NOTES TO STUDENTS: This assessment task is worth 40 percent (40%) of your overall assessment for this course. This assessment consists of: • Four (4) compulsory case study questions, worth ten marks each for a total of 40 marks. There is a word limit of 1,000 words (+/-10%), that is approx. 250 words per question. Answers should be short answer format that relates course theory to the case study. In- text referencing is NOT required. Remember to submit your responses via Safe Assign by exam week, Monday, 11/06/2018, 5.00pm (AEST). This is an individual task. You must complete this task independently and not in discussion with other students. Please clearly identify your submission with student name and number etc. on a cover sheet Toyota: Anything Goes – How returning to RAV4's roots led to record sales Source: Spicer and Bates, The Communications Council, 2017 Summary This case study shows how Toyota's brand, RAV4, re-established its credentials in the SUV category to rejuvenate the declining brand in the Australian automotive industry. • The challenge was to reclaim RAV4's youth credentials and re-invigorate its position in the category. • Research showed Toyota that the compact SUV segment was under threat from a subcompact segment, now the fifth most popular segment in Australia, which was having a devastating impact on RAV4 and the compact SUV category, inspiring a need for change. • Toyota relaunched RAV4 with the 'Anything Goes' advert, which was shared across TV, out of home, sponsorships, dealership and digital and captured the essence of the strategy: live in the moment, grab opportunities, balance pressure and routine with spontaneity. • The campaign achieved sales of greater than 7,100 over the campaign period and a rise in market share from 9 to 10.5%. The Situation When it launched in 1994, RAV4 was a trailblazer. It single-handedly created the exciting new compact SUV segment, establishing itself as an icon for the young. RAV4 liberated them to enjoy an active lifestyle in a vehicle that was born to break the rules, entering an automotive market dominated by 'boring' family sedans, 'bulbous people movers', and big expensive, 'grown up' 4x4s. In contrast, RAV4 presented as an entirely new offer, catering to young adventure seekers with a budget. It was sporty, stylish and compact with a youthful, fun and carefree attitude. All up, the RAV4 was 'a fun-in-the-sun kind of vehicle' that was quite literally driving itself out the door. Fast forward 20 years and the brand was the best-selling Australian SUV of all time, with 260,000 vehicles sold, but had become 'positively staid', caught in the category conventions of the now cluttered 4WD category. As a consequence, despite leading the category for so long, RAV4 was suffering an identity crisis. Over time it had lost its challenger spirit, and as leading brands are wont to do, settled into a comfortable 'middle ground'. It was a brand with a past rather than a future - illdefined and in the mind of consumers unchanged from decades earlier. After two years of consistent decline in desirability, and the loss of market share for five years straight, RAV4 was now a brand in long term decline. Compounding this situation, the compact SUV segment itself was under real competitive threat from a 'cool new kid' on the block. In 2015, the smaller and zippier sub-compact segment hit the big time, However, what happened was a modest update to the taillights, headlights and a streamlined frontend. This was not going to be the circuit breaking product news needed to resurrect the fortunes of the brand. The challenge was clear. Toyota needed to reclaim RAV4's youth credentials, reinvigorating its position in the category, and hold the line against a rampaging subcompact segment. It meant developing a communications platform that would drive desirability, win back hearts and minds, drive perceived value for money and, ultimately, convert indifference to desirability, consideration, and sales. Aims: • Toyota needed to aggressively defend what remained of the existing loyal customer base, whilst at the same time growing with a new generation of younger recruits and the 'fresh green shoots' of a sustainable future. They needed to maintain year on year sales, which in turn meant generating a market share increase in a declining segment. • Three key measures are crucial in the compact SUV segment: 'Style', 'Exciting Car' and 'Value for Money'. Toyota needed to directly address the three years of decline in those measures. Research Insights Research conducted among recent purchasers of both compact and sub compact SUVs revealed the formerly youthful compact SUV segment had grown with it's audience and was now engaged in a tussle for a more mature audience – young families. This was an audience that was happy to consider a whole range of vehicle types and categories and had a very different set of expectations from the young adventurers Toyota had previously attracted. In targeting families, RAV4 and the compact SUV category