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The Targeted Toyota Prius Advertisement Plan Marketing Essay

Paper Type: Free Essay Subject: Marketing
Wordcount: 5395 words Published: 1st Jan 2015

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This advertisement plan for Toyota Prius will focus on the target market needs and wants. The report will duly identify the target market with Prius differentiation and positioning in the market. The budget has been set at $25 million dollars with sales target of 50,000 Hybrid Prius cars.

The Toyota Prius is a full hybrid electrical car. It’s a mid-size hatchback whichwas initially a compact sedan.It’sdeveloped and manufactured by the Toyota Motor Corporation. The California Air Resources Board (CARB) and The U.S. Environmental Protection Agency (EPA or USEPA) rate the Prius as one of cleanest vehicles sold in the United States based on pollution and toxic emissions.It’s sold in more than 70 countries and regions

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A communications strategy which will interact with the target market has been created. The advertisement campaign will enhance the brand image .The strategy will use PR, Advertising, Direct mail, Radio, Television programs, Print (newspaper and magazines), Billboards and the occasional Internet will be the main media. The majority of the budget will be spent on TV and print advertising. The creative strategy is designed on the basis of marketing concept that emphasizes on knowing the need and wants of the customer and delivering them the desired level of satisfaction better than the competitor it will also highlight the unique points ofPrius and abate the target market objections.

Automobile industry:

WORLD MOTOR VEHICLE PRODUCTION according to The International Organization of Motor Vehicle Manufacturers (OICA) correspondent’s survey WITHOUT DOUBLE COUNTS the following figures were obtained for the year 2009. The car sector which is the sector of motor industry includes private cars of all description and engine capabilities provided that they conform to all rules and regulations and they are specifically designed to carry people. The car sector contributes to 84.4% of total Toyota production in 2009 and it includes the Prius.


The Prius is sold in more than 70 countries and regions. In May 2008 Toyota announced that it had global sales of 1 million Prius. In September 2010 the cumulative sales of the Toyota hybrid car Prius had surpassed 2 million units worldwide.

Almost half of the Prius cumulative sales as of December 2009 were accounted by the U.S. with 814,173 Prius units sold since 2000. However, Prius’ sales declined by two consecutive sales decline from its peak in 2007 to 139682 units sold in 2009. In UK, Prius became one of the main leaders in the European market. With more than 20% sales of all Prius made were accounted by Europe. In Japan, the Prius became the Japans bestselling vehicle in 2009 by overtaking Honda fit which was Japans bestselling car in 2008 (excluding Kei cars) and its sales almost tripled to 208,876 in 2009 a feat achieved first time since its introduction in 2007.

Prius Target Market

Toyota’s hybrid vehicle Prius belongs to the lower/medium passenger car segment (C). Prius has the advantage of being the ‘first mass produced hybrid car’ and except for Honda Insight doesn’t have a substitute therefore as this type of a car is new and doesn’t have much substitutes the competition is not stiff. As compared to the only other option of hybrid car that is the Honda Insight it when compared to Prius doesn’t offer the same comfort. The reason is very clear. Honda’s Insight is a two seat sports car whereas Prius aims to provide the level of comfort that as of any other Segment C car strength of Prius for its conventional buyers.

The market for Toyota’s hybrid car can be divided into 2 major categories Business buyers (B2B) and Consumer buyers (Private buyers)

Business buyers consist of customers who either by the car for hire/rental purpose or for the company fleet. Because of low operating cost the Prius becomes an appealing choice for Toyota’s business buyers. Car dealers are also customers but they do not have a free will and they have to sell the car that Toyota produces therefore the number of these ‘customers’ can be set by the company.

The customers buying process starts long before he makes the actual purchase and continues long after that. Toinfluence the customer behavior we first have to analyze and understand the customer’s needs and wants. To clearly identify the thinking process of the business buyers and the consumer buyers the following is the whole cycle which has 5 stages in it.

