While conducting marketing research about LEXUS:
Conduct an information search on the luxury car market. It should be an updated information such as current market share, future trend... etc,
Provide a luxury car market review to support the attached article.
Restrict area:
1. Luxury car in the market share (current) ,
2. Luxury market share between brand
3. Future trend of Luxury car
Question: How would you conduct an Internet search for information on the luxury car market?
Lexus: Imparting Value to Luxury and Luxury to Value:
In the 1980s, Toyota developed a concept for a new car that was destined to be a success. The concept of the car, which was to be called Lexus, was based on the observation that there was a large, affluent market for cars that could boast exceptional performance. A significant portion of that market ranked value highly. However, they were unwilling to pay the extraordinarily expensive prices that Mercedes charged for its high-performance vehicles. Toyota planned to target this market by creating a car that matched Mercedes on the performance criteria but was priced much more reasonably, providing consumers the value they desired, and making them feel that they were smart buyers.
Toyota introduced the Lexus in 1989 with much fanfare. A clever advertising campaign announced the arrival of this new car. For example, one ad showed the Lexus next to Mercedes with the headline, “The First Time in History That Trading a $73,000 Car for a $36,000 Car Could Be Considered Trading Up.” Of course, Lexus had all the detailed that the Mercedes did: a sculptured form, a quality finish, and a plush interior. The detail was not, however, limited to the car. Separate dealerships were created that had the type of atmosphere that affluent consumers expected from a luxury carmaker, including a grand showroom, free refreshments, and professional salespeople.
Toyota placed a strong emphasis on the performance of the new car. A package was sent to potential customers that include a 12 minute video displayed Lexus’s superior engineering. The video showed that when a glass of water was placed on the engine block of A Mercedes and a Lexus, the water shook on the Mercedes while on the Lexus it was virtually still. This visually told the viewer that the stability of Lexus was fare more extraordinary than that of even one of the most expensive car around. Another video showed a Lexus making a sharp turn with a glass of water on its dashboard. The glass remained upright; again , the Lexus proved itself. These videos were successful in bringing in customers, whose expectations were surpassed.
As a result of its continued success, Lexus decided to raise the prices of their vehicles. However, this strategy did not work out as well as Lexus had hoped. Lexus realized that it lacked the heritage of prestige that European Luxury cars command and that people are once again willing to pay extra for. As a result, the company turned to a new advertising campaign to inspire an emotional response to its cars. The campaign was exceptionally powerful because it also had to combat the decrease in growth of the luxury car market compared to the auto industry’s overall growth. Partly, responsible for this decline, the “near luxury” autos have skimmed away potential luxury auto consumers. Included in this group are the Toyota Avalon, the Nissan Maxima, and the Mazda Millennia. BMW and Mercedes also introduced products for this segment: the BMW 3 series and the Mercedes C Class.
In response to this competition, Lexus emphasized non-traditional advertising and promotion (e.g., sweepstakes), in addition to more mainstream luxury car advertisements, Lexus continues to show the automobile industry and its current customers that it is building vehicles with luxury, performance, and style. In the 2005 J.D. Power and Associates Initial Quality Study, for the fifth consecutive year, Lexus was the top-ranked nameplate. “ the clean sweep of five individual segment awards by Lexus and the record 10 award overall is a significant achievement,” said Don Esmond, Toyota Motor Sales senior vice president, automotive operations. As a result of Lexus’ marketing efforts, Lexus set a record of its own. With record-breaking 2004 annual sales, Lexus retained its crown as America’s No. 1-selling luxury brand for the fifth consecutive year. The automaker reported total 2004 sales of 287,927, up 10.5 percent over 2003 record-breaking sales.
For the future, Lexus is faced with the challenge of aiming at younger consumers. Denny Clements, group VP-general manager Of Lexus, said he target group for the new luxury sedan has a median age between 47 and 55, while the current LS buyer’s median age is 58 year old. “ the exterior design is much more dramatic than the previous generation LS 400,” said Mr. Clements, who admitted that past observations about the LS styling have included words such as “sedate” and “boring”. Continued marketing plans will help Lexus to attract younger customers.
As of January 2006, the Lexus line had expanded to included eight different models: LS, GS, ES, IS, SC, LX, GX, and RX. Moreover, the RX also came in hybrid version. Lexus plans to expand marketing efforts in the future with aim of not only gaining new customers, but also retaining present clients. Although the company’s plans are highly classified, their latest efforts hint that newer marketing tactics will follow in the unconventional style of ads past. For instance, Lexus’ recent relationship of a skiing event in Colorado included an invitation to all Lexus owners to spend a luxurious all-expenses-paid weekend in the mountains. These efforts are consistent with Lexus’ philosophy of imparting value to luxury, and luxury value.