marketing asri
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FACULTY OF
BBPM2103
MARKETING MANAGEMENT I
JANUARI 2013
ASSIGNMENT TITLE
ECONOMY DRIVERS
Name :
Matric number :
NRIC :
Telephone number :
E-mail address :
Tutors name :
Learning Centre :
Semester :
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CONTENT
TITLE M/S
1.0 Description on the selected organisation
2.0 Descriptions on the new economy drivers
3.0Identification and discussion on the new economy driver(s)
that affect the selected organisation
4.0Recommendations of steps to manage the new economy
driver(s) in the selected organisation
5.0 Summary that highlights the new economy drivers,discussion of effects and recommendations to manage them
6.0 References
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1.0 Description on the selected organization
The auto industry in Malaysia is closely linked to the history of Perusahaan Otomobil
Nasional Bhd (PROTON). PROTON was incorporated on May 7, 1983 to manufacture,
assemble and sell motor vehicles and related products, including accessories, spare parts and-
other components. Some researchers like, Sim (1979) and Keat and Li (1998) pointed out
obstacles to production efficiency in local motor vehicle assembly operations and also in the
marketing of automobiles in Malaysia. This includes diseconomy of scale associated with
production oriented to a domestic market of limited size and lack of Customer focus.
Later, the Malaysian Government with the direct support of Yang Amat Berhormat Dato'
Seri Dr Mahathir Mohamad, former Prime Minister of Malaysia initiated the national car project.
Picture: Proton Logo
Perusahaan Otomobil Nasional Bhd (PROTON) has come a long way from a mere car
assembler to an integrated car company. The Malaysian Prime Minister, Dato' Seri Dr Mahathir
Mohamad, commercially launched Malaysia's first car model, the Proton Saga, on July 9, 1985.
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Converted to a public company on 22nd Nov. 1990, it was publicly listed on the Kuala Lumpur
Stock Exchange (KLSE) in March 26, 1992.
The company is publicly listed on the Bursa Malaysia and a majority 42.74% stake of its
equity is owned by the Malaysian conglomerate DRB-HICOM, as of January 2012. Previously,
Mitsubishi Motors and parent Mitsubishi Corp. held a 15.86% joint stake in Proton from the
company's inception until March 2004, which they later sold to Khazanah Nasional.
Proton, predominantly reliant on the local industry is currently undergoing major
structural and internal changes, as evident in the appointment of a new owner and the launch of
various new and upcoming models such as the Proton Prev, designed to conform and compete
on the international level.
Among the greatest achievement of Proton are:
a) 11 January 2011 - The BrandLaureate Master Awards
2010 - Voted by The SMEs As The Most Preferred Brand
in Automotive.
b) 24 February 2011 - Proton Inspira - 2nd Place (Family
Cars Category) at the Asian Auto Fuel Efficiency Award
2010. Lotus Elise S - 2nd Place (Performance Cars
Category) at the Asian Auto Fuel Efficiency Award 2010.
c) 13 April 2011 - Proton Persona - 2011 Frost &
Sullivan Malaysia Excellence Award for the category
Value-for-Money Car of the Year (1.3l and Above).
d) 14 April 2011 - PROTON awarded the Quality
Management Excellence Award (QMEA) (Category IV -for annual sales turnover exceeding RM100 Million) during
the Malaysia Industry Excellence Award (IEA) 2010.
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e) 08 May 2010 -PROTON awarded Labour Day
Achievement Award for the category Competitive
Employer Award (Big Corporations) in conjunction with
2010 Workers' Day Celebration presented by the Prime
Minister.
f) 12 May 2010 - Frost & Sullivan Malaysia
Excellence Award 2010, Best Passenger Car Model of the
Year for Proton Saga (fifth award) and Best Automotive
Debut Model of the Year for Exora.
The development of the local motor vehicle industry has had useful economic functions-
generation of employment and has helped establishment of supportive industries. It has spawned
a number of companies solely dedicated to making specialised accessories such as sports rims,
tints, and an scores of workshops. Presently, Malaysia has become one of the region's largest
auto markets and holds a dominant position in vehicle sales among ASEAN countries.