Recognition: The buying process start with recognition – the buyer recognizes his needs and want. It can be triggered by both an external andinternal stimuli. The internal stimuli can be triggered when his normal need begins to rise such as for hunger or thirst and becomes so high to drive them. A need or want can also be triggered by external stimulifor example an advertisement of a car may bring the need for a comfortable drive or low-maintenance cost car.

Search: after the recognition takes place the buyer will search for the product that will fulfill his need. If the buyer decides to have a new car then he will pay more attention to cars, advertisement of cars, cars owned by friends and family and any car conversation anybody is having. Depending on the need the he may actively search the internet, talk with friends and gather any information he can by other means. The amount of search the buyer is going to do depend upon many other things too such as the strength of his need, the availability of information, the ease of obtaining more information and the level of satisfaction derived from such search. The information can come from many sources such as personal sources (family and friends), by commercial sources (advertisements, sales promotions, packaging, displays etc), by public sources (mass media, internet ratings etc), and experiential sources (using the product offered by handling and examining them) for example in this case a test drive of Prius. The influence of these information sources depends with buyer. In US Nielson’s survey it was found out that 78% of consumers receive the most credible endorsement of information from others. The consumer’s awareness and knowledge of the available product may help him to drop certain products. Toyota must therefore design a marketing mix to make its prospect customers aware and knowledgeable about his brand.

Evaluation: after the first two-steps of that is the recognition and search is completed the step three ‘evaluation’ comes into play. The company needs to know the alternative choice of the consumer if he instead doesn’t Prius. The evaluation phase is a difficult one as consumers don’t use simple or single evaluation process in buying any product there seem to be many process at work. Therefore the company should study buyers to find out how they actually evaluate brand alternatives. If the company knows what evaluative process goes on they can take steps to influence the buyer’s decisions.

According to a survey:

Decision: after the recognition, search and evaluation the fourth step emerges that is ‘decision’. The buying decision is backed by intentions. The intentions of the customer is influenced by two-factors the first factor is attitude of others as in someone important to consumer who thinks that he should buy a low-priced car, then the chances of him buying an expensive car is reduced. The second factor is unexpected situational factors. The customer may intend to buy a car based on his expected salary or product benefits but due to unintentional factors such as a bad customer feedback or an economic recession may result that the prospect customer may not make a purchase.

After-sales: after the sales have been made the company’s main aim is not merely to meet customer satisfaction but to delight him. After every big purchase customer usually suffer the syndrome called the cognitive dissonance. This is a post buying conflict that is buyers’ discomfort where he feels uneasy about acquiring the drawback of the chosen brand and about losing the benefits of the brands not purchased. The company must therefore take proper customer care because a dissatisfied customer is harmful to the company. A bad word of mouth may travel a long way and may damage other prospect buyer’s intention. The company should therefore make them their asset.

These were the basic customer thinking process. The target market segments are now described below of Toyota Prius.


The consumers (private buyers) are the most important segment in the market. The consumer’s age is between 30 to 50 years old. They could be either male or female. The family lifecycle is that they are likely to be married with children. They are educated adults who know the effect of hybrid cars to the environment. The income level of the costumers is to be seekers ($4376-$10,941) and strivers ($10,941-$21882). Therefore they are in upper middle class and have occupations that of high managerial or professional positions. Hence they not only are prepared to purchase an environment friendly car but they can also pay high go the comfort and future cost saving from the car.


According to the demographic profile three types of probable buyers can be identified

The first one is the early adopters and technology pioneers these people are the one who are interested in the latest technology who are the first-runners who want to own the latest invention. The second type are the people who are environment friendly they are the one who recognize the global warming situation the pollution and the impact of motoring industry on them. They would like to do something about it by buying an environment friendly car. But there is one set back they are seeking to express their concern and ease their mind these people only somewhat concerned and not willing to cause them too much inconvenience. The third types of customer are the customers who are looking for the ideal combination of low-maintenance cost car in the long run and the highly economized fuel consumption at an affordable price.

