Strategic Marketing for Toyota Innova (India) based on David Aaker's Model

1. Strategic
Marketing
January 29
2015
Strategy Development Report involving Customer Analysis, Competitor
Analysis, Market Analysis, Environment Analysis – Internal & Final
Recommendation for Strategy Development.
Toyota Innova
Bhavika P. – 13MBA1012
Ramya G. – 13MBA1052
Karthik V. – 13MBA1031
Vivian Marsh A. – 13MBA1083

2. Introduction
Founded in 1937, Toyota Motor Corporation is a Japanese company that engages in the
design, manufacture, assembly, and sale of passenger cars, minivans, commercial vehicles,
and related parts and accessories primarily in Japan, North America, Europe, and Asia.
Current brands include Toyota, Lexus, Daihatsu and Hino. Toyota Motor Corporation is the
leading auto manufacturer and the eighth largest company in the world. As of March 31,
2013, Toyota Motor Corporation’s annual revenue was $213 billion and it employed 333,498
people.
The Toyota Innova is a compact MPV manufactured by Toyota. It is produced in Indonesia
under supervision by Toyota Astra Motor since 2004. As with Toyota Kijang, which it
replaced, the Innova is produced and first marketed in 2004 in Indonesia. The Innova is part
of Toyota's IMV program together with the Hilux Vigo pickup truck and the Fortuner SUV. Its
official name in Indonesia is Toyota Kijang Innova, while for other countries it is Innova.
The Innova is also sold in India (replacing the Toyota Qualis), Malaysia, Philippines ,
Taiwan, Vietnam, Jamaica and Thailand. Unlike some of its competitors, such as the TATA
Sumo Grande, Chevrolet Tavera, or the Mahindra Xylo, but like the newly launched Tata
Aria, the Innova looks more like a minivan. The Innova is also available in Brunei, Saudi
Arabia, South Africa, Oman and the UAE.
In India, the Innova is available with twelve variants. Three variants of the Innova come with
a petrol engine option which is powered by a 1,998 cc, 1TR-FE, gasoline, inline four-cylinder
petrol engine with electronic fuel injection. The diesel variants of the Innova are powered by
2,494 cc, 2KD-FTV Diesel with intercooler and turbocharger 4 cylinder engine. In 2012,
Toyota Bharat introduced a new grade "Z" in India which is placed above the VX grade –
making it the most expensive trim in the entire line up. The available grades are E, G, GX, VX
and Z.
Parent Company Toyota Motor Company
Category SUV
Sector Automobiles
Tagline/ Slogan All you desire
USP Luxurious, comfortable, family car
Toyota Innova

3. SWOT Analysis
Strength
1. High brand awareness and market penetration
2. Wide range of available variants for the customers to choose from
3. Good penetration in Taxi and commercial segment
4. Good fuel efficiency both in city and on highways
5. It has a huge market in India, Middle East and south east Asia
Weakness
1. Limited presence in Europe and Americas, which can be good potential markets
2. Big size makes it less preferred for in city traffic
Segment SUV Segment
Target Group Urban families and businessmen
Positioning Positioned as a multi premium vehicle which provides premium style along with luxury and comfort
STP

4. Opportunity
1. Expanding SUV segment to accommodation competition
2. Acquiring collaborations with automobile business entities
3. Augment distribution and servicing network
Threats
1. Intense competition in the market with international car manufacturers
2. Competition offering Innovative features at lower price
3. New entrants in the same segment with better features and lower price