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2.0 Descriptions on the new economy drivers
New economy is a term often used in the media to describe the changes that have taken
place in the world of business since the widespread adoption of Internet technology. It has been
applied to a wide range of situations and issues, most notably the rise and fall of high-tech and
Internet startup companies. During the 1990s, as the United States experienced a long economic
expansion and the stock market soared, many people started to think that basic economicprinciples no longer applied in the age of the Internet.
The basic idea behind the new economy was that computer and Internet technology had
fundamentally changed the typical way of doing business. Analysts and investors alike focused
on technology adoption and stock price valuation rather than revenues and long-term business
plans when evaluating companies.
Companies in the new economy are heavily involved in the internet and biotech
industries, but the ripple effects of new technologies have spread out to all other industries as
well. Because marketing is one of the basic fundamentals of the business of business, hence it
is necessary to effectively identify and obtain new customers, and build strong relationships with
existing customers to ensure retention. Effective marketing should not only convey the product,
price and delivery methodology, but more importantly it is your tool to communicate the value
you create for your customers, partners and society.
Digitalisation and Connectivity
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The new economy is a digital economy. Throughout history, revolutions in a natural
resource have led to new tools, which led to new wealth and social development. The new age
could be aptly dubbed the age of sand. The affairs of commerce, business transactions, human
communications, and the insights of science are all reduced to charges on particles of silicon or
through glass fibers-both based in sand.
In the new economy, information is increasingly digital in form-bits. When information
becomes digitized and communicated through digital networks, a new world of possibilities
unfolds. Vast amounts of information can be squeezed or compressed and transmitted at the
speed of light. The quality of the information can be far better than with analog transmissions.
Information can be stored and retrieved from around the world, providing instant access to much
of the information recorded by human civilization. New digital appliances can be created whichfit in your pocket and can impact most aspects of business and personal life
By the year 2020, an entire generation, Generation C (for connected), will have grown
up in a primarily digital world. Computers, the Internet, mobile phones, texting, social
networkingall are second nature to members of this group. And their familiarity with
technology, reliance on mobile communications, and desire to remain in contact with large
networks of family members, friends, and business contacts will transform how we work and
how we consume.
In general, digitisation means conversion of non-digital material to digital form. It is
needed for easy retrieval and storage. The digitization of the business world has rendered the
phone book and print ads nearly obsolete. Consumers use Google and other search engines to
locate and research products and services. Word-of- mouth referrals are made via social media
sites such as Facebook and Twitter. Product and service reviews are available through corporate
and personal blogs. To survive and grow in todays market, businesses have to use all these and
more to reach their customers.
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The phenomenon of digitization is reaching an inflection point. The effects of an
increasingly digitized world are now reaching into every corner of our lives because three forces
are powerfully reinforcing one another.
Customisitation and Customerisation
Customisation refers to the tailoring of the campaign according to the needs of an
individual or groups of individuals. In other words it mean an activities of tailoring a particular
product to the specific needs of an individual customer. These are high margin products where
the volumes are low and the buyers are few. It is the process of allowing the customers to design
and have the product to their choice.
Production of personalized or custom-tailored goods orservices to meet consumers'
diverse and changing needs at near massproduction prices. Enabled by technologies such as
computerization, internet, product modularization, and lean production, it portends theultimate stage in market segmentation where every customercan have exactly what he or
she wants.
Customized marketing is generally practiced by companies whose products are very
expensive or unique, such as custom home builders or airplane manufacturers, because these
products can be designed to suit the special needs of each customer. Since the company adapts
its product and marketing program with such a high degree of specificity, customized marketing
is considered to be the ultimate form of target marketing. For example, a furniture manufacturer
that manufactures based on the customer needs.