The media usage for such customers will be as followed:

Print: Quality newspaper ( Telegraph, Independent, Times, Daily mail), National Geographic, Vanity fair, Stuff, New scientist, Waitrose Food illustrate, Financial/Business press, Wired, Trade press, Car magazines

TV: BBC One, BBC two, BBC three, BBC five, CNN, Discovery Channel, Channel 4, Sky TV

Other: Capital FM, Classic FM, Jazz FM, Radio 4, heavy cinema ads, intensive use of the internet advertisement, Galaxy

All three types of customer are likely to be open to all the same surrounding of the advertisements is it of Print, TV or others. The overall size of the target segments is small and therefore shows the eminent results that the hybrid car is yet to become common among other sectors as well.


The private buyer or the business buyer is more likely to come from an urban area or a city. One the strength is that its available in more than half the globe covering more than 70 countries and regions and therefore the customer can be from anywhere of the world. The most probability of prospect customers rest in the place where there is a pollution and congestion problem such as in US the Prius customers can avail up to $2000 tax rebate therefore the customers need not only be environment friendly because its cost efficient too.

According to a survey:

Toyota Prius: SWOT Analysis, Overview



• World’s largest car manufacturer,includingbiggest Japanese car manufacturer

• Reliableand safe Image

• Research and development is one the largest amongst other car manufacturers this insures innovative designs.

• ‘Just In Time’ Production

• Toyota Corolla. The bestselling car with over 35 million units sold

• Lexus another product, other strong brands


• Understanding of different Markets/

Cultures due to such vast markets

• World-wide distribution networks/ car dealers

• Prestige/ image when compared with

Other European makes

• Relatively small Market share



European Union market, elimination of quotas

Hybrid Prius technology

Introduction of new models

Online buying activities


Strong competitors in every segment;

(Ford, General Motors, Volkswagen, Mercedes, BMW,

Honda, Hyundai)

Public/Alternative transportation

Heavy taxation/ fuel prices increase

Worldwide economic recession

Internal strengths

Toyota is the world’s largest car manufacturer. Toyota can achieve economies of scale by having production facilities in more than 25 countries. Toyotais able to quickly respond to customer needs and reduce its operating cost and overhead by applying the “just in time” production, Toyota was one of the first automobile manufacturers to introduce this.

One of the most expansivebudgets for R&D in automobile industrywith various research centers around the world ensures innovation at Toyota such as of the world’s first mass produced hybrid cars Prius.

Reliability and quality standards are regarded as Toyota’s major strength in automobile industry. The Corolla the units of which have crossed 30 million mark back in 2007 since its production start in 1966. It also has many other strong brands in the industry such as Lexus.

Internal weaknesses

Due to large world-wide market Toyota has difficulty in catering to the different needs of different countries and culture. For example European customers have distinct needs from Japanese and Americanbuyers, yet their prestige of reliability is not good enough to convince European buyers who like toshow themselves with their selection of car and therefore choose cars with more eminentcachet from manufacturers such as Mercedes, Volkswagen, General Motors and Ford. Some customers might choose a car from adomestic producer to back the home industry (though Toyota has anoutputfacility in the United Kingdom).

External opportunities

Till 2000 the European market was protected to aboutsome extent as Japanese manufacturersaccordedto confine their imports to the EU market through voluntary quotas. Since January 2000 these quotas were polished off and now were entirely opened to the EU market for Japanese Carmakers.