5. Strengths:
 Strong market position and brand recognition: Toyota has a strong market position in
different geographies across the country. Such strong market position allows the company
to gain competitive advantage and also expand into international markets. In addition,
Toyota holds a portfolio of strong brands in the automotive industry. Thus, the company's
strong market position gives it significant competitive advantage and helps it to register
higher sales growth in domestic and international markets.
 Strong focus on R&D: Toyota has a strong focus on R&D to expand its product portfolio
and improve the functionality, quality; safety and environmental compatibility of its
products. The company's R&D efforts are directed at developing new products and
processes and improving the capabilities of existing products. The company conducts its
R&D operations at 14 facilities worldwide. Strong focus on R&D has helped the company in
incorporating newer features to its existing range of products and also in bringing out latest
technologies in the varied areas. The company's strong focus on R&D allows it to uphold the
technological leadership in most of its product segments. It also enables Toyota to develop
innovative products, leading to strong sales.
 Extensive production and distribution network: Toyota has an extensive production and
distribution network. Toyota and its affiliates produce automobiles and related parts and
components through more than 50 manufacturing companies in 27 countries and regions
besides Japan. In addition, Toyota has an extensive distribution network. While the
company’s geographically well spread production base diversifies business risks, its
extensive distribution network provides a wider reach, thus boosting revenues.
Weaknesses:
 Product recalls could affect brand image: Toyota has conducted a number of product
recalls in the recent past, which could affect the brand image and overall sales of the
company. For instance, in 2011, Toyota recalled 111,000 models of Toyota and Lexus
brands’ vehicles due to the damage to elements of the substrate and potential shutdown of
the hybrid system. In addition, the company was involved in government investigations
related to product recalls. For instance, in February 2012, the National Highway Traffic
Safety Administration initiated a preliminary investigation of a potentially faulty power
window master switch in the driver-side doors in model year 2007 Camry. This could also
result in significant penalties, which could affect the operational margins.
 Declining sales in key geographic segments: Toyota witnessed a decline in its sales in key
geographic segments. In FY2012, the company witnessed declining sales across Asia, other
geographic reasons, which together accounted for 60.8% of the total revenues of the
company. Thus, a continuous decline in the company's key geographic segments could put
pressure on the profit making segments and the overall revenues of Toyota.

6.  Poor allocation of resources as compared to peers: Toyota has low return on equity (ROE)
and return on assets (ROA) compared to its peer companies. The company's competitors
such as Honda Motor and Nissan Motor have more ROE when compared to Toyota. Honda
Motor's ROE was 4.8%, while Nissan Motor's ROE was 8% in FY2012. In contrast, Toyota's
ROE was 2.7% in FY2012. Lower ROE and ROA compared to its peers indicates that the
company is not using the shareholders' money efficiently and that it is not generating high
returns for its shareholders.
Opportunities:
 Growing global automotive industry: The Indian automotive industry was severely
affected by the economic downturn, with a decline in revenues being recorded in 2008 and
2009. However, 2011 saw a strong rebound which has continued into 2012. According to
Market Line, the Indian automotive manufacturing industry grew by 8.9% in 2012.
 Toyota poised to benefit from growing partnership with BMW: Toyota is poised to benefit
from the growing partnership with BMW. In June 2012, BMW and Toyota signed a
memorandum of understanding aimed at long-term strategic collaboration on technological
fields. As part of the agreement, the two companies will partner for the joint development
of a fuel cell system, joint development of architecture and components for a future sports
vehicle, collaboration on power-train electrification and joint research and development on
lightweight technologies. The growing partnership between the two companies is expected
to boost the technological know-how of the companies and may result in the development
of new products thus increasing revenues in the long run. Also, in the short run, the
combined partnership will result in significant synergies and cost-savings, boosting the
operational margins.
 Strong outlook for the global new car market: The new cars market has experienced
moderate growth during 2008-2012. However, forecasts suggest this will accelerate to
strong double digit growth during the 2012-2016 periods. Thus, the strong outlook for the
new car market coupled with the company’s new product launches provides a growth
opportunity for the company.
Threats:
 Intense competition: The Indian automotive market is highly competitive. Toyota faces
strong competition from automotive manufacturers in its various markets. The competition
among various auto players is likely to intensify in light of continuing globalization and
consolidation in the automotive industry. The factors impacting competition include product
quality and features, the amount of time required for innovation and development, pricing,
reliability, safety, fuel economy, customer service and financing terms. Increased
competition may lead to lower vehicle unit sales and large inventory, which may result in
downward pricing pressure, thus impacting the financial condition and results of operations
of the company.

