The success of marketing strategies adopted by PROTON

The importance in receiving customer feedbacks tend to be neglected, although there are feedback forms resting around where nobody seems to attend to it. Receiving feedbacks is a great tool for organizations to enhance the service as the exact problem is pointed out, thus it'll be much easier to close in on the situation alternatively than spending large amount of profit bettering on something that's not essential in building customer loyalty.

Customer loyalty is very important in building patronage toward a brandname. As the economic status of Malaysia is yet to attain its peak, the auto industry players in the united states, are also yet to prioritize in the value of customer satisfaction. The organizations should identify the most crucial performance cues, such as providing good customer service, that may indirectly affect the customer loyalty through customer satisfaction (Johnson and Sirikit (2002).

Company Background

The rationale for establishing a countrywide carmaker was to go Malaysia up the economic value string in the first 1980s. Subsequently, Perusahaan Automobil Nasional Berhad (Proton) premiered in 1983, with the first car being produced in 1985. This model, called the Proton Saga, is just about the most iconic model of the company and has been periodically revamped to suit market needs. In the begin, the elements of Proton are created by Mitsubishi and later on parts are transferred and knowledge was utilized.

In 1996, Proton received Lotus technology from ACBN Holdings, which was controlled by the owner of Bugatti. Because of this, Proton has obtained an extra source of engineering and automotive experience. This added to the creation of Proton Gen-2 which was designed to replace the Wira model. Proton opened up its new manufacturing plant in Tanjung Malim in 2004, which is part of the much larger development job called Proton City. It had been here that the new Gen-2 was produced. Tanjung Malim is also the manufacturing facility for Proton's answer to Perodua, the Proton Savvy. These models looked like guaranteeing to the amount that MG Rover was contemplating revamping them when the British firm began cooperation talks with Proton. Down the road, those attempted joint-venture failed and MG Rover collapsed.

Research Problems

Initially, Proton experienced a rocky start. However, by 1988, it experienced commanded an impressive 73% of the automobile market because Proton automobiles were 20% cheaper than overseas ones. This is due to the fact that the government heavily taxed and imposed import obligations on foreign vehicles, not because the vehicles were excellent and of good quality.

Since the Malaysian market is small, Proton decided to go into the international market. It made its first foray in 1986 when the company exported vehicles to Bangladesh. Currently, the business exports autos to the United Kingdom, Australia and South Africa and Proton is strong to advertise themselves towards many countries. Else than advertising, the company does indeed exporting to countries like Singapore, Indonesia, Brunei, Nepal, Pakistan, Sri Lanka, Bangladesh, Taiwan and Mauritius.

Almost from its inception, Proton proven itself as the national carmaker and therefore, captured a huge talk about of the Malaysian car market and reported a long time of expansion in conditions of sales. Even the introduction of Perodua in 1993 did not upset the preeminence Proton enjoyed. However, this was not to keep going.

Proton blamed this decline in sales and profit on many factors. External factors such as higher petrol prices and increased expense of raw materials were blamed for leading to lower profit margins; a more open operating environment and attempting market conditions which noticed fiercely competitive marketing endeavours by almost all car manufacturers and vendors with the speedy introduction of new vehicles and incredibly competitive promotional campaigns. The business apportioned blame to tighter credit insurance policies that led to fewer loans being approved as well as the semester in car or truck values which influenced trade-ins. The company also faulted the shift in the local market which favoured smaller engine motor capacity with lower petrol use (Proton 2007 Total annual Report).

While auto manufacturers are powerless from the surge of petrol prices, Proton must recognize that it is both an exercise in futility and counterproductive to blame its rivals for promoting their products more aggressively or the company's failure to identify new trends on the market as the cause for their decline in sales and damage in market talk about. Hence, the management of the company needs to execute a great deal of soul searching to articulate its raison d'Єtre and devise a proper turnaround strategy. Rivalry is very high whenever there are a large variety of firms in a saturated market, high fixed costs, high storage area costs and low turning costs (Barney, 2007). Hence, companies will be required to resort to all sorts of tactics to be able to endure and develop. Proton is a tiny car maker in a fiercely competitive international car market. Every possible niche has been explored from high end luxury cars to mini automobiles for the impoverished. Therefore, Proton needs to become big or it will fail. To attain a competitive benefits, Proton needs to achieve cost command or differentiation (Barney, 2007). It cannot make it through alone and it requires to form a tactical alliance or relationship with a major car machine. However, this has not been easy. Many potential alliances discussions have collapsed as both parties neglect to reach a consensus.