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http://www.businessdictionary.com/definition/production.htmlhttp://www.investorguide.com/definition/goods.htmlhttp://www.businessdictionary.com/definition/services.htmlhttp://www.investorwords.com/10302/meet.htmlhttp://www.investorguide.com/definition/consumer.htmlhttp://www.businessdictionary.com/definition/need.htmlhttp://www.businessdictionary.com/definition/price.htmlhttp://www.businessdictionary.com/definition/technology.htmlhttp://www.investorguide.com/definition/internet.htmlhttp://www.businessdictionary.com/definition/product.htmlhttp://www.businessdictionary.com/definition/stage.htmlhttp://www.investorguide.com/definition/market-segmentation.htmlhttp://www.investorguide.com/definition/customer.htmlhttp://www.investorguide.com/definition/exactly.htmlhttp://www.businessdictionary.com/definition/want.htmlhttp://www.businessdictionary.com/definition/production.htmlhttp://www.investorguide.com/definition/goods.htmlhttp://www.businessdictionary.com/definition/services.htmlhttp://www.investorwords.com/10302/meet.htmlhttp://www.investorguide.com/definition/consumer.htmlhttp://www.businessdictionary.com/definition/need.htmlhttp://www.businessdictionary.com/definition/price.htmlhttp://www.businessdictionary.com/definition/technology.htmlhttp://www.investorguide.com/definition/internet.htmlhttp://www.businessdictionary.com/definition/product.htmlhttp://www.businessdictionary.com/definition/stage.htmlhttp://www.investorguide.com/definition/market-segmentation.htmlhttp://www.investorguide.com/definition/customer.htmlhttp://www.investorguide.com/definition/exactly.htmlhttp://www.businessdictionary.com/definition/want.html -
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Customerisation on the other hand means a combination of operational and marketing
customization. A company has to be able to interact with each customer personally in terms of
message, services and customer relation.
Disintermediation and Reintermediation
Disintermediation is the removal ofintermediariesin a supply chain, or "cutting out the
middleman". Instead of going through traditional distribution channels, which had some type of
intermediate (such as a distributor, wholesaler, broker, oragent), companies may now deal with
every customer directly, for example via the Internet. Disintermediation initiated by consumers is
often the result of high market transparency, in that buyers are aware of supply prices direct from
the manufacturer. Buyers bypass the middlemen (wholesalers and retailers) to buy directly from
the manufacturer, and pay less. Buyers can alternatively elect to purchase from wholesalers.
Often, a business-to-consumer electronic commerce (B2C) company functions as the bridge
between buyer and manufacturer.The use of direct sales channels between manufacturers and
buyers was expected to significantly increase in the early 2000s, boding well for many
companies. Peppers and Rogers Group of Stamford, Connecticut and the Menlo, California-
based Institute for the Future conducted a study that revealed a healthy forecast for companiesselling direct. The research predicted the number of consumers using the direct sales channel
would triple between 1998 and 2010 from 11 percent to 33 percent, respectively. It also forecast
consumer direct sales to grow from $190 billion to $1.1 trillion during the same timeframe.
Reintermediation can be defined as the reintroduction of an intermediary between end
users (consumers) and a producer. This term applies especially to instances in which
disintermediation has occurred first. Reintermediation occurred due to many new problems
associated with the e-commerce disintermediation concept, largely centered on the issues
associated with the direct-to-consumers model. The high cost of shipping many small orders,
massive customer service issues, and confronting the wrath of disintermediated retailers and
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supply channel partners all presented real obstacles. Huge resources are required to
accommodate presales and postsales issues of individual consumers.
Convergence Industry
In the new economy, the dominant economic sector is being created by three converging
industries which, in turn, provide the infrastructure for wealth creation by all sectors. In the old
economy, the automotive industry was the key sector. The dominant sector in the new economy
is the new media, a product of the convergence of the computing, telecommunications, and
content industries. In the U.S, new media and its ancillary industries and services account for
more than 15 percent of GDP Computer hardware and communications bandwidth are both
becoming commodities. The profit in the new sector is moving to content because that's where
value is created. However, many of the content companies-the entertainment companies,
broadcast networks, and publishers-are slow off the block as old paradigms die hard. The more
successful companies are those with a background in software, services, computer-based content,
and digital telecommunications.
Convergence is becoming the basis of all sectors. The new media is already beginning to
transform the arts, the way scientific research is conducted, and the way education is delivered. It
is on the threshold of transforming the firm as we know it, and changing the way we do business,
work, play, live, and probably even think.
