Since the replacement tire market had matured and new channels had gained share, Goodyear wants to make a strategic decision for its product lines by innovating. The new product is called Aquatred, it is a replacement tire for passenger cars designed for driving under wet conditions. For that matter, in order to decide whether to go through with this innovation, Goodyear has to weigh the risks along with the benefits of launching this product. Although Goodyear has a strong distribution strategy, especially among small independent dealers, there are several weaknesses that need improving.
Knowing that the market is price sensitive, should the company expand its channels of distribution? If so, would these new channels sell …show more content…
With their single value proposition in design and quality traction under different weather conditions, Aquatred would be a hit for Goodyear. 55% of cars shot down under wet condition quicker. Being worn 50% the tire kept the same wet traction. Besides, Goodyear wanted to change the tire appearance with Aquatred. Although it is 10% premium over the invicta GS, the product is a good choice since it offers higher security, longevity and benefit. The tire replacement market represent 80% percent of the total tire market. It is in maturity and stable with slow growth factors and high competition. Goodyear is known for being innovator and pioneer in launching new and exciting products. Auquatred might be the product needed to enhance their perception among customers. Goodyear has the bigger market share units in the US (15%), overcoming the likes of Michelin, Firestone and Bridgestone. In other words as a premium product Goodyear comes first. Aquatred is a necessity for Goodyear to improve its financial position and enhance brand equity and set up as innovator leader among their competitors. The tire replacement market is stagnant and Aquatred might change the perception of the entire tire market moving away from primary