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Clever marketing boosts Lexus sales

One of the South African motor industry's biggest turnarounds in history in terms of brand marketing position and sales has boosted sales of Lexus to phenomenal heights.
During the first full year of the implementation of its revitalisation plan, Lexus sold more than 1.5 times the number they have recorded during the past 11 years.

In the years since 1993 Lexus sold only 1,782 new vehicles in this country. During the rebranding first year this figure escalated to 3,006 (250.6 vehicles per month).

“We can comfortably claim to have held to our forecasts despite some challenges placed on our figures such as the introduction of the new eNaTIS system and the revised National Credit Act,” says Brian Hastie, senior manager for Lexus South Africa.

Lexus embarked on a complete makeover last year, re-inventing themselves with an all-new product line-up, spearheaded by the revised RX 350, and then joined by the all-new IS 250, GS 300 and LS 460. The new model range was backed up by the creation of a dedicated Lexus brand division within Toyota SA to drive the brand forward.

Defining Lexus' new image included a new dealership strategy with a completely unique look and feel befitting the company's L-finesse design philosophy. “The aim was to establish an overall ownership experience unlike any other in the South African market that embodied the hallmarks of Lexus: simplicity of form and function, elegance and exclusivity,” says Hastie.

The new product range has acquitted itself particularly well in the SA market. The IS 250 automatic was nominated as a finalist in the South African Car of the Year competition and the brand silenced the skeptics when the LS 460 was named World Car of the Year, beating 28 other contenders to the prestigious accolade in the opinion of world jurors from 22 countries.

Lexus remains exclusively a premium segment player, and within that market has a model strategy that places the luxury brand only in the upper reaches of the respective segments they compete in. As such, individual model sales track well against established German rivals, and in many instances, Lexus now outsells more traditional brands.

The IS 250 significantly outstrips sales efforts from BMW's 323i and 325i, Mercedes-Benz' C230 and C280, and Audi's A4 2.0TFSI models. GS 300 also sells more units every month than the Mercedes-Benz E350, BMW 530i, and Audi's A6 3.0 and 3.2 FSI derivatives. While the Mercedes-Benz S-Class is a clear market leader in its segment, the Lexus LS 460 is a strong number two, selling a third more vehicles than BMW's entire 7-Series range, and a factor of more than that compared to Audi's A8 and Jaguar's XJ range.

The LS 460 has on occasion held as much as 25% market share of the segment.

“These figures effectively place Lexus in a consideration mix many might not have thought possible until now,” says Hastie. “In volume terms, Lexus has become one of the leaders in this segment within the realm of the models we market.”

Within the 3,006 Lexus sold in the 12 months since launching the brand's revitalisation plan, the IS 250 accounted for 77.3% of sales, the GS 300 for 13.1%, the flagship LS 460 for 4.0%, and the RX 350 for 5.6%.

“While the market in general is beginning to slow down, Lexus sales are not shrinking as much as others,” says Hastie. “This indicates our strong presence in the premium market and our continued ability to grow market share and volume through well specced products and brand awareness going forward.”

Lexus vehicles range in price between R287,800 and R359,400 for the IS 250; between R486,200 and R542,200 for the RX 350; between R440,700 and R480,500 for the GS 300 and R803,400 for the flagship LS 460.

The price of all Lexus vehicles include a four-year/100,000km maintenance plan.

Lexus' turnaround success must rate as one of the most pronounced in the South African motor industry – and it seems set to continue as it dealership network expands.
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