Goodyear Maketing Project Navin Bafna Gmba08 A123

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Goodyear Maketing Project Navin Bafna Gmba08 A123

  1. 1. GOODYEAR The Aquatred Launch NAVIN BAFNA GMBA08A125
  2. 2. Background <ul><li>Known as the ‘Gorilla’ of the world Tire industry </li></ul><ul><li>Income less than 1% of $10.91 Billion revenue in 1991 </li></ul><ul><li>41 Plants in US and 43 Plants in 25 other Countries </li></ul><ul><li>Interest spending US $ 1 million per day in 1991 </li></ul><ul><li>Ranked 3 rd in worldwide tire sales </li></ul>
  3. 3. Innovations <ul><li>Track record of launching Innovative Products </li></ul><ul><li>In 1977, introduced ‘Tiempo’ the first all season radial </li></ul><ul><li>In 1981, Introduced ‘Eagle’ the first radial offering high speed traction for sports cars </li></ul><ul><li>Invested to the tune of US $ 1.5 bn to upgrade the factories to produce radials </li></ul><ul><li>In 1980 it tried to diversify the business, making huge Investments in pipelines for Natural gas and Oil Transmission </li></ul>
  4. 4. Network <ul><li>41 Plants in US and 43 Plants in 25 other Countries, six rubber plantations </li></ul><ul><li>2000 Distribution outlets worldwide </li></ul><ul><li>4400 Independent dealers accounting for 50 % of sales </li></ul><ul><li>1047 manufacturer owned outlets and 600 franchise dealers </li></ul><ul><li>Overall Product/Brand portfolio: </li></ul><ul><li>Eagle Aquatred Invicta </li></ul><ul><li>Arriva Tiempo Corsa </li></ul>
  5. 5. Competition <ul><li>The US tire industry was denominated by 5companies in the early 1970’s where all the players are from US </li></ul><ul><li>Goodyear </li></ul><ul><li>Firestone </li></ul><ul><li>Uniroyal </li></ul><ul><li>BF Goodrich </li></ul><ul><li>General Tyre </li></ul>
  6. 6. The Industry Overview in 1970-90 <ul><li>Emergence of Radial Tire, requiring major Investments </li></ul><ul><li>Foreign Competition: Michelin of France </li></ul><ul><li>Oil Prices: Less Demand + Radial = Less Replacement </li></ul><ul><li>Impacts </li></ul><ul><li>Demand saturation </li></ul><ul><li>Price reduction </li></ul><ul><li>Production Capacity more than Demand </li></ul><ul><li>No Innovations and efforts from Companies </li></ul><ul><li>Resulted in Mergers and Acquisitions </li></ul>
  7. 7. Companies Groups <ul><li>Michelin : Uniroyal : Goodrich </li></ul><ul><li>Bridgestone : Firestone </li></ul><ul><li>Goodyear : Kelly-Springfield </li></ul><ul><li>Continental : General </li></ul><ul><li>Pirelli : Armstrong </li></ul><ul><li>Sumimoto : Dunlop </li></ul>
  8. 8. 7 consumer attributes for success of passenger tires CONVENIENT HOURS BRAND SELECTION MILEAGE WARRANTY STORES ARE ATTRACTIVE TRUST FAST SERVICE PRICE
  9. 9. AQUATRED <ul><li>Aquatred was designed to improve traction in wet conditions </li></ul><ul><li>Positioning it at the top of broad line segment </li></ul><ul><li>Aquatred comes with a 60,000 mile warranty </li></ul><ul><li>The cost of launch about $21 million </li></ul><ul><li>Planned to be launched during the Winter Olympics in Jan 1992 </li></ul>
  10. 10. Problems <ul><li>Aquatred can only be launched in the replacement market </li></ul><ul><li>Selling through lower service channels could increase the sales but it could also erode the value of the Brand </li></ul><ul><li>Pricing of Aquatred was at a premium of 10 % over the most expensive broad line tire - Invicta GS </li></ul><ul><li>Two other competitors Michelin and Bridgestone were planning to launch new tires in 1992 </li></ul><ul><li>-80,000 mile warranties </li></ul><ul><li>-huge advertisement budgets </li></ul><ul><li>The Plan to launch the product in winter Olympics </li></ul><ul><li>- production done only for the domestic car segment </li></ul>
  11. 11. Solutions <ul><li>Evaluation of channel for the launch of Aquatred - Keeping in mind the Positioning the product in the market </li></ul><ul><li>Positioning and differentiating the product </li></ul><ul><li>Focus on key business competencies </li></ul><ul><li>Emphasis should be more on the Premium Segment </li></ul><ul><li>Loyalty Program should be Initiated </li></ul><ul><li>Discounts and offers on Prices should be curtailed or the Prices should be decreased, it reduces the Brand image </li></ul><ul><li>Positioning itself with the store chains and other dealers thus reducing the impact of whole sellers in the market. </li></ul>
  12. 12. Thank You !!!

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