Proton Exora: Marketing Strategy

📄 Words:	2572
📝 Subject:	Marketing Strategy
📑 Pages:	10
✍️ Type:	Essay

Executive summary

The marketing plan relates to Proton Holding Berhad. The plan illustrates the various strategies to be incorporated in marketing Proton Exora. The situational analysis illustrates the firm’s background, mission and vision statement. It also identifies the management structure of the company and the major shareholders. Its financial performance for the past two years is also analysed. The external environment of the firm is also analysed. This includes the major business associates and the benefit that the firm attains from such a partnership. The major shareholders of the firm are also identified. A SWOT analysis is conducted to illustrate the strengths, weaknesses, opportunities and weaknesses of both the company and Proton Exora.

The PEST analysis is conducted to identify the external environment. This is attained by identifying the political, economic, social and technological factors affecting the company. The marketing objectives are also identified together with the marketing strategy. The marketing strategy entails the firm’s segmentation and positioning strategy. It also includes the marketing mix to be used by identifying marketing variables such as product, price, place and promotion. The cost of promotion is also analysed in a budget by identifying the various methods of promoting Proton Exora. The various activities to be conducted in implementing the strategy are also identified in the implementation plan. Finally, the method of control is also illustrated.

Situational analysis

Proton Holding Berhad is a public limited company with its headquarters located in Shah Alam, Malaysia. According to Proton (Anon., 2009), the founders of the firm include David Dickey and Jason Wahlstadter. The firm was established in 1983 and operates within the automotive industry. It mainly deals with assembling and manufacturing of motor vehicles. The firm is also involved in other activities such as production of motor vehicle related products, contract and consultancy services, and leasing of various assets and equipments. According to Proton’s annual report 2009 (Anon., 2009), the firm also issues diverse after sales services. The firm operates both in the local and foreign market and has a human resource base of 11,500 employees.

Mission statement

The management of Proton Holding Berhad is committed to ensuring that the firm becomes the best automotive manufacturing and engineering company. The firm’s mission is dividend five main components. These include customers, business associates, shareholders, employees and the nation. The table below illustrates the firm’s mission statement according to the above identified core parties.

Customers	Business associates	Shareholders	Employees	Nation
The firm is committed at ensuring that there is high level of customer satisfaction. This is by incorporating the concept of customer focus and offering products and services that are of high quality and competitively priced.	To its business partners, the management is committed at ensuring that it establishes a mutual and beneficial relationship for both parties.	The management is committed at ensuring that it attains the shareholders wealth maximisation objective of the shareholders through efficient utilisation of the firm’s resources.	It is the goal of the management to develop a competitive advantage in terms of human capital. This is through incorporation of human resource development	The management of the firm has the objective of ensuring that the firm contributes towards the achievement of vision 2020. This is by being a good corporate citizen (Laporan, 2004, p.1). .

Vision statement
To expand and strengthen the firm thus becoming the leading multinational firm in the automotive industry.	The management of the firm considers its employees as an important element in attaining its aspirations. It is the objective of the management to improve on the efficiency of the firms operation, become more customer- centric and improve core competencies.

Management of the company

Proton Malaysia has a well established management which consists of various parties. These include the directors, executive committee, risk management and audit committee, remuneration and nomination committee, disciplinary committee, auditors, registered office, and company secretary. According to Proton annual report 2007 (Anon., 2007), the operations of the firm are divided into various divisions. These include engineering, marketing, manufacturing, property, financial division, and associate and investor companies.

The firm has got a number of shareholders. The main shareholders include; Khazanah Nasional Berhad, Petroliam Nasional Berhad, Mitsubishi Motors Corporation, Mitsubishi Corporation, Employee Provident Fund Board. The shareholders also consist of other foreign and local investors. The table below illustrates the percentage of shareholding by the above parties.

Financial performance

The firm has witnessed a good financial performance over the past few years. In 2009, there was an increase in the firm’s sales revenue by a margin of 9% compared to 2008. As a result of increase in the sales revenue, the firm witnessed an increase in profit margin by a margin of 15% compared to 2008.

Business partnership

Proton Holding Berhad collaborates with two main automotive firms in its operation. These include Cherry Jinhua Youngman Automobile Company Group Limited and Automobiles Company Limited. In addition, the firm has also entered into a contract with Alado Corp Sdn Bhd which deals with the distribution of Chery’s automobile products within Malaysia. This contract will ensure that Proton’s products are effectively distributed in China. Through this business partnership, the firm will be able to expand its market size by venturing into the international market.

According to Proton annual report 2009 (Anon., 2009), Proton Holding Berhad has formed business associates with Aluminium Alloy Industries Sdn Bhd in its domestic market. This company supplies Proton Holding Berhad with the best aluminium necessary to manufacture the motor vehicles.