Toyota’s new hybrid technology Prius has turned outto be very flourishing in the US, Japan and Europe and already made severalnew models. Toyota could receive the benefits of being the first in this

Marketand other than Honda Insight which is also a hybrid carbut rather than a family car it’s a two-seater sports car. Toyota Prius therefore currently has 90% market share in hybrid vehicles).The entry of new models in developing segments generally offersmany opportunities.The fresh medium internet also opens up a new window of opportunities for the marketing of cars and side by side improves communications and cuts off operating costs

External threats

The chief threat comes from rich and big competitors who prevails the world market. Indirect

Competition comes from substitute methods of transportation such trains and buses because of low-costs. But in some countries it’s comparatively a safe net because very few people are prepared to use public transport. However the entry of the congestion charge in London has shown that car traffic can be cut down. Othergovernment incentives such as tax increases and fuel price increases are also directed at reducing the usage of cars. These activities can dilute the number of car purchases and reduce ultimate profits of Toyota Prius

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Objectives and Targets:

Targets are important to be clarifiedwhich therefore is ought to be achieved by planned actions. Objectives and targets of a company is formed and divided into three stages; corporate objective, marketing objective and communication objective.Corporate objective is achieved thorough higher profits and increased sales which is actuallystockholder wealth maximization. Marketing objectives is the productive introduction of a new car in the market. However, Prius was not introduced in the market for profit generation in fact in US it’s sold at its production cost. Due to a research project the Prius model was derived which was introduced in the market for two basic reason first the environmental responsibility factor which was good for the image of Toyota and the second was to show the engineering capabilities of the company.

The following are the main objectives and targets:

– To strengthen the bond with the Toyota Prius

– To enhance the attention towards Toyota Prius when a customer is planning for a new car purchase.

– To grow the target market and enter into other market segments and reach them as much as possible

– Business buyers and Consumers (private buyers) have to be informed about the new product and brand name.

– Create awareness of by educating customers of hybrid cars and advantages of having a Prius.

– Target markets should be thrilled about the new technology driven Prius and reach to othersby word of mouth.

– Communications should promptusers to learn more about the new Prius; see the

Website, order a test drives etc.

– The Prius ought to be looked at as a total and sensible alternative to conventional cars.

– At last communications should result to a purchase, a more eminentpercent of showroom visits should be turned into sales.

As this product is newthere are no trendsetter’sfor this product and also historical data is not available that would allowforming an idea what is possible or realistic or what is not. For example the Prius has been launched in Japan since 1997, but it was a different market with a different environment and therefore only to some degree of valid similarities as compared to the EU and UK market.To check if all or some of these objectives are met post campaign research should be started at regular intervals.

According to a survey:

Current-market Strategy

The Prius offers specifications that now other car offers. These unparalleledmarketing points should be underlined in the advertisements and any barriers to purchase be underminedsimultaneously (unequaledmarketing suggestionscheme). Advertisement messages are likely to change over time, early ads shouldfocus on the consciousness and education prospect, whereas later performances can center onproducingexcitement and focus on particular benefits.To charm to the target market ads should promote the car and its users to be innovational and creative leaders. barriers to purchase should be identified such as high initialcost anduncommon technology should be overpower by emphasizing the long runefficiency, achievement in Japan and by providing them product information. It is vital to emphasize that the Toyota Priusdoes not need any outside recharging which is often confused with traditional electric vehicles and it provides thesame comfort as that of a normal car, the Toyota hybrid car should therefore comprehended as ‘least brown’ and not’green’ (and all the weaknesses associated with that). The campaign is proposed “to make thetechnology come alive” (Bernasconi, CD, Oasis Advertising, NY).

It would add up to make different performances to target one of the three types identified in thetarget market and stressing their grounds to purchase and rebut their individual barriers to purchase. Consequently adsshould appear in media whichis given in the psychographic profile of where to advertise.The tone should be innovative, well-informed and humorous if possible.

Communications methods:

Various types of communication mix are available. Two significantelements have to be considered when choosing the communication for the Prius: The high involvement in the type of product and its introduction to threestages in the life cycle of the product. These two elementsdetermine the customer buying behavior and therefore the method has to be conformed to fit these terms.

