Challenges Facing Goodyear Problem Statement There are several challenges facing Goodyear in the current environment. Our sales have stabilized in recent years and we need to increase our market share to improve these numbers. Our debt is high and our interest payments are eroding our profiles, so we need to get more income to pay off this debt. The most immediate question is whether Goodyear should launch its new line of Aquatred tires. The trend has been towards higher mileage tires and the Aquatred tire is not in line with this trend, being more of a high-end tire. Also, if we decide to launch the Aquatred, will we start advertising during the Olympics when we don't have all tire sizes available? We are also evaluating whether staying with our current distribution channel is the best approach or whether we need to expand how our tires get to market. If we decide to expand our distribution channels, we will then need to determine which tires we will offer in the new channels. Finally, our market share in the aftermarket is lacking, but we are not sure this is true, and since consumers believe that purchasing tires is a necessity, we need to find a way to get them excited about purchasing ours product. Goodyear used to be considered the Gorilla among tire manufacturers, but with increased competition in recent years, that is no longer the case. Issues: Consumer Model and Expectations Essentially, consumers fall into 4 basic segments. § There are buyers with price constraints who buy the best brand they can afford. They show no loyalty to any brand and tend to shop around for tires, so we should get tired of them and get the best price. § There are value-oriented buyers who spend a lot to get the best price, but generally we would only buy the top brands, so we would probably be able to capture this buyer thanks to our brand name, but we would need competitive prices. § There are quality buyers who were loyal to the point of sale and the tire brand. These consumers were generally high caliber and will become our main target audience and the challenge here would be to bring the tire to the point of sale where the consumer feels comfortable purchasing and communicating the difference between our tires and those of the competition.§ Finally...... middle of paper... and the company has expressed concern about trying to make the tires as safe as possible. This is a positive turnaround for the company as a whole, which should translate into increased sales for our other tire products. In conclusion, we have a unique opportunity to take advantage of a niche market that has not yet been exploited. We have already purchased advertising space at the Olympics for which we will present our new Aquatred tyre, as well as promoting Goodyear's continuous research in terms of safety and quality. We will open new distribution channels for our entry-level tires in order to increase market share in these areas, while ensuring that the sales of our independent dealers 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 action plan. The most important attributes for consumers when purchasing a new tire:1. Tread life2. Wet traction3. Manipulation4. Snow traction5. Dry Traction US Passenger Tire Market OEM Replacement 15% 38% 20%