Amanda ChesserComm483 Nov. 10, 2015

Toyota Prius: Rejuvenating the American Dream: Driving A New Age

Situation Analysis

As concerns over the environment heighten, consumers are buying more environmentally friendly cars, like hybrids and electric plug-ins, which use less fuel and emit lower emissions (Ayre, 2015). The Toyota Prius is a leading hybrid in environmental technology that is facing heightened competition in an increasingly crowded marketplace for fuel-efficient cars, and as a result has struggled to maintain sales. As of July 2015, Toyota’s Prius sales were down 15.4 percent for the year.

The Prius’s position as a leading hybrid is threatened by competitor’s fuel-efficient sister models, which take away sales, and by evolving consumer preferences. According to a study published in April noting a spike of SUV and truck sales, 22 percent of consumers swapped in their fuel-efficient wheels for an SUV (Forbes, 2015).

Prius sales are also susceptible to changes from gas price fluctuations. This year, gas prices sank to their lowest levels in 11 years (Forbes, 2015). When gas prices are cheap, consumers may turn to conventionally fueled cars, which sport a more favorable price tag than eco-tech friendly hybrid models.

The U.S. automobile industry’s evolving consumer base will also impact future Prius sales. The growing U.S. Hispanic population is driving car sales and flexing increased purchasing power. In 2014, Hispanics accounted for 35 percent of Toyota’s year-over-year sales growth (Polk, 2014). Toyota’s ability to appeal to this key demographic is critical to drive sales and secure the Prius’s future in the growing hybrid automobile market.

SWOT Analysis

Strengths Toyota’s debut of its fourth-generation Prius hatchback will be the first

redesign release of the Prius in almost seven years. This may spur excitement and interest among loyal Toyota drivers, dealers and potential buyers.

With global cumulative sales that account for 68 percent of the 7.8 million hybrids sold worldwide, the Prius tops the hybrid market.

o As the first hybrid model on the market, the Prius also has historical credibility in the industry, and a strong fan base.

The fourth generation Prius’s new and improved features are selling points to drive sales:

o 10 percent mpg improvement in fuel efficiencyo 40 percent improvement in Prius engine efficiency, including

reduced friction and improved combustiono 10 percent smaller batteries with 28 percent better performanceo More luggage space o New technology: four-wheel drive, improved passenger protection

and safety technology such as traffic light connection.o New sport and luxury design enhancements: The new Prius is

longer, wider, lower and roomier. It has a new double-wishbone suspension and a lavishly equipped interior.

Toyota’s dealership incentives to clear the existing models for the new models could inspire increased sales of older Prius models.

In 2014, Toyota topped the Hispanic market with a 16.9 percent share. Toyota is also the top-selling brand for Hispanics for over 10 years (Bishop, 2014).

Toyota has a preexisting department, the Hispanic Business Strategy Group of Toyota North America, with staff who specializes in promoting Toyotas among Latinos.

Toyota has previous recognition among Hispanics:o In April of 2015, Toyota made Latino Magazine’s Latino 100 list for the

third year being in the top 100 companies providing opportunities for Latinos (Toyota, 2015).

o Toyota was consecutively the official automotive and transportation sponsor for the annual conference for Latino media influencers, Hispanicize in 2015 and 2014 (Hispanicize, 2015).

Weaknesses The Prius hybrid model is traditionally more expensive than conventionally

fueled vehicles. New technologies of the new Prius risk unpredicted defects; such as those

that resulted in the recalls leading to the Toyota factory freeze of 2009-2010.

Opportunities There is an increased international concern over the environment,

which may turn more consumers to the hybrid market. o Toyota can use this as an opportunity to elevate Toyota’s brand as a

leader in automotive sustainability initiatives and technology. Automaker experts predict the decline of conventionally fueled vehicles,

and expect sales of diesel and gasoline engine cars to near zero by 2050 (Kubota, 2015).

o Toyota can market the Prius as the affordable transition model to the future no-fuel-emission automotive industry.

The Prius’s environmental capabilities align with Toyota’s “wider green car strategy,” which aims to cut carbon-dioxide emissions by more than 22 percent by 2020.

Existing government subsidies or incentives for hybrid purchasers may favorably impact Prius sales.

Volkswagen’s recent downfall has dulled a fierce competitor, and created an opportunity for Toyota to gain and/or convert customers who were Volkswagen loyal.

Toyota topped the consumer-reported 2015 reliability study (Mays, 2015). Latinos are reportedly 15 percent more likely to buy a Japanese auto

brand than any other group. Many Hispanic generations are undergoing upward socio-economic mobility,

including purchasing a car for the first time. First-time car buyers are unlikely to have a preexisting brand loyalty.

o Hispanic culture has high group identification and loyalty, which could benefit customer retention and referrals.

