Running Head: Marketing Essay
Table of contents
Describe its segmentation, targeting and positioning strategy 4
Explain why the strategy succeeds or fails in the industry in terms of marketing concept 4
Compare its strategy with other product or brand name 5
Marketing involves the process of determining goods and services lacking in the market, then producing, supplying and promoting them in order to make a profit. It is therefore the whole process from production to selling of the products to the final consumers. The channels of production are involved in this process to ensure that goods and services are sold to the end-consumers. Innovative people with adequate capital venture into business with an aim of making profits. In order for the whole process to succeed, segmentation, positioning and targeting is required in the market.
Market segmentation is a concept that is commonly used in economics and marketing. This concept involves the occurrence of a particular group of people or organization with the same characteristics of needs. These organizations create a demand for a given product hence end-up consuming similar products. This trend of consumption enables the producer to produce specific products for a given number of consumers. The marketing managers indulge into the business with the aim of designing better brands for the right consumers hence an increase in supply and demand for the products. These managers end-up making concrete decisions on how to increase their sales on specific items depending on the forces of demand or consumer potential.
Product segmentation is influenced by age, gender, interests and price. People with different age numbers are likely to have different product demands hence the reason as to why the old and the young have different needs. The products that are required by the old people are likely to differ with those needed by the youth. Organizations are therefore likely to choose the type of products to produce for a particular group of people. This involves the volume of the products and their prices. On the other hand, product segmentation can be determined by the gender. Organizations produce products to different genders depending on the product demand. Interest segmentation is identified by the rate of consumption of a given product by consumers. Consumer interests therefore end-up influencing the volume and price of the products to be produced. Price is determined by the forces of demand and supply in the market. They fluctuate depending on the demand or supply of a particular product.
Targeting is the process by which a marketer aims at providing specific products to the public. The marketer identifies particular consumers and works towards providing them with their appropriate goods and services. This process involves two categories, which are single segments supplied with one product, and multiple segments supplied with a single product. The single segment supplied with single products involves a specific group of people supplied with a common product. On the other hand, the multiple segments supplied with single product involve a particular product being supplied to different people. It is therefore through targeting where a marketer is concerned with the needs of the product consumers. In order to maintain consumer loyalty, marketers apply good brand management skills in market targeting.
Positioning is the process of determining the how a product is perceived in the minds of people. It involves drawing images in the minds of the people on the viability of the product. It involves the consideration of consumer grievances and working towards correcting all the wrongs identified in a product or service. Perfection is all what is needed in positioning in order to maintain consumer loyalty. The goodness of a product is measured in terms of the quality and price as compared to competing products. The marketers take the obligation of ensuring that the products being produced are efficient and appropriate for consumers to afford and buy them for consumption. The marketer analyzes the risks of losing a customer, the need to retain the customer and the techniques of retaining the customer. With all this information at hand, an organization is capable of positioning a good image to the public. The overall interest of an organization is making more profits hence the need for it to carry out positioning.
Segmentation, targeting and positioning strategy of Toyota
The segmentation, targeting and positioning (STP) has led to Toyota organization’s increase in profits ever since 1961. Toyota’s marketers have been able to come-up with a good strategy in their STP. This is the reason as to why the company is increasing its sales for with time, it has discovered the needs of its consumers hence fulfilling them has created a good image for the organization. It is a global company, which manufactures prices and distributes motor vehicles and their spare parts to its consumers. In the year 2000, Toyota’s segmentation led to increased profits for the company because of the marketing segmentation strategy that was carried out by the company. This was during the introduction of the Automatic Tracking System in the manufacturing process in South Africa. This substituted the Job Card System, which required too much time and did not produce real time information. It enhanced the process of controlling stock and managing the organization’s finances. It also enabled a quick distribution and tracking of the products to its marketing paths hence increased profits for the company. This is because many motor vehicle consumers found it fast and efficient.
Reason for the success of the strategy
The Automatic Tracking system (ATS) was a move to counter their inefficient or low supply of their motor vehicles to their customers who had a high demand for the vehicles. This means that the demand for the vehicle was high while the supply was low due to the use of the old job cards that were used in tracking Toyota’s marketing information. After the substitution of the old job cards with the Automatic Tracking System, the organization was able to increase it sales making bigger profits than before. Its marketing target was aimed at all its potential customers and other customers who lost taste for other brands. Toyota’s image was good because of the good positioning done by the company’s marketing body. The new marketing strategy offered an easy time for the company’s segmentation, targeting and positioning. This was all intended to create more market for Toyota products.
Strategy Comparison between Toyota and General Motors
Toyota’s strategy was better than General Motors’ strategy for producing the electric car. The manufacturing of electric car strategy did not succeed because the company did not have the right plan or strategy. The idea was terminated by the government because top government officials were senior board members of the leading oil producing companies in the United States of America. The contract was cancelled after General Motors was blackmailed by the oil producing companies. This is an example of a viable plan that was to earn the company big profits that was terminated because of lack of good segmentation, targeting and positioning.
It is therefore evident and beyond doubts that the installation of the Automatic Tracking System succeeded because of the strategic segmentation, targeting and positioning in the company. Segmentation of Toyota products was identified to be single product for multiple segments because there was a large ready market for motor vehicle products. On the other hand, the supply for the products was low hence, the reason as to the old slow system of tracking had to be terminated to create way for a new system. In the case for General Motors, the segmentation was good because many people would prefer using electric vehicles as a measure to conserve the environment but it did not consider the impacts of the strategy to the present competitors in the market.
The target for Toyota succeeded because of the availability of the new market as opposed to the failed target for General Motors. General Motors target failed because of government intervention into the plan making it a sterile strategy. It is beyond doubts that Toyota and General Motors had good positioning of their product but the difference in the market segmentation and targeting led to the success of Toyota’s strategy and failure of General Motors’ strategy. In conclusion, segmentation, targeting and positioning are fundamental concepts required in improving the sales of a company as is evident in Toyota.