Saturn in Japan

B) Saturn intends to use its folksy marketing approach to appeal to Japanese consumers, coupled with its reputation for high quality vehicles-“In the US, Saturn tied for top place with Toyota’s luxury brand Lexus in last month’s customer-satisfaction study by J.D. Power and associates” (Saturn 1). The company’s marketing goals include recruiting dealers and readying showroom designs in tandem with figuring out what aspects of its successful US marketing approach might appeal to Japanese consumers. Saturn officials will not make public its sales goals arguing that numbers are not their focus right now but rather, “its goal is to have 10 to 20 sales outlets by April…[and]…to be No. 1 in customer satisfaction and No. 1 in dealer satisfaction…that is our goal” (Cox 1). The comp

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ition with the Japanese consumers. The name Saturn is virtually unknown in Japan so this will be one of the their biggest obstacles to overcome. To this end the company has hired the seventh largest Japanese advertising agency to help build brand name recognition, Daiichi Kikaku. The campaign they are creating will focus on customer loyalty. The company is also going for a no-haggling sales policy because bargaining on pricing in Japan can be intense. A) There are many risks associated with using a cost leadership strategy in foreign markets. One of the biggest is the fact that huge amounts of capital must be spend in order to gain cost advantage through economies of scale. Often, this is difficult to do in foreign countries because there are costs associated with production and manufacturing that are not incurred in the native country. For our example with Saturn, we can see how huge advertising expenditures might cut into the requisite of cost control. Further, to achieve economies of scale that give cost advantage, the most efficient, i.e. latest, technology must be utilized. However, the fact that there is little opportunity for product differentiation gives Saturn a chance to achieve economies of scale because it can
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Approximate Word count = 1258
Approximate Pages = 5 (250 words per page)

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