PR areuseful as they enjoy a high credibility but the exact message cannot be controlled at such a low cost but this communication form will be of big influence to the new prospect buyers of the Prius as they draw their information from the media.Personal marketing is very crucial because a car is a high participation product and gives morestrong belief for purchase which is given by personal marketing. The local dealerswho in advance would be trained to be familiar with Prius car, its specification, working, material, efficiency, and its advantages to overcome possible objection from the customers.

Personal marketing will also be of big importance when targeting the business buyer segment,because these customers buy in large quantities and therefore they would expect togive a presentation by a Toyota’s sales representative to convince them that Prius is worthy for their fleet.

The costs of training and personal marketing arepresumed to be dealt in dealers and Toyota’soperating expenses.Sales ads, pecuniary incentives to purchase, are most effective to activate a decision or purchase. Sales promotion isessential at the commencing of the product life cycle to gain acceptance or arouse a trial. Toyota isalready selling the Prius beneath its production cost. However an extra third party sales promotion for Priusmechanism has been put into place: The government, which is encouraging more cleaner fuels, will give a tax-rebate of up to $2000.

To get the largestreward out of this Toyota should advertise this fact. Otherwise Sales promotions should be used impromptu oncea decline in sales can is detected.Advertising, a monetary form of non-personal mass communication from adistinguished marketing agent should be commenced, and also should bethe major communication methodstrategy and formula this campaign.

Advertising or paid publicity is controllable but has a backdrop that it’svery expensive especially for television. Advertising can be used to enhanceconsciousness, arouse involvement and communicateabout the hybrid car Prius.Customers are reached by placing advertisements in their target media (as explained earlier).

Direct mail in the form of newsletters can be useful for this campaign to create consciousness before the launch and to inform and offer them the opportunity to know about the product by a test drive etc. Toyota has already atinformation in place but canalso purchasemore information. Direct mail is also important when approaching the business buyers and providesthem with detailed information about the Prius. But it should be ensured that only people who are intended should receive the mail as the people who may get the mail in error may lower their image of Toyota.

Recommended Campaign

In order to enter new market Pre-testing is a vital step especially for a totally new product, to check if the message conveyed is conceived as intended by the prospect buyers. Testing will help to determine the optimal combination and dilute the risk of failure in general.

Trying out with trial audiences who present the general public and the target audience should include conception, modern-fashion and innovative strategy of all intended communications and performances. A share of the financial budget must be appropriated for pre-testing.

Direct mail should be one of the commencement activities with pre-launch consciousness letters being sent to existing Toyota customers; those who fit in the target group description (Because 40% of buyers in USA & Japan previously owned a more expensive car).

Toyota can also buy moreinformation databases from media that their target has subscribed to (e.g. Times, as faras legally possible) and then filter among them with target demographic profile given above.

A second beckon of direct mail upon the launching with more distinctdata should follow and

Officiallydeclare the launching of the Prius. On this occasion the audience should be given the chance to either pre-order the car (benefit of Toyota loyalty) or request a test drive at a local dealer.

Local dealer’s own mailing efforts will be tested here. Direct mail should also be sent to business buyers, which are needed to be admitted in Toyota’s database. Their mailingsshould be custom-made to underline the characteristics that are important for bulk buyers.

Direct mail should also be used in the form of email to underline the Prius present-day image.

Emails could be planned to change to directly pre-order the car and purchase the car online,something that would invoke toinitiatethe mind-set. Newsletters should include detailed pamphletsand eventually a CD-Rom.

Positive public relations are going to be created by press releases and press conferences. These can be used forthe launch and early phase of the Prius to raise consciousness and produce interest for the new product. The public must also be educated about the Prius’ working and advantages. Strength will be increased when public relation appears in media consumed by the target market prospects. Taking into account the Prius revolutionarytechnology media will be eager to talk about this product because of speculation from the audience and even a certain number of called forcoverage could be anticipated.The Prius will be displayed in suitable shows and expos in the automobile industry to start some talks about the Priusand this will prepare the market.

