Company/Brand Information
Suzuki is a Japanese Motor Company that began operating in 1909. Michio Suzuki founded the multinational company at the age of 22 after constructing a pedal-driven loom for the silk industry. The company has been famous for its motorcycles, but has also entered the automobiles’ field. After the 1950 financial crisis that resulted in labor difficulties, the company entered the motor vehicle field; it launched the Power Free 36cc, 2-cylce motorized bicycle in 1952 and Diamond Free 600cc in 1953.
Suzuki Motor Company joined the US market in 1964; it exported and distributed over 6,000 Suzuki motorcycles. With the manufacturing of technologically advanced touring motorcycles, the company has been able to meet the needs of the wealthy class in the US market. The Hispanic population in the United Sates remains the largest minority population having a percentage of 17% of the national population as of July 2012 (Humphreys, 2012).
Just like other companies, Suzuki Motorcycle also felt the effects of the 2008/2009 global financial meltdown. The motor industry has come up with new models of motorcycles, and has laid strong marketing strategies to reach the Hispanic population in the US. In order to ensure close follow-up within the US, the multinational automotive company had set up the American headquarters in California. The state of California is projected to have more Hispanics than whites by March 2014.
The American headquarter, therefore, is a strategic point for the company to engage the Hispanic population. The media plan outlines how the motor company intends to maneuver in the current dynamic market and outshine its competitors like Honda, Kawasaki, Yamaha, and Harley Davidson in marketing its motorcycle brands to the Hispanic population in the US.
The aftermath of the Second World War saw the company begin to manufacture bicycle engines to aid in transporting products to different location; the new mode of transport in the country was affordable. Suzuki mostly targeted the middle-income civilians who needed small, comfortable, and cost effective locomotives.
In 2011, Suzuki assumed the 10th position among multinationals dealing in the manufacture, assembly, and sale of automobiles. In 2013, Japan Automobile Manufacturers Association (JAMA) rated Suzuki, as the country’s second greatest producer and distributor of automobiles (Global Suzuki, n.d.). Suzuki’s ownership is a family affair considering that its current Chief Executive Officer is Osamu Suzuki.
Marketing Mix
(4P’s) – Products
Suzuki motorcycles have been common for two uses: sporting and commuting. The sport/sport touring segment in the United States has different motorcycles brands, such as TU250X, GS500F, GSR750, INAZUMA 250, and GLADIUS. Suzuki Inazuma 250 is fuel-efficient and is capable of close to 85 mpg; the model has wide range of genuine accessories and has a semi-double cradle frame with the 248cc engine.
(Global Suzuki, n.d.)
In the commuting segment, there is the Suzuki SFV650. The bike has a seat height slightly less than 31 inches. SFV650 has an extremely accessible size, and provides plenty of confidence to those who prefer low-speed driving. Users of SFV650 agree that the bike is smooth and has an energetic commuter since it has a smooth handling.
There is also the 2010 Suzuki DR650; this bike is available in the US market. This model has the ability to move in ragged regions and other potentials that other models lack. It has the ability to maneuver through rocky areas, as it uses limited fuel and can access both urban and suburban areas.
In targeting the Hispanic population in the US, the company will have to manufacture affordable products so that they target market can purchase. There are also Suzuki Cruisers, Suzuki Dirt Bikes, Suzuki ATVs, and Suzuki Scooters. Suzuki Hayabusa gained entry into the market in 1999, and is the fastest sport-bike model of the Suzuki Company.
This sport-bike has a speed of 186mph, and in 10 seconds, it can accelerate within a quarter mile. This model was meant to compete the Kawasaki Ninja ZX-12, currently referred to as ZX-14 and the outdated Honda CBR1100XX Blackbird.
(Global Suzuki, n.d.)
Place
The company has its global headquarter in Minamu-ku, Hamamatsu, Shizuoka, Japan; it also has another headquarter in Brea, California. The two headquarters realize high sales, offer good services to their customers, and coordinates the sales of all Suzuki motorcycles in the globe.
With its entry into over 190 nations, the motor company has been the main distributor of the products. Apart from the American Suzuki Cooperation, there is Pakistani Suzuki Company Limited and Suzuki Canada Inc. In the US, Suzuki operates in many states targeting the people of color. The company must take into concern the activities of other competitors in the market. The company enjoys large presence in Europe and the US.
Price
Suzuki motorcycle models are comparatively cheaper than the Honda, Yamaha, and Harley-Davidson models. The Inazuma 250 ranges between $3,900 and $4, 990. This makes Suzuki motorcycles the fourth most expensive brands in the US market, which the media plan targets the Hispanic population.
Promotions
The company reaches its customers and others through many modes of advertisements. The company relies heavily on internet and network TV to reach the consumers. In the US, the use of internet-enabled gadgets will make it possible for Suzuki to remain in touch with the Hispanic population.