had deserted the core audience and allowed sub-compacts to occupy that now vacant heartland. RAV4 was born by tapping into the 'freedom aspirations' of 18-30 year olds who were having fun and raising hell, but over time, the exciting, free vibe of yesteryear had given way to a functional focus on safety, value, and practicality. No compact brand had embraced this positioning more fully than RAV4, whose advertising positioned was 'A Great Place to Raise a Family'. This recognised the fact that RAV4's drivers, who were notoriously loyal, had grown older with the brand. It showed up in the statistics - more RAV4 drivers "were buying because of past experience" than any other brand (27%). RAV4 was doing nothing to bring in new, younger drivers. Rather than continue to re-establish relevance with younger drivers, it was talking to families - who, based on the statistics, were already driving RAV4, and would remain loyal anyway! So, whilst the brief from Toyota reasserted the target audience to be 'Young Families' it was clear that this reinforced the short term tactical sales requirement but would not address the more fundamental long term strategic brand and business problem. Challenging the brief, Toyota argued real growth could only be achieved by re-establishing relevance with the "Young, free, and adventurous" (SINKS and DINKS) in the knowledge that the family audience would largely remain loyal to the brand. In doing so Toyota reopened the opportunity to talk to a new, youthful audience. Toyota realised the best-selling SUV in Australian history had become a victim of its own success. With 260,000 vehicles on the road, a maximum of 30,000 of those were new generation. The impact of RAV4’s ubiquity meant consumers residual impressions of the car were firmly locked in the past. RAV4’s success was masking the major leaps forward in style and technology (the main driver behind VFM perception) that the vehicle had made over years. This presented a major issue in a category predominantly driven by style and value for money. To force re-appraisal of product, resetting perceptions of style and value for money, our strategy was to launch the campaign with style - literally putting the RAV4 'metal' front and centre. Then, highlight the major leaps forward in technology to stop people rejecting for value. A new rally cry for a new audience With a new targeting strategy, Toyota needed a new organising idea. Whilst their first instinct was reinvention, research showed that the brand’s heritage still had the potential to fuel desirability to the young, free, and adventurous today. The trick was to return to the origins of the brand and understand what had ignited its initial success - and then make that relevant to 2016. An insight into what the RAV4 of 20 years ago stood for lies in the brand name itself: Recreational Active Vehicle (4x4). Thanks to its dynamic versatility, the RAV4 was a totally new type of vehicle that was ready for any kind of recreational activity. When it launched it completely redefined recreation for young people looking for a vehicle they could truly "own". Whilst previously they were forced to choose between on and off-road alternatives the RAV4 opened a whole new world of recreation that was not reliant upon terrain. RAV4 had redefined recreation in 1994 by challenging the restraints of landscape and convention. The historic campaign catalogue was testament to this; with campaigns like 'Camels' and 'Bad Things Happen Indoors', the advertising had introduced them to a brand that was unconventional, young, and free spirited. It was clear that to win back the hearts and minds of our new audience RAV4 needed to redefine recreation for a new generation. Redefining recreation The truth was, the "Young, free, and adventurous", were on the threshold of losing the final vestiges of freedom as marriage and/or children beckoned. There was every indication they were delaying major milestones to hold onto that freedom. They were having children later, buying homes later or not at all, and all the while they were working longer hours and worrying more about the future. Despite the impetus to make the most of their "best years", it was a challenge for them to take full advantage of what little time they had. They were trapped in a cult of busyness that reduced their ability to enjoy recreational activities. They weren't taking all their annual leave, only 8% of them "found their weekends exciting", and 45% of them described their lives as "busy almost all of the time". Increasingly they saw recreation as something that needed to be planned and scheduled. Toyota knew this had the potential to be a powerrful emotional 'tension' RAV could address in communications. Recapturing the Toyota feeling For as long as anyone can remember the Toyota brand has run the line "Oh, What A Feeling!". It captures the sheer pride and joy of driving a high quality and highly versatile vehicle. By 2015 that equity was beginning to lapse. The Toyota masterbrand had become