Running head: HONDA ACCORD 1
MMGP: Honda Accord
Liberty University
BUSI 520: Strategic Marketing Management
HONDA ACCORD 2
Table of Contents
Introduction......................................................................................................................................5
History of Honda and the Accord....................................................................................................6
The Four P’s of Marketing...............................................................................................................7
Product.........................................................................................................................................7
Place.............................................................................................................................................7
Promotion.....................................................................................................................................7
Price.............................................................................................................................................8
People...........................................................................................................................................8
Processes......................................................................................................................................8
Programs......................................................................................................................................9
Performance.................................................................................................................................9
The Mission of Honda.....................................................................................................................9
Honda SWOT Analysis..................................................................................................................10
Demographic Trends......................................................................................................................11
Economic Trends...........................................................................................................................11
Technological Trends.....................................................................................................................12
Customer Tastes and Preferences..................................................................................................13
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The Marketing Research Process...................................................................................................14
Step 1: Define the Problem, the Decision Alternatives, and the Research Objectives..............14
Step 2: Develop the Research Plan............................................................................................15
Step 3: Collect the Information..................................................................................................15
Step 4: Analyze the Information................................................................................................15
Step 5: Present the Findings.......................................................................................................15
Gathering Consumer Information..................................................................................................16
Cultural Factors.............................................................................................................................16
Social Factors.................................................................................................................................17
Personal Factors.............................................................................................................................17
Psychological Factors....................................................................................................................18
Potential Entry into Global Markets..............................................................................................19
Modes of Global Market Entry......................................................................................................20
Target Market Variables.................................................................................................................20
Evaluating Market Segments.........................................................................................................21
Product Specialization...................................................................................................................22
Needs of the Target Market............................................................................................................23
Positioning Statement....................................................................................................................24
How the Accord is Positioned in the Market.................................................................................25
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Building Brand Equity...................................................................................................................26
Brand Elements..............................................................................................................................26
Accord’s Brand Promise................................................................................................................27
Main Competitors..........................................................................................................................28
Honda’s Market Classification......................................................................................................29
Honda Accord’s Life Cycle Stage..................................................................................................29
Marketing through Labels and Packages.......................................................................................30
The Accord as a Shopping Good...................................................................................................31
Support Services............................................................................................................................32
Support Services Offered by Competitors.....................................................................................33
Post-Sale Service Arrangements....................................................................................................33
Repair and Service Efforts.............................................................................................................34
Sources of New Product Ideas.......................................................................................................35
New Product Screening Process....................................................................................................36
Pricing Methods.............................................................................................................................36
Price Adaptations...........................................................................................................................37
Distribution Strategy......................................................................................................................38
Distribution Channels....................................................................................................................39
Integrated Marketing Communication Components.....................................................................39
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Advertising Media.........................................................................................................................40
Honda’s Advertising Objective......................................................................................................41
Event Sponsorships........................................................................................................................42
Internet Marketing Possibilities.....................................................................................................43
Social Media Marketing................................................................................................................44
Promotional Efforts.......................................................................................................................44
Personal Selling.............................................................................................................................45
How Sales Representatives are Selected, Trained and Evaluated.................................................47
Social Responsibility.....................................................................................................................48
Conclusion and Recommendations................................................................................................48
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Introduction
Honda is considered as one of the most recognizable automobile brands in the world.
Founded in 1948, Honda has continued to innovate and develop consumer-friendly automobiles,
building a high degree of brand loyalty. As the automobile market continues to grow and
innovate, Honda will have to refurbish the product lines and continually change the marketing
strategy to stay in the ahead of the other automobile manufacturers. The purpose of this paper is
to identify the current marketing strategy of the Honda Accord and how Honda’s decades of
experience as the leading automobile brand in the automobile industry can help the company
continue to grow within the market. In order to accomplish this goal, specific research of Honda,
specifically dealing with the Honda Accord has been conducted. Each topic discussed within this
paper has been researched in depth relating to the Honda Accord. Also, recommendations have
been included in order to help Honda continue to grow and maintain profitability within the
automobile market.
History of Honda and the Accord
The Honda Accord was developed in 1976 as an offspring of the larger Honda Civic due
to people wanting smaller more economic cars during the oil crisis and the realization that fossil
fuels were a finite entity (Edmunds, n.d.). The Honda Accord is now on its fifth generation and
continues to change to keep up with the demand for more efficient and economic cars. Honda
Motor Co., Ltd. was established in 1949 by co-founders Soichiro Honda and Takeo Fujisawa
with the ambition to engineer a motorcycle aptly named the “Dream” D-Type motorcycle
(Honda). On June 11, 1959 American Honda Motor established itself in the USA with its first
overseas subsidiary in Los Angeles, California (Honda, n.d.). The first car created from Honda
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that was sold in the United States was the Honda N600; it wasn’t until 1976 until the first Honda
Accord was created. With 41 years of history, the Accord is the best-selling passenger car in
America with over 12.5 million being sold to date (Honda, 2017).
The Four P’s of Marketing
Putting a focus on the marketing mix is a great way for a business to ensure that the right
product is going to the right place (Martin, 2014). This helps businesses plan for a product to be
both relaunched and new. There are four P’s that are used to classify marketing- product, place,
promotion, and price. This was later evolved into the four new P’s- people, processes, programs,
and performance. Below is how Honda Accord uses the marketing mix for success.
Product
The Honda Accord is Honda’s largest sedan in its lineup and is available in a variety of
models that include hybrid and hybrid plug-in. 2.0L turbo, and 1.5L turbo are also available with
the Accord. This means that the engine will be turbocharged using recycled exhaust gas to
provide more power. Buyers will have different trims to choose from providing different add-
ons. The trims start with the LX which is the base model and then adds various features to the
Sport’s trim, EX and Touring trims. The tenth generation of the Honda Accord is new from the
ground up and features a lighter and more rigid body structure, an advanced new chassis design.
This model is all wrapped in a more sophisticated, sleek and athletic design with top class
interior space and comfort to bring in a new generation of buyers[ CITATION Ame17 \l 1033 ].
The Accord’s look is both sophisticated and sporty with aggressive accents. Like its competitors,
the Accord is equipped with a backup camera, push to start remote, Bluetooth as well as many
other technical features and upgrades.
Place
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Consumers can go to their local Honda dealership to test drive and buy a new Honda
Accord and anywhere else that Accords are sold. There are over 1,000 Honda dealerships in the
United States alone, so this is easily accessible for potential buyers. Buying an Accord online
and having it shipped to your home is also an option for a consumer that is interested in
foregoing a trip to the dealership.
Promotion
Incentives and rebates are programs offered by the manufacturers to stimulate sales. The
three most common programs are provided directly to consumers in the forms of cash rebates,
low interest financing and special leases (Edmunds, 2017). Some dealerships also provide
incentives if you are a returning customer, recent graduate, military and more. Honda
dealerships have also given incentives around the end of the year and participated in Black
Friday sales to further market the Accord.
Price
The manufacture’s price for the Accord range from $23,570 - $35,800 depending on the
trim you are interested in. The LX has a manufactured price of $23,570 only carrying the basic
features in the model (Edmunds). To get every premium feature that Honda has to offer with the
turbo charged engine buyers will be spending closer to $35,800. Buyers have the options of
paying for the car in full, leasing or financing the car through a bank or lender. Often times,
when a consumer decides to make payment arrangements, there are no payments for the first 2 to
6 months, depending on the incentive.
People
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It is important for Honda to continue to bring and keep jobs in the United States. It has
30,000 direct US employees with more than 73% in manufacturing roles. With 158,000 dealer
jobs, its 2016 payroll was $2.2 Billion dollars. The 10th generation Accord also brought more
new job to dealerships across the U.S. (Honda in America, 2014).
Processes
Soichiro Honda’s philosophy from Honda’s origin is still used to inform and guide every
decision and action with the company today. The philosophy says to respect the individual so the
customers are kept as a priority [ CITATION Cor18 \l 1033 ]. This will also keep everyone open
minded to new and innovative ideas and accept that change is good. Included in the philosophy
are the three joys, which are the joy of buying, selling and creating. Each joy will focus on a
different part of the car process. The joy of buying will keep the company customer focused, and
making sure that the buyer is getting a great product that they can be happy with. The joy of
selling and creating are employee-based to take pride in the product and its introduction to the
public.
Programs
The Honda Customer Mobility Assistance Program supports the mobility needs of the
drivers and passengers with physical disabilities. Honda also provides reimbursement of up to
$1,000 to eligible buyers on original retail for expensed incurred to purchase and install the
needed equipment. This goes for both vehicles that are leased and financed (Edmunds, 2017).
