BRAND AUDIT OF AN INTERNATIONAL BRAND (TOYOTA)

Posted: December 14, 2018

BRAND AUDIT OF AN INTERNATIONAL BRAND (TOYOTA)

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Table of Contents

1.0 History of Toyota and the brand’s role within the organization. 2

1.1 The brand’s role within the organization. 3

2.0 Brand elements. 4

2.1 Logos. 4

2.2 Symbols and slogans. 5

2.3 Characters. 6

2.4 Trademarks. 7

3.0 Toyota position in the market 7

3.1 Competitive analysis. 7

4.0 Direct and indirect competitive brands. 9

5.0 Brand Hierarchy. 10

5.1 Customers-based brand equity pyramid. 10

5.2. Brand Resonance Pyramid. 12

5.3 Brand Mantra. 13

5.4 Brand Portolio. 13

5.5 Brand Judgment 13

6.0 Inherent attributes of the product 13

6.1 Research and development 13

6.2 Distribution policies. 14

6.3 Communication. 14

6.4 Prices. 15

7.0 Strategy Recommendations. 15

9.0 Reference. 17

 

 

 

Brand Audit of an International Brand

History of Toyota and the brand’s role within the organization

Toyota Motor Corporation (TMC) is a Japanese automobile organization. It became the biggest vehicle manufacturer in 2008. Moreover, the majority of its subsidiary firms specialize in the manufacture of automobiles, vehicle spare parts, industrial and commercial autos. TMC started in 1933 as a branch of Toyoda Automatic Loom Work Ltd, introduced by Toyoda Sakichi. In 1936, it manufactured the first Car, Model AA sedan, while in 1937 it became an incorporated company, Toyota Motor Corporation Ltd, an automotive spin-off under the management of Sakichi’s son, Kiichiro Toyoda. Subsequently, the company established a number of associated firms such as Toyoda Machine Works, Ltd. (1941), and Toyota Auto Body, Ltd. (1945). Nonetheless, during the Word War II, TMC was forced to momentarily suspend the production of its automotive.

In the 1950s, the company’s manufacturing plants were back in operation and competitive. They also began the study of the US automobile producers. The study was due to the United States economic as well as technical superiority. Toyota’s senior management visited various manufacturing facilities like the Ford Motor Company to get a feel of the latest production technologies. They would then adopt these technologies, an aspect that led to increased productivity. In 1957, the Toyota Motor Sales, U.S.A., Inc., were formed and a year later Toyopet sedan model was manufactured, the first model to be marketed in the American market. The model was poorly received due to its high cost and lacked a horsepower. In 1958, Toyota released Land Cruiser, a 4 × 4 utility vehicle which was very successful, and in 1965, Toyopet sedan model was enhanced for US drivers and re-launched as Toyota Corona. The re-launch marked the major achievement of Toyota in the American market.

The brand’s role within the organization

The brand plays important roles within the company. For instance, as a brand, Toyota is the leading in the automobile production, it is not only recognized internationally but also identifiable. In addition, within the organization, it plays the role of performance. In particular, the brand offers quality, reliable and innovative autos.

Brand elements

Toyota’s current brand status relies on different brand elements including:

Logos

The Company’s logo has three ovals integrated in a symmetrical way. In addition, the logo has two perpendicular ovals inside the bigger oval that depict customers and the organization’s heart (Toyota 2014). Basically, the logo is overlapped with three ovals to symbolize trust as well as the association between one another.

 

Figure 1. Toyota global Logo (Source: Toyota Global Website)

Symbols and slogans

The two perpendicular ovals also represent “T” that depicts Toyota, and the steering wheel symbolizing the vehicle. The outer larger oval demonstrates the world’s recognition of Toyota. Conversely, the background space in the logo depicts the unlimited values that the company offers its clients such as high-quality vehicles, safety and the joy to drive, innovation, and social responsibility. Furthermore, the ellipses of the logo are red with a white background or metallic (Famous Logos 2013). Besides, the symbol of Toyota has various slogans based on the region, for instance, in the UK it is demonstrated as “TOYOTA ALWAYS A BETTER WAY”, in the US the slogan is “TOYOTA Let’s Go Places” while in Germany the slogan is “NICHTS IST UNMOGLICH”.

 

Figure 2. Toyota Logo, UK (Source; Toyota (GB) PLC 2014)

 

Figure 3. Toyota Logo, US (Source; Toyota (USA) PLC 2014)

 

Figure 4. Toyota Logo, Germany (Source; Toyota (Germany) 2014)

Characters

The logo is done using Roman style font displaying “Toyota”. The official colors of the organizations include red, white, and black. Toyota Racing TRD (2014) shows that the Toyota symbol is displayed by a reddish color on a black or white background. Again, the display of “Toyota” symbol is integrated with Toyota corporate logo in horizontal structures (Toyota Racing TRD, 2014).

