goodyear: the aquatred launch case study

Download Goodyear: The Aquatred Launch Case Study

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  1. 1. Harvard Case Study
  2. 2. Called The Gorilla Ranked 3rd in worldwide sales of new tires Operated 41 plants in the US, 43 abroad 2000 distribution outlets worldwide Revenues of $10.91 billion 105,000 employees Leader in the US market
  3. 3. By Performance Broad line tires Performance tires (Very Expensive) By Time of Buying Replacement (Bigger Market) OEM By Labels Major Brand(36%) Minor Brand(24%) Private Labels(40%)
  4. 4. Private label tires constituted 80% of the sales of Goodyears wholly owned Kelly-Springfield subsidiary Remaining under Kelly Brand Average retail price of private label tire was 18% lower
  5. 5. Tire Criteria 1. Price 2. Offers fast service 3. Can trust personnel 4. Store is attractive 5. Offers mileage warranty 6. Brand selection 7. Maintains convenient hours Tire attributes Tread life Wet traction Handling Snow traction Dry traction.
  6. 6. Price-constrained buyers(22%) Bought the best brand they could afford within budget Value-oriented buyers(18%) Searched for their preferred brand at the best price Quality Buyers(23%) Loyal, Upscale buyers Commodity buyers(37%) Valued price and outlet
  7. 7. Independent Dealers Own stores Franchised Dealers+ Govt. Agencies 50% 27% 23% Just Tires New Retail Format under Test
  8. 8. 3/4th of all Goodyear tires sold in independent or company-owned outlets on promotions Average discount of 25% Offered via various offers (such as free tires on buying some or special discount, etc)
  9. 9. 4,400 independent dealers Goodyear services to its dealers were not free Goodyear supported its independent dealers by offering various services in training, advertising & research
  10. 10. Major Brandds 51% Minor Brand 28% Private Label 21% Percent of Sales Represented by Quality Buyers
  11. 11. Intent to Buy for Major Consumer Segments
  12. 12. Consumer Loyalty Switching Among Tire Brands, 1991
  13. 13. 60,000-mile warranty Wet Traction Aimed to shed its grudgy perception among consumers Its unique look To increase customer loyalty Initially for Replacement tire market
  14. 14. Was Aquatred the right product? Should it expand its Distribution Networks? When to launch?
  15. 15. More popular among Quality buyers More moved from other brands to Aquatred 91% bought 4-tires Aquatred seems becoming brand itself
  16. 16. Test market proved it to be a right product 60,000-mile warranty BUT competitors offered upto 80,000-mile Priced 10% premium than its best broad line tire Invicta GS
  17. 17. Aquatred Distribution Strategy Target distribution through other channels to increase its reach Proper distribution should be assured to new dealers Share of Retail Sales of Replacement Passenger Tires by Channel (U.S. market only)
  18. 18. Winter Olympics in January of 1992 Can capitalize on high brand awareness Initially only for Domestic Cars
  19. 19. Dealers, retailers need to be trained in better way with more uniformity No promotion should be offered like previous times Utilize core events for marketing Should promote and market aggressively in wet regions
  20. 20. Thank You!
  21. 21. Disclaimer Created by Anurag Jain, MNNIT Allahabad, during an internship by Prof. Sameer Mathur, IIM Lucknow. www.IIMInternship.com