Like many of its competitors, Honda participates in grad programs giving discounts to recent
grad students to aid in the purchase of a Honda Accord.
Performance
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The Honda Accord has received many awards for the car produced this year. One of the
awards given was by Kelly Blue Book for the best resale value with the superior quality and
safety features offered. Other awards are for North American car of the year as well as car and
driver’s America’s best sedan raising the bar for the segment another time. The Honda Accord
has earned the Car and Driver’s award for an unprecedented 32nd time showing its reputation of
innovation [ CITATION Awa18 \l 1033 ].
The Mission of Honda
Honda’s mission is to provide its customers all over the world with the feel of luxury,
while preserving affordability. Its mission statement is, “Maintaining a global viewpoint, we are
dedicated to supplying products of the highest quality, yet at a reasonable price for worldwide
customer satisfaction” (Jurevicius, 2013, para. 2). The company strives to give customers the
best of both worlds. This helps it to cater to a large market, and several demographics.
Honda SWOT Analysis
Every company has strengths, weaknesses, opportunities and threats that make it unique.
In the automobile industry, there are a lot of competitors. It is important that companies are
aware of these factors to stay ahead of the competition.
Honda has many strengths that give it a competitive edge. Honda has received numerous
awards over the years. Most recently, the Honda Accord holds the 2018 North American Car of
the Year Award, the 2018 Car and Driver’s 10 Best Award, and the 2018 Car and Driver’s Best
Sedan Award (Honda Awards, n.d.). Honda has consistently obtained awards for its car safety
and record-breaking sells. Another is its diversity in products. Honda is most notably recognized
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in North America for cars. The company also produces motorcycles and other power products,
such as engines and motors.
Weaknesses are inevitable for any company. One weakness the company faces is its
history of having recalls on products. For example, in 2018, Honda issued a recall on their
automobiles for its airbags. “Honda says it is recalling an additional 465,000 vehicles and 960
Gold Wing motorcycles in the U.S. Honda plans to notify owners by late February. Owners can
get replacement passenger front air bags starting immediately” (Associated Press, 2018, para. 5).
Issues such as this weaken the customer’s faith in the product, inconvenience those directly
affected and deter new clientele.
In order to maintain a competitive edge, a company must seek out its opportunities. With
the push to conserve fuel, companies are producing cars that are electric. This trend is an
opportunity that Honda has expressed is in the works, but has not produced. Producing an
electric car would attract a new market of environmentally conscious customers. This would also
show the company in a positive light by displaying that Honda cares about the environment.
Honda’s main threat is its competition. Although Honda is a leader within the automobile
industry, its competitors are constantly trying to find new ways to get ahead. Honda’s price point
makes it a leader within certain demographics. Those who cannot afford the cost and
maintenance of Honda simply opt for a cheaper automobile.
Another threat to the company is alternative transportation. People who reside in
metropolitan areas simply do not need a car due to the multiple modes of transportation
available. Buying a car is futile in big cities where traffic is a problem and the alternatives are
cheaper. Buses, subways, bikes and car services such as Uber all provide significantly cheaper
alternatives to maintaining a vehicle.
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Demographic Trends
The Accord’s goal is to be as demographically broad as possible, but it targets consumers
that are ages 25 to 45 [ CITATION Cou17 \l 1033 ]. The tenth generation is wider than previous
Accords, making it more spacious for the buyers needing car seats to start or expand their family.
It’s great on gas so it helps with people who commute quite a bit and are interested in the miles
per gallon. Its safety features and low maintenance cost are great for first time buyers who may
don’t know a lot about car maintenance (Edmunds, 2017). The Accord is Honda’s premium line
of sedans so consumers can expect push-to-start remotes, navigation, Bluetooth options and the
leather seats at a competitive price. Honda has a variety of trims to ensure that its consumers
have options to pick the right Accord for them.
Economic Trends
Current economic trends that will affect the sale of the Honda Accord are the economy
itself and consumer’s psychology. New economic trends that can affect the sale of the Honda
Accord are:
(1) Subscription models which allows for owners of certain models to subscribe to the service
which allows for owners to swap their cars on a weekly basis with another (Korn, 2017).
(2) Car sales will be okay but not great in 2018. There will be many great deals being offered to
potential car buyers but, with the sedan market being over saturated along with customers not
having a need for sedans as much preferring family friendly SUV’s sales of the sedan will surely
slow.
(3) New entrants into the automotive industry will possibly take some consumer base from
Honda especially those with electric cars such as Tesla and many other smaller companies with
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electric cars which are the new trend sweeping the automotive industry and those who can’t keep
up will surely lose their footing in the industry (Gao, Werner-Kass, Mohr & Wee, 2016).
(4) Ride-sharing services such as Lyft, and Uber have will also affect the sales of the Honda
accord by making it easier for young people to get around town and not having to worry about
having an expensive car and insurance payment, “millennials would rather have experiences
rather than stuff such as a car” (Korn, 2017).
Technological Trends
Every year, Honda comes out with a sleeker, more technologically advanced Honda
Accord. These designs and advances allow Honda to stay competitive with the other automakers
like Toyota, Ford, Mazda, Nissan, and Hyundai. Honda is an award-winning brand and is known
for being one of the most trustworthy brands on the market. In 2018, the Honda Accord is being
dramatically redesigned from the aesthetically pleasing outside to the technology on the inside.
These changes will make the car a safer vehicle on the road, with advanced safety features,
including, “forward collision warning and automatic emergency braking”[ CITATION MIk17 \l
1033 ]. Another drastic change that the Honda Accord has inquired is the change from a V6
engine to a strictly turbocharged four-cylinder available in both a 1.5 and 2.0 liter version. This
will provide more efficient gas mileage for the consumers who are eco-friendly while not giving
up any of the power that is expected from the Honda Accord.
Within the hub of the vehicle, Honda has incorporated a “hushed” cabin, a feature that
they have not displayed in recent models. The newly “hushed” cabin along with the single screen
infotainment center, the 2018 Honda Accord is one of the most technologically advanced sedans
on the market today. Although Honda has incorporated all of these technological features, the
item that puts Honda over the top within the market is the reliability of the vehicles. Honda is
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known for building the most reliable, most efficient cars on the market. With all of the new
technological features that Honda has added to the Accord model, the Honda Accord is expected
be one of the top selling vehicles for Honda, as well as one of the top selling vehicles in the
sedan market.
Customer Tastes and Preferences
Consumer tastes and preferences are constantly changing. What could be a must-have one
day can become just another fad the very next. The companies that are able to predict these
changes, and are able to move swiftly to satisfy these preferences are the ones that will be
successful. Within the automobile market, the tastes and preferences that most consumers expect
include, safety, dependability, and technologically advanced. These preferences can vary
depending upon the demographic of the individual. The 2018 Honda Accord has taken these
preferences in stride and has implemented them into their newest vehicles.
Unlike many products, like retail, staying with the customers after their purchase is a
little bit easier for Honda. No matter what vehicle you purchase, eventually that vehicle will
undergo repairs or even just regular maintenance. “The post-purchase process has become just as
important as the experience of buying”[ CITATION Rya17 \l 1033 ]. It is very important for
Honda to provide an exceptional customer experience for their customer as they will most likely
be repeat customers further down the line. Technology is constantly changing and along with
that, so are the expectations of consumers. Therefore, companies have to constantly adapt to
consumer expectations if they want to remain relevant and continue to be profitable. In the 2018
Honda Accord, they have added all of the features that they believe the consumer would
personally enjoy and Honda expects to acquire the benefits in their sales.
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The Marketing Research Process
The marketing research process involves a total of five main steps (Kotler & Keller,
2016):
Step 1: Define the Problem, the Decision Alternatives, and the Research Objectives
Defining the problem is one of the most important tasks when it comes to the marketing
research process. As recently as 2017, the Honda Accord was ranked as the fourth most popular
car in the United States, behind the Honda Civic, Toyota Camry and Toyota Corolla (Rosevear,
2017). A great question to ask in this instance would be, “What improvements could be made to
the Honda Accord to make it more popular in the United States?” Some decisions to consider
regarding this question include: Should Honda pursue more technology or more performance for
the Accord? Should Honda offer more models at different price points in order to attract more
customers? What does Toyota offer that Honda does not? These would help define some of the
research objectives: What are some of the most important features Americans consider in regards
to purchasing a new car? Which of those features would be best to include in the Honda Accord
to make it a more popular model?