There is an opportunity to target Hispanics in the country of origin, establish awareness and build a positive reputation for the Prius before Hispanics move to the United States.

Hispanics outpace the general U.S. population when it comes to technology: They are early adopters of new technologies and more likely to use mobile

technology, social media, applications, and other digital tools for shopping (Acosta, 2015).

Threats The expanding hybrid market could take away from Toyota Prius sales.

o Competitor models include: Tesla, Nissan Leaf, Chevrolet Volt, Audi Etron, and the Ford C-max.

o Jeep has the fastest growing percent of Hispanic market share (Chappell, 2015).

Evolving consumer preferences for SUV or trucks. Declining gas prices. Barrier of moving prospects from the conventional gas market to the

hybrid market for the first time. Unfavorable infrastructural availability of charging stations for Toyota

Prius. Lack of one uniform “Hispanic identity,” as well as different preferences

(Hispanic v. Latino) or cultural identification factors, such as region of origin. Lack of intercultural awareness of the Hispanic culture among Prius

retailers and local dealerships, including communication preferences, language preferences and family structure.

Hispanic group-decision making style incorporating extended family members within the Hispanic culture may complicate the selling process.

Barriers associated with marketing to Hispanics, including language, availability of cable TV, and improper English-Spanish translations.

Residency complications associated with car ownership:o Barriers to gaining a drivers licenseo Barriers to getting a loan

Secondary Research:Secondary Research focused on the features of the Toyota Prius and its traditional consumers.

Hispanic Population:o By 2060, the US Hispanic population is estimated to reach 128.8

million, constituting approximately 31 percent of the population. o Hispanics are younger than most other racial/ethnic groups, with

the median age being 29 years.o As of 2012, the median income for Hispanics was $39,005o Hispanics are extremely family oriented, and place larger emphasis

on the extended family, while the Anglo-American family places more emphasis on the nuclear family. Shopping is often considered a social activity, and Hispanics are less likely to shop alone.

o 60 percent of Spanish-speaking US Hispanic consumers agree that there is a lack of Spanish digital content.

o Hispanic culture emphasizes traditional gender roles, and Hispanic moms are usually the decision makers.

o Hispanics aspirations are dominated by the desire for high educational attainment.

o Hispanics are 30 percent more likely to purchase a product advertised on a social site, and to use technology to make purchases.

Primary Research: Additional primary research to supplement existing information may

include:o A competitive analysis of rival models, analyzed across the

following dimensions: safety, price, performance, style, marketing tactics and technology.

o A formal survey could be administered among a sample that is representative of the US Hispanic population to measure their current perception of the Toyota brand, the Prius model, and to highlight the priority considerations when they purchase a car. This would use close-ended questions, and would deliver quantitative generalizable results.

This would help identify motivational variables which may move Hispanic consumers along from awareness to action- that is, to buy a Prius.

o A qualitative focus group among Prius dealers and salesmen may also help inform the campaign by highlighting barriers or factors that prevent Hispanics from purchasing the Prius model, or additional values that this demographic looks for when purchasing a car, as well as factors that influence a general prospect’s decision to buy any hybrid car.

Key Publics: Primary:

o Hispanic Americans Heads of household: Hispanic mothers, ages 30-60 First time car buyers

o All potential car buyers Current hybrid owners, especially those who own a Prius Potential hybrid owners Environmental-savvy car prospects

o Retailers/Dealers Sales managers and line salesmen

o Media Automobile influencers: trade media, bloggers, review

companies Hispanic influencers: journalists, reporters, bloggers,

publications produced in Spanish etc.

Environmental influencers: trade outlets, bloggers and influencers

Family magazines

Messages: American consumers, their values and their idea of the ”American Dream” is

progressively evolving. The Toyota Prius is at the forefront driving the future of America’s

automobile industry and environmental technology. With the Toyota Prius, you can have it all: style, efficiency, and an

environmental conscience. Purchasing the Toyota Prius helps keep the future of America and the

environment bright for future generations.

Big Idea: There is a new changing American Dream. The people envisioning it are also

changing, and they choose to drive Prius. Owning a car, a house, and receiving an education are all aspects usually associated with “The American Dream.”

Planning: Goal : For the Toyota Prius to be the preferred hybrid model among Hispanic

American consumers.o Objective: Improve brand awareness among Hispanic Americans (as

measured by a post-campaign survey evaluation) of the Toyota Prius as an affordable, family- and eco- friendly vehicle by the end of implementation.

Strategy : Utilize traditional media relations to target media placements in international Hispanic media, national media, local media (especially in cities with high Hispanic populations), and bilingual publications.