 

Figure 5. Toyota Logo characters  (Source: Toyota Global Website)

Trademarks

The company name was changed from Toyoda to Toyota. Because Toyota is simple, less clustered, and sounded pleasant. In addition, the eight letters in Japanese are related to good luck and prosperity. Toyota also meant the organization’s success from a family entity into a social corporation.

Toyota position in the market

Competitive analysis

Toyota has a strong position in the market. As such, the threat of new entrants is weak, because the automotive industry is capital-intensive, an aspect that works best for an established firm like Toyota. There is a high retaliation if a new entrant brings on board innovative products. Again, it is almost impossible for new entrants to attain economies of scale. Conversely, due to it’s strong position in the market, supplier power is weak. This can be attributed to many suppliers of automobile parts; suppliers do not threaten forward integration, and material for vehicle manufacture is readily accessible.

Nonetheless, the Toyota strong market position leads to strong buying power, as there are several purchasers of the automobile. Previous studies demonstrate that Toyota brand is preferred by many buyers since it’s reliable and cost-effective. Even though the recall issue might have adversely affected the brand, consumers are still loyal. Also, its long history in the auto sector, as well as quality services, has earned innumerable fans, regardless of the recall issue (Customer Report 2014).

Additionally, while a number of customers purchase one vehicle, corporate and government agencies buy large quantity vehicles at cheaper rates. Customers do not pose a threat to forwarding integration and they can easily choose another vehicle brand as switching cost is not high. Furthermore, the threat of substitutes is very weak. This can be a result of many options in the market, including motorbikes, planes, and bicycles. Other transport options are less and also environmentally conscious. However, these options do not present convenience. The threat of rival is extremely strong because the automobile sector is not only large but also mature. Again, competitors differ based on size; however, they normal fight over different buyer segments.

In brand positioning, the company uses low cost and differentiation strategies to gain competitiveness over its rivals. However, Toyota uses a broad scope, which comprises of each customer segment that wants to buy an automobile. In any case, the firm has the ability to reach a huge market. Moreover, the company offers automobile of all prices, from low-cost Toyota Corolla model to expensive luxury lines, such as sport utility vehicles (SUVs). Product development is useful for the firm since it should introduce free innovations yearly in this sector.

The company’s success greatly relies on quality details and out of the box ideas. Nonetheless, Toyota’s successful vehicles have several tag lines like the GT 86 (TRD special edition) “grab the steering feel the excitement” (Jun et al., 2017, p.383). When it comes to product development, Toyota uses lean manufacturing.

Direct and Indirect Competitive Brands

Toyota faces direct and indirect competitions from other brands in the automobile sector. For the direct competition, the firm faces an intense rivalry from Honda, Hyundai, and Ford. Hyundai is a South Korean automobile company and the largest auto company in the world that manufactures 1.6 million units yearly. Ford Motor Company is a Michigan-based auto company that produces and sells vehicles in over 200 markets, its associated brands include Lincoln, Land Rover, Mazda, and Jaguar. Regarding Honda, it was at one time the best-selling car company in the US (Lee and Yang 2015, p. 31).With respect to indirect competition, there are mass transit and motorcycle.

As such, consumers looking for cheap transport may go for mass transit or motorcycles. This indirectly threatens Toyota because it targets average income earners, compared to luxury consumers targeted by Lexus. Nonetheless, Toyota attempts to differentiate itself from competitors based on the points of parity (POP) and points of difference (POD). With respect to POP’s, the company manufactures fuel efficient, reliable, innovate and eco-friendly vehicles. On the other hand, it uses POD’s such as affordable and low-cost maintenance vehicles to differentiate itself from direct and indirect competitors (Jun et al. 2017, p. 382). Toyota is very popular due to affordable and low maintenance vehicles. “Toyota is for everyone” this implies that any individual can afford to buy Toyota products irrespective of their level of income.

Brand Hierarchy

Customers-based brand equity pyramid

Brand equity starts from variations in client response. If there are no variations, the brand name is simply a product; hence, competition will be determined by price. Variations in response arise due to client awareness of the brand, perceptions, beliefs, feelings and experiences related to the brand. Toyota has developed a strong, reliable, favorable and unique brand associated with clients. These efforts are the drivers behind the current status of the company’s brand.

Moreover, brand equity is depicted in preferences, views, and behaviors linked to marketing elements of the brand. A strong brand contributes to higher revenue. For instance, Toyota’s brand and asset valuator (BAV) model rely on the investigation of approximately 800,000 clients in 51 nations. BAV model presents the organization with comparative estimates of brand equity.