Step 2: Develop the Research Plan
After defining the problem, decision alternatives, and research objectives, the next step is
to develop a research plan. This includes making decisions about “data sources, research
approaches, research instruments and contact methods” (Kotler & Keller, 2016, p.103). As far as
data sources, it would be best for the research to use a combination of both primary and
secondary data. Primary data could be used to discover which features appeal most to Honda
Accord buyers, whereas secondary data could be used to find who buys cars from Honda and
Toyota. For research approaches, a combination of surveys and focus groups would be best
HONDA ACCORD 16
suited, and for research instruments questionnaires would be ideal. Lastly, contact methods
would include mail, telephone, and online.
Step 3: Collect the Information
After developing a research plan and creating ways to fulfill the research objectives, one
must then collect all of the information from surveys, focus groups, and so forth. It is important
that as much of the information is collected as possible, as every piece of information will play
an important role in helping to figure out how to make the Honda Accord more popular.
Step 4: Analyze the Information
Upon collecting the information it must then be analyzed; having data is simply not
enough and it must be manipulated in a way to help determine the research objectives.
Step 5: Present the Findings
Analyzing the information is important to determine such things as what features
Americans value most in buying a new car, but it is also crucial to then present all of the findings
in a clear and concise manner. In this way, management can then have a greater idea as to what
they should consider when designing next year’s Honda Accord to make it a more popular model
within the United States.
Gathering Consumer Information
There are five main forms of marketing research according to Kotler and Keller (2016):
observation, focus groups, surveys, behavioral data, and experiments. Of these five, focus
groups and surveys would be best in gathering consumer information relating to the Honda
Accord. What makes focus groups so effective is that they “provide the collective insight of
group dynamics while preserving individual preferences” (Threfall, 1999, p.102). They would
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give a glimpse into how both individuals and groups feel about certain aspects of the Honda
Accord and what could be done to improve upon it. Surveys play an important role as well in
that they will give Honda an idea of what it is that makes the Honda Accord so popular as well as
providing general demographics of those who purchase the car as well. This information will be
important to analyze as it can then be used by the company to further market the Accord to the
right groups of people in the right areas.
Cultural Factors
“Culture is the fundamental determinant of a person’s wants and behaviors” (Kotler &
Keller, 2016). The Honda Accord has in a sense become an icon of the American auto industry
while the reasons for that may vary there are a few certain reasons that this icon is still ranked as
the number one sold car in the U.S; One word “familiarity” is the main reason that the Honda
Accord is so popular which started in the 1980’s and 1990’s when many models coming out were
as reliable and generational with families passing down cars from generation to generation that’s
where the Accord came in and took over that segment of the market (Demuro, 2015). This
reliability led to many consumers purchasing the Accord as their children’s first car or passing
theirs down due to the reliability of the car with an estimated 1.6 percent of the Accords on the
road having over 200,000 miles on them with the average being 90,000 well over the 75,000-
mile average for most others (Edgerton, 2014). Through research it is found that the Gen X who
have a strong emotional need than baby boomers to buy a newer car and are more likely to
purchase the Honda Accord due to familiarity with from years before (Halliday, 2007).
Social Factors
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Social factors can be defined as reference groups, family, and social roles and statuses
that can affect our buying behavior (Kotler & Keller, 2016). The social factors that influence the
purchase of the Honda Accord can be people’s family members or friends who may currently
have a Honda Accord and can recommend the car for purchase. Indeed, word of mouth is the
primary factor behind 20 to 50 percent of all purchasing decisions (Bughin, Doogan, Vetvik, 2010). A
recent study by the University of Arkansas in collaboration with the Manchester Business School
in London found that consumers (ages 18-24) take on an active role in developing their identities
and appearance based upon celebrities (Sokolovska, 2016). Celebrity endorsement of a product is
a viable option to get the product out there to build awareness, and promote the product
(Sokolovska, 2016).
Personal Factors
According to Keller and Keller, age, stage of life cycle, occupation, and economic
circumstances are all among the factors that influence a consumer’s purchase of a product or
service [ CITATION Kel161 \l 1033 ]. The Honda Accord is a family mid-size sedan and having
a new or small family will play a part in a buyer’s purchase of a vehicle. These buyers will want
a safe and reliable car to commute with their family and the 2018 Honda Accord has a five star
safety rating[ CITATION 20118 \l 1033 ].
Because the Honda Accord is at a lower starting price point then others in its class, this
will entice the buyers who are just starting their careers but still want the premium options. This
can also be the case for buyers who are just starting a new family and not wanting to take out a
massive financing loan [ CITATION 201 \l 1033 ]. Its safety features are also reasons that will
make parents eager to buy as a first time car for their teenagers. A car like this is low in
maintenance and gas being ideal for a college commuter as well.
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With budget as a personal factor that will influence the purchase of a new car, marketers
search for relationships between their products and lifestyle groups [ CITATION Kel161 \l
1033 ]. With today’s technology a consumer can do a lot of research on a product and will have
an idea of what they can get for the money that they are willing to spend. The 2018 Honda
Accord is also #2 in the most affordable sedans of 2018 with one of the highest mpg ratings of
the cars in its class [ CITATION Tro18 \l 1033 ]. This will cater to the buyers that are money
constrained and want the most for their buck.
Psychological Factors
Psychological factors such as perception can play a significant part as well. Because the
Honda Accord has won awards every year such as the car and driver’s 10 best for 32 consecutive
years it shows that Honda is recognized as a top performer [ CITATION Cor18 \l 1033 ]. Before
a new Honda Accord comes out, consumers can already assume that it will be top performing car
in its class without knowing the specifications. This kind of perception becomes a buyer’s
reality and a consistency that returning buyers are relying on. Honda has really worked hard at
being consistent with their vehicles and keeping what works for its brand. Because of this,
consumers are able to discriminate towards their products. Buyers have learned over the years
that the Honda will be safe, reliable, good on gas and affordable.
Emotions that consumers are feeling while watching advertisements may affect the
purchase of the Honda Accord as well. You see a family in the car, you watch as the driver uses
various safely features such as the backup camera and you see the actors looking happy. You
begin to want what you see and feel a need for what they have. The consumer is now motivated
to get what he/she sees in this ad because of the perception of what they saw. The consumer’s
excitement is another way that Honda uses its marketing to bring customers in the doors for a
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test drive. This is why perception is more important than reality in marketing, because it affects
consumers’ actual behavior.
Potential Entry into Global Markets
As Kotler and Keller (2016) state, potential entry can depend upon a market’s
“demographic, economic, sociocultural, natural, technological, and political-legal environments”
(p. 221). Of these, there is one in particular that Honda should consider to evaluate potential
entry into global markets, economic.
It simply does not make sense for a company to try to expand into a new market without
gauging the economic environment first to see if the demand is there, and then to see if its
products can be properly adapted to local markets. Even if a company such as Honda puts in the
research and finds out that there is demand for its cars in India, for example, it does not
guarantee success unless it adapts. One reason as to why Honda has not been successful to this
point in India has been its product offerings. Fifty-two percent of the Indian automotive market
is comprised of low-cost diesel cars, due in large part to a higher fuel economy than gasoline.
Honda did not have a low-cost diesel car to offer, and when it tried to make one for the Indian
market for new car offerings it was in large part a failure (Chauhan, 2017). If Honda had studied
the economic environment more in-depth it would have realized the need to develop a low-cost,
efficient diesel car first before entering the Indian market, and because it did not the company
continues to lag behind other automakers in sales to this day.
Modes of Global Market Entry
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The most likely mode of global market entry for Honda would be direct investment.
Kotler & Keller (2016) list five main advantages of direct investment: costs, job creation,
relationships, control, and access. Of these, there are two in particular that would benefit Honda
the most, costs and relationships. It would make sense for Honda to pursue direct investment in
a new country if the country were to offer the company incentives such as tax breaks or an
educated population that would take little time to train, thus saving the company money in both
the short and long term. Most notably, Honda has done this with great success in the United
States through the manufacturing and selling of cars over the past thirty years (Ikenson, 2016).
Direct investment would necessarily bind Honda relationship-wise to the country it is entering as
well, as there can be significant costs involved such as building plants, offices, dealerships and
so forth. This would give the company a great opportunity to build a close relationship with the
nation, positioning itself favorably in the years and decades to come. As Pradhan (2000) states,
both “the host countries and investing firms expect to benefit from foreign ventures” (para. 7). If
both do not benefit, then it simply would not make sense for either to go through with the
investment, and this helps to minimize issues such as political risks.
