Ethics in Marketing: Toyota & Product Recalls

Solution Preview

Toyota faced both a management and engineering problem as a result of massive product recalls. The company, formerly known for quality, was thrust into uncharted waters, seemingly without a compass or a plan. Although the company has recently been awarded "most valuable global car brand" (Gain, 2013), it suffered a great amount of customer dissatisfaction and mistrust as a result of its poor handling of the product recalls.
According to Forbes Magazine, "83 percent of United States adults surveyed were positive about the Toyota brand" (Kelly, 2012), buying into the company's "I Love What You Do For Me, Toyota" campaign before the massive recall in 2009-2010. Customers agreed that Toyota stood for "quality, reliability and positive customer service" (Kelly, 2012). The company had set an aggressive growth target, and in fact, sales were growing faster than the company could manage. The company's growth "had taken priority over the company's traditional focus on quality" (Cole, 2011). Marketing strategy was singularly focused on achieving this growth, despite the facts that automotives had become technologically more complex and management must focus on quality to retain quality. Prior to the recall, Toyota's "core brand theme in the United States was advertised as quality, durability and reliability, with an added emphasis on value" (Cole, 2011). This helped Toyota become a leading automotive brand, but unfortunately, actual reviews and car owners' experiences did not correlate with the advertising theme.
Toyota faced two large product recalls, losing billions of dollars as well as consumer trust. Consumers reacted negatively to the news, with "almost 60 percent of comments heard about the brand on Twitter negative, while only 8 percent were ...