ASSIGNMENT 1. SEMESTER. SUBJECT CODE. :. SUBJECT TITLE.

ASSIGNMENT 1
SEMESTER
SUBJECT CODE :
SUBJECT TITLE : MARKETING MANAGEMENT
LEVEL : MASTER’S LEVEL
STUDENT’S NAME :
ID NO. :
PROGRAMME : MASTER OF BUSINESS ADMINISTRATION
LECTURER :
LEARNING CENTRE : CITY UNIVERSITY PETALING JAYA
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MARKING SCHEME RUBRIC.
Criteria Marks
Relevance
Directly relevant to the requirements of the assessment. /20
Knowledge
A substantial knowledge of relevant materials, showing a clear grasp of
themes, questions and issues therein.
/20
Analysis
Good analysis, clear and orderly. /20
Argument and Structure
Generally coherent and logically structured, using an appropriate mode of
argument and/or theoretical model(s).
/20
Critical Evaluation
May contain some distinctive or independent thinking; may being to formulate
an independent position in relation to theory and/or practice.
/10
Presentation
Well written, with standard spelling and grammar, in a readable style with
acceptable style with acceptable format.
/5
Reference to Literature
Critical appraisal of up-to-date and/or appropriate literature. Recognition of
different perspectives. Very good use of source material. Uses a range
of sources of sources.
/5
Total /100
I certify that the work presented in this report is, the best of my knowledge and belief,
original, except as acknowledged in the text, and that material has not been submitted, either
in the whole or in part, for degree at this or any other University. I acknowledged that I have
read and understood the University rules, requirements, procedures and policy.
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Table of Contents
1.0 INTRODUCTION......................................................................................................4
2.0 EXECUTIVE SUMMARY.........................................................................................5
2.1 Business Objectives....................................................................................................5
2.2 Missions......................................................................................................................5
2.3 Key Values of the Company.......................................................................................6
2.4 Market Goals...............................................................................................................6
2.5 Guiding Principle........................................................................................................6
3.0 COMPANY DESCRIPTION......................................................................................7
3.1 Ownership and Details................................................................................................7
3.2 Organization Chart............................................................................................................7
3.3 Location & facilities..........................................................................................................8
3.3.1 Location.........................................................................................................................8
3.3.2 Facilities.........................................................................................................................8
3.4 Daily Operation Producers................................................................................................8
3.4.1 Operations Review.........................................................................................................8
3.5 Suppliers & Management Control....................................................................................9
3.6 Administrative System & Future Service...................................................................9
4.0 MARKET ANALYSIS...............................................................................................9
4.1 Market Segments.......................................................................................................10
4.2 Target Market Strategy.............................................................................................10
4.3 Pest Analysis.............................................................................................................10
4.4 Main Competitors...........................................................................................................11
4.5 Market Size.....................................................................................................................11
5.0 MARKETING STRATEGY AND IMPLEMENTATION......................................11
5.1 Strengths....................................................................................................................12
5.2 Weaknesses...............................................................................................................12
5.3 Opportunities.............................................................................................................12
5.4 Threats.......................................................................................................................13
5.4.1 Threats of new entry and substitution...................................................................13
5.4.2 Evaluation- Measures of Effectiveness.................................................................13
5.5 Marketing Mix Strategy..................................................................................................14
5.5.1 Product.........................................................................................................................14
5.5.2 Price.............................................................................................................................15
5.5.3 Promotion.....................................................................................................................15
5.5.4 Place.............................................................................................................................15
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6.0 CONCLUSION.........................................................................................................16
REFERENCES......................................................................................................................16
1.0 INTRODUCTION
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PROTON or PERUSAHAAN OTOMOBIL NASIONAL BERHAD was incorporated
on May 7, 1983 to manufacture, assemble and sell motor vehicles and
related products, including accessories, spare parts and other
components. PROTON produced Malaysia’s first car, the Proton SAGA
which was commercially launched on July 9, 1985 by Malaysian Prime
Minister, Dato’ Seri Dr. Mahathir Mohamad who conceived the idea of a
Malaysian car. As the first Malaysian car manufacturer PROTON has well-
known a very strong credentials in the Malaysia motorized market.