The firm has also formed alliance with Detroit Electric which leads in manufacture of electric cars. The alliance is aimed at producing electric vehicles which are to be rolled out in 2010. In introducing this new technology into the automobile industry, Detroit Electric will use Proton’s vehicles as its platform for testing the electric technology. This will result into increased benefit to Proton’s Holding since the firm will benefit from a high level of research and development. According to the article Detroit Electric and announces strategic partnership to produce affordable and practical pure electric vehicles (Anon., 2009), Proton Holding Berhad will be able to improve on the quality of its automobiles resulting into an increase in customer satisfaction. This will also enable the firm to develop into a good corporate citizen by reducing the amount of carbon emission.

Competitive environment

Ford	Fiat	Daimler	General Motors	PSA Peugeot Citron
Price range	£ (7,095-11,220)	£ 7,090-£ 12,000	£ 8,100-£ 15,980	£ 8,099-£ 12,500
Quality	High	High	High	High
Performance	Good	Good	Good	Good
Features	High level	High level	High level	High level
Durability	Relatively high	Relatively high	Relatively high	Relatively high

SWOT Analysis of Proton Malaysia

Strength	Weaknesses	Opportunity	Threats
The firm has a high level of experience within the automobile industry having been in operation for over 20 years.	Inability to penetrate some markets such as US since the firm’s cars has a negative public image in this market.	High probability of the firm increasing the size of its market size by venturing into foreign direct investment and improving on its public image by increasing customer satisfaction.	Increase in competition from other firm’s from the domestic and foreign market such as, Perodua, Daimler and Fiat resulting into an increase in the number of substitute automobile products. These firms are incorporating high technology in their automobile products (Eileen, 2009, Para. 7).
Good distribution network into the international market through exportation.	High cost involved in research and development.	The firm can improve on the quality its products and services by investing in research and development thus improving its customer satisfaction objective.	Decline in consumer purchasing power due to the current economic recession. The recession has resulted into loss of employment making consumers to shift their consumption to basic needs.
The firm benefits from government protection since it has interest in the firm.	Approximately 60% of the company’s workforce is underutilised.	The firm can increase on its automobile product range to include multipurpose automobile products.
The firm’s cars have been widely accepted in some markets.		The firm can venture into production of electric vehicles to cope with the increasing competition.

SWOT analysis of Proton Exora

Strengths	Weaknesses	Opportunities	Threats
Proton Exora is cheap with a price range of RM 57, 548-RM 60,598	Decreased demand for Proton Exora in some markets.	High chance of improving on the features of Proton Exora through innovation.	Increased risk of obsolescence. Changes in technology which means that the firm has to continuously update the car for it to be competitive in the global market.
High technology has been incorporated in manufacture of the car to ensure that it does not consume a lot of fuel.		High probability of improving on the performance of Proton Exora in terms of fuel consumption.	Increased competition from Perodua which is a domestic firm that produces multipurpose cars whose price is also relatively cheap (Eileen, 2009, Para. 2).
Product variety has been incorporated in manufacture of Proton Exora. These include Exora basic either metallic or solid. A variety of designs have been incorporated in manufacturing of the motor vehicles.These include B-Line, M-Line.		Improving on the cars security features such as Global Positioning Systems.
Proton Exora have got superior devices and interesting gadgets (‘Proton Exora’, 2009, Para. 7)

Pest Analysis

Political environment

The Malaysian government is increasingly supporting the automobile industry. This is due to the fact that the government has identified the automobile industry as a key sector in contributing towards the countries economic growth. According to Proton annual report (Anon., p. 43), the Malaysian government has invested a significant amount of RM 200 Million towards the development of the industry through the Automobile Development Fund. The government is also committed to ensuring that there is sufficient and reliable human resource by establishing the Automotive Institute of Malaysia. In the foreign market, the firm is facing unreliable market conditions due to high rate of taxation on imports.

The government has also formulated a policy aimed at ensuring protection of product innovation through patenting. This will enable Proton Exora to be marketed both in the domestic and foreign market.

Economic environment

There was an increase in the rate of purchasing motor vehicles in 2008 in Malaysia. According to Proton annual report 2009 (Anon., 2009), this resulted from an increase in the country’s rate of economic growth with a margin of 5.75%. There was also the emergence of creative financing scheme to car buyers. However, there was a decline in this trend in 2009 due to the economic meltdown. The introduction of new models of automobile such Proton Exora has resulted into an increase in demand for automobiles. This is due to the fact that Proton Exora’s price is consumer friendly. Upon the economy recovering, there is a high probability of increase in demand for Proton Exora.

Social

Consumers are increasingly becoming price sensitive. In addition, there is an increase in demand for automobile products as a result of increase in disposable income and changes in lifestyle.

Technology

Increased rate of technological innovation has resulted into emergence of new designs within the automobile industry. By incorporating automobile design on Proton Exora, the firm can improve on the level of customer satisfaction. This will result into increased demand of the product.

