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Informal situational analysis – kia motors corporation

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An informal situational analysis is being conducted on KIA Motors Corporation to analyze critically the internal and external environment as it concerns KIA so as to find its capablenesss. clients. placement and rivals within its concern environment. It would besides affect the selling and concern scheme of the organisation. how they align to accomplish profitableness and/or market orientation. we would be able to detect after this analysis if KIA’s focal point is on profitableness or market orientation. Are they a market-oriented administration? This exercising can be achieved by working the SWOT analysis.

PESTEL or the 3Cs analysis and this analysis would at the same time utilize 2 of them.

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KIA Motors Corporation was founded in 1944 to prosecute in the fabrication and gross revenues of cars get downing from bikes to passenger vehicles. commercial vehicles. military vehicles and recreational vehicles while besides puting in new engineerings in the development and industry of eco-friendly autos. Kia Motors remains a driving force in Korea’s automotive industry with an spread outing merchandise line sold through a web of 4000 traders.

20 gross revenues subordinates. 141 distributers scattered across about 170 states around the universe. Its major trade names are the Cerato. Soul. Rio. Picanto. Sorento etc. Kia’s direction vision coined as – Innovation for Humanity tells a batch about its committedness to market orientation. 1. To turn the Kia trade name to a universe category degree and go a leader in the planetary car industry.

2. To prosecute “Customer Happiness” by supplying the best engineering and the highest degrees of quality and service. 3. To work hard at turning out of conventional manners of thought by being originative and self-generated introducing 4. To accomplish its long term vision by endeavoring to fulfill the client through technological invention that respects people and nature. KIA Motors’ end and mission statement is “to go a tier-one automotive trade name by 2016 with a mission to go one of the most desirable trade names in the automotive industry by supplying a different type of driving experience that will heighten people’s lives and enrich them every twenty-four hours. ”

Harmonizing to several research workers of marketing scheme. an organisation that is extremely market oriented and taking at accomplishing above normal market public presentation and supplying superior value to clients to accomplish a competitory advantage is bound to do net income. nevertheless. net income ought non be the major focal point above market orientation. Kia is able to instill the civilization of market orientation which harmonizing to Kohli and Jarwoski ( 1990 ) “is the organisation broad coevals of market intelligence refering to current and future client demands. airing of the intelligence across sections and organisationwide reactivity to it” into the organisation.

Kia gathers intelligence on its present and future clients through utilizing informations as respects their household life. work. vacations. involvements etc from reputable selling studies. it besides gathers information on current and future failings and strengths of its rivals and guarantee all these information are decently disseminated to all sections of the organisation inorder to each to place itself suitably to accomplish client satisfaction and keep competitory border. There is a strong coordination between cardinal sections runing from selling. branding & A ; communications. finance to plan sections. Therefore. there is a positive relationship between market orientation and profitableness. The organisation besides as a affair of policy allocates up to 5 % of its net incomes to Research & A ; Development so as to go on to present sustainable superior value to its present and future clients even in the long tally. SWOT Analysiss

STREGHTS1. Its selling scheme that is focused on client demands and desires. 2. Pricing 3. Manner and Vibrant designs that supply entreaty to the younger coevals. 4. Increasing web of distributers and traders worldwide. 5. Lower cost of production 6. Industry of intercrossed electric vehicles ( eco-friendly ) and extremely fuel efficient merchandises that can fit other international trade names. WEAKNESSES

1. They need to better on operational efficiency to run into both quantitative and qualitative criterions2. Inability to appeal to a broader audience3. Quality4. Low planetary consciousness degreeOpportunity1. A displacement in consumer penchant for eco-friendly vehicles due to skyrocketing oil monetary values and increased pollution ensuing in the depletion of the ozone bed. 2. Partnership with Hyundai in a individual production line and works will ensue in economic systems of graduated table for the KIA trade name and let it to continually concentrate on designs and selling for new merchandises. Menace




1. Competition is going stiffer2. Direct exposure to crisp alterations in the monetary value of natural stuffs or OEMs non manufactured by KIA could hold a positive or negative impact on underside lines and monetary values that hitherto used to be a merchandising point. 3. Vulnerability to natural catastrophes similar to that which affected Toyota in Japan.