Customer-based brand equity is determined by different components including: energized differentiation that evaluates the level of the brand compared to its rivals, its perceived force, and position (Van Doorn et al. 2010, p. 254). It also makes sense to assess the breadth and appropriateness of the brand’s appeal. Similarly, esteem is related to perceptions of loyalty and quality, while knowledge evaluates the level at which customers are recognizable with the brand.

Therefore, the current status of Toyota greatly relies on the components of customer-based brand equity, such as energized differentiation; knowledge, relevance, and esteem. These are the key factors that have put Toyota brand to its leading position in the market across the world. In the customer-based brand equity pyramid, there are different features such as:

  • brand salience that is associated with how regular a brand is evoked in different buying conditions;
  • brand performance that involves how a brand fulfills clients’ functional requirements;
  • brand image involves the extrinsic attributes of the product such as how it tries to satisfy clients’ social or emotional requirements;
  • concentrating on clients’ personal views and assessment;
  •  brand feeling entails clients psychological response  to the brand;
  • brand resonance this is the type of association clients have with the product.

Hence, these components start once a company invests in marketing activities to reach its target segment. As a result, these components has put Toyota into its current status. This is because, through marketing, the organization is able to change the customers’ mindset, in turn, the change influences the manner in which the brand performance in the market.

Brand Resonance Pyramid

 

Figure 1: Brand Resonance Pyramid Model

The above model is a reflection of the corresponding linkages between the brand and its clients. According to Keller (2013, p. 132), the vital element of the brand building block happens when all the central brand aspects are in tandem with the clientele demands. Toyota has developed this culture across its corporate structure throughout the years. This has created emotional burdens reinforced by positive individual experiences any other time a client comes in contact with the brand.

Brand Mantra

Toyota understands customer preference when it comes to fuel efficiency, versatility, and toughness. Toyota has earned the hearts of many customers around the world because of its low maintenance cost and high performance (Van Doorn et al. 2010, p. 255).

Brand Portfolio

Toyota competes internationally under four different brands, namely Hino, Daihatsu, Lexus, and Toyota. However, only Lexus and Toyota brands have significant brand recognition. When compared to companies like Volkswagen and General Motors, Toyota has a narrowed brand portfolio (Van Doorn et al. 2010, p. 256). As such, Toyota is unable to meet the tastes of an array of clients and meet their individual needs.

Brand Judgment

In measuring brand judgment, Toyota focuses on client’s individual opinions and analysis of the brand. By implementing and online portal, the company is able to get feedback from customer experiences with regards to the performance of different brands. Through a response mechanism, the company can be able to evaluate the brand based on quality, credibility, consideration, novelty, likeability, and brand superiority (Van Doorn et al. 2010, p. 257).

Inherent attributes of the product

Research and development

Focus on Research and development (R&D); the company concentrates on R&D to increase its product portfolio while enhancing quality, functionalities, and safety of the product. Toyota’s R&D attempts intend to develop innovative processes and products and enhance the abilities of existing ones. Toyota performs its R&D at all the company’s plants across the world. The focus on R&D assists the company in integrating new ideas to existing brands and by adopting current technologies in different areas of vehicle production. On the other hand, focus on R&D helps Toyota to support technologically oriented leaders in its product units. It also helps in the development of innovative products, which results in increased sales volume (MarketLine 2014).

 

Distribution policies

The company has numerous distribution systems. Apart from Japan, Toyota manufactures vehicles and associated parts in over fifty facilities in 27 nations. Much as Toyota is geographically positioned, manufacturing base helps in the diversification of business-related risks, present a broader reach, and hence increased revenue (Toyota 2014). Based on the company’s distribution policies, the facilities are responsible for implementing local sales approaches, which allows Toyota to timely respond to changes in the market and the demand.

Communication

The company uses an integrated marketing communication plan as well as different channels like celebrity endorsements, magazines, social media platforms; and TV adverts to market its brand (Toyota 2014). Broadcast: the company advertises its brand on television in different languages on the basis of the region while the ads are market focused (Toyota Global 2014). Print and Digital ads: print campaigns portray individuals celebrating the joy of the brand. Additionally, the company has carried out digital campaigns with a number of characteristics and entertainments like the DJ battle, Beatboxing and so forth.

Nonetheless, localization, as well as globalization methods, presents Toyota with several communication techniques. Several marketing campaigns are localized at a national level. For instance, in the United States, the company uses a playful technique “Moving Forward” that has been effective. But Baskin (2013) alleges that product based campaign such as “Style never goes out of Style” was not successful because the company had product recalls.

