Gooyear Case

Essay by EssaySwap ContributorUniversity, Master's February 2008

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At present, Goodyear is surely missing out on the sales opportunity from the loyal Sears customers. Sears has its own market segment and customer base. It is and has been a popular store to a large variety of customer base. A lot of the customers using the Sears automotive services are there to get their cars fixed and do their shopping at the same time. Therefore I do believe, that in order for Goodyear to bank on some increased sales, they should consider opening their tire sales through Sears.

One of Goodyear's strength is that it has the broadest line of tire products of any tire manufacturer and the largest number of "point of sale" for any branded tire with controlled distribution; that is either company-owned or franchises dealers. Goodyear has captured the largest number of replacement tire markets in the U.S.

At present, it is clear that the small retailers other than Good year company owned or franchised stores are picking up a greater percentage of the replacement tire market.

Goodyear has an opportunity to increase its sales through a different distribution channel.

Broadened distribution through Sears should generate incremental sales for Good year provided the loyal Sears customer is the target segment reached and the draw from Goodyear dealers is minimized. The average number of tire units sold by Sears Auto Centers are 10,055 replacement tired in 1991 compared with 2,927 replacement tires sold through Goodyear tire dealers. The principal retailers gaining share are discount multi-brand independent dealers. Since Good year has a thirty eight percent of the Original Equipment tire segment, it is clear that the new mass distribution channel is bound to create momentum in its tire sales.

Mass distribution through Sears represents a change in distribution policy in two ways. First, Goodyear is moving...