Toyota's Market Segmentation Strategy

Toyota wanted to develop and promote a car that would appeal on a global scale to 18- to 25-year-olds, a group that will dominate global car sales in 2020.

“Segmentation” is a term marketers use to describe the process of identifying consumers who represent the best opportunities for sales of a given product. Most brands offer benefits that will appeal to a relatively small group of consumers. Identifying the right market segment for a brand and developing IMC messages that will communicate brand benefits in a clear way are the central goals for any marketer.

Read the case below and answer the questions that follow.

Toyota developed the Scion brand to appeal to young consumers around the world. The first Scion, the xB, was so unusual in design that Toyota Chairman Hiroshi Okuda, felt impotent to offer relevant input. Though the Scion was off-putting for Okuda, it was well designed for the segment that Toyota wished to reach, consumers aged 18–25. With slogans such as "Ban Normality," the Scion was launched using guerrilla-marketing efforts rather than mass media. It became an immediate hit for the company, beating its initial sales target by 50 percent.

2a. After Toyota found a number of consumer typ...

After Toyota found a number of consumer types that might be interested in the Scion, including teens, college students, urban youth, and young adults in their early 20s, it began the second step in the market segmentation process. This step, in which the different small segments are combined, is known as

a) slicing.

b) identifying.

c) decomposing.

d) aggregating.

e) flattening.

2b. The global market of 18-25 year olds repres...

The global market of 18- to 25-year-olds represented the target market for Scion. Advertising to this group required reaching a group of consumers known as the

a) target audience.

b) mass audience.

c) daytime audience.

d) consumer market.

e) business market.

2c. 18 year olds living in California and 24 ye...

18-year-olds living in California and 24-year-olds living in Tokyo don't always have much in common. Toyota, through its research, knew that one attribute common to most members of the target market was an interest in individuality. Discovering this is an example of

a) trait matching.

b) selective perception.

c) message vulnerability.

d) a unique selling proposition.

e) finding a shared characteristic.

2d. The Scion is a car that strikes many older ...

The Scion is a car that strikes many older consumers as unattractive. To many younger consumers, however, it looks rebellious, is inexpensive, and can easily be customized. Identifying the market segment that seeks these desired qualities is a way of segmenting via

a) volume segmentation.

b) purchase occasion.

c) geographics.

d) user status.

e) benefits sought.

2e. The Scion product concept came from the obs...

The Scion product concept came from the observation that many West Coast youth were attracted to low-cost cars such as the Honda Civic and the Toyota Corolla, which they purchased and then customized. This consumer behavior is much less common among East Coast youth. Knowing this, Toyota might wish to further segment its market on the basis of

a) benefit segmentation.

b) user-status variables.

c) geographic segmentation.

d) purchase-occasion variables.

e) volume segmentation.

2f. Messages in Scion's promotional campaign...

Messages in Scion's promotional campaign emphasized individuality and nonconformity. These messages were supported by a host of accessories available for the brand that allowed consumers to make their car totally unique. In psychographic terms, Scion assumed that a primary motivation of its target market is

a) resources.

b) achievement.

c) self-expression.

d) innovation.

e) ideals.

2g. Scion's research team speaks with 5 consumers about...

Scion's research team speaks with 5 consumers about the brand. Which one of the 5 represents the type of consumer that Scion should spend most of its promotional dollars on?

a) Dennis liked a Scion ad, but was disappointed when he test drove the car.

b) Kim owns a Scion xB that she bought last year. She loves her car and will buy another at some point.

c) Paula drives a used Scion. When she needs another car, she'll buy another used Scion to save money.

d) Ed loves both the Scion xB and Honda Civic. When he makes up his mind, he'll pay full price for one.

e) Theresa likes another Toyota brand, Lexus, which sells for over $40,000.