is how businesses behaves and put their values and
behavior according to the expectations and needs of stakeholders. Their stakeholders
can be their interest groups, investors, communities, employees, suppliers, customers,
and society as a whole. CSR is a company’s commitment to be responsible to its
stakeholders. Moreover Ethics are a personal view of what is right to someone, they
have their own principles of right or wrong.

Toyota takes contribution to improve the living society and the environment very
seriously. Toyota considers their stakeholders of significant importance. Toyota wants to
create a respectable image all over the world, in addition to effectively working add
more value to stakeholders.

Toyota improved their CRS POLICY in August 2008, this improved policy had taken
relationship with stakeholders more important than before. Toyota is also looking
forward to seeing its partners adapting to such policy. Toyota has different major
stakeholders and they take their relationships with them with big importance. Toyota’s
relationship with its customers, Toyota puts many of its resources to ensure their
customers are satisfied and that they continue to trust in the company. Toyota is
constantly working to improve on that. Toyota has a “Customer First” policy. They
always remember that and ensure their customers get quality products and services. The
aim of Toyota′s “customer first” policy is to offer products and services with
outstanding performance. They aim for performance environmentally and also in safety
as well as quality. To have an exceptionally driving experience in which the customer
feels it has the value of the money he spent buying the product. Toyota tries to make
their products to its customers very affordable and is always determined to make sure
each customer is satisfied. Toyota also guarantees customer satisfaction through good
customer relations. They Assess and ask of the opinions of their customers to see what
the customers expect from the company. Toyota takes each case into consideration and
they respond to each customer differently and personally depending on the customer.
They also provide customer consultation sessions, they feel this helps their customers to
have more trust and confidence in the company. Toyota also has a Customer Assistance
Center. This is to allow them to handle as much cases as possible. The Center also offers
a toll-free number. Toyota believes this center helps them to improve their products and
services.

Another key stakeholder to Toyota is their employees. Toyota believes their employees
are so important that they call them the backbone of the company. They want to make
their employees manufacture high-class products. They believe this will help with their
customer satisfaction. Toyota wants to share the principles and attitude of the company
with their employees globally.

The “Toyota Way 2001” gathers and organizes the management beliefs and values that
Toyota has created since the company was established. They want respect amid their
labor workforce and their management, they also want employment stability. Each
Toyota employee is taking actions to improve work-related skills. Joint trust and respect
between labor and management is an essential code of Toyota’s employee relations

Toyota’s wants to do good to the society as it carries out its business activities, Toyota
considers improving corporate assessment will not only be of advantage to its
shareholders, but this will as well guide the way to more trust and acceptance of the
company in the long term. There are three components of Toyota’s financial strategy.
They are Growth, Efficiency, and Stability. Toyota believes that the balanced pursuit of
those three priorities over the medium to long term will enable the achievement of
steady and sustainable growth as well as increase corporate value. They want to grow by
improving their technology and supply as well as getting new investments.

They want to increase efficiency by increasing profits and making sure they produce to
their given capacity. Lastly, they want to have a safe financial status. Toyota tries to
increase there per share earnings as a way to prioritize their Shareholders. They watch
closely the time they reveal their shares and other information to the Shareholders. They
believe this will help to increase the support of the Shareholders. They believe this will
help give the Shareholders more precise and fair information. Toyota believes
Shareholders are the backbone of business.

Toyota also takes its relationship with its business partners important. Toyota wants to
have a honest and fair business activities with its partners. They will comply with the law.
Toyota wants to cooperation with its business partners such as their suppliers and
dealers as well as contributing to improve environment. Toyota works closely with its
suppliers. Toyota wants to build strong relations with their suppliers. They believe
suppliers are one of their best assets. Toyota sees this value more because as they
expand they will need loyal suppliers giving them good products with affordable prices.
They want their suppliers to act according to the Legal Compliance. This can be
respecting their workers and taking care of the society.

Toyota is widely compared to the Honda. They are both Japanese companies and they
are known for producing reliable vehicles. They also have similar prices for their vehicles.
For example, the Toyota Camry and the Honda accord both cost $20,000.

Apart from making vehicles, Toyota has reportedly invested in aerospace. They put in
US$67.2 million in the Mitsubishi Aircraft Corporation making it a minor shareholder in
the company.

Toyota also sees higher education as a very important asset. Toyota established the
Toyota Technological Institute in 1981. The institution is a university situated in Nagoya,
Japan. Only students with industrial work experience were accepted before Toyota
opened another branch in Chicago with the help of University of Chicago in 2003.

As Toyota knows how its industries can affect the environment by pollution, Toyota
regularly checks its industries for noise or air pollutants and tries to reduce to the
acceptable level for the community. For example at Toyota’s Kyowa plant where
electronics are produced, they noticed the noise level had exceeded the acceptable level
and therefore Toyota installed sound-insulating walls.

Chapter 16
To understand how to develop research objectives
2 To understand how to collect secondary data
3 To understand qualitative and quantitative research methods
4 To understand how to combine qualitative and quantitative research
5 To understand how to analyze data and report research findings
When the Toyota Company started receiving complains from customers in 2010
due to unexplained acceleration in some of its top models, the company made a
decision to close down production and stop the sale of multiple models. The
decision that Toyota made regarding closing down of production and halting the
sales of multiple models did not emerge arbitrarily, but was rather the results of a
comprehensive investigation.

Toyota may have used descriptive research to describe its immediate state of
affairs. Descriptive research has no control over various variables and can only
report occurrences (Zikmund, 2003). The company may have used such a
method to explain why the produced models did not meet the necessary
requirements and standards.

Another approach relating to the case of the Toyota Company is empirical

research. This strategy provides conclusions based on experimentation or
observation. For example, the company may have undertaken the testing of
various models which functionality raised doubts against anticipated results as
noted in their performance.

Empirical research is best applied when proof is crucial regarding the certain
variables that influence other ones. Unlike empirical research, conceptual
research relies on abstract ideas and does not need concrete data to support it. It
helps in developing new concepts or modifying existing ones.

The adoption of quantitative research by Toyota could promote the investigation

of measurable quantities and their relationships. These include the number of
sales in a given period and the amount of goods rejected by customers. It seeks
to establish conclusions using quantifiable variables. This approach is
comparable to qualitative research that involves investigating immeasurable
variables, such as human behaviour.

In a situation where a problem definition is obscure, it is difficult to set a realistic

hypothesis. In such a situation, exploratory research is necessary. Exploratory
research may not draw precise conclusions, but recommend the most
appropriate research design, data collection methods and other important
aspects of conducting an investigation. Exploratory research relies on collected
data which may be both qualitative and quantitative, and involves focus groups
and searches on the internet.