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Toyota Prius EV: Marketing Management
1. Marketing Management (MKT300)
Professor Richard Trutz
Summer 2012
Chanchai Rukkhawattanakul (Wee)
Cyrus Attarseidi
Guo Dong Guo (Gordon)
Piyanuch Kangwankijwanich (Tu)
Vasatha Smitthimadhindra (Vicky)
2. Agenda
•Toyota EV Prius Introduction
•Market Demands
•SWOT Analysis
•Sales Objectives
•Marketing Objective and Strategies
•Marketing Tactics
•Marketing Communications
•TVC 60 sec
•Financial support
•Conclusion
3. Toyota EV Prius Introduction
•Sedan electric car
•Good quality at affordable price ($36,850)
•Eco-friendly and cost effective ($0.6 VS $3.8)
•Easy to maintain, no oil change
•Better after sale service (Certified used cars policy)
•Coming in Q4 of 2012
4. Market Demand
Domestic Policy Goals
• Reduce dependence on foreign oil
• Reduce export of dollars, particularly to unstable regions
Global Impact
• Minimize climate change in Europe
• Balance pollutions in China
• Allocate funds for clean technology by governments around the world
Climate Change
• Transportation accounts for 15% of CO2 emissions
• United Nations’ Framework Convention on Climate Change (UNFCCC)
Gas Price
• Increase gas price
• High fuel price countries
5. SWOT Analysis
Strengths
•The world’s reliable brand
•High-quality cars at a reasonable
price
•High reputation of eco-car
Weaknesses
•Less dealers (only 1,200 VS
5,000 of Ford)
•Indifferent car features from Ford
and Nissan
Opportunities
•Increasing awareness of
environmental concerns
•High cost of fuel
•Government’s subsidiary ($7,500
rebate & no oil tax)
Threats
•Expensive electric components
•High initial price
•Nissan Leaf, a brand leader
6. Sales Objectives
The sales volume will be 75,000 cars between August and
December 2012 (15,000 cars per month)
Toyota should have market share of EV cars at
1% in 2012
4% in 2013
7% in 2014
(Increase 3% each year)
7. Marketing Objectives and Strategies
Sale volume
Introduction
Maturity
Growth
Decline
30
Time (Months)
Introduction Phase
High Price
Growth Phase
High Price
Competitor-base
Pricing
Standard
Quality
Value Pricing
Toyota
Nissan
Standard
Quality
High Quality
Low Price
High Quality
Low Price
8. Marketing Tactics
Categories
Ford
$35,200
Price
Nissan
Superior Value Proposition
Toyota
$39,995
$36,850
Just Noticeable Difference
Feature
Max. Speed
Charging battery
time
Km. per full
charge
Dealerships in
US
150 km/hr
135 km/hr
140 km/hr
7hr.
3.5 hr.
3.5 hr.
105 km
136 km
110 km
1,100
5,000
1,200 + online services
After sales
services
24/7 onsite car service
- Lockout protection
- Flat tire changes
- Jump starts
- Fluid delivery
- Towing for the unexpected
Certified used cars policy
Spare component available
Free maintenance 30,000 km
Charge
Charge
Free (within 3 years)
No
No
Yes
Hard
Easy
Easy
9. Marketing Communication
Nissan
Leaf:
Funny but in
serious
Mood and
tone
Example: Gas
powered
everything
campaign
Toyota
Prius:
Fun, Sincere,
Clean, and
Colorful
Be
differentiate
to generate
interest and
desire
Target Audience:
Generation Y or Millennial:
the U.S. largest population,
nature and social media lovers
11. 60 SEC TVC
Scene: Busy city
Voice over: In the big city where pollution is everywhere
Sound: Honk, Construction
Scene: It start destroying buildings
and bridges
Sound: Scream, Car crash, Honk,
Ambulance
Scene: Smoke and Godzilla was born
Sound: Scary music
Scene: Hero appears
Sound: Tan ta da da !
Scene; Crowded people
Voice over: Here he come! Electric man
Sound: Clapping, Hooray !
12. 60 SEC TVC
Scene: He is jumping close to Godzilla and it fears
Voice of Godzilla: Don’t kill me. I’m sorry…(funny crying)
Scene: Godzilla and people are
stunned
Voice over: What is he doing?!