In the print media, there are motorcycle magazines, entertainment magazines, sport magazines, men magazines, and other outdoor cycle magazines like cycle guides. After reviewing their best selling model, Hayate, the company invested 6 – 8% of the total turnover in promotions in 2013 (Global Suzuki, n.d.).
Suzuki has been supporting sporting activities since the 90’s. This provides it with the requisite exposure for brand positioning of its products. In addition, it posts advertisements around stadia during sporting events. The company advertises on newspapers and television stations across the globe as well.
Its most successful advert increased the purchase of Suzuki Hayate (Global Suzuki, n.d.). In other occasions, different sponsors often support events organized by Suzuki. Suzuki equally uses social media to reach out to audiences on Facebook, Twitter, and LinkedIn among other avenues. Just like the cars’ slogan “Small Cars for a Big Future,” the motorcycle company has focused on the American market with honest, realistic, and inspired advertisement tone about their products.
Industry Information
According to Kochhar, Fry, and Taylor (2013), there is stiff competition in the motorcycle industry. An analysis on the sales from 1992 to 2012 shows the growth in sales up to 2008/2009.
The decline was due to the economic recession. An approximate 450,000 motorcycles were sold in 2010. Suzuki belongs to the manufacturing industry. It deals in the design, assembly, and marketing of automobiles in its 23 subsidiaries across the world (Global Suzuki, n.d.). Many external factors influencing sales in the automobile sector include politics, economics, technology, and competitor information.
Politics
A stable political platform provides an opportunity for companies to thrive. Politics influence relations between countries and citizens. This influences the exchange rates of currencies in the targeted countries. Latin America has an unstable political ground. Investors in these countries need to develop risk measurement policies in their media plans in order to develop solutions to business stability even when wars occur.
Economics
In the past three years, Suzuki engaged in extensive financial training of individuals in the US. The company realized that financial illiteracy makes it difficult for consumers to make wise decisions before purchasing products or services. This will help Suzuki in attracting several Hispanics who will have interest in Suzuki stocks due to its speed.
However, other financial factors such as inflation are beyond the control of Suzuki, Honda, Kawasaki, and Yamaha among other players in the market. When recession occurs, it increases the cost of importing used Japanese motorcycles, and new ones; this would increase the price of the imported products, which could interfere with sales.
Technology
Product development at Suzuki requires sufficient technological input. Technology assists in research, marketing, online banking, and other cost effective activities. Suzuki needs to venture into a market that understands technology properly. It should have an advanced technological community that would carry out online transactions for shipment purposes. Business trends shifted towards online support systems in the 20th century (Katz, 1995), and Suzuki needs to ensure that the Latin market understands these concepts properly.
Competitors’ Information
The Suzuki motorcycles are facing stiff competition from Harley Davidson, Honda, Yamaha, and Kawasaki. In terms of market-share in the US, Suzuki ranks 5th after the listed motorcycle companies.
(Suzuki Motorcycles, n.d.)
(Suzuki Motorcycles, n.d.)
External Information
With the Suzuki media plan targeting the Hispanic population in the US, the report analyzes the Hispanic economical, political, social, and cultural trends. These parameters and trends affect the sales of motorcycles among the targeted population. Even though the Hispanic population is expected to surpass that of whites, their economic status is far much behind the rest of the nation. Household income, home ownership, and managerial occupations are some of the key indicators of economic status.
According to the Pew Research Center analysis, the median wealth of Hispanic Households is 1/18 time that of white households (Humphreys, 2012). The median wealth table below shows the wealth ratios of the Hispanic population to the whites and whites to blacks. From the table, 2009 is the year that white-to-Hispanic ratio was much higher compared to other years since 1984.
By 2012, there were approximately 48 million Hispanics in the US. A study on the effects of the 2001/2002 recession indicated that Hispanics were hard hit. Averagely, the Hispanic population has a per capita income of about one third to that of whites. Despite the negative aspects of the recession, Hispanics’ buying-power continues to revitalize the consumer market.
There has been a constant rise in their economic clouts since 1990. This makes it a good target for the Suzuki Motorcycle products. Between 2002 and 2007, for instance, Hispanic companies almost quadrupled the non-Hispanic companies by growing by 45% implying that they are experiencing increase in wealth ownership.
Similarly, the Hispanic population lags behind in acquiring high school education and other educational attainments. Even though the targeted population is below the Native Americans in educational achievement, there has been an upward mobility in the number of those acquiring high school diplomas and bachelor degrees in recent years. Hispanics in the job market between 2000 and 2012 increased by 38%, representing nearly 6 million people (Humphreys, 2012).
Since the American population has people of different culture, per capita income, demographics, and wealth, it is evident that the nature of Hispanic spending is not similar to that of the inhabitants. Hispanics families use-up less money on new automobiles, entertainment, and healthcare than the non-Hispanics population in the United States.