Research Objectives

In this research have two main aims:

To identify the potency of marketing strategies implemented by PROTON.

To examine consumer's to the brand satisfaction and views of PROTON.

Research Approach

One of the approaches that was found in this research is the case study approach. This strategy relates a deep conduct in review of any company to know its success, failures and operation. Provided this case study can be good, other company with similar characteristics can apply the results as well. Therefore, whatever which is true for Proton could possibly be the identical to other organizations as well.

Importance Of Study

In targeting the consumer market, opponents such as Perodua, Honda and Proton was emphasizing on setting up a recognized value by customers on different characteristics such as Perodua being the most inexpensive choice, Proton as the countrywide car machine, and Honda being the mixture of both economical and good quality to target different markets. These strategies are integrated to entice customers who value the importance of a particular characteristic to purchase the different bundle offered by the different corporation respectively.

Due to many stupendous strategies used by the automobile organizations, issues have surfaced whether customers are being devoted to these companies. Since service providers are differing in terms of product differentiation and positively expanding their selection of services to increase market talk about on the market, customers may tend to opt for a change whenever the business is endowed with the most advanced technology or ground breaking services. Consumers' notion on the service quality of the new services and solutions offered are vital towards the company in getting patronage.

Price battle among industry players has been the media hype to encourage customers to improve organizations choices. The purchase price war one of the players such as Proton, Perodua and Honda is dependant on different prices established for all their products and services. For instance, Perodua may have lower charges for automobiles, Proton having better loan plans and Honda have good petrol economical options of automobiles.

Although the price war can happen to be nice thing about it to the clients as they are spoilt with a variety of alternatives, this price war causes unstable conditions for automobile organizations as customer can certainly change over to another company. This might cause Proton to reduce out on new customers but also existing customers will leave for better grounds hence it should act as a wakeup call to stop their price war.

Chapter 2: Literature Review

According to Cooper (1988) "a literature review uses as its data source reports of primary or original scholarship or grant, and will not report new primary scholarship itself. The principal reports found in the literature may be verbal, however in the vast majority of cases accounts are written documents. The types of scholarship may be empirical, theoretical, critical/analytic, or methodological in mother nature. Second a books review seeks to spell it out, summarize, evaluate, clarify and/or combine this content of key reports".

Customer Perception

Customer conception has several explanations. It is considered as different from quality of goods where it is intangible and it has a obstacle to marketers whereby service given is not easily communicated.

"Service quality differs from quality of goods, for the reason that service are intangible. This presents a challenge to marketers; service cannot easily be communicated to customers, and therefore quality maybe difficult for customers to examine. Service are characterized to be intangible, perishable, produced and consumed simultaneously, and heterogeneous" (Zeithaml and Bitner, 2000; cited by vehicle der Wal et al. , 2002).

The understanding of customer towards the service quality made available from Proton is a competitive gain among its rivals and it is ordinarily a major obstacle for companies to provide the service process with quality constantly. Something with high-quality has a competitive benefit in attracting new customers which contributes to the market talk about. So recognized high service quality will incline and increase buying quantity, consistency, as well as growing positive word of mouth (Venetis and Ghauri, 2000; Cited in Aydin and Ozer, 2005).

A common explanation of service quality would be that the service should match the customers' goals and meet their needs and requirements. The definition is customer-oriented, but should not be interpreted as and therefore the Proton should comply with the client and his needs. It also seems that the client who decides what is good or bad quality will not mean that the customer is always right or that the client can always completely articulate or verbalize his needs and hopes. In order to also find and understand non-verbalized customer needs, a sense of insight, useful dialog with the client and a knowledge of his situation are required.