Sound: Cricket
Scene: He jumped into the Toyota EV Prius
Sound: Start engine
Scene: Hero talks to camera
Voice over: We have to solve
the problem at its origin, pollution
Scene: Godzilla is shirking
Voice of Godzilla: Oh-O
13. 60 SEC TVC
Scene: People jumped into the Toyota EV Prius and driving.
Sound: Happy song
Prius EV
Hero by Choice
Effect: Fade in
Effect: Fade in
16. Competition Price (MSRP) Comparison
Nissan Leaf
MSRP
Ford Focus
Electric
Prius EV
$35,200
$39,200
$36,850
•There is an additional $7,500 Federal Tax Credit for Electric
vehicles (EVs) purchased in or after 2010.
•Our total production for this campaign is 2,500 units.
17. Cost, Budget, Revenue, and Profit Margin
• The maximum total sales forecast for this campaign is 92,125,000
USD ($36,850 x 2,500 units).
• In regard to the fix cost we consider 100% financing of our
required initial investment.
• Our “fixed cost per year” is based on our “capital cost per year”
and Time Value of Money (TVM).
18. Fix and Variable Costs
• Our fix cost is about 55% of our COGS and the rest is our variable
cost at %45 of COGS.
• Our total cost of goods sold (COGS) is at 40% of our sales price
including various costs during this campaign.
• Our profit margin is 60% of our sales price since we have a direct
sales approach during this campaign. The profit margin would
decrease to 35% when we go back to our normal supply chain
method.
19. Sales Forecast (Production Unit)
• We expect to see a rapid increase in sales of electric car in general considering
the enormous amount of investment by federal and local governments as well
as privet sectors in infrastructure.
• Our sale forecast would be 2,500 units during this campaign, and for the 2nd
year we predict 20,000 units sales and for the 3rd year we expect to sell
around 70,000 units.
20. Expense Forecast (Costs)
• We expect to have a steady decrease in our total cost of goods
sold (COGS) in the future considering:
• Economies of Scale
• Suppliers spare parts price decline
• Learning Effect
21. Conclusion and Recommendations
• We believe we have a great product to offer since:
• Toyota Prius is the world's first mass-produced green car.
• Toyota Prius is in the market since 1997 for almost 15 years.
(Very high brand awareness)
• In 2011 Toyota Prius family was the 3rd Best-Selling Vehicle Line
in the World in term of number of vehicle sold.
22. Conclusion and Recommendations
• Huge saving in Energy Costs per Mile gasoline-powered
vehicles $0.12 vs. $0.025 BEV (One Fifth)
• Federal Tax Credit $7,500
• 0-60 mph in just 7 seconds
• Zero Emissions Vehicle
23. REFERRENCES
Becker, T. A. (2009) Electric Vehicles in the United States A New Model with Forecasts to 2030, retrieved from: http://
cet.berkeley.edu/dl/CET_Technical%20Brief_EconomicModel2030_f.pdf
Clancy, H. (2012). 7 trends driving electric vehicles in 2012. Retrieved from http://www.zdnet.com/blog/green/7-trendsdriving- electric-vehicles-in-2012/19665
Deloitte Global Services Limited. (2011). Fuel prices will be tipping point for U.S. electric vehicle consideration: Deloitte
Retrieved from http://www.deloitte.com/view/en_GX/global/
e3411d9873a6f210VgnVCM1000001a56f00aRCRD.htm
Deloitte Global Services Limited. (2011). Unplugged: Electric vehicle realities versus consumer expectations.
Retrieved
from http://www.deloitte.com/assets/DcomUnitedStates/Local%20Assets/Documents/us_auto_DTTGlobalAutoSurvey_ElectricVehicles_100411.pdf
Hofstetter, D. (2011). Electric Vehicles 2012: Technology, Economics, and Market. Retrieved from:
http://www.greentechmedia.com/research/report/electric-vehicles-2012-technology-economics-and-market/
MetLife. (2009). America’s Gen Y. Westport: Mature Market Institute.
Statista. (2012). Estimated U.S. ad spending of Toyota in 2010 by medium (in million U.S. dollars). Retrieved from
http://www.statista.com/statistics/192132/us-ad- spending-of-toyota/
Toyota (2012). Service Offering Retrieved from http://www.toyota.com/owners/web/pages/dealers/service-offers
Toyota (2012). Service Offering Retrieved from http://www.toyotacertified.com/