7. Industry Overview and Analysis
Toyota Motor Corporation competes in the automotive industry. The past five years were
tumultuous for automobile manufacturers. Skyrocketing fuel prices and growing
environmental concerns have shifted consumers' preferences away from fuel-guzzling
pickup trucks to smaller, more fuel-efficient cars. Some automakers embraced the change
by expanding their small-car portfolios and diversifying into the production of hybrid electric
motor vehicles. Other automakers were more reluctant to shift their focus from big to small
cars, expecting the price of fuel to contract eventually, bringing consumers back to the big-
car fold. When fuel prices did fall during the second half of 2008, it was due to the US
financial crisis ripping through the global economy. This had a domino effect throughout the
developed and emerging worlds, with many Western nations following the United States
into recession. Industry revenue fell about 15.4% in 2009. Pent-up demands will aid industry
revenue growth, estimated at 2.1% in 2013, thus bringing overall revenue to an estimated
$2.3 trillion. 3 Overall, the large declines followed by recovery are expected to lend the
industry average growth of 2.2% per year during the five years to 2013. Throughout the past
five years, growth in the BRIC countries supported production. Rising income in these
countries led to an increase in the demand for motor vehicles. Also, Western automakers
moved production facilities to BRIC countries to tap into these markets and benefit from
low-cost production. Over the next five years, the emerging economies will continue their
growth, and demand for motor vehicles in the Western world will recover. Industry revenue
is forecast to grow an annualized 2.5% to total an estimated $2.6 trillion over the five years
to 2018.
In India, the Innova is available with twelve variants. Three variants of the Innova come with
a petrol engine option which is powered by a 1,998 cc, 1TR-FE, gasoline, inline four-cylinder
petrol engine with electronic fuel injection. The diesel variants of the Innova are powered by
2,494 cc, 2KD-FTV Diesel with intercooler and turbocharger 4 cylinder engine. In 2012,
Toyota Bharat introduced a new grade "Z" in India which is placed above the VX grade –
making it the most expensive trim in the entire line up. The available grades are E, G, GX, VX
and Z.
Value proposition:
Wider range
TOYOTA INNOVA offers more models than any other make.
Lower operating costs
Running costs can double the price you can pay for a vehicle, and there are many hidden
costs, which are revealed when accurate records are kept of all outgoings. TOYOTA INNOVA
is dedicated to ensuring the lifetime cost of a vehicle is kept low through advanced engine
technology which extends performance and efficiency across the entire range.

8. Lower maintenance costs
TOYOTA INNOVA designs vehicles to be easy and fast to service and maintain. TOYOTA
INNOVA Extra Care Extended Warranty cover can take the guesswork out of managing
unexpected costs and provides an industry leading range of insurance, warranty and
roadside assistance and products. This is designed to keep your business on the road when a
breakdown occurs.
High resale value
TOYOTA INNOVA has a broad market acceptance and a reputation for retaining their
value. The total cost of owning a vehicle isn’t known until the last transaction: disposal. If it
holds value, you are that far ahead.
Quality and reliability
TOYOTA has a long-standing reputation for manufacturing excellence and for producing high
quality vehicles such as INNOVA and Camry.
Fast parts supply
TOYOTA INNOVAS’ investment in parts supply systems means shorter waiting time for
repairs and faster returns service. For every day you are without replacement parts, your
investment lies stagnant.
Safety
Its tests are based on the toughest of both the current and anticipated, safety standards of
Europe, Japan, Australia and the United States. The result is a unique benchmark of safety
excellence known as Global Outstanding Assessment, GOA.
Customer analysis
Toyota Innova s primary target are building confidence for young parents. 35-45 year old
social class , married with kids are the PTM, while the growing families who wish to travel to
different destination with comfort are also target market. On evaluating with the Maslows
need theory, Toyota Innova attains the safety and self esteem status. Their main focus is on
comfort and giving options of interior and exterior.
UNMET NEEDS: Toyota Innova failed in their air bag safety provision. There have been
many deaths due to the failure of air bags for which Toyota had to give huge compensation.
The resale value of Toyota Innova is poor while compared to its competitors like Ertiga from
Maruti. All variants of Toyota Innova do not have a similar engine sound.
CUSTOMER CENTRICITY: One of the biggest advantages of Toyota Innova is their
suspension. The travel is so comfortable cause of these excellent suspension systems which

9. they produce. Even aged people can have a comfortable journey as they do not feel the
tiredness of journey. Toyota Innova gives a standard mileage over a life span of the car
unlike Maruti Ertiga which gives good mileage initially and after a period of time the mileage
starts to decrease. Service check is made compulsory for every 10000 km by the service
station. The service they provide is excellent and the treatment is same throughout India,
irrespective of location. The customers feel that Toyota Innova causes lesser breakdowns
when compared to its competitor. On road tyre punctures and damages are very less, this is
cause of the wheel alignment and branded tyres that they use. Toyota Innova is better
suited for long trip. The service which is been offered after sales is extremely good in
Toyota. Toyota offers supreme after sales services were the time taken is hardly hour.