However, the customers seeming that it has not supplied what is
guaranteed and anticipated by them. As a result, PROTON is incapable to
create optimistic response in the head and heart of its customers. PROTON
still has wonderful prospective and capability to accomplish superior in
offering its customers products and services of highest quality.
The new concept of Proton Inspire 2.0 is hope that the enhanced and new
brand images and recommendations will be able to help PROTON establish
an optimistic response in the customers’ memory which will lead the
company to achieve its vision of becoming a Life Friend for its consumer.
Based on its recent performance, PROTON has indeed working very hard to
live up its working philosophy of making the right car at the right time, for
the right market, at the right price. Production in the automotive industry
in Malaysia can be considered the most important and strategic industry.
Industry deregulation and imports from Japan, Korea and China with strong
regional brands at affordable prices, car establishment, to enhance their
competitiveness. About 90 percent of cars sold in Malaysia as the
Malaysian automotive industry plays an important role in the development
of local production, the local producers that are made of protons and
Perodua. One of the major factors of market to grow significantly in the
automotive industry in Malaysia offered to help the auto industry is
technological developments in the production stages. the global crisis, the
rise in oil prices has also affected the sales of Malaysian automobiles.
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Increasing interest rates and rising oil prices also impacted vehicle sales in
Malaysia, caused sales of protons, as shown, to reduce consumers'
purchasing decisions, and definitely affect the sales volume.
2.0 EXECUTIVE SUMMARY
2.1 Business Objectives
PROTON was publicly listed on the Kuala Lumpur Stock Exchange (KLSE) in
1992 and its shareholders include Khazanah Nasional Berhad, Petroliam
Nasional Berhad, Mitsubishi Corporation, Mitsubishi Motors Corporation,
Employee Provident Fund Board and other local and foreign investors.
Proton Holdings Bhd has swung into the black in 2008 with a cumulative
net profit of RM202.9 million, compared with the loss of RM589.5 million it
registered in 2007. PROTON aims to have a strong product portfolio by
introducing “the right car, for the right market, at the right price and at the
right time”. PROTON has also continued to update and refresh existing
product lines to entice and attract customers.
2.2 Missions
Proton’s mission in its short-term goal is focusing on three main attributes
that distinguish itself from its competitors as follows: -
a) Economical – providing cars which are affordable, cost efficient and
value for money;
b) Caring – providing customer satisfaction and its social corporate
responsibility as a truly Malaysian car manufacturer and to enhance its
Customer Relationship Management (CRM)
c) Quality – providing a consistently improved product and customer
experience.
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Hence, by introducing new concept car known as Proton Exora 2, Proton
expects that it will improve its market share in the automotive industry
and improves its ranking in future.
2.3 Key Values of the Company
CORE
VALUES
DESCRIPTION
Quality We make products that work the first time, every time.
Customer
focus
Customers are the source of our income. We deliver on our
promises to our customers’ satisfaction.
Innovation We challenge convention, always seeking new and better ways
of doing things. We view change as opportunity.
Teamwork We trust, respect and share knowledge to foster teamwork at
the workplace.
Speed
We have a “can do” attitude and will not rest until the problem
is solved. We have an inherent sense of urgency in everything
we do.
Caring As a responsible corporation citizen, we invest in safety, health
and the environment.
2.4 Market Goals
The process in identifying the consumer target for new Proton Exora 2 is
important due to the fact that consumers tend to have different brand
knowledge structures and thus they will perceive differently for the
products or services. Proton has successfully identified their target market,
according to the segmentation bases namely behavioral, demographic and
psychographic factors.
2.5 Guiding Principle
There will be amendments on the National Automotive Policy (NAP)
because according to Malaysia’s World Trade Organization, the current
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import licensing or appoved permit (AP) mechanisms, excise duties and
other non-tax measures in the automotive sector will be terminated in the
near future (Rosli,2017). In addition, 10% Sales and Service Tax (SST) will
return and made effective on 1st September 2018. Before any new car can
be released to the market. The car makers need to get the certification
from NCAP (New Car Assesment Programme) and SIRIM (Scientific and
Industrial Research Insitute of Malaysia). The process will usually take
minimum one year to obtain these certifications 29 (Aziz, A. 2018)
3.0 COMPANY DESCRIPTION
3.1 Ownership and Details
PROTON has seen its fortunes dwindle due to growing competition from
local and foreign competitors as Malaysia opens up its auto market.
