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Nissan Motor Co., Ltd. (A): The Hakone Pilot Marketing Strategy Analysis & Solution
Marketing & Sales Case Study Analysis and Solution
At Fern Fort University, we use Harvard Business Review (HBR) marketing principles and framework to analyze Nissan Motor Co., Ltd. (A): The Hakone Pilot case study. Nissan Motor Co., Ltd. (A): The Hakone Pilot is a Harvard Business Review case study written by David Weinsteinfor the students of Sales & Marketing. The case study also include other relevant topics and learning material on – Pricing
Strategic Marketing Analysis of Nissan Motor Co., Ltd. (A): The Hakone Pilot case study written by David Weinstein will comprise following sections –
- Nissan Motor Co., Ltd. (A): The Hakone Pilot Case Description
- Marketing Definition
- Market Potential Analysis of Nissan Motor Co., Ltd. (A): The Hakone Pilot
- Market Share Potential Analysis
- Segmentation and Segment Attractiveness Analysis
- Competition and Competitiveness Analysis of Nissan Motor Co., Ltd. (A): The Hakone Pilot
- Customer Value Analysis of Nissan Motor Co., Ltd. (A): The Hakone Pilot case study
Nissan Motor Co., Ltd. (A): The Hakone Pilot Marketing Case Description
Sales & Marketing Case Study | Authors :: David Weinstein
Nissan Motors Ltd. went through a spectacular turnaround led by Carlos Ghosn. Nevertheless, in spite of strong growth in new car sales, "After Sales" of automobile parts in Japan did not keep up, hurting dealer profitability. Since dealer profitability is a key success factor in the auto industry, Nissan decided to lead its Japanese dealers to (1) improve their cost structure, (2) improve their management methods, and (3) stimulate "customer traffic" via better marketing strategies. The After Sales department identified a Toyota dealership that actually managed to increase its profitability by working on these three factors, and its president agreed to let Nissan benchmark with his operation. The department decided to replicate this Toyota dealer's management methods, costs and strategy. The latter includes significant price reductions on fees for road worthiness tests, which dealers are authorized to perform on behalf of the Japanese government. Many Nissan dealers raised objections to this pricing approach and, in order to convince them, the company executes the strategy on a "pilot" basis, in Hakone, testing the approach and, hopefully, creating a showcase. While initial results were encouraging, the growth in market share seems to flatten, possibly vindicating the doubting dealers' arguments. The case, generates considerable controversy in both MBA and executive classes, includes discussion on market segmentation, pricing strategy, channel design and dealer network management issues. The case includes a detailed discussion of the dealers' "business model", allowing the class to inspect the financial impact of various strategic scenarios for both Nissan and its dealers.
According to American Marketing Association – Marketing is a set of activities that a firm undertakes for creating, communicating, delivering, & exchanging offerings that have value for customers, clients, partners, and society at large.
Kotler explains - Marketing is a process by which organizations can create value for its potential and current customers and build strong customer relationships in order to capture value in return.
Market Potential Analysis of Nissan Motor Co., Ltd. (A): The Hakone Pilot
Market potential analysis comprises evaluating the overall market size of the related product that the firm is planning to launch. This will involve defining – Why the target market segment needs the product and how it will provide a solution to full its consumers’ needs. Market potential of Nissan Motor Co., Ltd. (A): The Hakone Pilot products various on factors such as –
- Maturity of the market. In mature markets the profitability is often stable but the market potential is less as most of the players have already taken market share based on the segment they are serving. New players have to go for market share strategies in marketing.
- Technological competence of the existing players and culture of innovation and development in the industry.
- Untapped market sizes and barriers to both enter the market and serving the customers. Often companies can easily see the unfulfilled needs in the markets but they are difficult to serve as there are costly barriers.
- Define the core need that your product is serving and list out all the direct and indirect competitors in the market place. This will help not only in positioning of the product but also in defining or creating a segment better.
- Uncovering the current and untapped market sizes and barriers to serving the larger market. Analyze the areas that you need to sort out while launching the products to wider market and what are the challenges the firm will face in market place.
- Estimate the current stage in product life cycle and its implications for marketing decisions for the product.
Market Share Potential Analysis
- Understanding the buyer behavior model for Nissan Motor Co., Ltd. (A): The Hakone Pilotindustry.
- Identifying the market share drivers relevant to Nissan Motor Co., Ltd. (A): The Hakone Pilot market.
- Segment Attractiveness Analysis – Our analysis will work out which are the most attractive segments and which are the one the firm should go ahead and target. We point out in great detail which segments will be most lucrative for the company to enter.
- Understanding the different needs and relative value of your offering by segment.
- Developing segment priorities and positioning the product based on the product need fit developed by the firm.
Competition & Competitive Position Analysis
- Uncovering customer-based competitive positions for key rivals and firm’s offering. This will not only help in assessing the strengths and weaknesses of the competitors but also help in defining and positioning of the product.
- Developing a positioning and launching strategy. It will require not only distribution channel analysis but also promotion mix for the product.
- Strategic Marketing Planning — the process of developing and maintaining a strategic fit between the organization’s objectives and capabilities and the ever evolving marketing opportunities for its products.
Nissan Motor Co., Ltd. (A): The Hakone Pilot - Customer Value Analysis
Capturing customer value is essential to marketing efforts as it results in higher return in the form of both current & future sales, greater market share, and higher profits. By creating superior customer value, the organization can create highly satisfied customers who stay loyal and buy more. This, in turn, means greater long-run returns for the firm.
- The crucial role of customer perceived value in acquiring and retaining profitable customers. Product differentiation is often based on building on a value niche that a firm believes that is very important to the customer. This niche contributes to perceived value. If the perceived value is high then customer stay loyal to the product if not then she can switch to the competitor’s product.
- Graphically displaying value differences for deeper understanding and better internal communication. This helps is building a narrative that a customer can identify with. The better the insight more are the chances of connecting with the potential customers.
- Identifying and selecting actionable value creation options. This can help in increasing the customer lifetime value. Customer lifetime value is the value of the entire stream of purchases that the customer would make over a lifetime of patronage.
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