10. Market Research
MARKET SHARE
Toyota Innova launched at a starting price of Rs.12.45 lakh. It has captured 33% market
share of the MPV industry in the first year of its launch itself. However, Honda plans to bring
globally successful MPV Freed to take on Toyota Innova in India. In recent days Innova has
the fierce competition in its kind like Maruti Suzuki Ertiga, Nissan Evalia. According to IASI
(India Auto Social Index), Innova faces many challenges and continued to strive for success
in MUV kind.
Challenges
Toyota's rivals are ramping up capacity, and increasing the number of models in several
segments. M&M's refreshed Xylo and the new Maruti Ertiga are challenges for Innova.
Especially Mahindra xuv500 competes with the Innova. Toyota's utility vehicles could face
further pressure when M&M's South Korean acquisition, Ssangyong Motor, helps the Indian
carmaker introduce the Rexton, this year.
LEADERS
Category MUV/MPV - Toyota Innova continued to be the highest contributor to the overall
volume of mentions. It leveraged Welcome India’s No1 contest on Twitter, to promote the
newly launched Toyota Innova facelift. Nissan Evalia had high positive mentions under all
themes. Nissan Evalia’s facelift with a new front which was tested in China drove the highest
positive mentions for the car under ‘Features’. Nissan Evalia and Toyota Innova had the
highest share of positive mentions in November 2013; Chevrolet Tavera had the highest
share of negative mentions in this category
Followers
Despite several competitions Innova succeeds in owning the hearts of upper middle class
family who are fond of having big family. The unique value proposition of Innova is MUV
with maximum cubic capacity. It comes up with ABS and dual airbags. It provides the value
for money. INNOVA is the only car provides the guarantee of five lakh kilometres and has
wide boot space than any other MUV of its kind Automobiles are one of the most actively
discussed and researched categories on social media. Auto manufacturers are increasingly
leveraging platforms like Facebook, Twitter, YouTube, blogs and forums along with owned
digital assets ahead of new product launches or as part of marketing initiatives.
WEB ANALYTICS
Web analytics is not just a tool for measuring web traffic but can be used as a tool for
business and market research, and to assess and improve the effectiveness of a website.
Web analytics applications can also help companies measure the results of traditional print
or broadcast advertising campaigns. It helps one to estimate how changes traffic to a
website after the launch of a new advertising campaign. Web analytics provides information
about the number of visitors to a website and the number of page views. It helps gauge

11. traffic and popularity trends which is useful for market research. Through web analytics
company growth can be measured with the help of consumer’s reviews and likes.
FACEBOOK ANALYTICS:
The below graph was taken from the Facebook analytics to determine how actively
Innova was followed by the people in one month.
From the above graph we can infer that Innova is followed by many people consistently
over Facebook and they were actively engaged in discussion threads regarding Innova
services.
TWITTER ANALYTICS:
Similarly twitter shows that 69 percent of people have Re
tweeted for the Innova active tweets. It enables us to
identify the market penetration of the company.
Study proves that people continously engaged in
tweeting Innova updates are tend to influence
other people who arent following Innova. Twitter
is used as a marketing performance measuring tool
in many companies . Through sentimental anlaysis
twitter can give the five point scale rating for the
company’s quality .
The below graph shows the total number of posts posted
by the company and the re tweets. The grey colour indicates

12. the posts by company and the blue bar indicates the replies.
Blog works India Auto Social
Index:
Moving away from the vanity indices,
the ‘Blog works India Auto Social Index’
aims to correlate social metrics,
consumer sentiment and sales data to
provide marketers and brand owners
with actionable insights.
Market Growth
The market growth has three phases, growth, maturity and decline. Through leader boards
that IASI have create the report which help auto brands to monitor their performance vis-à-
vis their competitors over a period of time. The report shows the overall rank holders in
Automobile segments for the year of 2013. The following table shows that various brands
been ranked according to the market share and customer reviews.

13. Especially the multi utility vehicle segment
Innova holds the top position in India. The
following table has been recorded and
given by Indian social Index.
Though Innova has a good market share in
India, it tends to decline in the sales due to
the arrival of numerous competitions in its
kind. This is because of personality of
many people who gets attracted to
newness and innovations. For the In line
with the global trend, Honda has also
started to launch vehicles in India soon
after global debut, while few models are
even being designed specifically for India.
This results Honda’s market-share in the
passenger vehicle market has more than
doubled from 3% in FY13 to 7% in April-
November 2015. It has also doubled