3 Cs AnalysisCompanyThe selling scheme of KIA as already mentioned above is directed towards run intoing the demands and desires of its mark clients. Marketing mix Product – Kia introduces a new theoretical account after about 18months of the last theoretical account launch which normally comes with an betterment with regard to interior and exterior specification which is meant to vie with other trade names come ining the market. The phases of the merchandise life rhythm being introduction phase. growing phase. adulthood phase and diminution phase. Therefore at debut phase. gross revenues are merely get downing to derive impulse. consciousness and instruction of clients on the merchandise is merely being done and the client is get downing to take buying determinations.

At this phase. Kia engages in aggressive and tricky adverts and glandular fever carnivals across states to carry possible clients to purchase. And it can be said that Kia trade name has an mean life rhythm of 3 old ages after which the client is ready for a alteration of auto. At the growing phase when Kia auto proprietors have clocked 3 old ages on their former purchase. a batch of them are willing to purchase the new theoretical account that has newer options and gross revenues continue to mount at this phase. but at adulthood. gross revenues extremum. and get down to worsen which is when gross revenues and net incomes are likely to diminish.

Therefore. the organisation upon analyzing the form of gross revenues on the big assortment of trade names they have. follow a production mix that emphasizes industry of higher merchandising merchandises than merchandises that have lower gross revenues. Pricing – The company adopts different pricing for their merchandises at different phases of their merchandise life rhythm by puting higher value on vehicles at debut phase and depending on market response adjust the monetary values consequently. nevertheless in order to perforate the market every bit rapidly as possible and deeply before rivals. it adopts the incursion pricing scheme.

Besides for each trade name of auto theoretical account. monetary values differ to let consumers to make up one’s mind at best suits their lifestyle and demands. for illustration. the Rio has 3 discrepancies and with different monetary values from which a client can take from. However. the monetary value of Kia vehicles ranges from $ 8. 000 to $ 36. 800 with the Picanto being the lowest of the scope and the Sorento tops the scope of merchandises.

Topographic point – Kia is headquartered in Korea but has webs and is good represented across the universe through 4000 traders. 20 subordinates and 141 distributers with farther enlargement still ongoing. Traders could do or impair the trade name. and hence. Kia ensures there is uniformity in the mentality of franchises across the universe. while guaranting criterions are purely adhered to. In seeking to guarantee client service are non compromised. it is necessary for them to bring forth feedback from clients across the universe refering their Kia experience at all franchises and besides acknowledge those known to continue the Kia criterions.

Promotion and Branding – Kia. in the last 10 old ages has spared no costs making consciousness of their merchandises to the devouring public. Using non merely the traditional attack of publicity and advertizement but besides the usage of societal media and electronic digital selling. The usage of societal media allows it to constantly connect with younger coevalss and enable it to have and give feedback every bit expeditiously as possible. At the debut phase of a merchandise is when big sums of financess are invested in advancing to do consumers cognizant of the new merchandise and its benefits. The company’s web sites are besides good developed to advance and publicize their merchandises.

They besides get involved in indorsements and sponsorships of major events. athletics squads. jocks. charity events etc. that they believe would sell the KIA trade name. Kia has introduced a figure of fresh thoughts into the automotive universe market and have allowed the trade name to be built since it was launched to the United States market in 1992 and to the remainder of the universe siting on the slogan “Power to surprise” . Its major accent on Design has besides allowed it to carve a niche for itself in the market and the development of the trade name. Therefore. they safely assume trade name acknowledgment has been achieved while non resting on its oars to derive market portion by go oning to set up the best client relationships. The stigmatization scheme being deployed by Kia so far can be termed to be successful leting it notch the 87th place on the 2012 Interbrand’s Best Global Brands study far behind its benchmark rivals. Toyota at No 10 and Honda at No 21.

CustomerKIA’s selling scheme is formulated in such a manner as to turn to to 2 important issues which the organisation revolves unit of ammunition. Which clients do we desire to function? How do we mean to make value for the clients we want to function? To reply the 1st inquiry. KIA embarked on a procedure of market cleavage through market intelligence across 4 variables viz. – geographic. demographic. psychographic and behavioral. Diagram 1 – Market Segmentation

The 2nd inquiry in explicating its selling scheme is market distinction and placement which is being done through its major focal point on its nucleus strength which is cutting border design and manner. In 2006. Peter Schreyer. an award winning interior decorator came on-board as Kia’s Chief Design Officer thereby wholly turning around the full merchandise design line since 2009 to day of the month and doing KIA a universe renowned automotive trade name.