Target Market Variables
Demographic segmentation is used to identify where the company should allocate most
of its sources of marketing based upon the demographic areas of their consumers, as well as the
buyer’s personality qualities. Some characteristics that may present themselves towards the
demographic segmentation include age, gender, race, income, marital status, occupation, and
education. For Honda, the Honda Accord reaches to a wide variety of audiences. The consumer
would most likely range from the ages of 17 to 40; the Honda Accord reaches to a wide variety
of customers because of its very efficient price range along with its dependability.
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The psychographics segment places an emphasis on finding the interests and activities of
the consumers, so that the firm is able to market to those individuals. “Sometimes,
psychographic profiles can be quite detailed. Take the Accord. Honda Motor reports that the car's
owners like to vacuum their garages. You can't say they're not clean” [ CITATION Dan07 \l 1033
]. Some associations may be quite strange, but if it helps the firm continue to make a profit, it is
well worth it.
Behavioral segmentation allows companies to target customers based on their
experiences with the company. This allows the company to target current customers with shared
familiarity with the company. “Car companies often use benefits segmentation to target a broad
market looking for different benefits, such as economy, performance, luxury or status”
(Kokemuller, 2017). With the behavioral segment complete, Honda can now acknowledge what
the customers enjoy within the vehicle, and what Honda needs to improve upon going forward to
ensure the continued success of the company.
Honda uses these techniques to give it the most efficient opportunity to target their best
potential customers. Market segmentation is very beneficial to break your target audience down
and identify what the customers identify towards and their interests. This allows that Honda to
market towards those individuals and potentially sell more Honda Accords.
Evaluating Market Segments
Honda must determine the types of consumers within their market that they will be
designing and marketing their products towards. These market segments allow Honda to adjust
their marketing strategies to capture the attention of their potential customers. Within the
demographic segment, Honda will pursue the attention of the clients within similar age ranges
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and salaries. With the Honda Accord being a little more family friendly than the Civic, Honda
should pursue medium income households with only one child.
With the psychographic segment, this will allow Honda to find the interests and activities
that their consumers are involved in and enjoy. With the knowledge of what their customers
strive towards, this allows marketing for the Honda Accord to be more specific to generate
interest for customers to buy the Honda Accord.
Finally, for the behavioral segment, having the knowledge of what customers enjoy is key
to building and maintaining the brand. This allows Honda to find out what their current
customers enjoy within the car, as well as what they can improve upon. Having all of these
market segments are very important in finding out how to market to each demographic and
maintain profitability.
Product Specialization
Honda Accord is categorized as a mid-sized sedan. Mid-sized sedans are designed to
appeal to broad demographic of consumers. Although the automobile appeals to a large
demographic, this large group can be broken down into market segments. “A market segment
consists of a group of customers who share similar sets of needs and wants” (Kotler & Keller,
2016, p. 246).
Due to the automobile’s ability to cater to a wide variety of customers, the firm should
pursue product specialization. Kotler and Keller (2016) define product specialization as selling a
certain product to several different market segments. Honda Accord provides features that appeal
to a variety of consumers. The cars sleek yet spacious design, fuel efficiency and high-tech
interior make it hard to market toward one market segment.
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This strategy can be beneficial for Honda. “A product specialization strategy allows a
company to focus on its reputation for quality in brand development” (Kokemuller, 2017 para.
1). Honda is known for its affordability and luxury. Product specialization would give Honda the
opportunity to showcase these unique benefits of the Accord.
Kotler and Keller (2016) note that a drawback to this approach is that the product may be
overthrown by a new product providing something entirely different. The Honda Accord has
seen this happen over the years. With the shift in popularity from mid-sized sedans, other types
of vehicles have taken over. One way that the Accord combats this disadvantage is by its yearly
release. By adding new cutting-edge features, the Accord can attract new clientele while
retaining existing customers.
Needs of the Target Market
The Honda Accord caters to a wide variety of customers and has features that meet the
needs of each target market. The fuel efficiency of the vehicle appeals to consumers of working
and middle class that commute to work daily. The Accord can return 30 MPG on the highway
and 27 MPG in the city (Car Buy Strategies, n.d).
For those with small families or couples looking to start families, the Accord’s spacious
interior is a benefit. Families can travel comfortably without feeling cramped. Also, its reliability
and safety ratings cater to this group. Knowing that you can travel from place to place without
worrying eases the minds of parents. “Because of its long-term reliability, the 2017 Accord is a
car you can pass down to another family member” (Car Buy Strategies, para.7, n.d). This
reaffirms that the Accord is a long- term investment.
The Accord’s price point is a feature that attracts the young adults of Generation-Y. “It
has been widely reported that the Great Recession has hobbled young people in debt and
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joblessness, making them less likely to buy some of the staples of adulthood, including
cars” (Tseng, 2013, para 4). Even those young adults who do decide to invest in a car are likely
to be more conscious of cost. With a starting price of $23,000, this car is an affordable option for
this group. Each of these features may overlap between the needs of each target markets. This
truly makes it a well-rounded vehicle.
Positioning Statement
Developing a brand position statement for the Honda Accord should focus on designing a
company’s image to occupy a place in the minds of the target market. Ultimately, the goal of any
brand positioning is to guide marketing strategies to identify the goals and preferences of the
consumers, therefore allowing us to create an effective marketing strategy to reach those
individuals [ CITATION Kot161 \l 1033 ]. Honda Accord’s positioning statement should target a
wide variety of individuals; these individuals can range from the ages of 18-40, safety conscious,
and be of a medium income household. An example of a brand positioning statement for the
Honda Accord is as follows: A sleek, dependable vehicle for the entire family.
The 2018 Honda Accord has been completely renovated to be one of the best looking
vehicles on the road for its price point. The sleek design of the Honda Accord will reach to all
age groups, as everyone wants to ride in a vehicle that has been designed for style. Honda is
known for making dependable vehicles; the 2018 Honda Accord will be no different. Consumers
out there look for the most dependable car on the road, as they would much rather spend their
time driving, rather than sitting in a shop while their car requires maintenance. Honda is known
for their relatively cheap parts to repair their vehicles, so when something does go wrong, the
Honda Accord won’t be off the road for long [ CITATION Neh171 \l 1033 ]. The brand
positioning statement should be broad and to the point. This positioning statement signifies that
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the Honda Accord is a great looking vehicle, and is one of the most dependable vehicles on the
road.
How the Accord is Positioned in the Market
The Honda Accord is obviously positioned within the automobile market, but more
specifically within the category of sedans. Honda has positioned the Accord within the premium
sedan segment of the market, alongside the sedans of Ford, Toyota, and Volkswagen. Honda’s
target market is a medium income household with families with one to two children. Honda’s
positioning of the Accord within their own company is located within the Premium Honda
Brand. The Honda Accord is more luxurious than that of the Civic, or other lower level brands
produced by Honda.
Within the market, Honda has many competitors, including Ford, Toyota, Volkswagen,
Chevrolet, etc. But the design and affordability of the Honda Accord allow Honda to remain at
the lead of the sedan market year after year. Some of the greatest strengths that Honda possesses
are the customer’s satisfaction, this is the most important piece for Honda. If Honda’s customers
are satisfied and happy with their product, they will most likely continue to be a customer for
life. Another strength that the Honda Accord in particular addresses is the luxurious interiors and
great performance. Honda is always looking to improve their products, while making them faster
and more fuel-efficient at the same time, while providing an enjoyable, comfortable ride, this
allows their consumers to truly fall in love with driving.
Building Brand Equity
According to the text, brand equity is the added value endowed to products and services
with consumers. This could affect the way the consumer thinks, feels and acts with respect to the
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brand (Kotler & Keller, 2016). Honda is perceived to manufacture superior quality automobiles
utilizing technology in the best possible way. It is also considered as a reliable brand that offers a
great driving experience through its products (Haseeb, 2015). This trust that consumers have did
not happen overnight. Honda’s goal has been to successfully build a car that was reliable since
their introduction to the industry. Given the reliability and safety stats for the last decade, it is
clear Honda achieved his.
Brand Elements
Brand Elements, as stated in the text, are devices, which can be trademarked that identify
and differentiate the brand (Kotler & Keller, 2016). Honda uses various useful elements like its
memorable and short name. It is easy to pronounce and easy to remember. Honda is in no
danger of becoming a synonymous product such as Kleenex or Band-Aid as it got its start from
motorcycles and eventually started producing cars. However, Honda could have challenges
trying to introduce something outside of the industry because it is already well known for the
automobile industry. Honda’s biggest brand element used for the Accord is its logo of the letter
H. The 2018 Honda Accord has had an upgrade with technology and giving consumers another
way to stay connected. It has 4G LTE Wi-Fi hotspots, over-the-air updates for consumers to
upgrade to the latest software, two driving modes, as well as new remote app features. The first
generation HondaLink, allows consumers to connect their smartphones to the Accord to access
social media, contacts, music and more. This is a way for consumers to be connected to their
vehicle wherever they are with maintenance and recall notifications (Shar, 2017).