14. output with the start of a second plant in Rajasthan in February, while a third unit in Gujarat
is also on its way.
In the same period, Toyota Kirloskar Motor, which till date relies on premium products like
the Innova, saw market share may drop from 6.2% in FY13 to 5.5% in April-November FY15,
and was struggling in the subdued market last year. A look at Toyota’s current scenario in
India tells us that it has a very limited product offering for the market and will continue to
depend majorly on the MPV segment for its growth. The Innova will, thus, continue to bear
the heavy burden, of sustaining the entire brand. However Innova strives to be succeeded in
MUV segment in order to not get declined. The above graphs and table proves that people
continue to value Innova in spite of increased cost. Thus proves that Innova is stagnant in
matured growth stage.
CORE COMPETENCIES OF INNOVA:
The core competence of Toyota Motor Corporation is its ability to produce automobiles of
great quality at best prices, thereby providing a value for money to the customers. This core
competence of quality can be attributed to its innovative production practices. The quality
aspect of Toyota’s products have revolutionized the automobiles in the past and almost all
the automobile companies had to try and better the quality of their products. It is a
cornerstone of the cost leadership strategy that the company pursues.
 Anti lock braking systems
 Brake assistant system
 Traction control
 Vehicle stability control
 Lane-keeping assistants
Innovation of Innova
The form that design creativity can take for market leadership in India is well illustrated by
Toyota’s Innova. As the name suggests, it is indeed a unique vehicle even in the global
automobile industry. Despite retaining the same dimensional features as a 5 seater sedan
car, Corolla (which has dimensions of 4540, 1760 and 1480 mm in length, width and
height), Innova as a utility vehicle (4585, 1760 and 1850 mm in length, width and height) has
been engineered to accommodate 7 to 8 people with the requisite boot space as well as
seating and cargo flexibility. As a result, it meets both the urban and rural needs, as well as

15. intercity and intra-city traffic and drive conditionsof India nicely. By offering, in addition,
diesel engine as a standard feature from early days of Innova’s introduction Toyota made
sure that Innova also emerged as a vehicle particularly low on driving costs. The product
profile backed by an impeccable service backup of Toyota ensured that Innova became the
choice vehicle in the UV market, with a pricing that is attractively pitched between the
home grown MPVs (like Tata Safari and M&M Bolero) and the imported MPVs such as
(Honda CRV and Mitsubishi Outlander). If smart dimensional packaging alone could deliver
such differential positioning to Toyota Innova, more fundamental innovations which are
customized to the multi-purpose India user needs could lead to additional successes (Toyota
sells around 80,000 Innovas ranking higher than any other UV in India and sharing the space
as one among the Top 10 cars in India).
Fundamentally, the ability to enhance the wheel base (for example, 2750 mm of Innova
compared to 2600 mm of Corolla Altis) while reducing the front track and enhancing the
rear track with comparable road handling and safety would be a vital benchmark of spatial
engineering. There could be other innovations too, such as a switchable all-wheel drive
option to make on-road off-road traction easy or a transverse mounted engine with front
wheel drive to further economize on dimensions. Whatever be the innovations “less is
more” needs to be the design mantra for UVs in the Indian market. It is important to
maintain a minimum seating capability of atleast 7 passengers, with adequate luggage
space, to make the UV a truly family vehicle in India, while optimizing all other performance
characteristics like ground clearance, turning radius, gradient management, cruising speed,
ride quality, road handling, vehicle and passenger safety, easy navigation, and interior
comfort. This requires companies to adopt a three tiered approach to design innovation that
optimizes exteriors, interiors and performance in one India-centric package. The Indian
automobile manufacturers would need to consider if they will be governed by current
market size and offer many “apparent variants” or a few “real options” customized for
multiple needs. The former may succeed with a “mix and match” or “cut and re-form”
approach which would be economical (as with Quanto) but would not drive the UV segment
to its full potential. In contrast, a design strategy of developing the right form, comfort and
performance combination on entirely different and discrete platforms like Toyota does

16. (RAV4, Innova, Fortuner, Prado and Land Cruiser) could open up the UV segment in India to
unforeseen growth
COMPETITIVE INTENSITY:
Rivalry among the competitors is very strong is this industry. The major competitors are so
closely balanced that it increases the rivalry. In order to gain market share in the automobile
must gain market share by taking it from their competitors. One of the other reasons there
is such high rivalry is that there is a lack of differentiation opportunities. All the companies
make cars, trucks or SUV's. The competitors are compared to one another constantly. The
price, quality, durability, and many other aspects of different manufacturers are greatly
taken into consideration when deciding what type of vehicle to purchase. When the
different manufacturers advertise they even compare their products to their competitors.
For example, the commercials will focus on areas where the company outperforms its
competitors.
The three major rivals of Innova are
 Scorpio
 Ertiga
 Xuv 500
The annual sales figures in Indai for the year 2013 is as follows:
 Ertiga -7337
 Innova-4682
 Scorpio-4277
 Xuv 500-4237
Comparison - 1 Ertiga Vs Innova :-
There have been many talks that Ertiga is Comparable to Innova.
We feel that Innova has much better styling, dimensions, better for long getaways
compared to Ertiga. Ertiga scores well in 2 critical parameters - Price & Mileage over Innova
If you compare Engine, Power, Torque, Dimensions, Features

