Case Study: Toyota’s RAV4
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Case Study: Toyota’s RAV4


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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.


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? 

The major macro-environmental factors that are discussed in this case study are as follows:

Demographics – This relates to the people who are targeted for RAV4 such as age, gender, occupation and other statistics. They are crucial for the product as their needs define the business and act as drivers for market development.  This offers both opportunities and challenges for Toyota. With rapid population growth, there is a shift in demographics. The RAV4 was targeted at younger population in the age group of 18-30 years. As years progressed, these target customers have become aged whose main intention is to settle in their lives rather than focusing on recreation. RAV4's strength is its brand loyalty which would encourage its aging existing target market to purchase the same product. However, RAV4 has to redefine its marketing campaign to attract new young customers through its image as a recreation vehicle showcasing freedom and spontaneity.


Competitive Environment – This is created by the competitors who offer similar products to the same target customers. RAV4 had positioned itself in the compact SUV market.  It is facing stiff competition from the sub-compact segment as it is gaining popularity in Australia. This segment offers stylish models of imported vehicles such as Mazda and Mitsubishi which has attracted the younger generation who prefer style, speed and freedom. This has severely impacted the sales of RAV4. To overcome this RAV4 has to rebuild its brand by enhancing customer perception as an adventurous vehicle for everyday use.

Socio-cultural Factors – The social values and beliefs of the RAV4's existing customers has changed as they become aged. Their focus is mainly on safety, value, and practicality. The main issue was the past success of RAV4 which has masked the improvements in its style and technology front. Toyota has to reappraise its RAV4 to reset perceptions about it and focus on advancements in the vehicle to showcase the value addition.

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