Marketing objectives

To increase the market share of Proton Exora with a margin of 30% within a period of one year.
Improve on the image of Proton Exora both in the domestic and foreign market by producing high quality car models. This will minimise the possible resistance amongst the consumers to purchase Proton Exora.
Increase the sales revenue of Proton Exora with a margin of 20% within a period of six months.
To improve on the level of customer satisfaction by supplying quality automobile products.

Marketing strategy

Segmentation strategy

The management has targeted both individual and institutional customers in marketing Proton Exora. It has incorporated various demographic and psychographic variables. The demographic variables considered include income level, gender and social class. On the other hand, the psychographic variables to be considered include consumer’s values and attitude. This is through production of a variety of Proton Exora models with different prices.

Positioning strategy

The management of the firm will use competitive pricing strategy in positioning Proton Exora in the market. This will help in creating a positive image to the consumers. In addition, the management will ensure that the quality of Proton Exora is high thus ensuring a high level of customer satisfaction. This will help Proton Exora attain a high competitive advantage compared to its competitors.

Marketing mix

Product

Proton Exora will has superior features and designs to ensure that it meets the consumers demand. Various colours will also be incorporated in manufacturing the car to ensure that it appeals to a wide category of consumers. In addition, continuous research will be conducted to ensure that Proton Exora remains competitive.

Pricing strategy

To ensure that Proton Exora is effectively launched into the market, the firm will incorporate penetration pricing strategy. According to penetration pricing strategy (Anon., 2009), this will be achieved by setting the price of Proton Exora at a relatively low price compared to the competitors. This will be attained by conducting competitor market research. Penetration pricing strategy will enable the firm attain a high market share.

Promotion strategy

The firm will conduct effective promotion of Proton Exora to ensure that there is effective product awareness. Various methods of promotion will be incorporated. These include advertising, personal selling and public relations. The management will consider various forms of advertising such as through newspaper, magazines, radio and television. The firm will also incorporate electronic advertising through the emerging social networking tools such as You Tube. The firm will also participate in national and international trade fairs and exhibition as its public relation strategy. Personal selling will be conducted through use of catalogues. The firm will also use bill boards in advertising the Proton Exora.

Distribution strategy

To ensure that Proton Exora is accessible in the entire market, the management has devised a comprehensive distribution strategy. The strategy incorporates both direct and indirect forms of distribution (Jacob, 2009, Para. 4). This will involve opening distribution outlets in various regions in the domestic market. In the foreign market, the firm will incorporate the use of marketing agents (Lars, 2008, para. 3).

Budget allocation

It is important for a firm to set a certain amount to cater for its promotion in its marketing strategy (Rob & Kent., 2000, p.1).

Item	Cost in ‘000’ RM
Cost of market research	15,000
Cost of promotion
RadioTelevision You Tube Newspaper Catalogues	20,00035,000 10,000 15,000 5,000
Total expected cost of promotion	100,00

Implementation plan 2009-2010

Activity	December	January	February	March
Consumer market research	→
Competitor market research	—	→
Research on the best promotion medium in the domestic and foreign market			→
Launching Proton Exora in foreign market				→

Control

To determine whether the firm is attaining its marketing plan, the management will conduct continuous market research. The research will be aimed incorporate various variables such as the consumers and the competitors. Consumer market research will be aimed at identifying the perception of the consumers with regard to Proton Exora. It will also enable the firm to identify the consumer’s perception of the price set. Competitor market research will be aimed at establishing the moves of the competitor such as their innovation. This will enable the firm to be proactive in its innovation thus maintaining the competitive nature of Proton Exora. The firm will also use the changes in sales revenue in determining the effectiveness of Proton Exora in the market.

Reference List

Corporate Profile. 2009. Proton annual report. Web.

Corporate Profile 2007. Proton annual report. Web.

Eileen, N.G. 2009. Malaysian car maker proton posts quarterly profits, shrugs off threats from Perodua. Web.

Jacob, B. 2009. Types of Distribution channels. Web.

John, B. 2009. Widen your online marketing with You Tube advertising. More Free Information. Web.

Laporan, T. 2009. Proton Holding Berhad. Web.

Lars, P. 2008. Channels of distribution. Los Angeles: University of South California. Web.

Linked Incorporation. 2009. Proton. Web.

Paultan. 2009. Archive for Proton Exora: Proton MPV. Web.

Pelantar Sistem. 2009. Proton Exora: you will be amazed. Web.

Rob, H. &Kent, W. 2000. Understanding and developing a promotion budget. Tennessee: The University of Tennessee. Web.

RUETERS. 2009. Detroit Electric and Proton announce strategic partnership to produce affordable and practical pure electric vehicles. Web.

Tutor2U. 2009. Pricing strategies: penetration pricing strategy. Web.