17. Engine & Power
Toyota Innova Diesel comes in 2.5 Lit Diesel Engine displacing maximum 102 BHP of Power
Maruti Ertiga Diesel is powered in 1.3 Lit Ddis Diesel Engine displacing maximum 90 BHP of
Power.
The torque of Innova is also better than Ertiga
Been smaller engine, Ertiga gives much better fuel efficiency compared to Innova. As per
ARAI Mileage - Ertiga diesel has fuel efficiency of 20.78 Kmpl, while that of Toyota Innova as
13.5 Kmpl
Dimensions
Innova - Length mm - 4580, Width mm - 1770, Height mm - 1755, Ground Clearence mm -
176
Ertiga - Length mm - 4265, Width mm - 1695, Height mm - 1685, Ground Clearence mm -
185
Innova is much spacious and can accommodate and is apt 7 Seater Passenger car compared
to Maruti Ertiga
Price
However - to tell you Innova Gx Diesel will atleast cost you Rs. 13 Lacs (On Road Price in
Delhi) compared to Ertiga Vdi which costs you Rs. 9 Lac (Middle Variant)
Ertiga is Value for Money deal. If you are budget friendly and look for feel of MPV - Ertiga is
your choice. However - if you are looking for a powerful car and ready to extend budget by
Rs. 4 Lacs with a real drive and power - Go for Innova.
Comparison - 2 Ertiga Vs Innova Vs Xylo:-
Option and Variants - Ertiga and Innova comes in both Petrol and Diesel Option.
Mahindra Xylo comes only in Diesel Option. However, in MPV segment, diesel
engine accounts for over 70% of the sales. Hence, it would be wise to compare all 3
cars in Diesel Option.
Engine - Eritga Models - Lxi, Vxi and Zxi having K Series 1.4 Litre Petrol Engine, while
Diesel has 1.3 Litre DDIS Engine as similar to Sx4 having models as Ldi, Vdi and Zdi.
Xylo comes in 3 Engine - 2.5 Litre Mdi Engine(for base models of D2 and D4), 2.5 Litre
M-Eagle Engine for its middle models (E4 and E8) and 2.1 Litre M-Hawk Engine for top
end model E9. Toyota Innova comes in 2 Litre Petrol and 2.5 Litre Diesel Engine.

18. Power - Toyota Innova Petrol delivers 132 BHP power, while Diesel Innova gives 102
BHP of power. Mahindra Xylo in Mdi Engine delivers 95 BHP in Mdi Engine, 112 BHP in
M-Eagle and 120 BHP in M-Hawk Engine. Maruti Ertiga will deliver 95 BHP in Petrol
and 90 BHP in Diesel Engine.
Dimensions -
Toyota Innova has dimensions - Length mm - 4585, Width mm - 1770, Height mm -
1755
Mahindra Xylo has dimensions - Length mm - 4520, Width mm - 1850, Height mm -
1895
Maruti Ertiga has dimensions - Length mm - 4265, Width mm - 1695, Height mm -
1685
Mileage - Ertiga Mileage expected to be 16 kmpl in Petrol and 21 Kmpl in Diesel
Engine. Toyota Innova gives mileage of 10 kmpl in Petrol and 13.5 kmpl in Diesel.
Mahindra Xylo gives mileage of 14.88 kmpl in D2 and D4, 11.7 kmpl in E4 and E8 and
14.01 kmpl in E9 Model
Price - Toyota Innova price for Petrol Starts as Rs. 9.38 Lac for Petrol and goes till Rs.
12.54 Lac for top end Vx Petrol. While Diesel Innova starts for Rs. 9.91 Lac and goes till
Rs. 13.15 Lac for top end Diesel. Xylo has price starting from Rs. 7.38 Lac for base
model D2 in Mdi Engine, 8.11 Lac in M-Eagle Engine for E4 and top model E9 having
Scorpio M-Hawk Engine at Rs. 10.25 Lac. Ertiga Price expect to start from Rs. 7 Lac to
Rs. 9 Lac for top end Diesel.
Recent News - Maruti Ertiga Price
Maruti has launched Ertiga at starting price of Rs. 5.89 Lac for Base Model Petrol. The
Top End Diesel Model of Ertiga will cost Rs. 8.45 Lac . Stated Prices are Exshowroom
Delhi. Its a highly competitive price even beating the estimates. We expect Ertiga to
be a huge success keeping in the factor of Price, Mileage and backing of network of
Maruti Suzuki.

