DQ Questions and Report For ASHIM_AG ONLY

Reread the Toyota Scion case in Chapter 4. Identify all advertising actions and relate them to the methods described in this chapter. Also, identify all activities that can be considered market research. In addition our first question, focus your discussion on what can increase loyalty. Businesses need repeat customers to maintain their overall financial health. It is well speculated that it takes 5 times as many resources to get a new customer than it takes to maintain an existing one. What are some of the things that were used to maintain a loyal customer base?

Closing Case TOYOTA SCION GOES SOCIAL FOR ADVERTISING AND MARKET RESEARCH

The Problem

The automotive industry is a global multibillion-dollar business where competition is very intense. At stake is not only how many cars can be sold, but also how much profit can be made and how to survive in economic downturns.

Toyota has been known for decades for its manufacturing innovations. Now it’s taken an innovative lead on the Web. Here, we look at one of its newest brands, the Scion, geared toward Generation Y (Gen Y), which includes those born between 1980 and 1994. As of 2009, Gen Y and Gen X (the generation before Gen Y) combined are expected to account for at least 40 percent of vehicle sales. The problem faced by Scion has been how to reach Gen Y and Gen X.

Using Social Computing

Scion is using segmented advertising as its major media-based strategy in social networks. The company also uses search engine marketing, mass advertising, and one-to-one targeted marketing, all of which are aimed at increasing brand recognition.

Here are some representative activities:

Scion uses display ads that reach urban audiences via sites such as blastro.com and hiphopdx.com (Rodgers 2007). Scion works with these sites to develop ad content in a way to make it attractive to the sites’ membership. This ranges from photo galleries to social networking profile pages to offering interactive features.

In August 2007, Scion launched Club Scion, a threestory virtual nightclub with dance floors, music, and hot tubs. Each level of the club reflects a different Scion model, which includes the xA hatchback, xB SUV, and tC sports coupe.

Toyota targets children as a means to influence their parents. In April 2007, Toyota began placing its Scion on whyville.net , an online interactive community populated almost entirely by 8- to 15-year-olds. Toyota hopes Whyvillians will do two things: influence the users’ parents’ car purchases and grow up to buy Toyotas themselves. The power of younger consumers has grown stronger in recent years.

According to MediaBuyerPlanner.com (2006), a study by Packaged Facts showed that 39 percent of parents of 10- and 11-year-olds say their children have a significant impact on brand purchases.

Scion maintains a presence in several large virtual worlds, including secondlife.com , whyville.net , there.com , and gaia.com . Each virtual world lends itself to a different marketing strategy. In Whyville, where users tend to fall between the ages 8 and 15, the company launched a virtual driver’s education program. Since there.com is populated by older teens, Scion made sure to create a more provocative social environment.

Toyota made effective use of the Internet by using live chat to attract the 18- to 24-year-old audience. The campaign includes the use of microapplication ads that allow consumers to stencil designs over the picture of the Scion.

To capitalize on wireless technology, in 2004 Toyota launched a mobile advergame (game to advertise a product), called “Scion Road Trip.” Players earn virtual miles when they send e-cards to friends and get back responses. The campaign lasted for several months.

For the 2008 model xB SUV, Scion created a special Web site ( want2bsquare.com ). Visitors to the site can earn points by playing games, watching videos, and e-mailing others about the site. The site features eight microsites, including user community features; each has a unique theme and its own design. There are microsites that focus on music, resemble a Monty Python set, feature a haunted house, and include a town square and an urban zoo.

Toyota also created its own social network site called Scion Speak, where Scion lovers can socialize, communicate, and play. Scion owners can choose from hundreds of symbols and create customized logos for their cars. They can then download the logo and make window decals, or have them painted on their cars (for a fee).

Finally, like several other automakers, Scion is creating its own broadband channel. These channels are a way to move from push to pull marketing, where the consumer decides what materials to view and when. A content-rich, broadband-friendly site is an always-on marketing channel to which people will return.

Source: Courtesy of Toyota Motor Sales. Used with permission.

The Results

According to MarketingVox.com (2007a), Scion has 80 percent brand recognition, a very high value. As of April 2007, Scion was the number one brick-and-mortar e-tailer among consumers 35 years old and younger. Scion had not even made it into the top 25 sites in 2006; the amazing jump to the number one ranking was due to the interactive and community-oriented nature of the Scion online experiences.

The Scion Web site is highly personalized. Sophisticated customization tools allow people to build their own virtual cars on the site. This online information is then integrated offline—a local dealership locates the desired or similar vehicle for each virtual car builder and contacts them for a test drive. Other digital frills like a social network for Scion car buyers and a Web site that plays music and lists concert information create a superb brand experiences. Let’s look at some of the specific advertising activities.

The brand’s Scion City in Second Life generated 10,000 blog posts between April and June 2007 and is the third most recognized brand behind Reuters in Second Life awareness.

The on-site chat feature provides a forum for hundreds of conversations per week. Prior to the chat, users are asked a few questions, one of which is where they live. Interestingly, Toyota found that many of the chatters reside in areas where Scion is not even available, providing valuable information for dealer expansion plans.

The New York Times reported that visitors to the site had used the word Scion in online chats more than 78,000 times; hundreds of virtual Scions were purchased using “clams,” the currency of Whyville; and the community meeting place “Club Scion” was visited 33,741 times.

SMS (short messaging service or text message) is being used to alert players of their accrued virtual miles and weekly contest events.

Toyota Scion is now using Twitter to stay in contact with its customers ( twitter.com/scion ).