Marketing Mix of Lexus and 4Ps (Updated 2023)

The Marketing mix of Lexus analyses the 4Ps of Lexus, which includes the Product, Price, Place, and Promotion of Lexus. Lexus is a subsidiary division of its parent company Toyota. It is associated with the automotive industry and deals in the manufacturing and marketing premium vehicles. Lexus marquee is of Japanese origin and was founded in 1989 by its founder, Eiji Toyoda.

Regarding market value, it has been positioned as one of the ten largest global brands of Japanese origin. Lexus has targeted the Elite class of car enthusiasts seeking perfection, comfort, and ultimate luxury as its potential customers. Brand faces fierce competition in the market, and some of its competitors are as follows.

• Ferrari
• Lamborghini
• Maserati
• BMW
• Mercedes-Benz
• Cadillac
• Nissan

About Lexus

• Type: Luxury vehicle
• Industry: Automotive
• Founded: 1989
• Founder: Eiji Toyoda
• Headquarters: Nagoya, Japan
• Area served: Worldwide
• Key people: Akio Toyoda (Chairman) and Koji Endo (CEO)
• Number of employees: 37,000

Lexus Product Strategy

Lexus has been declared as the largest-selling luxury car in Japan. It is involved in the manufacturing, engineering, and designing its vehicles. Its founder started Lexus vehicle as a covert project as he wanted to create the best luxury vehicle. It took nearly six years to develop the Lexus LS 400, and since then, the brand has been involved in several types of vehicles. Its current product portfolio includes-

SUVs

• Lexus LX 570
• Lexus GX 400
• Lexus GX 460
• Lexus RX 450h
• Lexus RX 350
• Lexus RX 270

Sedans

• Lexus LS 600h L
• Lexus LS 600h
• Lexus LS 460 L
• Lexus LS 460
• Lexus GS 450h
• Lexus GS 350
• Lexus ES 350
• Lexus GS 250
• Lexus ES 300h
• Lexus IS 250
• Lexus IS 300h

Hybrid

• Lexus HS 250h
• Lexus CT 200h

Coupes

• Lexus RC F
• Lexus RC

Performance cars

• Lexus F/F Sport
• Lexus LFA
• Lexus GS F
• Lexus RC F

The product mix of Lexus, Toyota’s luxury vehicle division, includes various vehicles.

The product mix of Lexus in 2023 is as follows(Source)

1. Sedans: Lexus offers a variety of luxury sedans, including the IS, ES, and LS models. These sedans are known for their comfort, advanced technology, and performance.
2. SUVs and Crossovers: The brand’s SUV lineup includes models like the UX, NX, RX, and GX. These vehicles are famous for their blend of luxury, space, and off-road capability.
3. Coupes: Lexus coupes, such as the RC and LC, are designed for performance and style, appealing to drivers looking for a sporty and luxurious experience.
4. Hybrid and Electric Vehicles: Lexus has been expanding its range of hybrid vehicles, offering models like the ES Hybrid, RX Hybrid, and the all-electric UX 300e, aligning with the global trend towards sustainable mobility.
5. Performance Vehicles: The F series, including models like the RC F and GS F, are high-performance versions of their respective base models, featuring more powerful engines and sportier designs.

Lexus Place Strategy

Lexus has gained worldwide brand loyalty and recognition and is being marketed in Europe, Latin America, and Southeast Asia, with the United States being its primary market. Products are exported to nearly seventy countries worldwide, including Australia, Canada, Malaysia, Philippines, Chile, Indonesia, South Africa, Switzerland, South Korea, Taiwan, the United Kingdom, China, Russia, and India.

Its headquarters is in Nagoya, Japan, and its operational centers are California, Torrance, Belgium, and Brussels. Its manufacturing facilities have been set up in Japan at Kyushu, Fukuoka, Miyata, Chubu, Aichi, and Tahara. Its first overseas plant was in Ontario, Canada. The Lexus brand has a strong distribution channel helps export its products successfully to other countries. It includes regional distributors, dealership networks, exhibition centers, and Lexus showrooms. Lexus International coordinates its global operations and reports directly to the chief executive of Toyota.

