Leading car manufacturers are seeking to expand their consumer bases all over the world with a new group of dynamic individuals known as Generation Y in mind. This cohort of young people believed to be born of the late seventies, eighties and early nineties and, therefore, share a new century. They have distinctive characters in social awareness, cultural diversity, massive spending powers, technological consciousness, and peer group influences (Coates, 2007). Asian automobile makers having studied the car market in the U.S have ascertained that this generation associates Asian made cars with trendiness thus “must haves.” Moreover, the large customer base, over 70 million highly influential young Americans, is an ideal target market alternative with their home market comprised of an aging generation.
Two of these manufacturers currently enjoying this market are Honda and Toyota. The duo Asian vehicle giants have it in them that young Americans prefer to treat new and foreign car models as ones meant for them. Through product branding, Honda and Toyota jointly launched rival models Element and Scion XB respectively, two fly and elegant SUVs that are affordable thus have a strong market leadership. Product branding ensured formulating stylish brand names and design aimed at attracting consumers of age 24 years old (Cravens,2005). Furthermore, Toyota concentrated heavily in advertisements through television commercials and social networking sites such as Twitter, MySpace, and Facebook. Their marketing managers aimed to score a large number of young views from social fronts, on and offline.
Such strategies have sure desirable payoffs shown by the amazing returns from the sale of Toyotas’ Scion XB. This brand, since its launch has exceeded the company’s original sales target by selling over 150000 vehicles with eighty percent of these buyers being first time consumers. So high is the sales volume that the manufacturer may have considered a possible concentration on other viable projects. We could term this strategy as a success story based on the number of Asian competitors watching, envying and showing entry interests. Rival examples include Kia, Hyundai, and Nissan with the former choosing to stay with its older models while at the same time studying the potential young market (Cravens, 2005).
On the other hand, Nissan and Kia introduced the Cube and Soul aimed at competing in a market already dominated by Scion XB. However, this campaign has failed to activate since most Soul and Cube users are either too affluent or older than their initial target market. The above exhaustive argument, therefore, proves that the Toyota-Honda strategy is the best vis-à-vis that of their competitors.
Toyota, however, has come up with a decision to limit the number of SUV Scion XBs available for sale. We can say that this is a desirable move considering that this is a generation with its own negative characteristics. Let us consider a situation where company X introduces a new technology Y in the market for a generation Y. Backed by heavy advertisement, Y trends so much until competitor firms come in to try to have a share of sales by offering different versions of Y. Since agents from generation Y are technologically conscious, they will always be eager and curious, moving from product to product depending on which one is fashionable (Coates, 2007). It is, therefore, necessary for Toyota to determine a breakeven point to create room for brand improvement. Better still, they could also come up with a remarkably different model to replace this market dominance based on consumer feedback and critics thus slowly facing out Scion XB.
References
Coates, J.(2007). Generational Learning Styles: Generation Y- The Millennial Generation. River Falls: WI .LERN Books.
Cravens, W.D. ( 2005). Strategic Marketing. Pennsylvania State University: Pennsylvania. McGraw-Hill.
Written by Lio Savage.
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