Case 8

841 Words2 Pages
bulb-icon

Recommended: Relevance of a good distribution channel for successful marketing

Introduction
Goodyear Tire and Rubber Company specializes in the design, manufacturing, and distribution of tires worldwide. Founded in 1898, the company primarily sells passenger, light truck, and highway trucks tires for the original equipment tire and the replacement tire market. Goodyear operates 7 rubber plantations and 44 tire product plants in 28 countries. Unfortunately, the tire company loss 3.2% market share between 1987 and 1991. Sears, Roebuck and company proposed an option to sell the Goodyear’s Eagle brand in their stores. Since the 1920s, the company has not offered its tires to mass-merchandise chain stores. Because of the recent decline in market share, Goodyear Tire and Rubber Company must reevaluate the Sears’ proposal.
Definition of the problem
Goodyear’s executive must decide whether to accept, reject or modify the Sears, Roebuck and Company’s proposition to offer Goodyear tires in the mass-merchandise chain stores. The firm must consider all implications of changing its distribution policy and which tire brands to allow Sears to sell.
Alternatives and Uncertainties
The firm has four major alternatives; including limiting the offering only the Eagle brand through Sears, extending the offering to all Goodyear brands through Sears, offering to make one brand or product exclusively for Sears, or maintaining current status quo. If the firm were to offer Goodyear tires at Sears, there will be several uncertainties:
1. Dealers influence on consumer purchases
2. Product cannibalism
3. Market share penetration
Franchised dealers may influence customers to buy another brand since only a few buyers are knowledgeable enough when it comes to tires. As a consequence of selling the same or similar Goodyear brand tire...

... middle of paper ...

...oduct should be positioned as premium tire brand. The initial brand that should be offered in the Sears will only include Eagle GA. Once more research has been completed on how many sales of the Eagle brand come from franchised dealers, the firm can make that determination to move the entire Eagle brand product line to Sears.
Distribution
Distribution of the product will take place through the 850 Sears Auto Centers.
Price
The price must not exceed the cost of what a consumer would purchase the product through the franchised dealers. Sears can run promotions, but Sears Company will have to endure the loss of any retail markups.
Advertising
The advertising budget will reduce, for Sears will bear any financial costs of promotions and advertising of the Eagle GA product.
Conclusion
Based on the implemented plan described above, the firm can overcome several obstacles

Show More
Related

  • 1984 and Walle Themes

    829 Words  | 2 Pages

    ...ir advantage. Franchises such as Walmart, manipulate product advertising and put items in specific places to increase chance of sales.

    Read More

  • Motivation At Dick's Sporting Goods

    607 Words  | 2 Pages

    It is through following these statements that will bring a firm success in the future. However, external factors outside of a company’s control can negatively affect the expected targets and steer the company from their mission & vision. Most companies do not have direct influence on this kind of environment (Harrison & St. John, 2014). The following three sections will evaluate the external forces & trends for Dick’s Sporting Goods. The following also will elaborate on external factors from direct competitors that faces Dick’s Sporting Goods. I will conclude on what other threats Dick’s Sporting Goods can expect to see, and how they can place a buffer in between these factors to stay on track towards their mission &

    Read More

  • Sonance Case Study

    1699 Words  | 4 Pages

    Regarding strategic control, they were faced with determining how to move forward, and with what mix of product offerings? The leadership realized that with shrinking profits and increased competition the status quo would not guarantee long-term survival. Execution via their previously successful marketing channels would be problematic without either some sort of peace offering to dealers and installers, or a total shift in the advertising and sales process. The dealers and installers interacting with the customer were more likely to understand the customers concerns. Unless the company rebuilds their relationship with these front-line sales force, the customer service will suffer and ultimately the brand equity will continue to erode. The idea that the dealer is treated as the most valuable link to the customer and feels completely supported by the supplier, is exactly what enabled Caterpillar to survive in the late 1990’s. (Fites, 1996). Regardless of how the company addresses their root problems, a marketing channel analysis will undoubtedly conclude that both order getting and order servicing expenses will initially increase. In the short-term, the relationships must be rebuilt. In the long-term, they must shift overall strategy to remain profitable. If they elect to maintain their high-end product mix, customer expectations will increase demanding more from

    Read More

  • West Jet's Brand Management

    779 Words  | 2 Pages

    According to a recent survey by SFP (Spencer Francey Peters), a North American branding agency and The Strategic Counsel, WestJet came in at number 3 in Canada's best managed brands, while Air Canada bottomed out in last place. "Respondents ranked companies based on a number of criteria relating to delivery of brand promise including consumer focus, customer service, brand values, reliability, consistency, value, trustworthiness and respect" (par3 Best Managed Brands). The interesting part of this survey, is that by having consumers respond to these criteria, the companies' brands are judged not by how much value the consumer sees in the product and service they are purchasing, and not just the popularity or commonplace the brand may have.

    Read More

  • case one

    599 Words  | 2 Pages

    1. List the needs and expectations that Ms. Linsky and her groups may have in relation to hotel accommodations

    Read More

  • Target Corporation Competitive Analysis Essay

    1800 Words  | 4 Pages

    The company had to be the second largest retailer shop in the US; it has many advantages that come along. The customers well acknowledge the company and its brand have been well established.

