goodyear the launch of aquatred

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  1. 1. GOODYEAR: THE AQUATRED LAUNCH
  2. 2. What is Goodyear?
  3. 3. It is one of 5 major Tire Industries in United States during early 1970s. Goodyear is also known as The Gorilla for its dominance on world tire Industries. Goodyear has : 41 Plants in U.S 43 in other 25 countries 6 Rubber Plantations
  4. 4. Goodyear has : 4400 Independent Dealers 1300 Company owned outlets 600 Franchised Dealers GOODYEAR is the only major U.S Tire Manufacturer that had not been acquired during 1991.
  5. 5. The Industries experience important changes during 1970-1980.
  6. 6. Emergencies of radial tire to replace bias or bias-belted Tire. Increased foreign competition Change in nature of demand from consumer & Car makers.
  7. 7. What is the impact due to major changes during 1970-1980?
  8. 8. Demand grew sluggishly New tire price declined capacity out strapped demand Merges and Acquisition
  9. 9. 1970 - $1.5 Billion to convert factories to radial 1977 - Launched TiempoTire 1981 - Launched EagleTire 1980s - Invested in pipelines 1987-1991 - 13% work force furloughed 1991 June - Stanley G Gault become Chairman of GOODYEAR
  10. 10. Passenger tire segmentation. Performance and broad line tire Replacement and OEM tires Broad classification : Major brand Minor brand Private Label
  11. 11. What is the consumer behaviour in the Replacement passenger tire market?
  12. 12. 5 Important performance attributes Tread Life Wet Traction Handling Snow Traction Dry Traction
  13. 13. Customers Criteria for selecting Retailer Price Service Trust Attractive Store MileageWarranty Brand
  14. 14. What are the consumer segmentations? Percent of Sales Represented by Percent of Consum ers Major Brands Minor Brands Private Brands Price- constrained buyers 22% 30% 35% 35% Value-oriented buyers 18 54 29 17 Quality buyers 23 51 28 21 Commodity buyers 37 18 37 45 All tire buyers 100 33 33 34
  15. 15. Whole sale distribution channels: Type of Outlet 1976 1981 1986 19 91 Oil companies 9% 5% 3% 2% Large retailers 24 20 16 19 Manufacturer-owned outlets 11 10 13 12 Independent dealers 56 65 68 67
  16. 16. Retail Distribution channels. Channel Share of Retail Sales 1976 1981 1986 1991 Garages/service stations 18% 11% 8% 6% Warehouse clubs 0 0 2 6 Mass merchandisers 28 24 16 12 Manufacturer-owned outlets 11 10 11 9 Small independent tire dealers 36 47 46 40 Large independent tire chains 4 2 12 23 Other 3 6 5 4 Total 100% 100% 100% 100% Relative Price Index, 1991 Sales of Private Label Tires as a Percent of Retail Sales Dollars, 1991 Garages/service stations 110% 57% Warehouse clubs 80 8 Mass merchandisers 97 34 Manufacturer-owned outlets 107 16 Small independent tire dealers 100 36 Large independent tire chains 90 54 Other N/A 59
  17. 17. The Launch of Aquatred.
  18. 18. How Aquatred tires is different from others? Attractive Unique Aqua channel design Better traction under wet condition 60000 mile warranty
  19. 19. Aquatred Decision Situations. GOODYEAR concern about Would dealers accept high prised Aquaterd tire with 60000 mile life compared to low prised tire with 80000 mile tires? Would customer prefer there Safety and Reliability of product or low priced high mileage product?
  20. 20. Other Decision Issues: What are we actually selling? Should Aquatred launch? When to launch (Timing) Finding the target market Brand positioning Whether to expand distribution or not What specific channels to be adopted Pricing and promotion Conflict between company outlets and independent dealers
  21. 21. Current test market: GOODYEAR got 38% of tire Replacement It has got 23% of value-oriented buyers and 61% of Quality buyers It has 91% of 4 tire buyers It has 74% of Domestic buyers & 26% of Import buyers. 54% of brand oriented buyers.
  22. 22. Recommended Decisions: Since GOODYEAR has got good percentage of buyers as per test market, it will be accepted by dealers. Since there are 23% of value oriented buyers and 61 % of Quality buyers, Customer will defiantly prefer Aquatred.
  23. 23. Other Recommended issues: What are we actually selling? Safety, Reliability and Trust. Should Aquatred launch? Yes, it should. When to launch? (Timing) Winter Olympic would be of advantage to launch and advertise Aquatred. Finding the target market. Target heavy rain fall areas in U.S & target value oriented and quality buyers.
  24. 24. Other Recommended issues: Brand positioning Capitalize high brand promotions & highlight safety, reliability & trust within customers. Whether to expand distribution or not? Current distribution has met the demand of value oriented & quality buyers. So, no expansion is necessary. What specific channels to be adopted? Use more independent chains & less owned outlets.
  25. 25. Other Recommended issues: Pricing and promotion Provide incentive schemes for dealers, Promote aggressively during winter Olympics, Sponsor for Olympics, promote sale and offers for customer buying Conflict between company outlets and independent dealers Use uniform pricing strategy.
  26. 26. Recap: Goodyear details Important changes experienced by industries Impact of the above changes Market for passenger segmentation Consumer behaviour in tire market The wholesale & Retail distribution channels The Launch of Aquatreds Decision Situations & Analysis of test market Recommended Decisions
  27. 27. Credits: www.google.com www.flikr.com www.wikipedia.com www.hrb.org
  28. 28. Created by: Ishwarkumar Teggi, Siddaganga Institute of Technology, Tumakuru During an Marketing Internship by Prof. Sameer Mathur, IIM Lucknow. (See:www.IIMInternship.com)