Malaysia is Southeast Asia's largest passenger car market with 497,459
vehicles sold in the year 2008. Malaysia’s auto market is dominated by its
national cars, PROTON and Perodua which in year 2000 accounted for
market share of roughly 90 percent of the vehicles sold annually. Some 25
other manufacturers compete for the remaining 10 percent. But compare
with last 2 years, market share of the national car makers has declined to
roughly 63 percent.
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During year 2000, PROTON conquered 63.4 per cent market share. It has
eroded to below 30 percent in year 2007 and 2008. Perodua, the second
national cars manufacturer has taken over the market of the king for two
years ago with a market share of 33.6 percent in 2008. Malaysia is
Southeast Asia's largest passenger car market with 497,459 vehicles sold
in the year 2008. Malaysia’s auto market is dominated by its national cars,
PROTON and Perodua which in year 2000 accounted for market share of
roughly 90 percent of the vehicles sold annually. During year 2000,
PROTON conquered 63.4 per cent market share. Perodua, the second
national cars manufacturer has taken over the market of the king since
two years ago with a market share of 33.6 percent in 2008.
PROTON is currently undergoing a transformation process as part of a
long-term turnaround plan. PROTON's tie up with Geely is expected to
return the company into profitability and regaining an international
presence, betting on the introduction of the much-anticipated SUV named
Boyue planned to be launched by the end of 2018. PROTON’s marketing
mix based on Kotler’s 4Ps model: Product, Price, Place and Promotion.
3.2 Organization Chart
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3.3 Location & facilities
3.3.1 Location
Proton Holdings Berhad (stylized PROTON) is a Malaysian car
manufacturer. It is headquartered in Shah Alam, Selangor and operates an
additional manufacturing plant in Tanjung Malim, Perak. The company was
established in 1983 as the sole national car company until the advent of
Perodua in 1993. Proton is a Malay acronym for Perusahaan Otomobil
Nasional Sendirian Berhad (National Automobile Company Private Limited).
3.3.2 Facilities
The R&D facility, where the dreams of the nation are transformed into
reality, provides a complete and comprehensive range of engineering
services both for the automotive industry as well as for engineering
consultancy for any industry requiring R&D expertise. As one of the
engines of growth for the country, PROTON has the responsibility to
contribute towards the industrialization of the nation. The facilities and
expertise available at PROTON's R&D facility, provides Malaysia with the
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Dato' Sri
Syed Faisal
Albar
(Chairman)
Amalanathan
Thomas
(Director)
Daniel Donghui
Li
(Director)
Feng Qing Feng
(Director)
Shaharul Farez
Hassan
(Director)

capability to lead the way by offering a complete range of engineering
solutions to both local and foreign companies.
3.4 Daily Operation Producers
3.4.1 Operations Review
The total amount of manufacturing is forecast to raise by 3 percent to
162,000 units for the next financial year. The rise in the single digit is the
consequence of the market's cautious tone owing to the global economic
crisis that has certainly affected the worldwide car market.
Approximately 90% of the volume is allocated to the domestic market,
with the remaining 10% reserved for export, as the overseas market has
been severely affected. The amount of production is anticipated to use
less than 50 percent of the installed plant capability of PROTON and all
plants are expected to function in the current financial year on a one-shift
basis.
The volume loss has encouraged the Group to further improve operational
efficiencies and enhance operations to reduce costs. PROTON is confident
that all the cost reduction initiatives suggested will be implemented
accordingly.
3.5 Suppliers & Management Control
Suppliers sell raw materials demanded by the company to produce final
products and services. Suppliers can influence marketing efforts. In the
automobile industry, the suppliers' power is increasing. If materials are
supplied at a high cost, it will definitely affect Proton’s competitiveness in
the market as the higher price will be passed back to the customers. This
is the reason why Proton should choose suppliers wisely. For example,
Mitsubishi Motors used to source for a large majority of vehicle platforms,
engines, parts, and technical experts before being fully sold to Khazanah
Nasional for it's more quality and worth the price.