Accord’s Brand Promise
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According to Kotler & Keller (2016), a brand promise is the “marketer’s vision of what
the brand must be and do for consumers” (p. 303). It can also be defined as “words and images
that express what customers can expect” when using a product (Goldring, 2013, para 9). When it
comes to the Honda Accord, the company promises it to be “The most impressive Honda ever”
(“Meet the Accord Family,” 2018). There are three features of the Honda Accord (according to
the company) that make it the most impressive ever: a redesigned exterior, Honda Sensing, and a
new engine (“Accord Family,” 2018).
Even though the Honda Accord was among the 10 best-selling cars in the United States in
2017 (Mays, 2018), the company decided to completely overhaul the car’s exterior for the 2018
model year. It has been described by Honda as a “muscular, fastback inspired design” (“Accord
Family,” 2018, para 8) that offers a combination of both style and space. The Chicago Tribune
describes the exterior as “A coupelike design [that] feels as if you’re getting in and out of a sport
sedan” (Duffer, 2018, para 5).
The next aspect of the Honda Accord that makes it the most impressive Honda ever is a
new technology known as Honda Sensing. It is described as “an intelligent suite of safety and
driver-assistive technologies that can help you stay aware on the road” (“Accord Family,” 2018,
para 14). The suite comes standard across all Accord models and includes traffic sign
recognition, lane keeping assist, adaptive cruise control, road departure mitigation, and a
collision mitigation braking system (“Accord Family,” 2018). Kelly Blue Book lauds the new
technologies, stating that they “lighten both the mental and physical loads of longer-range
highway driving” (Allan, 2017, para 9).
Lastly, the 2018 Honda Accord discontinued its usual 2.4L V-4 and 3.5L V-6 engines with
more robust 1.5L V-4 and 2.0L V-4 turbo engines instead. The main difference between the 2018
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engines and the previous ones is the amount of torque that is available, with Car and Driver
describing them as being “slightly more muscular” versions (Wendler, 2017, para 3). What more
torque offers is the ability to speed up faster, as opposed to more horsepower, which allows the
car to stay at higher speeds. The 1.5L turbo offers a best-in-class 192 lb-ft of torque, while the
2.0L “blows away the Accord’s longtime nemesis, the Camry, from zero-to-60-mph by 0.6
seconds and to the quarter-mile mark by 0.5 seconds” (Wendler, 2017, para 5).
Main Competitors
In 2017 the top-selling sedan in the United States was the Toyota Camry, with the Honda
Accord in second place (DeLorenzo, 2018). According to Nkomo (2014), one of the main
strengths of Toyota is its enormous production and distribution network, which reduces business
risk through diversification and allows for a wider reach. Toyota has a degree of flexibility that
no other car company has with its production network in 27 countries; if one supplier is not
delivering on quality the company can simply pivot elsewhere to get what it needs quickly and
efficiently (Nkomo, 2014).
One of the biggest weaknesses in regards to Toyota in recent years is the number of
recalls that have been made on many of its models. For instance, the company has recalled as
many as two million Camry sedans due to power-window switches that may short-circuit
(“Toyota Recalls,” n.d.). This is in addition to millions of other cars and SUVs within the
company that are being recalled due to: faulty airbags, air-conditioning condensers, subwoofers,
brake problems, and power steering assist issues (“Toyota Recalls,” n.d.). If anything, this
creates a reliability issue for the company as a whole and will lead customers to look elsewhere
for their next automobile purchase.
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Honda’s Market Classification
A market leader is defined as a “Brand, product, or firm that has the largest percentage of
total sales revenue (the market share) of a market” (Business Dictionary). Honda Motor’s market
classification is that of an industry/market leader further solidifying its position as a leader in the
automotive landscape with their Honda Accord wining the Oscars of the car industry with the
2018 Honda Accord being named the North American Car of the Year (Howard, 2018). The 2018
Honda Accord is stated as being “the most innovative Accord in years, but the most compelling
midsized Sedan on the market” (AutomobileMag, 2018). Further solidifying Hondas
classification as a market leader is their motorcycle, all-terrain vehicle, and Walter motors which
account for more than 15% of Honda Motors market valuation, with these segments accounting
for nearly 14% of the company’s total revenues (Trefis Team, 2017). Honda Motors is considered
a leader in the motorcycle industry as well accounting for nearly 33% of the global motorcycle
sales.
Honda Accord’s Life Cycle Stage
The Honda Accord is what I would consider to be in a maturity stage because the car has
been through the cyclical growth and decline in production cycle that happens with a car in its
maturity stage such as that with the Accord. The Accord is in its maturity as a vehicle
considering that it has been around for 42 years and is on its tenth generation which is an
immaculate track record for any vehicle. Although the Accord is to be in its maturity stages and
is expected to decline it instead continues to grow its image and raise the bar with the technology
that is being implemented into their new 2018 Honda Accord such as the new infotainment
screen which is miles ahead of the ongoing generation which comes with Apple Car Play and
Android Audio (Kennedy, 2017). Along with innovation there is the continued demand for the
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family sized sedan at a reasonable price which the Accord provides to family at a reasonable
price which keeps the car in high demand among many age groups.
Marketing through Labels and Packages
Packaging and packaging design are important in communicating product benefits to the
customer (Rundh, 2009). For cars, unlike other products such as foods and electronics, the
product itself is the packaging. Everything from the exterior design of the car, to the interior
would be considered packaging. “Packaging updates and redesigns can occur frequently to keep
the brand contemporary, relevant or practical” (Kotler & Keller, 2016, p.342) Cars typically get
packaging updates every year. Even though design changes maybe small, companies try to
introduce a different version of the car each year to entice new customers and retain existing
customers.
The 2018 Honda Accord design features a lower and wider car design with sleeker
taillights, an additional 2.5 inches of leg room, and more aerodynamic shape. (Weiner, 2017).
The designers put a lot of careful time and effort into this design. In efforts to capture what the
design would look like in the American sunlight, as opposed to the design studio light, Japanese
designers flew a clay model of the Accord to California. (Honda News, 2018). Honda went
through all this effort to ensure that the 2018 Accord was suitable for the American market.
The color of the packaging is an important aspect. The color of a product can be loaded
with meaning (Kotler & Keller, 2016). The benefit to the Honda Accord is that the consumers
can select whatever color they desire from what is available. Customers can tailor the packaging
to their preferred taste.
After the design is complete it undergoes series of tests. One of the various tests is the
engineering test. This test is conducted to see if the product is able to withstand normal
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conditions (Kotler & Keller, 2016). Car manufactures conduct multiple safety tests on their cars.
The National Highway Traffic Safety Administration has awarded the 2018 Honda Accord 5
stars in the crash safety test (United States Department of Transportation, 2018). For this year’s
version of the Honda Accord, engineers invited dynamics specialists and designers to test drive
the prototype for the first time (Honda News, 2018).
Another test packaging undergoes is a consumer test. Consumer tests allow the company
to get a sense of how others will respond to the product and packing. Companies use tests such
as focus groups and test drives to gather this information.
A label is a designed graphic attached to the package (Kotler & Keller, 2016). Typically,
on a car the company symbol is located on the front and the back of the car. On the back is also
the model of the car. In addition to these, some cars include a trim level or grade to distinguish
what version of the model the car is. These labels help to identify the product, as well as promote
it. Whenever drivers get behind other cars and see these symbols they associate the vehicle to the
brand.
The Accord as a Shopping Good
Usually when a consumer decides to buy a car, a lot of planning and research is typically
conducted. Customers want the best deal while getting the best quality. These qualities
exemplify those of a shopping good. Unlike like luxury cars, Honda’s are competitively priced
and do require comparison. Due to the multitude of midsize sedans on the market, shoppers must
shop around to determine which one is best for them.
The Honda Accord is a homogenous shopping good. “Homogenous shopping goods are
similar is quality but are different enough in price to justify shopping comparisons” (Kotler &
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Keller, 2016, p. 369) Most midsized sedans on the market have similar features. Customers must
compare prices to find a car that suits their needs.