From the cultural dimension, there has been a continuous progression of Baby Boomers among the Hispanic population; they have turned on motorcycles to recapture the youths. This has been evident with the increase in the number of accidents and reduction in motorcycle ownership.
In 1993, 1 in 10 people owned a motorcycle, while in 2003 the rate reduced to 1 in about 4 (Suzuki Motorcycles, n.d.). In order to minimize the rampant deaths emanating from motorcycles, there is need to enforce stringent laws to end fatal crashes. The Suzuki Company can also set-up motorcycle riding schools across the US to attract more Hispanics, thus reducing the number of deaths resulting from careless riding.
The US has a favorable political environment that supports business activities. Politics determine the inter-boundary relations between states. It also determines the relationship between a government and the citizens. Moreover, it exists in the relationship between rivals in a target market. When Suzuki invests in the US, it should assess the growth potential in the states by reviewing profiles of other competitors.
There is a possibility that the progress of competitors such as Yamaha in the US could equally apply to Suzuki’s progress in the same place. According to Katz (1995), a politically stable country negotiates monetary exchange rates reasonably. It saves resources for public gain; this reduces the cost of taxation. Most states have unstable political grounds, which adversely affect businesses. Inflation influences major decisions in this industry.
Following the 2009 to 2011 worldwide recession, companies developed media plans that had financial risk management measures. Inflation also influences exchange rates between countries. Considering it is an external factor, Suzuki cannot control it. Instead, it needs to develop a good strategic plan that will help it manage the unpredictable economic terrain in Latin America. Other economic factors that Suzuki needs to assess include the number of major and minor competitors in the target market.
This will enable it establish showrooms in the most receptive states in the US. Product development at Suzuki requires sufficient technological input. Technology assists in research, marketing, online banking, and other cost effective activities. Suzuki needs to venture into a market that understands technology properly.
It should have an advanced technological community that would carry out online transactions for shipment purposes. Business trends shifted towards online support systems in the 20th century (Katz, 1995), and Suzuki needs to ensure that the Latin market understands these concepts properly.
Current Users
After introducing TU250X, GS500F, GSR750, INAZUMA 250, Suzuki Scooters, Suzuki Hayabusa, and GLADIUS to the African and Indian markets, it was evident that the car suited middle-income earners who sought to reduce traffic and fuel consumption. A similar case applies to Latin America. Users of Suzuki motorcycles compliment its speed and ability to access various terrains (Global Suzuki, n.d.).
In India and Africa, people use various models in both urban and suburban regions for commuting, racing, and fun events. The fact that it reduces congestion of public vehicles promotes its convenience to the suburban areas. People from such regions constantly seek markets in urban regions while acquiring resources from the rural areas. They choose these Suzuki models since it maneuvers through different terrains.
The Suzuki motorcycles have many traits including affordability, which is a principal factor to consider. India and Africa have huge populations of low and medium-income earners (Global Suzuki, n.d.). They have huge differences between the rich and the poor. This contributes to high poverty levels making it possible for people to acquire the basics only. Following the introduction of varied motorcycles in this market, people displayed interest in ownership of motorcycles for commercial purposes.
Indians and Africans like Suzuki motorcycles because of their low fuel consumption rate. A capacity of 60cc enables an individual to drive the commuter model for almost two weeks without refueling. This encourages most people to own such models. Further, its maintenance is easy because of locally available spare-parts in various markets. Suzuki Hayabusa and Hayeta provide services for light-users because of its size.
However, it does not damage easily; this reduces the cost of maintenance (Global Suzuki, n.d.). Among those who plan to buy or lease a motorcycle in the next 12 months, the age group of 18-24 and 23-34 showed great potential, they have indexes of 180 and 123 (Kochhar, Fry, & Taylor, 2013).
Within the group who shows interest to buy or rent motorcycles, most of them have a relatively high income, for example, those who have an average income from $70,000 to $104,999 has the highest share. In summary, demographics and psychographics of audiences in India, Africa, and the US are close. They share related political and socio-economic challenges, and this shapes their mindset.
The same applies to audiences who choose other motorcycle brands from Suzuki, Kawasaki, Honda, Harley-Davidson, and Yamaha. The increase in the number of educated Hispanics increases the income levels. This has made it possible for such families to own motorcycles. The Suzuki Motorcycle firm has to put up relevant marketing strategies to hold the Hispanic population even with the stiff competition for the competitors.
References
Global Suzuki. (n.d.). Web.
Humphreys, J. (2012). Economy: Hispanic Economic Clout. Web.
Katz, H. E. (1995). The media handbook. Lincolnwood, Ill., USA: NTC Business Books.
Kochhar, R., Fry, R., & Taylor, P. (2013). Wealth Gaps Rise to Record Highs Between Whites, Blacks, Hispanics. Web.
Suzuki Motorcycles. (n.d.). Web.