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3.6 Administrative System & Future Service
Proton maintains its position as a national automotive industry pioneer
that caters to the masses. On this note, Proton has consistently produced
cars that offer value for money, affordable technology such as the Body
Control Module (BCM), as well as the Lotus ride and handling featured in
Proton cars. On an international level, Proton is determined to become a
recognized and relevant global automotive player. The export market
plays a big role in our future as the Malaysian domestic market’s growth is
becoming saturated — the cars-to-population ratio in Malaysia is very
similar to that of developed countries and growing at the rate of 3% to 4%
annually.
4.0 MARKET ANALYSIS
Every industry is being affected by the developments in the macro-
environment. Fundamentally, all organizations are affected by the same
developments; however, the extent to which organizations successfully
cope or take advantage of these developments differs in substantial
manner. Furthermore, developments may potentially influence one
industry more severely than other. Therefore, it is vital for organizations to
identify or anticipate the macro-developments in order to assess their
potential impact on the industry and the organization (Nijssen & Framback
2000, p. 53).
4.1 Market Segments
The company used to segment its market on variables such as behavioral,
demographic, and geographical differences.
Behavioral Segmentation
Behavioral segmentation is based on the customer's needs and
subsequent reaction to those needs or toward the purchase of intended
products and/or services.
Demographic Segmentation:
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Demographic segmentation refers to a wide study of the potential
customers. Since the company is targeting its market to more economy
class customers, demographic segmentation is employed by the company.
Geographical Segmentation:
Geographical segmentation is done by dividing people (markets) into
different geographical locations. The company targets markets of different
countries other than Malaysia.
4.2 Target Market Strategy
Since Proton is the largest and most competitive Malaysian automobile
manufacturer, the most important target market of the company should be
Malaysian Market. Other markets Proton automobiles targets include
China, Singapore, Australia, Algeria and United Kingdom.
PROTON will continue to serve the domestic market despite its challenges
and tight competition. For new markets, PROTON is also targeting to
expand its products portfolio in the A, B, SUV and MPV segments for their
export market potential. These four segments account for 68% of ASEAN’s
total industry volume.
4.3 Pest Analysis
Political
· Asian Free Trade Area (AFTA)
· Different environmental Policies
Economic
· Global and local economic crisis;
· Slowing growth of Malaysian
economy;
· Poor consumer sentiment and
changing buying behavior of the
consumer;
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· Very competitive market
Social
· Huge population;
· Car ownership (1:5);
· Growing knowledge and concern of
the people towards the
environment;
· Impact of the image of the brand
· Slowing/decreasing buying pattern
of the consumer.
Technological
· Competing development in
technology;
· Maturity of technology;
· Intellectual property;
· Potential for innovation and
development;
· Maturity and capacity of
manufacturing
4.4 Main Competitors
Marketing success depends very much on how firms fulfill their consumers'
needs better than their competitors. In order to realize this objective,
Proton should select a market where it possesses a strong competitive
advantage over other competitors. Besides serving consumers, Proton
should also be aware of its competitors’ strategies. For example, in the
automotive industry in Malaysia, there are many car manufacturers like
Honda, Toyota, or Mitsubishi to compete with Proton in order to gain
customers.
4.5 Market Size
PROTON Holdings Bhd achieved its widest market share of 18.1% in 47
months amid the dwindling market size of the local automotive industry.
The national carmaker said it sold 7,615 of Proton units last month alone,
which saw its second-highest sales for this year. In May 2019, Proton
continues its upward surge in 2019 by recording the highest market share
figure since July 2015. However, the sales of 7,615 units for June 2019 is
the second highest figure, garnering an 18.1% share of the Malaysia
automotive market in a month when the total industry volume (TIV) is
estimated to have shrunk by 30.8% to 42,090 units. As for month Jun 2019
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delivery, Proton recorded 23% growth compared to June 2018, helping the
company to secure high sales for the third consecutive month.
5.0 MARKETING STRATEGY AND IMPLEMENTATION
SWOT Analysis
Political
· Asian Free Trade Area (AFTA)
· Different environmental Policies
Economic
· Global and local economic crisis;
· Slowing growth of Malaysian
economy;
· Poor consumer sentiment and
changing buying behavior of the
consumer;
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· Very competitive market
Social
· Huge population;
· Car ownership (1:5);
· Growing knowledge and concern of
the people towards the environment;
· Impact of the image of the brand
· Slowing/decreasing buying pattern
of the consumer.
