Goodyear Case Writeup

P's in marketing Mix

Products: Goodyear produces tires for nearly all types of vehicles including passenger vehicles, light truck tires and highway truck tires. There are currently 30 different types of passenger car tires ranging in price, tread wear index's, traction and temperature grades that Goodyear has to offer.

Price: Retail tires for passenger vehicles range from $125 to $175.

Place: Goodyear distributes its products to some 8000 locations in the United states, and some 25,000 locations worldwide including Asia, Europe and Latin America. Goodyear operates 44 tire plants in 28 countries.

Promotion: Goodyear is one of the leading national advertisers in the United States. Goodyear continues to keep a high profile in auto racing to keep it's high profile in upper end products. Goodyear is well know for its blimps often seen over popular events. Network TV is often used for advertising campaigns to introduce new products and pull customers to retail outlets. TV budgets for Goodyear commonly ran from $10 million to $30 million and budgets for cooperatives with dealers were from $20 million to $100 million. Print media was also used extensively for promotional perks. ( See Exhibit. 1 )

Competencies:

Core Competence - Goodyears core competencies are its relationships with Original Equipment buyers such as GM, Ford and Chrysler and its leading market shares in passenger car tires, light truck tires and highway truck tires in the US.

Distinctive Competence - Goodyears distinctive competencies is the strong name which Goodyear stands for. Goodyear has a variety of tread designs, tread widths, tread durabilities. performance capabilities, and price categories for all types of buyers needing tires in the industry. Up until Michelin acquired the Uniroyal Goodrich Tire Company in 1990, Goodyear was distinguished as the world leader in tire production.

Porters 5 Forces Model:

Supplier Power: In the tire industry supplier power is somewhat low. In Goodyears case having company owned retailers increases the supplying power. Goodyear also has independent retailers who they must keep happy in order for the Goodyear product to be pushed to the consumer.

Buyer Power: Buyers in the industry have greater bargaining power due to the availability of competing products. If Goodyear will not accommodate its retailers they will simply stop carrying their product. A majority of buyers are company owned so they are excluded in having greater buyer power.