    Read More

  • Buyer's Behavior Of Under Armour: Case Study Of Buyers

    900 Words  | 2 Pages

    The reason consumers select Under Armour is because the brand is innovative. They’re constantly creating new products. Under Armour is the originator of performance apparel. That is what attracted their first customers, their present customer, and future customers. Add that with their marketing, and that is what helps make the company what it is today.

    Read More

  • Cabela's Pricing Strategy Case Study

    595 Words  | 2 Pages

    Setting prices too high would discourage purchasing and setting prices too low negatively affects revenue. While several pricing strategies exist, the use of a value-based pricing system, as implemented at Cabela’s, offers an optimal strategy that meet both customer expectations and company requirements.

    Read More

  • Kmart Case Study

    1083 Words  | 3 Pages

    Some core competencies that must be exploited are: Brand Kmart is an existing well-known and trusted national brand in USA Kmart has private label and designer clothing that is well endorsed Infrastructure Kmart has a large number of well-located, low-cost, leased stores in urban far away from competitors through out the country ( Appendix B ). Staffing Confidence by the market in Kmart is created by the achievements of its staff and management. With the turn-around strategy in place, new blood has been put into the top management structures. In any renewal there will be retrenchment as unprofitable stores are closed. This can be used as an opportunity to retain and move high performing staff to where they are needed and to get rid of non-performing staff. Anderson the chairperson of Kmart is well supported by Wall Street and the board of Directors. These new staff members enter the company with needed skills to address problems in certain areas that previously were poorly managed such as inventory control and merchandising. Store locations, layout and Performance Stores conveniently located away from competitors like Wal-mart and Target therefore less to compete for customers face-to-face. There are 250 non-performing stores who have already been identified as being more cost effective to close than continue with running costs. Expertise exists in-house for the planning of store layout and appearance to meet different customer segments. This concentration of effort will enable focus on key areas Technology Kmart has already invested in good retailing systems. The system can be use to control inventory, supplier payments, track customer buying and monitor income versus profit margins across all stores. Research and Development The planning department is well established and in cross-functional to provide various perspective. The planning department to ensure that strategies at all levels are executed can further use the access to past data and knowledge of changes in buying patterns. Financial Backing JP Morgan Chase has agreed to support Kmart to avert the current threat of closure due to bankruptcy.

    Read More

  • American Eagle Outfitters Analysis

    1692 Words  | 4 Pages

    American Eagle Outfitters is a fairly new company but they are doing extremely well because they have a clear grasp of who their target market is. They posses a fresh new hip look with great quality clothing at a reasonable price for consumers (http://www.prism.gatech.edu/~gte201w/aeostrat.html). This is one of the main reasons why teenagers and young adults are so attracted to the company. American Eagle is aiming to appeal not only to the targeted 20 year old but also consumers between the ages of 16 and 34 years old. This will widen the gap between their major competitors because they are trying to appeal to more segments than just one. American Eagle seeks to be assessable, fashion orientated, and has a strong value proposition, which has allowed the company to thrive and take shares from competitors over the past five years. Not only is their clothing line very comfortable, bold and fresh, the store layout and atmosphere is also major key factors in American Eagle’s success over the recent years. AE also has a strong competitive advantage because of their short lead times and their ability to position themselves in high-visibility, high-profile locations in key markets. American Eagle’s cycle time is about five months from design to delivery, versus about nine months for The Gap and six months for Abercrombie. AEOS minimizes lead times by maintaining sourcing relationships with a few key manufacturers and producing much of the merchandise in North America, versus 9% for The Gap and a minimal amount for Abercrombie. AEOS has the ability to quick-source some of its simpler product categories in order to react quickly to sales trends. (http...

    Read More

  • Walmart’s Domestic and Global Marketing

    1225 Words  | 3 Pages

    This paper will be about Walmart’s domestic and global marketing. The paper will be identifying the environmental factors that affect Walmart’s domestic and global marketing decisions and many other marketing decisions. Walmart itself has about 11,000 retail units in 27 countries. They employ 2.2 million associates around the world with 1.3 million associates being in the United States (Walmart, 2014).

    Read More

  • Dollar General's Bussiness Strategy

    646 Words  | 2 Pages

    Given the dominance and fiercely competitive nature of Wal-Mart and Target within the big box discount retail industry, Dollar General avoided competing head-to-head with these larger rivals by differentiating a classic generic bu...

    Read More

  • Sears Company Analysis

    2561 Words  | 6 Pages

    Sears has seen many different changes in business and has had to adjust to t...

    Read More

  • Mission Statement for Success of Steve Madden Footwear

    2695 Words  | 6 Pages

    There are many products in each product line because a trendy company like Steve Madden offers many different styles of shoes. Flat shoes, boots, heels, and super high heels. Every season the styles and colors change for the shoes that they sell and the older styles go on sale. The Brand name for the company is Steve Madden and their brand mark is the name in the circle. The name is in the Brand Mark so that it is always clear what company the brand mark is talking about. You can never get confused with what company makes the shoe or posted the ad because the name is always on it. The company has been continuing moving forward. There may have been some rocky points, Steve Madden knows exactly how to continue running strong. What competition is there? None.

    Read More

  • BMW External Factors

    1239 Words  | 3 Pages

    ...ring system. Due to these recalls, concerns may be raised about the quality of its vehicles, affecting its brand name. Moreover, manufacturing replacements may drive up its production costs.

    Read More

More about Case 8

Open Document