Press Releases Media Kits Pitches Deliverables

Strategy : Put a face on the Toyota Prius by partnering it with a prominent recognizable Hispanic spokesperson

Recruit Sofia Vergara as a brand ambassador. Undergo reverse placement in popular TV show

“Modern Family.” Use reverse placement in ads for mobile devices

Strategy : Partner the Toyota Prius with a popular mobile provider or producer, such as Verizon.

Use reverse placement for the Prius in Spanish marketing campaigns for mobile devices, tablets, computers etc.

Creation of a “chance to win a Prius” or “chance to win an electronic device” with the purchase of either.

Strategy: Engage Hispanic Americans with the Toyota Prius brand online with integrated new media approaches.

Creation of Prius blog, twitter and SnapChat account. Creation of an online campaign with the integrated

hashtag #DrivingDreams, where Prius owners share an accomplishment that happened with their car (Ex. Road trip, first kiss, first day at school, move into college etc.)

Get spokespeople to tweet about the Prius and the campaign from their personal accounts

Integrate social campaigns into ads and deliverableso Ensure all social content is mobile compatible

Strategy : Ally with organizations specific to Hispanic Americans

Sponsor Hispanic American influencer conventions Align with Hispanic American activist groups, civic

groups and non-profits, and include them in community events.

o Objective: Increase sales of the Prius among Hispanic Americans by 25 percent in at least seven key markets during 2016. (Output objective)

Strategy: Provide support for dealers to help close sales with Hispanic prospects efficiently.

Host educational events on communicating with prospects of the Hispanic culture.

Create internal deliverables and distribute to dealers in print, and display in high traffic employee areas.

Establish local friendly competitions between dealerships.

Create a reward program for successful cross-cultural sales.

Establish a national Toyota assistance hotline/mentor to help prospects struggling with residency complications.

Create a marketing campaign that is culturally relevant to Hispanic Americans

Incorporate elements of Spanish in marketing materials. Include actors or actresses and voices in marketing

materials of different ethnicities, such as Hispanic. Reverse placement in popular Spanish-language

television shows Create online elements to facilitate online purchases among

Hispanics

Creation of a customization app and purchase website for Prius to facilitate online transactions

Make each online website, blog, and social media account available in Spanish and English

Incline a “group design” feature, so that multiple members can vote on key design elements

Advertise in print, online and on social the ability to purchase Prius online

Host events in seven key Hispanic cities Music events at community colleges/public institutions,

featuring Hispanic artists, such as Pitbull or Enrique Iglesias, sponsored by the Toyota Prius.

Hyper-local Prius retailer premiere gatherings within Hispanic communities, and raffle off

Goal: For the Toyota Prius to be the premiere choice for potential hybrid buyers.

o Objective: Increase awareness among consumers of the Prius as the “face” of hybrid cars by 30 percent.

Position the Toyota brand as the industry leader of environmental technology.

Ally with environmental activist organizations Secure placement in environmental academic

publications, produced by environmental research groups, NGOs, non-profits, professional coalitions.

Create and head an environmental coalition among auto providers, including companies who make tires, electricity, music, etc.

Creation of an environmental pledge signed by prominent spokespeople and/or organizations. This can be displayed in Prius retailers.

Partner with Uber and/or Lyft to provide Prius cars to Uber drivers and create an “environment car” option on the Uber app, with the ability to “share your eco-friendly choice” on Facebook.

Highlight the environmental benefits of the Prius Media placement in environmental academic

publications. Sponsor national environmental initiatives, such as

project clean stream.

Evaluation The evaluation of this campaign can be measured by:

o Sales growth in the Toyota Priuso Performance percentage measurement of sales efficiency for dealers

engaging Hispanicso Sales growth retention one year after implementationo Number of Hispanic referrals o Number of media placements, including the favorability of coverageo Social media engagement, including favorites, likes, retweets and

hashtags.

Sources

Ayre, J. (2015, March 28). Electric Car Demand Growing, Global Market Hits 740,000 Units. Retrieved November 9, 2015, from

Breyer, M. (2012, August 8). Toyota Prius: Latest status symbol for the wealthy? Retrieved November 9, 2015

Chappell, L. (2015, May 18). Sales to Hispanics outpacing the market. Retrieved November 11, 2015

Hispanic or Latino Populations. (2015, May 5). Retrieved November 10, 2015.

Kubota, Y. (2014, October 14). Toyota Maps Out Decline of Conventionally Fueled Cars. Retrieved November 11, 2015

Toyota Named to LATINO Magazine's LATINO 100 List for Third Consecutive Year. (2015, April 29). Retrieved November 11, 2015

Toyota and Scion 'Presente' at Hispanicize 2015. (n.d.). Retrieved November 11, 2015