Honda Marketing Plan Assignment

Honda Marketing Plan Assignment Words: 2096

With the fast development of the consumer brand and increasing customer base, Honda became one of the leading automobile companies in the US. In order to maintain a consistent growth in sales and popularity among the customers as well as stabile position on the US market, Honda wants to remodel an existing version of their light truck, more known as “Ridgeline”. There is a need in increasing pull power, payload, fuel efficiency and affordability. The main goal of this major renovation is to provide a hundred percent of the customer satisfaction, measured through repeat consumers, referrals and surveys.

Honda also believes that is important for the company and for the clients to have a high quality trucks in their line of production, that will satisfy ll the customer’s needs for a relatively low cost. Moreover market annalists estimate an optimistic gross margin over the industry average. Company Description The company was incorporated on September 24, 1 948 as Honda Motor Company. In 1959, American Honda Motor Co. , Inc. was opened in Los Angeles, California. The first Honda manufactured in Marysville, Ohio on November 1, 1982. The President, CEO & Representative Director of Honda is Takanobu Ito.

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The chief products are motorcycles, automobiles and power products. The Honda Company mission statement is “Maintaining a global iewpoint, we are dedicated to supplying products of the highest quality, yet at a reasonable price for worldwide customer satisfaction. ” (Honda Worldwide, 2014). External Environment Competitive The industry of light trucks and utility vehicles are pickups, vans and sport- utility vehicles. Vehicle manufacturing is a highly competitive industry; there are four major competitors. First is General Motors Corporation, which is one of the world largest automakers and the largest domestic manufacturer.

The Main products are the series of Chevrolet Silverado and GMC Sierra. Second s Ford Motor Company, which is the second -largest domestic automaker. Ford recently introduced red uced-displacement turbocharged engines under the most of their vehicles. Third is Toyota Motor Corporation. It was the first major company who sell hybrid vehicles. In 2014, the Toyota introduces a new light truck ‘Tacoma”, which with V-6 engine and optional 4-cylinder engine. Those competitor companies expected to account for 68. 8% of the whole industry, and Honda account 5. 5%, which is a small portion of the total industry.

Economic Because Honda’s operational facilities are located in Japan and throughout he world. A sustained loss of consumer confidence in these markets, which may be caused by continued economic slowdown, recession, changes in consumer preferences, rising fuel prices, financial crisis or other factors could trigger a decline in demand for automobiles. As a result it may harmfully affect Honda’s results of production. “Overcapacity within the industry has increased and will likely continue to increase if the economic downturn continues in Honda’s major markets, leading potentially, to further increased price volatility.

Price volatility in any of Honda’s markets could adversely affect Honda’s results of operations. ” (Honda Motor Co. , Ltd. , 2013). Legal/ Regu latory In terms of legal factors, the company is expected to adhere to the laws and regulation of the country where it operates. For example, in most countries in North America and Europe, the working hours are standardized, and employees are only expected to work for 8 hours. What is more, employee wages are calculated per hours, hence making it difficult for the company to sustain wages and salary.

In the United Kingdom, employment laws require companies such as Honda to pay E 6. 93 per hour as minimum wage. Consequently, this highly affects the sustainability of the company operation and profits (McBeth, 2009). Technological Analysis of Honda Company Due to the advancements in technology, Honda will be required to make use of new technological trends to stay competitive. For example, in the development of its new light truck, the company should use of satellite navigation systems for the purpose of tracking and security to make it easy to provide the location of their cars (Cortez, 1994).

Most importantly, the company is passionate about using technology to produce innovative products and challenge the boundaries of mobility advancements. The impact of technology affects the market because people are shifting towards the purchase of environmentally friendly cars. In response to this customer need, the company has started the production of trucks fitted with vi-Tec engines, which are friendly to the environment because they produce fewer emissions to the biosphere (Shook, 2008).

Furthermore, the rising cost of petrol globally, forces the company to use eco-friendly technology in order to ensure that their vehicles have a sustainable future. Socio-CuIturaI Analysis Socio-cultural factors affect the customer needs and potential markets ecause of the demography and cultural aspects. For example, in the American and UK market, consumers have a higher preference for the local brand of vehicles such as Mercedes or Jaguar model of vehicles. Therefore, Honda Company had to change the belief of consumers by introducing the Honda Civic Hybrid, which is an eco-friendly vehicle (Nonaka & Takeuchi, 2005).

What is more, the company intends to promote the new fuel efficiency trucks; hence the need to sensitize people about the significance of acquiring the new low capacity engine trucks. Another socio-cultural aspect affecting the operations of Honda is the language barrier. Especially when venturing into English speaking countries. Therefore, the company is forced to employ English speakers to help in the marketing of its products. Furthermore, many consumers perceive the Honda cars are too expensive; hence they are less preferred to Bentley, Benz and BMW.

In this regard, Honda has to grapple with the task of changing the social and cultural aspects of consumers on their products (Mitchel, 2005). Although, the culture of Honda Company is innovation and creativity through the use of tech nology, customers still perceive its products as overly expensive and overrated. Therefore, the ompany should redouble its efforts in producing affordable products and marketing them as eco-friendly. Customer Environment The Honda Company has always focused its attention on marketing its products in developed countries such as Asian and American countries.