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3.0 Identification and discussion on the new economy driver(s) that affect the selected
organisatio
Convergence is becoming the basis of all sectors. The new media is already beginning to
transform the arts, the way scientific research is conducted, and the way education is delivered. It
is on the threshold of transforming the firm as we know it, and changing the way they do
business, work, play, live, and probably even think.
Driven by convenge industry, Proton exports cars to the United Kingdom, South Africa,
and Australia and the company is aggressively marketing its cars in several other countriesincluding the Middle East. Additionally, Proton has also been exporting a small volume of cars
to Singapore, Brunei, Indonesia,Thailand,Nepal, SriLanka, Pakistan,Bangladesh,Taiwan,Cypr
us and Mauritius. 14,706 Proton cars were exported in 2006 . The export units jump to 21,261 in
2009 but fell to 18,769 in 2010 due to global recession
Also, the digitalization has affected proton on how they going to expand their business.
Hence, Proton actively connected to digitalization by rapidly makes rebranding using their
medium of technology. From 1983 the manufacturer's badge on the front of the car was a mid-
blue shield with a yellow crescent below a yellow fourteen-pointed star - references to
Malaysia's coat of arms. In 2000 this was revised into its current form, a stylized
yellow tigerhead on a green roundel upon a darker blue shield, with the Proton name in yellow
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http://en.wikipedia.org/wiki/United_Kingdomhttp://en.wikipedia.org/wiki/South_Africahttp://en.wikipedia.org/wiki/Australiahttp://en.wikipedia.org/wiki/Middle_Easthttp://en.wikipedia.org/wiki/Singaporehttp://en.wikipedia.org/wiki/Bruneihttp://en.wikipedia.org/wiki/Indonesiahttp://en.wikipedia.org/wiki/Thailandhttp://en.wikipedia.org/wiki/Nepalhttp://en.wikipedia.org/wiki/Sri_Lankahttp://en.wikipedia.org/wiki/Sri_Lankahttp://en.wikipedia.org/wiki/Pakistanhttp://en.wikipedia.org/wiki/Bangladeshhttp://en.wikipedia.org/wiki/Taiwanhttp://en.wikipedia.org/wiki/Cyprushttp://en.wikipedia.org/wiki/Cyprushttp://en.wikipedia.org/wiki/Mauritiushttp://en.wikipedia.org/wiki/Global_recessionhttp://en.wikipedia.org/wiki/Coat_of_armshttp://en.wikipedia.org/wiki/Tigerhttp://en.wikipedia.org/wiki/United_Kingdomhttp://en.wikipedia.org/wiki/South_Africahttp://en.wikipedia.org/wiki/Australiahttp://en.wikipedia.org/wiki/Middle_Easthttp://en.wikipedia.org/wiki/Singaporehttp://en.wikipedia.org/wiki/Bruneihttp://en.wikipedia.org/wiki/Indonesiahttp://en.wikipedia.org/wiki/Thailandhttp://en.wikipedia.org/wiki/Nepalhttp://en.wikipedia.org/wiki/Sri_Lankahttp://en.wikipedia.org/wiki/Pakistanhttp://en.wikipedia.org/wiki/Bangladeshhttp://en.wikipedia.org/wiki/Taiwanhttp://en.wikipedia.org/wiki/Cyprushttp://en.wikipedia.org/wiki/Cyprushttp://en.wikipedia.org/wiki/Mauritiushttp://en.wikipedia.org/wiki/Global_recessionhttp://en.wikipedia.org/wiki/Coat_of_armshttp://en.wikipedia.org/wiki/Tiger -
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capital letters. At the same time text representations of the Proton name were changed from
lowercase italic text "proton" to uppercase "PROTON". Sales collateral and PR literature use
both "Proton" and "PROTON".
4.0 Recommendations of steps to manage the new economy driver(s) in the selected
organization
In order to effectively embrace the New Economy, Proton need to realize that the new
economy is a networked economy, integrating molecules into clusters which network with others
for the creation of wealth. The new paradigm in wealth creation is possible because of digital
computer networks and because of a shift from the host-computer, hierarchical networks of the
past to peerto-peer webs based on the Internet model. As the bandwidth of such networks grows
to achieve full multimedia, the opportunities for new institutional structures grows dramatically.
