Toyota Alters Advertising to Attract Younger Buyers
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Toyota Motor Corp., with the oldest average American customer among big Asian car brands, is beginning a series of commercials featuring young buyers in an effort to boost market share by raising sales to drivers under age 40.
New commercials using the slogan “moving forward” promote the Camry sedan to buyers younger than the 40- to 58-year-olds, known as baby boomers, who purchase most Toyota products, said Toyota’s marketing communications manager, Deborah Meyer.
Toyota, the world’s second-biggest carmaker, raised its American market share 1 percentage point in the first eight months of the year to 12.2%,trimming the gap with General Motors Corp., the largest automaker, and Ford Motor Co. with new car and truck models. To speed those gains, Toyota is targeting buyers in their 20s and 30s, along with its typical buyer who is now 50, according to J.D. Powers & Associates’ data.
“Toyota understands that the baby boomers are the whole company right now,” said John Wolkonowicz, a forecaster at Lexington, Mass.-based Global Insight Inc. who studies demographic trends. “They know this is not a good situation.”
The average age of an American new car buyer in the 2004 model year is 50, the same as for Toyota, based on a J.D. Power survey of more than 50,000 buyers. Honda Motor Co. and Nissan Motor Co. each had customers with an average age of 48,according to the Westlake Village, Calif.-based J.D. Power, an industry consultant.
The Toyota City, Japan-based auto company boosted sales as the 76 mil lion shoppers defined as baby boomers, buyers of inexpensive Toyota cars a generation ago, traded up to more expensive sedans and sport-utility vehicles that are the core of its business, Ms. Meyer said.
Toyota’s market share gain from 9.3% in 2000 has been led by sales of higher-priced SUVs and pickup models. Market share for American brands of Ford, General Motors, and Daimler-Chrysler AG’s Chrysler slipped to 58.8% from 65.6% in the same time period.
Several new commercials seek to link the Camry, the top-selling American passenger car in six of the past seven years, with young drivers in situations early in their lives, such as leaving home for a new job and meeting future in-laws.
Camry and other midsize sedans draw buyers in their mid-50s, according to J.D. Power data. The new commercials are unlikely to alter the Camry buying trend, said Daniel Gorrell, vice president of San Diego-based Strategic Vision, which analyzes consumer preferences for automakers.
“There’s going to be a bit of disconnect without a new vehicle, since they’re promoting the current Camry,” Mr. Gorrell said. “You can always get the older buyer into the young person’s car. The reverse isn’t true.”
Toyota expects spending on advertising to rise “in-line with its sales growth,” said the American marketing head for the Toyota brand, Jim Lentz, at a press conference. He declined to discuss the automaker’s budget for ad spending.
Toyota plans to start ads in November for a new version of its Tacoma pick up, emphasizing “toughness” with a new truck logo of a bolt-shaped “T” on a metal plate, Mr. Lentz said.
Kurt Ritter, a former General Motors marketing executive who developed the “Like a Rock” slogan for Chevrolet pickup trucks, was hired as a consultant to help Publicis Groupe’s Saatchi & Saatchi agency advertise Toyota vehicles.
The advertising, along with models sold under the Scion brand aimed at young buyers, show Toyota wants to win those shoppers, Global Insight’s Mr. Wolkonowicz said. Scion, which went on sale this year, has an average customer who is 43 years old, J.D. Power said.
“Toyota’s average age is rising one year, each year, which means they aren’t attracting enough younger buyers,” Mr. Wolkonowicz said. “They’re attacking it on multiple fronts.”
Toyota spent about $1.01 billion on advertising last year, a 7.8% rise from the previous year. Toyota was the 10th biggest American advertiser, according to TNS Media Intelligence/CMR, which tracks spending.
General Motors, the second-largest American advertiser at $2.49 billion last year, plans to raise spending 30% through the rest of this year to support models such as the Chevy Cobalt sedan and new minivans for Saturn, Buick, and other brands, North American marketing chief Mark LaNeve said September 13.
Procter & Gamble Co. was the biggest advertiser last year.
Toyota’s shares fell 28 cents to $73.78 in New York Stock Exchange composite trading yesterday.