Technological
· Competing development in
technology;
· Maturity of technology;
· Intellectual property;
· Potential for innovation and
development;
· Maturity and capacity of
manufacturing
5.1 Strengths
One of the important strengths of the company is its reputation or strong
brand image due to the long years it had stayed in the industry. Because
of that, the Malaysia people have become familiar and loyal to the brand,
aside from the fact that Proton had become the national car brand in the
country. Due to that, the car manufacturer has a strong support or back-up
from the government, which is considered as an important entity in any
business environment.
5.2 Weaknesses
First is the lack of R&D or innovation as well as lack of original products
and limited products because of the inability of the company to introduce
real new models, which lead them to cannibalize their screwed-up line of
products (Build Board n.d.). Furthermore, company is having different
human resource issue due to their inability to retain and cultivate talent.
Because of all these reasons, the company is lacking in international
operations.
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5.3 Opportunities
The support of the government to the company is an important
opportunity, because the government considers the company as their
partner, therefore majority of cars needed by local and national
government will be Proton. Entering new markets will also help the
company to expand their business in terms of size; therefore, can help to
gain more turnovers.
5.4 Threats
The most crucial threats to be faced by the company are the global
financial crisis which affects the economy of Malaysia and affect the
lifestyle and buying behavior of the consumer. The main reason behind
this situation is the AFTA which focus on reducing tariffs from zero to 5% in
15 years among the six nations through a common effective preferential
tariff It planned to reduce tariffs to zero to 5% in 15 years among the six
nations through a common effective preferential tariff (Ghani & Zainuddin
2008).
5.4.1 Threats of new entry and substitution
The threats of new entry pertain on how easy or difficult for new entrant to
start competing. The primary barriers of new entry are the high capital and
investments that are needed in order to enter the industry.
The threats of substitution pertain on the ability of the customers to go for
substitute products that might be cheaper and accessible. In terms of the
passenger car industry, the growing demands for bikes and motorcycles.
5.4.2 Evaluation- Measures of Effectiveness
The following measures will be taken as towards monitoring and
evaluation of specific activities. Following strategies are important in
development of new launching product of Proton Brand.
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N
o.
Promotion
Mix
Measurement / Goals
1. Advertising on
print and
electronic
media
End of each year an impact assessment survey will
be conducted to identify effectives of the
campaigns. Based on finding necessary corrective
action or changes will be taken to continue the
campaign further.
2. Sales
promotion
One of the most important indicators to measure
the effectiveness of the proportions will be number
of sales occur due to that particular proportion. This
will be identified by the application form which
indicates the indicator to be filled by customers.
3. Internet /
Interactive
Marketing
The effectiveness is based on the number of traffic
generated on the website throughout the campaign
period, and comments received from the users.
5.5 Marketing Mix Strategy
5.5.1 Product
Introducing a strategy of the, right car for the right market at the right
price and on time recently. Furthermore, it needs to continue
strengthening product portfolio with a multi-purpose high-quality vehicle
belonging to the family oriented modern lifestyle needs. By using the right
technology and keeping finger on the pulse of customer needs, really
believe that this will help bringing the company closer to achieving its
goals of dynamic product portfolio.
As a strategy given above the Proton Inspire was launched which has
almost zero difference between the Inspire and Lancer save for Proton’s
unique front-end design, which is of a V-shape as opposed to Mitsubishi’s
trademark trapezoidal “jet fighter” grille. This will be followed by Inspire
2.0.
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Product Development
With proper product planning, the company was being able to introduce
both new and improved PROTON cars in the year under review, marked by
the successful launch of the different models in past. The same strategy
will be used to for product developed by incorporating customer needs and
expectation, and research and development will be given more
emphasizes. A company can choose one or a combination of these product
development strategies. Just remember the main objectives of your
product development process:
1. To be prominent compared to competitors.
2. To continuously satisfy customers.
3. To expand your current market.
It will focus the Growth through an increased market base, increased sales
and increased profit. However, it is not only product development that is
important in a business but development of everything else that makes a
business special, which includes to develop sales techniques, marketing
strategies, manufacturing processes and office procedures. Products,
processes, procedures, strategies and techniques, all of these can be
researched and developed until they are all cutting edge.