It is often appropriate to tell apart three groups of people whose expectations, needs and requirements should be studied into account. Aside from customers, these folks contain employees and management. We do not need to try out down the value of customers' notion of quality - on the other hand - but to have the ability to offer customers the right quality; the other two communities must be satisfied. This is of quality is the fact that it satisfies needs and fits objectives; those of the clients, employees and management. It is vital to fully understand the many needs and prospects of these teams, the way they are formed and exactly how they change. When developing services, it is crucial to build in the right quality by balancing these partly contradictory needs on the service. Satisfied customers distributed the good news quickly, something which is fulfilling for the employees & most likely also for the owners. Quality improvement can be regarded as a game where all members are winners. This will be the idea of departure for all those quality development.

Customer Satisfaction

Customer Satisfaction is defined as:

"The overall frame of mind consumers have toward a good or service after they have attained and used it. It is a post-choice evaluative wisdom resulting from a specific purchase selection and the knowledge from using it" (Mowen and Minor, 1998).

Customer satisfaction brings many advantages as satisfied customers aren't really price sensitive, buy additional products, are less affected by competition and stay as loyal customers. Client satisfaction is explained where it's been deemed right to impact customer retention and companies' market talk about. In finance institutions, service quality, service features, and customer-complaint controlling determine client satisfaction. Few factors that have an impact on satisfaction are long term hours of operation and competitive interest levels as investigated by the analysis of Levesque and McDougall (1996). Furthermore, there are experts who discusses the links between satisfaction, loyalty, and profitability (Heskett et al, 1994).

According to Athanassopoulos and Iliakopoulos (2003), the concentrate on customer satisfaction has matured from being truly a simple measurement to a imperative measurement that affects a firm's competitiveness. In exhibiting the connection between variables, there exists considerable research that belief on service quality become an antecedent to customer satisfaction, which eventually causes customer loyalty (Johnson and Sirikit, 2002). Just as, Leisen and Vance (2001) affirmed the association.

In assessing literatures on client satisfaction, contact points between the provider and the client were used as a guide point in the research done by Athanassopoulos and Iliakopoulos (2003).

Satisfaction with the service agency is defined as the customer's overall analysis of his/her experience with the company. Customers also make assessments with their satisfaction with the contact person who they interact with. Satisfaction with the contact person, along with social trust, is recommended as a key component of relationship quality.

Customer satisfaction can also be observed as a crucial component of profitability. Exceptional customer support results can bring out in increased customer retention, which in turn brings about higher profitability. Since customer commitment is a significant contributor to lasting profit expansion, for achieving success, company must commit superior service. However, adult companies often ignore what made them successful before, when company begins to lost concentrate on the client and concentrating on the bottom brand and quarterly results. Companies seem to be like forgetting that satisfying customer needs and ongoing value creativity is the only path to sustainable progress.

Customer Loyalty

Customer loyalty is approximately creating and retaining a romance with your customers. An essential area to the mutually beneficial romantic relationship is the awareness of customer desire or today's and potential needs and wishes of a customer about any aspect of the business. Loyal customers can be easily convinced to test new products or services hence allowing companies' to impose higher prices and use them as a willing referral.

Customer devotion is one of the foremost objectives in a business. Apart from having such an objective, attaining customer devotion is also a crucial problem today especially in this progressively competitive and crowded marketplace due to eventual profitability it'll give especially in conditions of international marketing.

Countless marketing academicians, statisticians and marketing specialists have beaten the truth that it is more expensive to get a new customer than to hold on to a preexisting one. Companies require programs to acquire and retain devotion of customers when confronted with increasing product parity and intensifying competition. However, the problems do not only stop to devotion programs but also it is about the proper execution and goals of such programs (Munnukka, 2005)

Customer loyalty is defined as the trend of a customer to choose one business or product over another for particular needs or demand. For example, in the packed goods industry, clients may be described as being "brand faithful" since they tend to choose a specific brand more often than others. Understand that the utilization of the word "choose" in the context of customer devotion becomes more evident when selections are being made and activities were used by any customers. It could be said that devotion is shown by the activities of the customer.