In spite of the immense profits it has generated, the company should be aware of the several opportunities available; such as, new investment opportunities in the Mediterranean, Africa and other developing countries. Therefore, the company should expand its target market to ensure that the current and potential customers accept the products. The overall brand position for Honda is manufacturing of efficient and high quality cars. For a long time, the Honda Company has been focusing on producing cars that are more suitable for the working, middle and high-class people in society.

Although, Honda has succeeded in producing different models of cars for its consumers, the target market has always been limited to a specific segment. This can be achieved by introducing new models, such as trucks, to aimed at attracting customers from this segment of the market. Honda has been exceptionally successful in the adoption of the 5W model. In terms of “who,” the company strives to eflect positively in the society. In terms of “what” Honda vehicles have been regarded as highly efficient in terms of performance.

In terms of “where” the company has strategically positioned their vehicles as the “ultimate driving machine” owing to the design and modification of their automobiles. In terms of “why,” the company produces uniquely designed cars for comfort, class, style and elegance to satisfy the needs of customers. Finally, in terms of “when,” the company has positively used technology to produce automatic cars, which can be tracked and operated using technology (Honda. com, n. d). Therefore, Honda has been highly successful owing to its unique brand, and differentiation of its vehicles, thus gaining competitive advantage in the market.

The company continues to produce fuel-efficient cars that are affordable and stylish. In conclusion, Honda Company should target the market depending on the needs and quality needed by their customers in different countries. Internal Environment Honda Motor Co. ‘s well performance in North America is largely owing to its sales of practical and affordable small cars. A relatively small market share underlines the company’s gradual-expansion market strategy compared to its ajor rival, Toyota Co. who is of a big market share. Among Honda’s popular models, light trucks and larger sport-utility vehicles account for less than 50% of overall sales. “IBIS World”, n. d. ) According to Honda’s month report in previous year, light trucks had achieved highest sales since 2007 in contrast to decreasing sales in Acura division. (“Honda”, 2013) Honda makes strategic plans according to consumers’ shifty preferences in regional marketplace supported by innovative technologies and manufacturing efficiency. Honda has shifted its strategy in North America to fuel-saving cars and light trucks ccordingly. However, unlike relatively frustrating sales on hybrid fuel-saving car models, bolstered sales on light trucks indicate that the companys strengths still lie on core models.

Under luxury division, cutting-edge technology is and will continue to be the direction to realize outstanding fuel- efficiency and performance for Aruca. According to web information, 1300 Honda and Acura in IJS sold more than 1. 49 million vehicles in 2013, ranking #1 at mass-market brands in 2012. (“Honda”, n. d. ) Recently, the company has been trying to communicate to younger buyers through digital creative and eb innovation as part of marketing strategies. Honda runs business with a racing spirit that allows them run toward a bright future in a flexible, transparent, respectful and constructive manner.

Honda America has 530 OEM suppliers in 34 states funded by $23 billion on parts and materials employed 8500 associates in 2013. (“Honda”, n. d. ) On April, 2014, it forecasted net income may increase to 595 billion yen ($5. 81 billion) in the 12 months ending in March 2015. (Yuri kagiyama, ABC News, 2014) SWOT Analysis Strengths Weaknesses Broad product portfolio provides a future growth platform. Product recalls influences product reputation Specified divisions allow quick response to customers’ demands while using local manufacture sources to a maximum extent.

Products under luxury division are hard stand out among other brands. Large investment in R&D distinguishes products and maintains leading position in cutting-edge technology. Opportunities Th reats Expansion through new product plants and increased production capacities. Volatile fuel and materials price or other market conditions may adversely affect operation and sales. Economic, environmental trends and consumers’ reference will help market expansion. Operation is subject to currency fluctuations. Marketing goals and objectives: 1 .

Long term goal: Our goal is to continue the strengths on mainstream models with a focus on developing and introducing new truck models through a more adaptive strategy in potential market while catering mainstream customers in existing marketplaces. We will continue to be committed to energy sustainability and conservation. Short-term goals: 2. Honda’s aware of the environmentally friendly trend for automobile industry, as many companies coming to concession for fuel efficiency, we ntend to realize fuel efficiency for trucks with high technologies in the future. 3.

Safety has always been Honda’s priority; our trucks’ safety is recognized by customers and proved to be our advantage in the market. We plan to keep this as our strongest strength in future design and production. 4. Honda plans to establish some new plants for truck researching and manufacturing. (most plants are for minivan and economics) 5. Honda strives to be the leader in innovation. Our current truck models have not been clearly categorized; we hope to create models that are able to meet customers’ needs in every aspect et still be innovative compared to competitors. . Surveys and customers’ feedbacks indicated customers’ demand in full-sized Honda trucks. We have determined to create new models of different size so as to increase our market share in the long run. 7. The company is committed to provide customers excellent driving experience. We pursue higher driving performance on the road. Objectives: 1 . Developing a new series of pickups on the basis of existing model of Ridgeline in the next 5-year period. First prospecting model will come up in 2016. 2. Current model-Ridgeline’s percentage in brands sales is 1. 27%,

Honda plans to increase market share to 30% in total with a focus on mid- sized renovated version of Ridgeline of in the next 5-year period. 3. In order to develop a competitive edge over Honda’s competitors, we will modernize the manufacturing methodology in order to accommodate efficient production of low-priced fuel-efficient model of a new truck. 4. The prospecting new model of our pickup in 201 6 is going to be renovated in stronger body structure, modified in a longer, smoother and stylish appearance, reinvented in high and more powerful efficiency engine, equipped with high-end and spacy interior.

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