19. MARKETTING CAPABILITIES:
Marketing plan :
1. Toyota Innova PTM are “Building Confidence for Young Parents”
2. For growing family and having new businesses.
3. Can choose from Mitsubishi Adventure, Isuzu Crosswind, Chevrolet Orlando, and
Nissan Grand Livina
4. Gap is all other brands are known for having the capacity for seating a number of
people and have spacious cabin.
5. Toyota’s market share is 40% and is about Php15B.
6. Toyota Innova is an AUV that has a lot of varieties to choose from. From standard
feature to luxury.
7. Comparing vehicles with engine displacement, price is 3% lower than Isuzu
Crosswind (AT) and 20% higher on the rest
8. Uses ads such as media, newspaper and magazine, websites, promotions, events &
experiences, and word of mouth
9. Stores are available nationwide
10. Uses supply and distribution leverage approach to win
What makes Toyota Innova different from other?
Only Toyota Innova has a variety of choices to choose from. Depending on the
capability and preference of the consumers.
 From standard style to luxurious style
 Regular chair to captain chair
 Standard upholstery to leatherette upholstery
 From 2.0 to 2.5 Engine Displacement

20.  From Automatic to Manual Transmission
 And from Gas to Diesel Engine Type
Toyota Innova uses a variety of ads , discounts , promos, events & experiences and word of
mouth.
VRIO Framework Analysis
 Valuable: Yes, many customers feel the better associated with the logo & finds value
in the offering.
 Rare: Yes, just-in-time production is a popular strategy used by companies in all
industries; however, Toyota’s methodology is very rare.
 Inimitable: Yes, many companies have tried to recreate the system; however none
have been able to do it in as efficient of a manner. The reason why competitors find
it difficult is the fact Toyota’s culture is integrated deeply in its operations. Hence it
is difficult to replicate.
 Organization: Yes, Toyota has been using this system since the 1960’s and have been
perfecting it along the way.
 Competitive Implication: This creates a sustained competitive advantage.
Porter’s Five Forces of the Automotive Industry
Threat of New Entry (Weak):
 Large amount of capital required
 Few legal barriers protect existing companies from new entrants
 All automotive companies have established brand image and reputation
 Products are mainly differentiated by design and engineering quality
 It is very hard to achieve economies of scale for small companies
 Governments often protect their home markets by introducing high import taxes

21. Supplier power (Weak):
 Large number of suppliers
 Companies use another type of material (use one metal instead of another) but only
to some extent (plastic instead of metal)
 Materials widely accessible
 Suppliers do not pose any threat of forward integration
Buyer power (Strong):
 There are many buyers
 Most of the buyers are individuals that buy one car, but corporate or governments
usually buy large fleets and can bargain for lower prices
 It doesn’t cost much for buyers to switch to another brand of vehicle or to start using
other type of transportation
 Buyers can easily choose alternative car brand
 Buyers are price sensitive and their decision is often based on how much does a
vehicle cost
 Buyers do not threaten backward integration
Threat of Substitutes (Weak):
 There are many alternative types of transportation, such as bicycles, motorcycles,
trains, buses or planes
 Substitutes can rarely offer the same convenience
 Alternative types of transportation almost always cost less and sometimes are more
environment friendly
Competitive Rivalry (Very Strong):
 Moderate number of competitors
 If a firm would decide to leave an industry it would incur huge losses, so most of the
time it either bankrupts or stays in automotive industry for the lifetime
 Industry is very large but matured
 Size of competing firm’s vary but they usually compete for different consumer
segments
 Customers are loyal to their brands
 There is moderate threat of being acquired by a competitor

22. Sales Report of Toyota Innova in Comparison with Competitors in same segment.

23. BCG Matrix – Analysis of Toyota
High Low
STAR QUESTION
*Prius Hybrids * Fortuner
* Land Cruiser * Camry/Corolla Hybrids
CASH COWS DOGS
* Innova
* Qualis - (Withdrawn)
* Camry
* Corolla Sedans
Relative Market Share
MarketGrowth
High
Low