Support Services
Support services are important for buyers and it can be just as important as actually
buying the product. When making any kind of purchase, especially a big purchase like a new
vehicle it is important for buyers to feel as though they will get continued service. Buyers want
to know that they will still be taken care of after their purchase. The potential buyers that are
interested in the Honda Accord do not buy a new car annually. This is something that the buyer
will use for years so they want to know that it will be reliable, and able to get them to and from
their destinations for more than a couple years.
Even though Honda is said to be a very reliable and a safe brand, it is comforting to know
that there is an extra layer of protection to make sure consumers are well taken care of. Like the
Toyota Camry, the Honda Accord has limited warranty for three years or 36,000 miles, and a
powertrain warranty of five years or 60,000 miles. The two also has an eight year or 100,000
miles hybrid component warranty and a five year unlimited miles corrosion protection package
[ CITATION Whi17 \l 1033 ]. Honda strives to keep out of pocket cost low and has an estimate
annual maintenance cost of approximately $213, compared to the Toyota Camry’s $318 estimate
[ CITATION Hon2 \l 1033 ].
In regards to Honda Accord’s support service responsiveness, consumers are able to reach
Honda on a general line, by fax, mail or email, as well as social media platforms such as Twitter.
During business hours if potential buyers visit its website there will be an option of a live chat to
get immediate assistance and support. Consumers are also able to get help like its 24-hour
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roadside assistance with Honda’s app, HondaLink [ CITATION Ame17 \l 1033 ]. Honda is
making it easier than ever to get support no matter where you are.
Support Services Offered by Competitors
Honda’s competitors such as Toyota and Nissan have similar manufacture warranties but
it is Hyundai that takes it a step further. Hyundai provides a ten year or 100,000 miles
powertrain limited warranty and a five year or 60,000 miles for the new vehicle limited warranty.
Hyundai also offers a seven year unlimited miles anti-perforation warranty opposed from the
year unlimited warranty from Honda and Toyota [ CITATION Hyu \l 1033 ]. The annual
estimated cost to maintain a Toyota Camry is approximately $310 depending on your provider
and Hyundai Sonata with $444, both more expensive than the Accord [ CITATION Hon2 \l
1033 ].
Both the Toyota Camry and Honda Accord are three times likely to be traded-in with over
200,000 miles on them than the average mid-sized car [ CITATION Hon2 \l 1033 ]. This is a
great example of that shows how reliable and durable these cars are. Buyers are able to keep
them longer and not being forced into getting a new car as soon as it hits 100,000 miles. The
2018 Honda Accord has also been given the resale value award with a 50% return at 36 months
and 35.5% at 60 months. The Toyota Camry came in third place with a 43.8% return at 36
months and 32.4% at 60 months [ CITATION 201 \l 1033 ]. This is important for buyers to
consider who are planning on keeping their car for the long haul.
Post-Sale Service Arrangements
When customers buy a car, they want to be assured that their investment will go a long
way. In order to do this, they must calculate the life-cycle cost of the car. Life-cycle cost is, “…
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the product’s cost plus the discount of maintenance and repair less the discounted salvage value”
(Kotler & Keller, 2016, p.423). One of the strategies companies use to enhance the life-cycle cost
after a sale is having post-sale arrangements. Post-sale arrangements help to reduce worries for
customers, while creating customer satisfaction and loyalty (Crothers, 2014).
The 2018 Honda Accord currently offers extended warranties to customers to assist with
post-sale services. These warranties provide maintenance and repair services for a certain amount
of time at a specified contract price (Kotler & Keller, 2016). The extended warranty with Honda
is called “Honda Care”. It is suggested for customers that plan on having their vehicle past the
three-year limited warranty. This add-on includes services such as 24-hour roadside assistance
and rental car reimbursement. Honda Care provides extensive coverage on brakes cooling
system, engine and more (Honda Care). The extended warranty is fully transferable. This feature
allows owners to also give security if they decide to give it to someone else.
Repair and Service Efforts
Whether in the event of something going wrong or just regular maintenance, customers
want to be provided with the best experience possible. Marketing firms must ensure their
experience is pleasant to maintain a good customer relationship (Pan & Nguyen, 2015).
Typically, customers have three specific worries about product services: dependability, downtime
and out-of-pocket costs. When customers invest in Honda Care all these needs are met.
Product support services, under Honda Care specifically, enhance the customer’s
experience. This in turn provides customer satisfaction. The 24-hour roadside assistance cuts the
customers downtime in the event of an emergency. They can be helped almost immediately,
reducing the time they are without a functioning vehicle. “The longer the down time, the higher
the cost” (Kotler & Keller, 2016 p. 422). Most people use their cars to commute to and from
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work. The longer they spend fixing their car the less time they spend at work, which can result in
a decreased pay check. If the problem of the car is covered in the extended warranty, they may
pay little to no money to get back on the road. When a customer’s car cannot be fixed quickly,
Honda Care also provides rental car reimbursement. By covering the cost of a rental customers
are provided service dependability.
Sources of New Product Ideas
The possible sources for new product ideas for Honda Motor Co. can come from
conducting market research and involving the customer in new product development. Through
the marketing of your products you can get the exposure out of for your new product and
expands the exposure of your product to existing customers as well as possible new customer.
With expanded marketing efforts Honda will continually expand its brand being known as an
industry leader (Root, III).
Involving customers in the development of new product design can happen in three
involvement strategies:
1. Customer involvement as an information source (CIS): Is done directly by ratings or
feedbacks of the customers or indirectly as in the idea of gathering and analyzing the
most implicit data from customer behavior, mindset, and decision making (Dastras,
2016).
2. Customer involvement as co-developers (CIC): This strategy involves customers
participating more actively in the new product development process. Select groups
are involved in different steps of the process for involvement of idea generation to
marketing activities (Dastras, 2016).
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3. Customer involvement as innovators (CIN): This new product development strategy
is where the customers are the only one who are used to design and develop the
product (Dastras, 2016).
Ultimately it is the decision of Honda to determine what possible strategy they could
potentially use that they believe to be suitable for new product development.
New Product Screening Process
Honda Motor Co. new product screening process is very straight-forward it starts off with
an idea being submitted for a new product. The first step those ideas need to be screened to
determine whether action needs to be taken with them. Secondly, the ideas are then sorted into
three categories: promising ideas, marginal ideas, or rejects. The third step of the screening
process is that those promising ideas are sent to a board or committee to be evaluated, with those
surviving ideas to be screened even further (Honda, 2018). If a product can make it through the
rigorous screening process and other standards set by Honda then it will go into the research and
development phases.
Pricing Methods
According to Kotler and Keller (2016), there are seven main price-setting methods:
markup pricing, target-return pricing, perceived-value pricing, value pricing, EDLP, going-rate
pricing and auction-type pricing. Of these Honda uses markup pricing, which is “a standard
markup to the product’s cost” (Kotler & Keller, 2016, p. 475). Honda sells its cars and SUVs to
car dealers for a percentage above what it costs the company to manufacture them along with a
holdback of two percent (Reed, 2013). The holdback percentage is above the invoice price that a
car dealer would pay, and is reimbursed generally at the end of each quarter (Reed, 2013). For
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instance, if the car is worth $20,000 with a holdback of three percent, the dealer would pay
Honda $20,600 as the invoice price. The dealer could then theoretically sell the car to a
customer for the ‘invoice price’ of $20,600 and still make a profit of $600 with the
reimbursement.
Price Adaptations
There are four main price adaptations that Honda should use: special event pricing,
special customer pricing, cash rebates, and low-interest financing. Cash rebates are paid out at
the time of purchase and are offered as a way to entice budget-conscious customers to buy
vehicles immediately (Demirag, Keskinocak, & Swann, 2011). Special event pricing establishes
special prices “in certain seasons to draw in more customers” (Kotler & Keller, 2016, p.483). For
instance, special event pricing is used in the United States around holidays such as July 4 and
Memorial Day because most individuals have off work and would be more motivated to search
for cars that are priced lower than normal. This can create problems for car dealers, however, as
customers could simply wait until a holiday comes around to buy a car instead of during other
times of the year. Special event pricing should still be used as the additional volume that is sold
can offset the price differences; as stated earlier, even if dealers were to sell at invoice prices they
will still make a profit off of the holdback percentage.
