The document summarizes a case study about Lexus, a luxury car brand. It discusses how Lexus was introduced in 1989 to target an affluent market for high-performance cars. While Lexus included features of Mercedes, Toyota also focused on performance and stability. As Lexus grew successful, increasing prices did not work well, so new advertising campaigns aimed for an emotional response. The document outlines management decision problems for Lexus regarding price increases, advertising approaches, targeting younger consumers, and customer loyalty. It develops marketing research problems and hypotheses to address these decisions.

1. 5 4 3 2 1

2. `

3. Humaira Tanzila BBA 027 08012 Amina Sultana BBA 027 08038 Md. Ashraful Alam Khan BBA 027 07989 Arifur Rahman BBA 027 08076 Kh. Ahmed Imtiaz Mahmood BBA 027 07924

4. Current Presenter Humaira Tanzila CASE SUMMARY  In the 1980s, Toyota developed a concept of their new car Lexus that was destined to be success based on a large and affluent market for cars with exceptional performance. However, the market was unwilling to pay the expensive price that Mercedes charged for their kind. Toyota targeted this market & introduced the Lexus in 1989 along with clever advertising. Lexus included with all the features that Mercedes had but in addition Toyota focused on the performance & stability of the car. As success continued, Lexus raised its price but unexpectedly it didn’t work well. New advertising Campaign was then involved to gain emotional response toward Lexus. Lexus sponsored a “New World of Luxury” sweepstakes on the TiVo promotional page.

5. in durability in retention of customers in customer satisfaction in selling luxury brand ` Current Presenter Humaira Tanzila

7. Asks what the decision maker needs to do Action Oriented Focuses on symptoms The decision problems (DP) that Lexus faced are: DP-1 “Should the price of Lexus be increased?” DP-2 “Should non-traditional advertising and promotion be used?” DP-3 “Should SUV of Lexus be targeted to the younger consumers?” DP-4 “Will Lexus be able to gain new customer and retain existing clients?” Management Decision Problem Current Presenter Kh A Imtiaz Mahmood

8. Asks what information is needed & how to collect it Information Oriented Focuses on underlying cause DP-1: “Should the price of Lexus be increased?” Marketing Research Problem Broad Statement: “ To determine the price elasticity of demand and the impact on sales and profits of increased price of Lexus” Specific Components: a) What is the overall effect of price increase of Luxury vehicle? b) What is the prospective consumers’ reaction toward the increase in price? Marketing Research Problem Current Presenter Amina Sultana

9. DP-2: “Should non-traditional advertising and promotion be used?” Marketing Research Problem Broad Statement: “ To determine the effectiveness of the non-traditional advertising and promotion” Specific Components: a) Are non-traditional advertising and promotional programs accepted among potential consumers? b) Are non-traditional advertising & promotion programs effective in attracting new consumers? Marketing Research Problem Current Presenter Amina Sultana

10. DP-3: “Should SUV of Lexus be targeted to the younger consumers?” Marketing Research Problem Broad Statement: “ To determine the preferences and purchase intention of young customer groups” Specific Components: a) What features younger consumers look for in luxury cars? b) What are the demographic and psychographic profiles of the young consumers? Marketing Research Problem Current Presenter Amina Sultana

11. DP-4: “Will Lexus be able to gain new customer and retain existing clients?” Marketing Research Problem Broad Statement: “ To determine if customers will be loyal to Lexus in long term” Specific Components: a) Who are the customers? b) What is the extent of brand loyalty of the customers to Lexus? Marketing Research Problem Current Presenter Amina Sultana

12. attitude variables Arifur Rahman Current Presenter (9) Handling (10) Value (11) Style (12) Comfort (13) Prestige (14) Status And (15) Visual Impact. (1) Reliability (2) Quality (3) Durability (4) Safety (5) Security (6) Performance (7) Efficiency (8) Technology

13. gRaphical model Luxury Vehicle’s Characteristics/ Features Prospective Consumers Reliability Quality Durability Safety Security Performance Efficiency Technology Handling Value Style Comfort Prestige Status Visual Impact Prospective consumers/ Purchasers Arifur Rahman Current Presenter attitudes

14. HYPOTHESIS Questions Current Presenter Md. Ashraful Alam Khan Research Research P ROBLEM “ To determine if customers will be loyal to Lexus in long term” Research Q UESTIONS [ i ] Are the Lexus customers loyal to the brand? [ ii ] Can the Lexus customer be segmented? H YPOTHESIS [ i ] Lexus consumers are loyal towards the brand. [ ii ] There are distinct segments of Lexus customers

15. Non-Traditional Promotion & Advertising approach Customer need identification Are the keys th a nk you