Prices

The organization differs considerably in accordance with the model. Pricing demonstrates how an organization set the price of its product. In this case, the company uses value-oriented and market-based pricing strategies. With market-based strategy, Toyota uses it to determine the cost of its brand as determined by marketing situation and rivals’ prices. This strategy is widely used for sedan models and trucks. On the other hand, Toyota uses value-oriented strategy to a luxury brand like Lexus and Prius (Rahmani et al. 2015, p. 99).

Strategy Recommendations

Toyota must focus on penetrating in Asian markets. This will help the company to build brand equity in Asian markets while increasing its manufacturing facilities. In addition, this will help Toyota to get cheaper distribution channels and closer to emerging buyers. In turn, this will reduce middle management so that engineers influence what clients’ preferences are considered in the production of new vehicles.

To build brand equity, Toyota should also use the strategy of promoting business and cost changes. This will be important for the organization when it comes to realizing solid management systems to allow timely response to market changes. In particular, the company should ensure a streamlined system by reducing fixed costs while increasing its operation in established markets.

Moreover, the company must hasten its penetration in the rapidly developing markets by comprehensively assessing marketing situation. This will allow Toyota to develop the brand equity since it will able to launch products suited to the needs of every region. The company must adopt an environmental strategy that involves fuel efficient products and integrate value chain. With an environmentally friendly strategy, the company will see growth in different departments such as logistics, main components like vehicle air-conditioning compressor, and the mobility of engines and autos.

Furthermore, the company should support other sectors and social infrastructures globally by providing products that meet customers’ demand. This is necessary for promoting engendering society. Generally, the firm has outperformed the automobile sector for many years and increases a significant market share. Hence, it should shift to small and fuel efficient automobiles, which it can produce at a cheap cost to support the growth of the American market.

Summary

Toyota Motor Corporation (TMC) is a Japanese establishment that has been around since 1933. For more the eight decades, the company has been dedicated to developing a brand that meets the needs of the customer. Through cost effective and innovative designs such as the lean manufacturing, the company has been able to emerge as the world’s leading producer of automobiles. However, the company has been able to manufacture vehicles that are tough, cost effective and of high performance. And yet, to remain competitive, the company has to invest not just in research and development, but also put in place platforms that would help gather opinions from customers.

 

References

Baskin, J. 2013. Toyota's Ad Demonstrates How Not to Sell Cars. Available: http://adage.com/article/cmo-strategy/toyota-s-ad-2014-corolla-shows-sell-cars/244201/. [Accessed 14th  May 2017]

Customer Report 2014. The family-friendly SUV stands tall in the mainstream midsized SUV segment: 2014 Toyota Highlander isn’t sporty but it is quite capable. 2014. [Online] 14 May 2017.

Famous Logos 2013. [Online] Available from: http://www.famouslogos.org/logos/toyota-logo [Accessed 14 May 2017]

Lee, H.J. and Yang, H., 2015, December. Potential competitor identification and competitor analysis by monitoring patent information. In ISPIM Innovation Symposium (p. 1). The International Society for Professional Innovation Management (ISPIM).

Jun, S.P., Jun, S.P., Park, D.H. and Park, D.H., 2017. Visualization of brand positioning based on consumer web search information: Using social network analysis. Internet Research, 27(2), pp.381-407.

Keller, K. L. 2013. Strategic brand management building, measuring, and managing brand equity. Boston: Pearson.

Market Line. 2014. Company Profile. Toyota Motor Corporation. 1 (1), p. 4-6

Rahmani, K., Emamisaleh, K. and Yadegari, R., 2015. Quality Function Deployment and New Product Development with a focus on Marketing Mix 4P model. Asian Journal of Research in Marketing, 4(2), pp.98-108.

Toyota 2014. Changes and Innovations [Online] available from: http://www.toyota global.com/company/history_of_toyota/75years/data/company_information/management_and_finances/management/tqm/change.html [Accessed 14 May 2017]

Toyota Global 2014. Worldwide Operations [Online] Available at: http://www.toyota-global.com/company/profile/facilities/worldwide_operations.html [Accessed 14 May 2017]

Toyota Racing TRD 2014. Brand standard [Online] Available from: http://www.toyotaracing.com/trd/pdf/Toyota-TRD-Logo-Usage-Guide.pdf [Accessed 14 May 2017]

Toyota (GB) PLC. 2014. [Online] Available from: http://www.toyota.co.uk [Accessed 14 May 2017]

Toyota (USA) PLC. 2014. [Online] Available from: http://www.toyota.com [Accessed 14 May 2017]

Toyota Germany 2014. [Online] Available from: http://www.toyota.de/[Accessed 14 May 2017]

Van Doorn, J., Lemon, K.N., Mittal, V., Nass, S., Pick, D., Pirner, P. and Verhoef, P.C. "Customer Engagement Behavior: Theoretical Foundations and Research Directions". Journal of Service Research 13.3 (2010): 253-266. Web.

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