Third, Honda should use special customer pricing to not only create more goodwill in
communities but also more incentives for individuals to buy the company’s vehicles. Honda can
create more goodwill in communities by offering special prices to teachers, police officers,
firefighters, or even members of local associations. The prices could be used as a way to say
‘thank you’ to the local communities that the vehicles are being sold, which could lead to not
only more sales but also more loyalty as well. Lastly, Honda could use low-interest financing to
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greater induce more individuals to buy its vehicles and make a greater profit overall from each
sale. Honda Financial Services has been in existence in the United States since 1983, and should
be used as a go-to option for financing of Honda cars and SUVs to give customers a more
convenient way to pay for their vehicles (as opposed to getting financing from their respective
banking institution) and greater profits from interest charges for the company as well.
Distribution Strategy
Honda’s distribution strategy is based around four key aspects, product, promotion, price,
and placement. Honda has a variety of independent retail sales operations throughout the world
that market and sell their products. These retail operations allow Honda to distribute
transportation products worldwide, while focusing their time and attention on the innovation of
new ideas and marketing strategies. Honda also uses the Internet as an efficient tool for
distributing their products. Before purchasing a product, most consumers will use the Internet for
the comparison of multiple automobile manufacturers based upon price, safety, dependability,
gas mileage, etc. Honda makes sure to put an emphasis on marketing to these websites to ensure
that they are being well advertised and putting their brand out for the consumers to see.
Honda’s distribution strategy is based upon how their end-users will buy their products.
The distribution strategy that Honda delivers provides their consumers with information for all of
their products. Honda considers how and where their consumers prefer to buy their products,
whether they need personalized education based on their purchase, whether they need additional
products or services for their product, whether their product needs to be customized, and finally
when the product should be serviced. Honda’s distribution strategy allows their products to be
distributed worldwide, which gives them the ability to be a leading automobile manufacturer in
the world.
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Distribution Channels
Distribution channels, also known as, marketing channels “are sets of interdependent
organizations participating in the process of making a product or service available for
consumption” (Keller & Keller, 2016, pg. 494). For Honda, the distribution strategy that they
pursue is through interdependent car and motorcycle dealerships worldwide. As of 2014, Honda
had a network of 4,780 interdependent retail operations for their automobile operations
throughout the United States, Japan, Asia (excluding Japan) and Europe [ CITATION MBA14 \l
1033 ] Honda maintains one of the largest distribution channels within the automobile market,
allowing them to provide quality products and customer service worldwide.
Another growing distribution strategy that Honda has pursued is through the Internet.
Shopping in the world today is mainly done on the World Wide Web, and this is no different for
the automobile industry. The Internet has become an important and influential resource tool in
the car buying process. The Internet allows the consumer to research a variety of automobile
brands, reviews, and price ranges. Honda utilizes these websites to advertise their brand,
ensuring that they put their best foot forward in marketing to the consumers.
Honda utilizes a variety of distribution strategies and channels to push their brand
forward, whether it is through their retail operations, or simply marketing to their online viewers.
Honda is always leading the automobile industry in their distribution strategy, making them one
of the most profitable automobile brands worldwide.
Integrated Marketing Communication Components
Integrated Marketing Communications (IMC) is a marketing approach that utilizes
different promotional methods to enhance the impact of messages on an audience. Companies
are utilizing this approach to maximize and reinforce their campaigns. Instead of creating
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different advertisements for different media, companies are now strategically creating campaigns
that convey the same message through various channels. “Rather than just employing a number
of different activities in the hope that they will achieve the desired results, IMC needs to tie
into the overall function, purpose and future direction of the company” (Strategic Direction,
2006, p. 23, para. 5).
For the 2018 Honda Accord, the company utilized IMC into its marketing efforts. It
started off with a television commercial that pictured trophies coming to life and spreading a
message of self-improvement, no matter how much you have accomplished (Cohen, 2018). The
company took the campaign to social media and developed an interactive initiative where people
can nominate their friend on social networks for personalized awards. By incorporating social
media platforms, such as Facebook and Twitter, Honda strengthened its message through media
coordination. Media coordination occurs across and within media types combining different
channels the achieve maximum impact and to increase message reach and impact (Kotler &
Keller, 2016). By allowing the public to interact with the company and pass messages to their
friends, it created intimacy and brand awareness, while generating word-of-mouth.
Advertising Media
When a company selects media to carry its message, it must assess which media will
generate the best reach, frequency and impact. When a company selects media that achieves
these three components, the audience’s awareness will be greater and higher (Kotler & Keller,
2016).
Honda uses a variety of media to advertise the Honda Accord. The company typically
runs multiple television advertisements a year for its products. The effectiveness of television
advertising is increasing because marketers are getting better at knowing when to use television,
HONDA ACCORD 42
despite there being an increasing number of media available (Jayanthi, 2015). Although,
television advertisement is the company’s main source of its advertisement, it must compete with
the many other advertisements that cause clutter. Honda must ensure that its television
advertisements are able to cut through the noise and grab the consumer’s attention.
Honda utilizes magazines for print advertising. Honda is often featured in the pages of
popular magazines, such as HGTV Magazine and TIME. By utilizing magazines for advertising,
Honda can reach its target demographic more selectively.
With the advancements in technology, companies are utilizing electronics to reach
consumers. As previously stated, the Honda Accord has reinforced its television advertising by
incorporating social media into its campaigns. Honda now can reach consumers instantaneously
with one-click ads on websites, sponsored ads on social media and email advertising. One of the
disadvantages of electronic advertising is that companies pay a high price to be able to reach its
consumers rapidly. Regardless of the cost, companies are willing to pay the price in order to get
directly in front of the consumer.
Honda’s Advertising Objective
According to Kotler and Keller (2016), an advertising objective is “a specific
communications task and achievement level to be accomplished with a specific audience in a
specific period of time” (p.587). There are four main advertising objectives: informative,
persuasive, reminder, and reinforcement (Kotler & Keller, 2016). Of these four, informative and
reinforcement advertising have played key roles for Honda in recent years. Informative
advertising tries to “create brand awareness and knowledge of new products or new features”
(Kotler & Keller, 2016, p.587). Throughout 2017 Honda emphasized the large amount of cargo
space that its newest Fit model contained in much of its advertising (Schultz, 2017). Ads
HONDA ACCORD 43
displaying this feature were especially prominent in mid-September as a way to lure college
students into buying them for moving into new living arrangements (Schultz, 2017).
In regard to the Honda Accord, one of the company’s most recent advertisements
reinforces the fact that it has been “the best-selling car for more than 41 years” (Gazdik, 2017,
para 2). The commercial is titled “Trophy City” and features trophy figures coming to life to
offer inspirational quotes (Gazdik, 2017). Susie Rossick, assistant vice president for Honda
marketing, stated that the most recent advertisement “was created to recognize all that the Honda
Accord has achieved as well as inspire everyone to keep reaching higher” (Gazdik, 2017, para 4).
The television commercial not only acts as a form of reinforcement advertising for Honda but
also shows that the company is not willing to simply rest on its laurels.
Event Sponsorships
Event sponsorships help to “give brands the opportunity to reinvent themselves, or, at
least present another facet of themselves to the public” (Hendricks, 2017, para 7). One of the
main ways in which Honda reinvents itself is through sporting events such as the PGA Tour’s
Honda Classic, which comprise approximately sixty percent of its overall sponsorships (“Inside
Honda’s Sponsorship,” 2016). Honda is looking to find ways to reach not only more millennials
but older demographics as well, and it feels that event sponsorships provide an effective avenue
for doing so (“Inside Honda’s Sponsorship,” 2016).
It is also important to consider technological advancements these days as well. One or
two modes of advertising will simply not suffice in today’s world, and event sponsorships
provide a way for a car company such as Honda to branch out of traditional forms of advertising
to reach more audiences. It is simply “not enough to exist on pages and screens, you also have
to maintain a presence where the clients are” (Madslien, 2011, para 9). Honda could sponsor not
HONDA ACCORD 44
only sporting events but also music festivals as a way to diversify its advertising portfolio and
reach demographics that may not be as familiar with the company.
Internet Marketing Possibilities
Honda uses the Internet to market to potential consumers; this marketing strategy allows
Honda to reach its consumers easily and efficiently. According to Kotler and Keller (2016), there
are four main categories of online marketing towards consumers. Marketing can be completed
through websites, search ads, display ads, and email. These online options of communication
give companies the option to send detailed, consumer-oriented information for the public to see.
Honda uses all of these strategies to market the newest line of the Honda Accord. The advantages
of using online marketing strategies include the effective tracing of the users interaction with the
ad by viewing how many customers clicked on the ad. Although going online may have its
disadvantages as well, Honda may produce an ad on a particular website that generates software
powered bogus clicks, therefore fooling the marketing team by thinking their ads are more
effective than they actually are. However, the pros of going online clearly outweigh the cons, as
the Internet is one of the most effective and efficient ways of reaching the desired consumers.