It is also stated that customer devotion has become a catch-all term for the results of different marketing techniques in which customer data is used. Customer commitment is the consequence of well-handled customer retention programs; customers who receive attention with a retention program illustrate higher loyalty to a company.

Consequently, there can be an interaction between your desired results and client satisfaction, customer commitment and customer retention. They may pass other definitions such as customers, clients, clients, etc. Without the customer it isn't possible for any business to survive especially those who are fighting in the international world. Reaching the desired results is usually a consequence of customer actions. Any business which neglects client satisfaction is at the mercy of the market. Without devoted customers, the competitors could steadily pinch away at our customers hence decreasing customer retention rates.

Loyal customers normally do not leave even for an appealing offer anywhere else. At the minimum they'll provide you the opportunity to match the opposing factors offer. Maintaining loyal customers can be an important part of any business. A great way to get or maintain dedicated clients is through possessing quality products and services which satisfies customer needs. However one of the key problems is learning the exact need of each customer. Even though we knew their exact requires a customer can and will switch them with no warning or reason. Using a good healing process for a dissatisfied customer is crucial in this world.

Customer devotion studies have been able to measure both characters and experiences which directs to advisable behaviours. It really is a study that is extremely actionable whereby it bank checks areas for improvement, prioritizes them, recognizes remedies, and then provides opinions on their success. Alternatively, market researchers choose to debate if the range of such research is really "client satisfaction" or "customer loyalty. " Most will debate whether loyalty can be an attitude or a behavior. It isn't difficult to get caught up in the semantics, but the bottom-line is clear.

Such theory applies to each and everyone available market. In market surroundings that are experiencing slow growth, the existence of customer base company is a valuable asset. Hi-tech markets have an awful way of shifting. Contemporary and immediate business organisation, or companies offering substitute services, can develop abrupt and upsetting changes in the competitive business environment. In this respect, a company which has a clear understanding of its recognized talents and weaknesses are those organizations which will be well-prepared to improve and market effective competitive strategies. Establishments with small customer bases are in need of objective feedback as soon as they could have paying customers and faithful customers.

According to Dekimpe et al (1997; cited in Aydin and Ozer, 2005), a firm's successfulness depends on the capability to hold on to and making customers patronize the brand. There were a number of meanings of customer loyalty distributed by different publication authors and researches.

In customer devotion, the process that a customer undergoes before patronising a brand is when they previously purchased a superior quality product and are satisfied with their purchase.

It is identified from few different empirical studies; customer perceived service quality (conception) and client satisfaction are the main factors correlated in building customer devotion. The recognized service quality is important in measuring the devotion of customers towards a service provider as it would show the exact reason why or you will want to the customers patronize the brand. Value of perceptions could also differ based on the usage situation (Anckar and D'Incau, 2002; cited by Pura, 2005).

In the literature review, contradiction among research workers has been found. In Aydin and Ozer (2005) research, identified service quality has been found necessary but insufficient to condition customer devotion while in Johnson and Sirikit (2002) affirmed by providing high quality service, client satisfaction will occur resulting in customer loyalty. Most of these literatures are located in western countries, where in fact the actual effects cannot be assumed in Malaysia. Therefore, this research topic on customer commitment in telecommunication industry as their service has been chosen to help expand contribute to the data on this theme in Malaysia.

Businesses around the world including telecommunication providers are constantly seeking unique ways of differentiating their offerings (Johnson and Sirikit, 2002) in terms of innovativeness and quality to gain and maintain a competitive benefit (vehicle der Wal, 2002). Predicated on the literature review from Athanassopoulos and Iliakopoulos research (2003), it is available that four different contact points between the customer and the telecommunications operator are significant, which projects client satisfaction has a confident influence on the telecommunication service provider.

Chapter 3: Research Methodology

3. 1 Location and Time of study

In this research, the survey will be conducted in Kuala Lumpur, the administrative centre of Malaysia. This location is chosen because all three providers, particularly Maxis, Digi, and Celcom are relatively strong in terms of market show in this area. The demographic factors of respondents in this field are the the most suitable as busy standards of living of respondents are attributable to the intense working environment as well as the exhilarating nightlife. In a chain effect, the needs and needs of respondents for the service provider are usually more particular and challenging.