The new networked organizational structures are not simply the creation of "process-
oriented" organizations in which "stovepipe" business processes are reengineered horizontally to
save costs and improve responsiveness. Nor is the change simply a shift to team-based structures.
Rather, it is a radical rethinking of the nature and functioning of the organization and the
relationships between organizations. The new organization, dubbed by the Alliance for
Converging Technologies as the "Internetworked Enterprise," is a vast web of relationships,
including all levels and functions, in which the boundaries inside and outside are permeable and
fluid.
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For Proton, the new technology networks enable small companies to overcome the main
advantages of large companieseconomies of scale and access to resources. At the same time,
these smaller companies are not burdened with the main disadvantages of large firms-deadening
bureaucracy, stifling hierarchy, and the inability to change. As larger companies become clusters
of smaller molecules which can work well together, they gain the advantages of agility,
autonomy, and flexibility.
The Internetworked Business is a far-reaching extension of the virtual corporation,
because there will be access to external business partners, constant reconfiguration of business
relationships, and a dramatic increase in outsourcing. The Internetworked Enterprise will behave
just like the Internet, where everyone can participate and the total effort is greater than the sum
of the parts.
It is also impotant for them that the overall economy will act in the same way. Networks
of networks along the Internet model are beginning to break down walls among companies and
their suppliers, customers, affinity groups, and competitors.
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5.0 Summary that highlights the new economy drivers, discussion of effects and
recommendations to manage them
The new economy involves acquisition, processing, transformation, and distribution of
information. It is a marvelous device for allowing us to collect and transmit existing information,
of which there is an enormous amount dispersed around the world. The rules of the new
economy promote the generation of new knowledge because the lower distribution costs make
the potential market for new information much larger and more lucrative. On this other hand, the
lower cost of transmission and distribution may erode the property rights in intellectual property
and make the production of new knowledge less profitable. But yet, how these two forces willbe
resolved is unclear.
For Proton, broadening the boundaries of international trade is part of the more general
phenomenon wherein the new economy is likely to intensify competition in many sectors. In
essence, the reduction in communications costs, particularly the immense increase in
connectivity due to the Internet, will allow much improved price discovery, comparison
shopping, online auctions, and other features that in effect increase the size of markets. This
trend will be particularly intensified with the increasing push toward commoditization, discussed
above, which broadens markets and intensifies competition.
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Added together, these trends suggest that the main impact of the new economy on open
economies indeed on individual firms and individuals who are after all tiny open economies
will be to intensify competition, erode pockets of market power, and reduce the frictions that
keep markets from operating effectively and even ruthlessly. This is surely good news for
consumers and for nimble businesses but may be bad news for sluggish firms, rigid economies,
and inflexible or poorly educated workers. In the new economy, as Pascal said, risk favors the
prepared mind.
6.0 References
"First National Car Reborn". The Star / YouTube. 18 January 2008. Retrieved 6 March 2013
http://corporate.proton.com/About/Brand/Awards.aspx. Retrieved 6 March 2012
http://www.proton.com.my/. Retrieved 6 March 2013
Ong Soo Heong (2006-01-13). "VW's demands wreck deal with Proton". Malaysia Today.Archived from the original on 2007-01-03
"PROTON 25 Years". Proton Interactive / YouTube. 15 July 2010. Retrieved 7 March 2013
Whitley, Angus (2007-01-25). "25/01: Malaysia's Proton loses top-selling spot for the first time".Bloomberg.com. Archived from the original on 2007-10-10
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http://www.youtube.com/watch?v=sSq2MYjRmgo&feature=youtu.be&t=1m36shttp://corporate.proton.com/About/Brand/Awards.aspxhttp://www.proton.com.my/http://www.youtube.com/watch?v=hAxduyoNXYwhttp://www.youtube.com/watch?v=sSq2MYjRmgo&feature=youtu.be&t=1m36shttp://corporate.proton.com/About/Brand/Awards.aspxhttp://www.proton.com.my/http://www.youtube.com/watch?v=hAxduyoNXYw -
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