It is the job of the marketing team to go where their consumers are, and that is mainly on
the Internet. The typical U.S. consumer uses media in everyday life, and almost half of this time
exposed to the media is on the Internet. Therefore, for Honda to continue to be successful, the
marketing strategy will need to include online marketing through websites, search ads, display
ads and through email to ensure that their 2018 Honda Accord is being properly displayed for
potential consumers to see.
Social Media Marketing
HONDA ACCORD 45
With social media becoming an increasing feature in the world we live in today, it is
imperative that companies and organizations create marketing teams and strategies to reach out
to potential consumers that use social media in everyday life. Social media is a means of
communication of texts, images, audio and video between two individuals or between an
individual and a company. Marketers can use social media to see what trends may be coming
into action that companies can get an edge on. Social media allows marketers to tap into the
online communities and create inviting bonds for consumers to become interested in the
company.
According to Kotler and Keller there are three main platforms that are included within the
social media realm, including, online communities and forums, blogs, and finally social media
networks that include Facebook, Twitter, and YouTube. The most effective of these three for
Honda would be on social media networks through Facebook, Twitter, and YouTube. As many
consumers use social media every day, For Honda to market to these consumers and create a
positive relationship, the marketing team will need to create a social media marketing section to
reach these consumers to advertise its brand new 2018 Honda Accord.
Promotional Efforts
Just like any other product or service, Honda needs to promote the Accord so potential
buyers know what is available. Direct marketing, according to the text is the use of consumer-
direct channels to reach and deliver goods and services to customers without using market
middlemen (Kotler & Keller, 2016). An example could be while getting the mail, a potential
returning buyer sees holiday cards promoting a sale or an informative flyer on a car already
purchased. Dealerships also implement special deals on leasing and financing as well to get
units moved faster [ CITATION 20118 \l 1033 ].
HONDA ACCORD 46
Honda also has ads on radio, TV commercials, and newspapers as well. Using integrated
marketing, Honda is on multiple media platforms such as YouTube, Facebook, Instagram,
Twitter and snapchat. Integrated marketing is the holistic approach to communication in
marketing. Marketers need to be consistent both on and offline when delivering a message and
this aids in helping potential buyers who want to know how the Accord drives or what new
features it has, they can go on YouTube before even stepping on the lot. Buyers can see what
other people think with blogs or social media post and companies can also see the public’s
reaction sooner. This can help Honda prefect the Accord by learning what buyers like and what
they want changed so the next generation can be adjusted.
Honda goes wherever its audience is and that communication keeps the company very
engaged with its buyers. Honda also uses social data to analyze data from millions through
social activity. This is used to be informed with who to talk to and what topics to discuss on
social media. Companies obviously want to talk about topics that its audience is interested in.
This data is collected to support or disprove any ideas or hypothesis that the company may have
regarding innovative ideas and leads into future planning.
Personal Selling
Part of being a salesperson is to understand the market so he/she can diagnose problems,
and come up with a solution. In personal sales, salespeople need to find their prospective buyers
that are interested in the Honda Accord. Often times with Honda, the consumer is going to a
dealership so it’s clear who the prospecting buyers are. Also, sales reps are taught the SPIN
method to build long-term relationship by asking several questions [CITATION Kot161 \l 1033 ].
Situational questions are designed to talk about facts, or what the current car situations of
the buyers are. The sales representative will need to know current situations like, what size
HONDA ACCORD 47
sedan you are looking for or how many people usually accompany you on your daily commute.
This is keys to see what the problem is so the sales representative can begin trying to come up
with a resolution.
Next are problem questions, these will consist of the prospective buyer’s current
problems or difficulties so it is known what brought the consumer to the salesperson. If the
current car being driven breaks down a lot or goes through a lot of gas, the sales representative
will have open- ended follow up questions. They may ask how often the buyers goes through
this with their current vehicle or how often do you have to fill up with gas. The Honda Accord is
known to be great on gas and most Honda buyers are keeping their cars with over 200,000 miles.
Salespeople also ask implication questions which are consequences or effects of buyer’s
problems or difficulties [CITATION Kot161 \l 1033 ]. The salesperson needs to understand why
these problems affect the buyer. The buyer may be asked how having an unreliable car has
affected their job or family. Honda Accord’s annual maintenance fees are one of the lowest in
the mid-size sedans class [ CITATION Hon2 \l 1033 ].
Need payoff questions are of the last questions in the SPIN questionnaire. These are
questions related to the value, importance or usefulness of the proposed solution. The
salesperson could ask, what benefits the buyer will have if this problem was solved, this will stir
up positive emotions to make the buyer more eager to buy. This is also a good time for the
salesperson to overcome any objectives that the buyer may have expressed and try to move into
the action phase.
How Sales Representatives are Selected, Trained and Evaluated
Sales representatives for Honda Motors are selected through a standard employment
process where the applicant applies for a job posting online for a designated period, their
HONDA ACCORD 48
application is looked over by the hiring manager and management team the best candidates of
those who applied are chosen to come in for interviews. After all the candidates are chosen are
interviewed the next step is for management to make a decision on a selection of the best
candidate or have another round of interviews with the top 2 and make their decision from there.
Afterwards the final sales representative is chosen and after starting their training starts
recently Honda has implemented a new training program with the help of iPads and DISC to help
deepen and strengthen customer relationships (Straw). BLCL “Building Lifetime Customer
Loyalty” is the slogan of Honda’s new training program with the goal of building lifetime
relationships with their customers so that they’ll continually come back for years and years to
come as well as their families. The program is a flash-based curriculum a voice-over with on-
screen graphics is used to review key information, providing an alternative to traditional
facilitator lecture in addition to the lecture being personalized to the participants to enrich the
experience (Straw,2012). The program is used to help the person learn about themselves and help
determine what makes them “tick” along with behavioral styles and how they affect the
interaction with customer (Straw,2012). The classroom portion of the class uses iPads to train
new employees instead of the tradition pen and paper in which employees can become
disconnected and uninterested with the content being taught to becoming warm and enthusiastic
with new employees being connected having interaction (Straw,2012).
Honda’s evaluation system is adopted for the needs and conditions of each region where
the company is located. Assessment interviews are conducted with each employee in which the
employee discusses their goals and objectives for the year. Six months after their assessment
interview another interview is conducted to see if progress is being made towards their goal and
share assessments with the employee on their strengths and weaknesses (Honda,2015). Near the
HONDA ACCORD 49
end of the yearlong assessment a final interview is conducted to see if the goals have been met to
see if the goal is reached to determine yearly incentives and compensation (Honda, 2015).
Social Responsibility
Honda’s social responsibility statement reads “Honda strives to be “a company that
society wants to exist.” Through our diverse array of products, and the processes required to
produce, sell and use them, we impact society in many ways. Whether developing fuel-efficient,
low-emission products, minimizing the environmental impact of our global manufacturing
operations, or assisting communities in need, Honda seeks to be a responsible company and
community partner (Honda,2018).
The one way that Honda could become for socially responsible that they’re currently
working on is to reduce their emission even though they’re lower than the industry average and
continuing to work on their carbon footprint there is still work to be done on their part. Honda
has created a program which is be called the “Green Path” initiative with the goal of continually
cutting emissions with the goal of reduction of 50% by the year 2050 (Honda,2018).
Conclusion and Recommendations
Honda has managed to remain a leading competitor in the automobile industry for over
50 years. This accomplishment has only been attainable through a combination of exceptional
product quality, reliable customer service and innovative marketing strategies. The Honda
Accord specifically, has remained top in its class of mid-size sedans. By being marketable to a
wide demographic, it has displayed versatility in an ever-changing atmosphere.
HONDA ACCORD 50
It is recommended that the Honda Accord focus on areas that need improvement. One of
those areas is making the Honda Accord attractive to the millennial demographic. Since this
group is holding off on big purchases, such as cars, successful acquisition of this group would be
profitable. Offering new financing options, in combination with relevant advertisement could
improve sales amongst this group.
Another marketing opportunity for the Honda Accord is to enhance its social media
presence. With the growing popularity of social media, engaging with the consumer in this way
is vital. Developing a social media marketing team dedicated to creating strategies and tracking
trends, will increase product visibility.
With the combination of implementing these recommendations and the knowledge of past
success, the Honda Accord will continue to be a leader in the automobile industry. Consequently,
reinforcing its mission statement of providing high quality products at reasonable price for
worldwide satisfaction.
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