Another reason Kuala Lumpur was chosen for the analysis is because the English literacy of respondents are higher compared to other says in this Islamic country. With proper knowledge of the review questions, respondents have the ability to provide more accurate and truthful data. . In addition, metropolitans are chosen as the positioning of study in previous research done by Aydin and Ozer (2005) and Leisen and Vance (2001). The review will be conducted in two locations, namely KLCC (Kuala Lumpur Convention Centre) Playground and Titiwangsa Park in Kuala Lumpur. These locations were chosen as the number of demographic parameters of respondents is large. Moreover, the respondents in these parks tend to be more willing and will often have free time to captivate questionnaire survey in comparison to other areas in this busy city. The review will be completed on Sunday on 31st of July 2010. The distribution of the questionnaire will be sectioned off into two classes. The first session commences at 9. 00am in the morning at Titiwangsa Park whilst the next session takes place in KLCC later in the day. This time around was chosen as the rate of recurrence of people going to these parks are significantly higher during those times.

3. 2 The Sample

The targeted people of this research is on mobile phone user based in Kuala Lumpur. The sample comprised of 100 respondents who have used any of the three providers, particularly Maxis, Digi, and Celcom. In earlier studies, the difference in sample size of other empirical studies ranges from 200 respondents (Leisen and Vance, 2001) to 1950 respondents (Aydin and Ozer, 2005). A non-probability quota sampling way was also applied on demographic factors such as years and gender. This sampling method was done to ensure these demographic factors of the mark society are well symbolized and the test results would be unbiased.

In my research I'd also choose the non-probability quota sampling approach in order to acquire data that is well symbolized. For me personally to collect neutral data, I put to work with two different locations so that I possibly could get a more substantial variance in my own sample group.

3. 3 Source of Data

The primary data collection method found in collecting the samples in this crosssectional research will be the questionnaire study method. This data collection method was implemented from other empirical research as the response rate was found to be relatively high. A response rate of 88% (Johnson and Sirikit, 2002), and 85. 2% (Aydin and Ozer, 2005) were registered in their individual research. . Another reason behind using the questionnaire method is the capability to collect huge amounts of data within a short while frame which is also less expensive. Posting questionnaires through the mail is not feasible scheduled to low response rates (Munnukka, 2005) and the time constraints in completing this analysis.

A precise questionnaire will serve as the primary data collected to investigate the variables needed in this analysis, namely the demographics, customer devotion, customer perception, and client satisfaction towards telecommunication service providers among cellular phone users in Kuala Lumpur. 100 questionnaires will be distributed to the public in the parks to be able to satisfy the sample frame.

3. 4 Research Instrument

As explained above that really the only way to obtain data are from questionnaire, the designed questionnaire are followed from three few empirical studies. The questionnaire was summarized into five major parts, that was further split into more parts showing neatness and simplicity respondents in answering. The first part (part A) comprise questions regarding respondents' demographic variables such as era, gender, level of education, competition and income scale. Ordinal scales was used in measuring the age (question one) rather than ratio scale is principally due to sensitivity of the question. Nominal size was found in identifying gender, degree of education, competition and income (question two, three, four and five).

The second part (part B) of the questionnaire comprise a summarized overall belief and satisfaction of company, which consists five questions. This practice of summarizing the instrument were followed from van der Wal et al. (2002), which Aydin and Ozer's (2005) research. The five questions measure the customer's overall perception and satisfaction towards the business.

The third part (part C) involves the service quality of the company. This is split into 5 sections consisting of attentiveness and mannerism, trustworthiness, level of sensitivity, professionalism and pricing. 21 years old questions were asked concerning the service quality of the company. A five-point Likert size was utilized in measuring these variables.

The fourth part (part D) are made up eight questions that your aim of the question is to determine the satisfaction level of the respondents to the telecommunication service providers. Again, the five-point Likert size was utilized in measuring these factors.

The last part (part E) consists of six questions regarding customer devotion of the business. The questions are split into two sections which can be self-loyalty and suggestion to others. The five-point Likert range was utilized in measuring these factors.

