Challenges Facing Goodyear Essay -- Business Management Consumerism Ti

Challenges Facing Goodyear Problem Statement There are several challenges facing Goodyear in the current environment. Our sales have leveled off in the past few years and we need to increase our market share in order to improve these numbers. Our debt is high and our interest payments are eating away at our profiles so we need to get more income to pay down this debt. The more immediate question is if Goodyear should launch its new line of Aquatred tires. The trend has been toward higher mileage tires and the Aquatred tire is not in line with this trend, being more of a higher end tire. Additionally, if we do determine that we are going to launch the Aquatred, do we start the advertising during the Olympics when we don’t have all the tire sizes available? We are also determining if remaining with our current distribution channel is the best approach or if we need to expand the way our tires get to market. If we decide that we are going to expand our distribution channels, we then have to determine which tires, we are going to offer in the new channels. Finally, our market share in the replacement market is lacking not sure this is true, and since consumers feel that buying tires is a necessity we have to find a way to make them excited about purchasing our product. Goodyear used to be considered the Gorilla in tire producers, but with increased competition in recent years, that is not longer the case. Issues: Consumer model and expectations Essentially, consumers fall into 4 basic segments. Â § There are Price-constrained buyers who buy the best brand they can afford. They do not show any loyalty toward any brand and tend to shop around for tires so we would have to get our tired in front of them and be the best priced. Â § There are the Value-oriented buyers that shop around a lot to get the best price, but would generally buy major brands only so we would probably be able to capture this buyer because of our brand name, but we would need competitive pricing. Â § There are the Quality buyers who were loyal to the outlet and the brand of tire. These consumers were generally upscale and are going to be our main target audience and the challenge here would be to get the tire to the outlet that the consumer is comfortable buying at and communicating the difference in our tire verses our competitors. Â § Finall... ... and concern was put forth by the company to try to make tires as safe as possible. This is a positive spin on the company as a whole, which should translate to higher sales for our other tire products. In conclusion, we have a unique opportunity to take advantage of a niche market that is as of yet untapped. We have already purchased advertising time at the Olympics for which we are going introduce our new Aquatred tire, as well as promote Goodyear’s continuing quest for safety and quality. We are going to open up new distribution channels for our lower end tires so as to increase market share in these areas, while ensuring that our independent dealers sales are respected and promoted as much as possible. This is a very exciting time for Goodyear and the Aquatred tire. A little long, but I like your plan of action. Most important attributes for consumers when purchasing a new tire: 1. Tread Life 2. Wet Traction 3. Handling 4. Snow traction 5. Dry traction US market for Passenger Tires Replacement OEM Total Industry 152.0 43 195 Goodyear 22.8 16.3 39.1 Goodyear’s percent 15% 38% 20%