Marketing: Custom Edition for Texas A&M University 17th Edition by William Pride,Ferrell

Exercise 32

Toyota Uses Advertising to Restore Trust
For decades, Toyota set the standard for quality and reliability. Known worldwide for its commitment to quality production, Toyota created the "Toyota Way," a manufacturing philosophy that emphasized continuous progress and reduced waste. Thanks to the success of the Toyota Way, Toyota became the top automobile manufacturer in the world in 2008.
However, Toyota hit a major snag that caused stakeholders to question its quality. In 2009 and 2010, the company issued a series of recalls on several of its popular models because of safety problems with accelerators, brakes, and power steering. Following the announcement of the recalls, Toyota engineers and mechanics began to search for solutions to the problems and started the process of repairing millions of cars. Many critics accused the company of acting too slowly to recall the defective cars and of trying to push the problem under the rug.
Toyota was fined $16.4 million for allegedly hiding safety defects from consumers. This came after its reputation was already tarnished by a seemingly endless number of recalls on various car models. The company became the target for late-night television jokes and seemed to constantly be in the news regarding yet another recall. This negative publicity damaged the reputation and goodwill that Toyota had developed over many years.
In the wake of massive recalls, Toyota had to adjust its advertising strategy. The world's largest carmaker pulled its national advertising campaign that promoted its cars for dependability, safety, and reliability. Toyota, which had long been the leader in automotive quality, had to scramble to figure out how to handle a growing public relations crisis resulting from recalls and a halt in sales. A series of ads were developed to deal directly with the crisis and admit that the company had strayed from keeping its eye on quality while its sales had been growing rapidly. A number of low-key ads dealt directly with the issue and promised to regain consumers' trust. Toyota also took out full-page ads in major newspapers and produced feel-good television spots featuring dealers, mechanics, and owners. The company offered no-interest loans, discount leases, and a complementary two-year maintenance program to get buyers back.
Although the situation looked dim for Toyota, a later revelation changed everything. In 2011, Toyota achieved a victory when the National Highway Traffic Safety Administration ruled that most of the accidents were caused by driver error, not mechanical problems. This cleared Toyota from several of the accusations levied against the company by media outlets and irate stakeholders. Yet the combination of the recall crisis and the natural disasters that hit Japan greatly damaged Toyota's sales, and General Motors surpassed Toyota as the world's top auto manufacturer.
However, signs now indicate that Toyota is on the rebound. The Toyota Camry and Toyota Corolla are some of the best-selling cars in the United States, and the Toyota Prius remains one of the most popular hybrids. Additionally, Toyota is still the brand of choice for many segments of the population. For instance, American minorities buy more vehicles from Toyota than any other carmaker. One reason is the fact that Toyota has become an expert at targeting advertisements to minority populations. For example, when Toyota became concerned that few African Americans were purchasing its hybrids, the company released a commercial featuring an African American couple deciding that a Toyota hybrid was the best vehicle for them. Sales of the Toyota Prius nearly doubled among African American buyers after the ad ran.
After a three-year hiatus, Toyota also began to advertise in the Super Bowl. During the 2012 Super Bowl game, Toyota released a series of ads depicting the quality and luxury of Toyota vehicles. Whereas one ad contained more of a feel-good quality and featured Toyota factory workers at different stages of the production process, another advertisement targeting first-time Millennial car buyers tried to make purchasing a Toyota vehicle into a "game" by using backdrops from Hasbro's Life board game. Although they had the same objective-promote Toyota vehicles-these different advertising messages were tailored to target specific parts of the American population.
Toyota's advertising push signals a strong message to its competitors: Toyota is fighting to regain its global dominance. Although the automaker may have more hard work ahead before it can re-obtain its high-quality status, the company appears to be well on its way to rebuilding its reputation.
How is Toyota using advertising to overcome negative publicity associated with a product quality issue?