increasingly rational in its promise as a fragmented and competitive market leveraged new technology and innovation. Toyota saw an opportunity to recapture the "feeling" and use it as a way of emotionally reconnecting with their audience. After all, as one helpful research respondent helped identify, "Recreation is as much a feeling as it is an activity". Toyota wanted their target to get a real sense of the positive, exuberant and energised feeling that stems from doing things for the sheer enjoyment of the moment. Toyota identified a role for RAV4 as the brand that celebrated spontaneity; that encouraged the audience to grab recreational opportunities where and when they could, and live in the moment. They would reposition 'recreation' as a feeling that needed to be celebrated and enjoyed in the moment - because in a busy world, anything goes. The creative idea RAV4 enables you to feed your urge for Spontaneous Recreation - no matter when it hits and no matter what shape or form it comes in. Set to the iconic "Anything Goes" Cole Porter classic, RAV4 was relaunched with a fresh perspective on what recreation meant in 2015/16. The creative solution was a celebration of moments of freedom and spontaneity when the everyday pressures are left behind. The upbeat track injected renewed energy into the brand and reinforced its position as a "modern classic". It was the perfect, ridiculously catchy anthem and rallying cry for the next generation of RAV4 drivers. "Anything Goes" captured the essence of the strategy; live in the moment, grab opportunities, balance pressure and routine with spontaneity. In bringing the idea to life, Toyota created a bespoke communications approach that both challenged perceptions of the product and repositioned the brand as exciting and stylish. This required more than just matching luggage throughout channels. The meeting point between creative/media strategy delivered multiple experiences that met the brand objectives and moved consumers along a path from reappraisal of "style" to excitement about the brand, to positive perceptions regarding value and finally through to consideration and purchase. To force style reappraisal, the 'metal' had to be front and centre - seeing is believing, after all. The first phase of the campaign was all about showing the vehicle at its "new look" best. TV and OOH were used, offering the broadest reach and highest impact. This would help force people to take a proper look at RAV4 style again. This was followed by a fully integrated campaign to excite people about the RAV4 brand. The anthemic "Anything Goes" creative ran across TV, OOH, and digital. It celebrated the feeling of freedom and spontaneity that the 'Young, free, and adventurous' found so compelling as the onset of more responsibility and greater constraint beckoned; embracing the 'Anything Goes' attitude to recreation. Lastly, with more people rejecting RAV4 on 'value for money' than any other brand, To needed to create a sense of real brand value. From research, Toyota knew that the number of dealership visits on the path to purchase has dropped from 5 to 1.6 in the last decade. This was depriving dealers of a key opportunity to 'sell' the car. Toyota developed 5 fun cover versions of "Anything Goes", providing clear information disguised as entertainment used to retarget prospects online, demonstrating the RAV4 features and benefits essential for the spontaneous 'Anything Goes' lifestyle. In this way, Toyota was able to demonstrate further evidence of value for money, and help drive conversion. Success Measures 1. Achieve sales of greater than 7,100 over the campaign period a. Achieved: In a market that declined 18% year on year during the campaign period, private sales increased 3.6% to 7,446 , and broke its record for private sales in June. 2. Increase market share from 9 to 10.5% a. Achieved: private market share peaked at 12%, an increase of 33%, and averaged 11% over the campaign. While not an objective set up front, the content significantly outperformed industry benchmarks for clickthrough (1.17%, 290% above industry norm) and view through (55 seconds, 57% above industry norm). Questions: Ques 1: Identify and discuss the main macro-environmental forces at play in this case study and how these may be addressed with the strengths and weaknesses of the RAV4? Ques 2: What is the product lifecycle? Explain where you believe the Toyota Rav 4 is on the product lifecycle stage in Australia and identify what would be a relevant marketing mix for the product at that stage. Ques 3: What is market segmentation and why is target marketing important? Describe a person who has the characteristics of the target market for this campaign. How in your opinion might the older loyal customers of RAV4 respond to the new positioning campaign? Ques 4: Explain the consumer-decision making process and what would be the key factors influencing a purchase in this product category. Provide recommendations for Toyota at each stage of the decision-making process..