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Toyota Motors Analysis


Several key factors are influencing the strategy and operations of Toyota Motors. These are demographics, culture, socio-economic environment, and consumer attitudes. According to the International Monetary Fund, the Japanese population’s median age is slightly over 48 (Japan, 2020). It means that Japan is the country with the oldest population globally. The International Monetary Fund also notes that over the next forty years, “…Japan’s current population of 127 million will shrink by over a quarter” (Japan, 2020, para. 1). Toyota Motors offers its vehicles to all age groups over 18 years old.

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Young adults prefer the Toyota Supra and Toyota Celica, while older people buy Toyota Allion and Toyota Premio (Islam et al., 2011). Here one may notice age-related consumer preferences. The company primarily targets consumers of the third generation, those with families and significant finances, by offering them cars, which are family-focused but more expensive.

Toyota Motors and Education and Income in Japan

Socio-economic influencing factors include levels and distribution of education and income. Japan is one of the best providers of quality education for both low-income and wealthy students. Semuels (2017) notes that “the OECD estimates that in Japan only about 9 percent of the variation in student performance is explained by students’ socioeconomic backgrounds” (para. 2). It is noteworthy that Japan’s high school graduation rate is slightly under 97% (Semuels, 2017). On the contrary, the situation with income distribution in Japan is not so positive. At the time of 2014-to 2017, Japanese society was on the verge of income inequality (Kyodo, 2017).

Nowadays, this negative trend is in decline. According to Statista Research Department (2020), “Japanese households had an average annual income of approximately 5.17 million Japanese yen in 2019” (para. 1). It is equal to US $ 49,000. Toyota Motors has differentiated products by class and developed particular price policies to cover all society’s strata (Islam et al., 2011). The categorization system is built on the automobiles market price.

Toyota Motors and Religion in Japan

The two prevailing religions in Japan are Shinto and Buddhism. One aspect of Shinto is the sanctity of nature shrines and people and nature’s unity (Shinto, n.d.). In Buddhism, one of the core principles is the interconnection of all objects in the world and no harm (Buddhism, n.d.). These religions’ attitudes to nature manifested themselves in the country’s domestic policy. The Japanese government decided to replace all new gasoline cars with electric ones by the middle of the next decade (Davis, 2020). Toyota Motors is addressing traditional pro-ecological trends with hybrid vehicles.

Toyota Motors and Level of Consumerism in Japan

The level of consumerism in Japan is the same as in other high-income countries, but with some regional differences. Research shows that both third-generation Japanese and millennials prefer quality consumption over mass consumption (Japan: Reaching the consumer, 2021). It is essential to note that millennials are more inclined to choose low-price products due to the slowdown in economic development that started in the 90s.

Nevertheless, they still demand high-quality standards and services from producers just like their predecessors (Japan: Reaching the consumer, 2021). Moreover, Japanese consumers are extremely loyal to brands they like (Japan: Reaching the consumer, 2021). It is reflected in Toyota Motors’ strategy as loyal customers occupy a special place in the company’s consumer segmentation (Islam et al., 2011). Toyota Motors has developed a specific organizational culture to address social challenges and meet consumer demands effectively. It comes from the Japanese’s traditional values, namely continuous self-improvement, teamwork, and mutual respect (Workman, 2020). It is what has ensured almost a century-old company’s success.

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Buddhism. (n.d.). Yale School of the Environment. Web.

Davis, R. (2020). Japan plans phase-out of new gasoline cars by mid-2030s. Bloomberg Green. Web.

Islam et al. (2011). Toyota market segmentation, targeting and positioning. DocShare. Web.

Japan: Demographic shift opens door to reforms. (2020). International Monetary Fund. Web.

Japan: Reaching the consumer. (2021). Santander Trade. Web.

Kyodo. (2019). Japan’s household income gap down slightly but remains near record level, 2017 survey finds. The Japan Times. Web.

Semuels, A. (2017). Japan might be what equality in education looks like. The Atlantic. Web.

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Shinto. (n.d.). Yale School of the Environment. Web.

Statista Research Department. (2020). Average annual income of households in Japan from 2010 to 2019. Statista. Web.

Workman, J. (2020). How adopting ‘Toyota culture’ can help a company improve faster than its competition. Printing Impressions. Web.

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