24. Company Strategy
Toyota's management philosophy has evolved from the company's origins and has been
reflected in the terms "Lean Manufacturing" and Just In Time Production, which it was
instrumental in developing. Toyota's managerial values and business methods are known
collectively as the Toyota Way. In April 2001, Toyota adopted the "Toyota Way 2001", an
expression of values and conduct guidelines that all Toyota employees should embrace.
Under the two headings of Respect for People and Continuous Improvement, Toyota
summarizes its values and conduct guidelines with the following five principles:
 Challenge
 Kaizen (improvement)
 Genchi genbutsu (go and see)
 Respect
 Teamwork
The Toyota Way in Sales and Marketing (TWSM)
The TWSM gives emphasis to the principle and values of placing the “customer first” and the
importance of integrated action by dealers, distributors, and Toyota. Distributors from
across the globe met in Los Angeles to talk about the potential of implementing the key
TWSM values around the globe. Toyota established the Global Knowledge Center (GKC) as a
platform for sharing and learning best practices from different regions.
Strategic Management critical success of Toyota:
1. Base your management decisions on long term philosophies, even at the expense of
short term goals
2. Create continuous process flow to bring problems to the surface
3. Use pull systems to avoid over production
4. Level out the workload
5. Build in a method to stop and fix problems when they are discovered, this ensures
quality the first time
6. Standardized tasks provide the foundation for continuous improvement and
employee empowerment
7. Use visual control so no problems are hidden

25. 8. Use only reliable, thoroughly tested technology that serves you people and
processes
9. Grow leaders who thoroughly understand the work, live the philosophy and can and
do teach it to others
10. Develop exceptional people and teams who follow your company's philosophy
11. Respect your extended network of partners and suppliers by challenging them and
helping them improve
12. Go and see for yourself so that you completely understand the situation
13. Make decisions slowly by consensus, thoroughly consider all options; implement
decisions rapidly
14. Become a learning organization through relentless self-examination and continuous
improvement
Voice of the Customer
Refusing to buy Innova for 3 Years! Finally Buys Maruti Ertiga
1. There are more Taxis running with Toyota Innova.
There is no difference between a taxi driver and an Innova
owner at a valet parking.
2. Sales team from Innova wasn’t warm as compared to
Maruti Ertiga where sales team frequently contacted
appropriately to close the sale.
3. Acquaintance who owned an Innova was charged a
sum of Rs. 60,000/- for lock replacement due to missing key.
4. Bad Ergonomics – Feels puking while a driver who
doesn’t drive the vehicle well due to improper balance of
centre of gravity associated with height of vehicle.
5. Better mileage with Maruti Ertiga costing Rs. 500 for a trip to Pondicherry.
6. Lower engine capacity compared with Toyota Innova as desired for usage of the customer.

26. RECOMMENDATIONS:
To survive in a market as India, Toyota must focus & strengthen itself to the key priority of
its customers, Mileage!
i. Toyota has sought help from Daihatsu, Japanese Auto Maker for partnership to
improve current poor sales performance, need to strengthen this relationship for
better sales, similar to its Indonesia Model, considering the Indian Market &
Consumers in Mind.
ii. Competitors such has Suzuki have set up comprehensive local supply chains for
cheaper costs, Toyota must consider the same.
iii. Can the Top Management change the Taxi Attitude for Innova?
iv. The Centre of Gravity issue pointed out by users who have compared Ertiga and
Innova needs to be sorted out.
v. Local suppliers can help reduce costs associated with parts and replacements for
customer.
CONCLUSION
Toyota has promoted diversification through continuous innovation all through its life and
expanded the scope of its business domains to include textile machinery, automobiles
(vehicles, engines, car air-conditioning compressors, etc.), and materials handling
equipment, electronics, and logistics solutions. All these Expansion Strategies adopted by
Toyota has resulted in making Toyota one of the largest Conglomerates.
Today Toyota is the largest carmaker in the world leading General motors and the top
selling automaker. The Japanese company has sold 9.7million cars and trucks in 2012 leaving
GM in second place with 9.29million cars.
The backbone of their success being their sharp, well thought out and excellently
implemented strategies. It yielded excellent result over the years it brought them to the No.
1 position and if maintained, there is no doubt about the fact that they’ll maintain their
position for years to come.