Kia Motors UK is distinguishing the merchandise within the market by selling with a 7 twelvemonth guarantee that can be passed on to whoever the vehicle is transferred to. this is a novel and one of its sort in Europe. In Nigeria. Kia workshop is unfastened Mondays through Sunday to provide to working category people that are unable to convey in their autos for service during working daies. Therefore. the KIA’s client is the mean in-between and upper in-between category with an mean age of 40. upwards nomadic. male and female looking for the best value for money and located in all parts of the universe. Rivals

Kia’s major rivals are Hyundai. Toyota. Ford. Chevrolet. Vauxhall. Toyota continues to take the battalion due to its high resale value that can non yet be matched by Kia and besides its repute for safety. The merchandising point being adopted by this company to accomplish competitory advantage is a better monetary value offering. i. e better monetary value for better styled merchandise. However. the Kia trade name is non yet known in major planetary metropoliss and it is a known fact that they are missing in planetary consciousness for which the organisation is already positioning itself to turn to.

Inspite of being soon owned by Hyundai. Kia is still being seen as competition. Since the recession. Kia has stealthily grown its market portion coupled with the Tokyo catastrophe which stalled Toyota production for a period. this allowed for a high growing rate for the trade name in the last 5 old ages. but with the recent choice up of Toyota. Kia is likely to hold a tough clip in keeping this growing rate which stood at 27 % in 2010 against industry norms of 12 % . Therefore. they continue to put in capital outgo. edifice of new workss. re-inforcement of the design centres to be able to churn out designs that would go on to project a dynamic and vernal trade name. sharply market and spread out its presence across the universe.

Decision

The concern and selling schemes of Kia are good aligned as analyzed above which is responsible for the success they have continued to accomplish over the old ages as reflected in the gradual trade name credence globally. Kia is client and market oriented. it does non pay lip service to its ends and mission of guaranting it delivers first-class client service and besides acquiring to the top 3 automotive organisation even though it may look as an unattainable undertaking. it still continues to place itself to bridge the spread.

It is recommended amongst others that Kia improves on quality of its merchandises. handiness of OEM parts and trim parts. entree to after gross revenues service and all other factors that make the trade name more attractive and besides increase on its resale value which is soon nil to compose place about soon. It should besides from clip to clip gather information on which autos are having more credence and guarantee they are produced in measures that would run into client demands. As we speak. the Sportage is making really good but supply remains low to run into up with demand. Kia besides adopts the usage of market portion as a step of trade name equity step which harmonizing to Aaker ( 1996 ) to be delusory particularly since Kia monetary values are lower comparative to market monetary values. therefore it is besides advisable to mensurate the comparative market monetary value at which the trade name is being sold compared to industry market monetary value.

Mentions

1. Aaker. D. A. . ( 1996 ) ‘Measuring Brand Equity Across Products and Markets’ . California Management Review. 38 ( 3 ) pp. 102-120

2. Interbrand. ( 2013 ) Best Global Brands 2012: The Top 100 Brands. Available at: hypertext transfer protocol: //www. interbrand. com/en/best-global-brands/2012/Best-Global-Brands-2012-Brand- View. aspx. ( accessed: 14/10/13 )

3. Kia Motors Corporation- Company Profile. Information. Business Description. History. Background Information on Kia Motors Corporation [ online ] Available at: hypertext transfer protocol: //www. referenceforbusiness. com/history2/74/Kia-Motors-Corporation. hypertext markup language [ Accessed 14 October 2013 ]

4. Kohli. A. J. & A ; B. J. Jaworski. ( 1990 ) ‘Market Orientation: The Construct. Research Propositions. and Managerial Implications’ . Journal of Marketing. 54 ( 2 ) pp. 1-18 5. Yu R. ( 2011 ) . “Focused. plucky Kia bears down on its competitors” ( online ) Available at hypertext transfer protocol: //usatoday30. usatoday. com/MONEY/usaedition/2011-06-28-Kia_CV_U. hypertext markup language. ( accessed 16 October 2013 )

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