3. 5 Data Analysis

In analyzing the info collected, SPSS version 12. 0 software will be used. Descriptive examination methods will be used in analyzing the pattern of the data, including the utilization of frequency table which ultimately shows the distributions old, gender, degree of education, and selection of service agency of respondents. Club graphs and pie charts will be utilized to percentages on respondents' devotion towards their company. These descriptive analyses will be shown in the following chapter.

Mean comparisons are also done on the demographic variables with the respondents devotion toward the telecommunication service providers. From this, the means of each category of a demographic variable is shown and comparisons can be made. Furthermore, a cross-tabulation between your demographic factors of the respondents and the respondents' commitment towards their current service agency will be completed. That is to learn the exact percentage of respondents in a specific category for every single demographic variable on whether the respondents are devoted or disloyal to their current company.

Limitations of the Study

There are a few constraints that have surfaced in the process to do this research. First of all, the scope of the study is bound as there are additional evaluating factors for those three factors specifically customer satisfaction, recognized quality, and price sensitivity. The excess evaluating elements aren't included due to the existing significant theoretical platform as well as the small amount of time frame in doing this research. Secondly, sources of data are limited as postal and face-to-face interviews cannot be exercised as these procedures require a long time span for the procedure to be completed. Last but not least, the sample size will not significantly represent the population as a sizable sample size can't be obtained through a report done by only one researcher with budget and time constraints. Inside a chained reaction, a more accurate seven-point size (Likert size) can't be utilized as it is unsuitable for small sample size of 100. When we use an example size of 100, the Likert scale of 5 point is generally used. Because of our test size of 100, a 5 point Likert size will be used to create the questionnaire.

The format of the five-level Likert range is:

1. Highly disagree

2. Disagree

3. Neither Agree nor Disagree

4. Agree

5. Highly agree

In future research, experts can take these limitations under consideration in improving the quality of research on telecommunication services.


Descriptive information have been provided to make clear about the respondents in conditions of the demographics parameters such as age group, gender, degrees of education. Researching on issues like customer loyalty has to contain a bigger test size rather than the 100 sample size used to obtain a clearer result. Here are some recommendations on how the telecommunication providers should improve for the better future.

Recommendation 1

The telecommunication service providers should advertise more adverts in journals and newspapers. They should not put the publicized period in the same time that is basically because continuity advertisement could keep up to date and persuade customer about the business. Then, advertisement should be throughout the year to get more customers' attention. Marketing department will accountable for this.

Recommendation 2

The telecommunication service providers should always have IT engineers to keep an eye on and keep maintaining their website which is obviously down. Website maintenance is another method for customer convenient and easily grows to them. IT team with responsibility because of this and they'll keep updating the info about the company information.

Recommendation 3

The telecommunication companies should give prize to the employees whom are performance in good such as extra and travel. Incentive will motivate employee to performance well and continue stick with them, the goal is to decrease the training cost. Additionally a minimal turnover rate will help to save money and time for training. Travel plan is defined and in-charge by human being resource department. This will likely boost the service provided by the employees and in a position to increase customer loyalty.

Recommendation 4

Furthermore, the telecommunication service providers should provide more training on service quality and customer commitment retention. Training could keep employees improve their skill and knowledge, for example technical, especially for deal person. Training is including seminar or discussion among small group. This training is in control by human source department.

Recommendation 5

The telecommunication companies should give more trust with their customers. For many Chinese businessmen, "trust" is often the primary of an effective business. It is regarded by many that is the normal Chinese mentality in conducting business. Actually, this mentality could be the best core marketing strategy for each telecommunication company. When customers builds trust on the service provider, it'll instinctively assist in retaining existing customers and heightening customer devotion.

Recommendation 6

Lastly, employees' critical thinking is crucial. Within the moment of interacting with these consumers, which might only take short while, the employees have to carry out the best answer for both the telecommunication providers and customers. The employees should be trained to boost their negotiation skill, critical thinking, and communication skill. This is done by sending the managers or exceptional employees to attend seminars or training programs in related fields.

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