5.5.2 Price
The firm's pricing objectives must be identified in order to determine the
optimal pricing. In this regard pricing objectives include the company
started with t profit maximization objective of seeks to maximize the
profit, taking into account revenue and costs. The second objective is often
to maximize long-term profits by increasing market share and lowering
costs.
The pricing objectives are determined based on the factors including
production cost, existence of economies of scale, barriers to entry, product
differentiation, rate of product diffusion, the firm's resources, and the
product's anticipated price elasticity of demand. The company will use
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penetration pricing strategy for new model such as Inspire 2.0, by
charging for products which is set artificially low in order to gain market
share. Once this is achieved, the price is increased.
5.5.3 Promotion
Promotion strategies will vary depending on the target market segment.
Word of mouth strategy would be applicable to all segments however,
there is no direct action for this strategy and would be incorporated to
different activities. A cost-effective campaign, focused on direct
marketing, publicity, webpages/sites, and advertising is would be
conducted as a promotional activity.
There are mainly two main types of sales promotion strategies: Push, Pull,
and as a third type combination of those two will be used. A push strategy
involves convincing trade intermediary channel members to "push" the
product through the distribution channels to the ultimate consumer via
promotions and personal selling efforts. In this regard’s tactics like
allowances, buy-back guarantees, free trials, contests, specialty
advertising items, discounts, displays, and premiums would be employed
in company’s sales promotion.
A pull strategy attempts to get consumers to "pull" the product from the
manufacturer through the marketing channel. The company focuses its
marketing communications efforts on consumers in the hope that it
stimulates interest and demand for the product at the end-user level. This
strategy is often employed if distributors are reluctant to carry a product
because it gets as many consumers as possible to go to retail outlets and
request the product, thus pulling it through the channel. Some of the
tactics like providing samples, coupons, cash refunds and rebates,
premiums, advertising specialties, loyalty programs/patronage rewards,
contests, sweepstakes, games, and point-of-purchase (POP) displays,
would be employed by the company.
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5.5.4 Place
Since the term “place’ really refers to any way that the customer can
obtain a product, for selling of Proton Inspira 2.0 will be occur via any
number of distribution channels, such as in a retail store, through and
through the online orders. The customers could approach the product that
it will ease for them to order or buy.
6.0 CONCLUSION
PROTON as the first Malaysian car manufacturer has established a very
strong identification in the Malaysia automotive market. As a result,
PROTON is unable to create positive response in the head and heart of its
consumers. Based on its recent performance, PROTON has indeed working
very hard to live up its working philosophy of producing the right car at the
right time, for the right market, at the right price. Possible solutions to
mitigate the problems identified are by introducing additional value
improvised features to enhance the performance and sales of Proton
Inspira2.0 by focusing on fuel efficiency, convenience and safety and
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emphasizing on the environment friendly vehicle. Overall, the action plans
recommended are based on 4Ps’ strategies and marketing mix models, is
to increase its sales and promotions, and give more emphasis on
continued research and development to meet the changing needs of the
customers. In this regard it is important that the company to increase its
appearance on print and electronic medians and on internet especially on
social media networks. It is also important to measure the impacts of the
marketing campaign and to take necessary corrective action time to time
to improve effectiveness and efficiency of the campaigns undertaken.
REFERENCES
Kotler, P. and Keller, K.L. (2009). Marketing Management (pp 53, 77-
84) New Jersey: Pearson Prentice Hall
PROTON’s official homepage. (www.proton.com) & (www.proton-
edar.com.my)
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Quirk, J. (2008, January 28). Car Technology: The Latest Innovations in
Engine Development and Safety. Sky Motoring. Accessed on August 13,
2019 from http://news.sky.com
The Star, Wednesday 21,2007, Many Issues Still for Proton to Address.
The Malaysian Insider, Sunday, March 28 2010, Low Export Not Proton’s
Real Problem
The Malay Mail, The Problem with Proton, by editor Leow Ju-Len, June 12,
2009.
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