Regarding the place strategy of Lexus, here are the key points:

1. Global Network: Lexus operates in over 90 countries and regions, utilizing a worldwide network of dealerships to ensure widespread availability.
2. Premium Dealership Experience: Lexus dealerships are designed to provide a luxurious and comfortable experience, aligning with the brand’s image. This includes personalized services and high-quality facilities.
3. Strategic Market Focus: Lexus strategically focuses on key markets like North America, Europe, and Asia, particularly in countries with a high demand for luxury vehicles.
4. Online Presence and Digital Sales: Lexus has enhanced its online presence, providing digital sales options and virtual showrooms to cater to changing consumer behavior and preferences.
5. Local Manufacturing and Distribution: To cater to local markets more effectively, Lexus has set up manufacturing units in key regions like Japan, North America, and Europe, which helps reduce shipping times and costs.

Lexus Pricing Strategy

Lexus has established a strong foothold in the premium segment for upmarket customers. It offers high-end products at affordable rates because it has adopted a mid-premium pricing policy. Lexus faces severe competition in the consumer market. To deal successfully with its competitors, it has kept its prices slightly lower than rival luxury brands’ product prices. It has adopted a competitive pricing policy, providing a distinctive competitive advantage and resulting in larger sales volume and better profits.

As a luxury automotive brand, Lexus employs a pricing strategy that reflects its positioning in the market and aligns with its brand image and customer expectations. Here are the critical components of Lexus’s pricing strategy:

1. Premium Pricing: Lexus positions its vehicles in the premium segment. This strategy involves setting higher price points than mainstream brands to reflect its vehicles’ superior quality, advanced technology, and exclusivity. This approach not only aligns with the brand’s luxury image but also adds to the brand equity and the perceived value of the products.
2. Value-Based Pricing: While maintaining a premium stance, Lexus’ marketing strategy also emphasizes value-based pricing. This means setting prices not just on cost but also considering the perceived value to the customer. Lexus vehicles often have advanced features, superior craftsmanship, and innovative technologies that justify their higher price points.
3. Competitive Analysis: Lexus closely monitors its competitors in the luxury car segment, like BMW, Mercedes-Benz, and Audi. The brand ensures its pricing remains competitive while offering distinctive features and benefits that set it apart. This strategic pricing keeps Lexus relevant and appealing in a highly competitive global market.
4. Segmented Pricing Strategy: Lexus offers a range of vehicles, from luxury sedans to SUVs and hybrids. Each segment follows a tailored pricing strategy based on the target market’s expectations and willingness to pay. For instance, Lexus’s pricing for high-performance vehicles like the F series differs from that of their hybrid models.
5. Dynamic Pricing for Innovations and New Launches: Lexus may adopt a dynamic pricing approach when introducing new technologies or launching new models. This involves setting a premium price for innovative features or new releases and gradually adjusting the price based on market response and competitive dynamics.
6. Geographical Pricing Strategy: Lexus adjusts its prices according to geographical markets, considering factors like local taxes, import duties, market demand, and economic conditions in the target market. This geographical pricing ensures the brand remains competitive in different regions while optimizing profitability.
7. Financial Options and Incentives: To make their vehicles more accessible to a broader audience, Lexus offers various financing options, leasing deals, and occasional incentives. These financial strategies help attract customers who aspire to own a Lexus but are sensitive to high upfront costs.

Lexus’s pricing strategy is a sophisticated blend of premium positioning, competitive prices, value consideration, competitive analysis, and market segmentation. This approach reinforces its status as a luxury brand and ensures that it remains competitive and appealing to its target customer base.

Lexus Promotion Strategy

The key to success depends, to a great extent, on an organization’s marketing policies. Lexus is a high-end product and has projected itself in a superior customer service market with great aplomb because of successful marketing campaigns. Its advertisements highlight distinctive features like balance, relentlessness, perfection, smoothness, and precision. One of the ad campaigns encourages gifting a Lexus to near and dear ones.

The brand has taken the help of electronic, social, and print media to advertise via television, magazines, newspapers, billboards, and online platforms. Lexus participates in several charitable events and sports to increase its brand awareness. Through sponsorships, the brand has endorsed Grand Slam events in Lawn Tennis from 2005 to 2009, Golf Association U.S Women’s Open, U.S Open, U.S Amateur, and U.S Senior Open tournaments. Several celebrities from the automobile industry and sports fraternity are endorsed and sponsored by Lexus as part of their brand promotion.

Lexus’ promotion strategy focuses on creating a premium brand image through high-end advertising campaigns, leveraging digital marketing and social media for targeted outreach to customer segments, and establishing partnerships and sponsorships in luxury events and sectors to enhance brand visibility and prestige. This multifaceted approach helps Lexus connect with its affluent customer base while reinforcing its status as a luxury automotive leader.

Some Recent Video ads and Print ads of Lexus are:

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