Advertising is one of the most important communication methods along with personal marketing. The

Use of TV ads, Print media, Internet seems most hopeful to reach and affect the target market segments.

The strategy is to use slightly different executions among each of the three mindset as discussed by their individual media.

Advertising will go through different stages to aware, educate and interest the target audience andthen hopefully result in a dealer visit. Personal marketing as discussed above is very essential to win over both business buyers and customers (private buyers) in thecar market.

Media Strategy

The favorite medium of advertisement for cars is television because of its high impact of prospectbuyers. Though very expensive that is the volume of TV ads but identified popular TV group programmers should be used as much as possible Identified TV stations, BBC one/two/three, channel 4 etc.Print advertisements will be placed in worthy newspapers and especially in their weekend editions (back cover &second page). Extra ads will be placed in car industry magazines and those read by the targetgroup.

Titles identified to read by the target audience: The Independent,

Financial Times,the Times, National Geographic, Stuff, Daily Telegraph, New Scientist, Vanity Fair, Waitrose Food Illustrate,the Times Auto, Express, Car, What Car etc.

Personal marketing activities will concentrate on target audiences print publications and TV ads but also involve TV programme that do show on cars (Top Gear, 5th Gear, new technology programmes) the environment and maybe even radio programmes for the sake of even publicity. Press releases at regular interval to the target group and car industry.

Placing Outdoor billboards at busy junctions will assist TV and print advertisements and should be placed in urban areas to reach the broad audience of car drivers at a lowcost

Internet also plays a vital role a specific prius site will offer all info through e-brochures and pamphlets plus direct mail will be sent as email where prospect buyer is enabled to buy and purchase the Prius online. Plus, the customers can make their own customized Prius too. Plus all advertisements should bear the Prius web address.

Budgets control and Timing of Factors:

Before the product is actually launched the marketing communication should be launch so that at launch they show their full potential. Even long before that all sections that add to the production and communication will have to meet regular interval for an integratedstrategy.

Pre-Launch: The arrangement of a site round the Prius will happen once the hybrid car has been shown onexhibitions. Direct mail will be sent before and after the launch. Personal marketing will be allowedbarely beforeand fully after Launch. Once the product is available advertisement will start. TV advertisements will start ina flux into a ‘consciousness pattern’ after half-year to maintain consciousness for a product that has a long purchase cycle and takes a longer decision time.

Post Campaign Testing:

Post-testing (during and after campaign) is vital because it helps to measure the literalachievement of the campaign. It answers the questions such as was the money worth spending over the advertisements, were objective achieved after such long strategy planning. If not where did it fail? Customer feedback also helps when designingnext campaigns.

Post-testing will be outsourced and will be held by an agency that particularizes in carrying surveys to finding out thepublic’s reaction to the communications. These tests will include the credit/ consciousness ofadverts, recall rate and its influencing power over feelings and attitude towards people. Was the target market segment covered and reachedwith the right message should also be analyzed. These results can then be equated with results assessed before the campaign commencement to state the

Affect the campaign had. Budget has to be allocated for this post-campaign testing.


The report considered all the in-out possibilities of the advertisement components available to ensure that each and every component is taken into consideration. We urge a communications strategy that makes use of advertising, personal marketing, new media and direct mail, radio and television. Personal selling will be rendered by the existing network of local dealers.TV will be used for advertisements and Print Outdoor media to initiate the purchases. The Internet will play asignificant role for bothadvertising and direct mail, using a modern medium to emphasize the encouraged character of this car.However that this plan sofar is only a advertisement plan, and not definitive, it can mould especially if pre or post-testing give damaging results and according to its result will be taken appropriate steps to overcome those obstacles.Before making the suggested action a long designing period with frequent meetings of all parties is essential to insure the unity and wholecontents of the plan.





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