, MKTG 340
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Bridgestone Americas Holding, Inc, hereinafter, will be referred to as
Bridgestone. Bridgestone is a well-established corporation in the business of selling varied tire and rubber products to markets all over the world. In this marketing plan, we are focusing on mostly the tire part of the business, which accounts for the majority of
Bridgestone’s sales revenues and the effect of customer service centers.
In this marketing plan, we have outlined specific financial, as well as nonfinancial goals and ways to help implement these goals and reach projected quotas. We feel that because Bridgestone is such a large corporation, with a large amount of capital, as well as being well- established in the tire industry, it has more freedom to take marketing risks. These risks involve spreading out and adding more outlets all over the world and taking advantage of opportunities of countries with rising economies.
Bridgestone also has the ability to be more environmentally safe and to give back to the community, through recycling of tire products, such as in playgrounds and in underwater reefs, as well as reusing rubber products for construction purposes. Bridgestone also has the ability to help with environmental relief efforts, by contributing to help with world relief.
As far as product development, Bridgestone is constantly increasing its product line, by introducing new types of tires, and adding improvements to those that have been in the market for a while. It is one of the leading tire producers in the world, but there is still competition, and the way to get ahead is to offer consumers new products that are more cost-efficient, safe, and durable, with good warranties and convenient and available help provided by service centers when needed.
Bridgestone needs to expand its number of company-based stores that are located within America. It also needs to establish new markets every year, both geographic ones throughout the world, but also with new demographics, such as younger generations.
Bridgestone offers quality tires, while remaining at low, competitive prices and that is what has attracted its customers for years. It has a wide consumer base as it is, and revenue is in the millions, but there are always way to improve and make its products available to more people worldwide.
Bridgestone is a leader in world tire technology. Its roots begin in 1900 when
Harvey S. Firestone established The Firestone Tire & Rubber Company in Ohio. A few years later, in 1931, a man named Shojiro Ishibashi created Bridgestone Tire Company
Ltd. in Japan. In 1990, these two companies merged to form Bridgestone Americas.
This company is an international manufacturer and contains 38 production facilities scattered all across the United States.
Tires are the largest part of Bridgestone’s business. Bridgestone develops, manufactures, and markets tires designed for almost any type of vehicle. There are more than 8,000 different varieties currently offered by Bridgestone. Along with tires, air springs, building materials, synthetic and natural rubbers, and industrial fibers and textiles are manufactured and sold across America and internationally.
Tires are sold through outlets all across America. There are currently more than
12,000 different outlets where tires are available and these include independent dealers, discount retailers, warehouse clubs, and company-owned stores. Tires range from 13foot-tall giant radial tires for earthmoving equipment all the way down to kart tires as small as 10 inches with passenger, light truck, truck, bus, construction, mining, agricultural, and motorcycle tires in between.
Bridgestone prides itself in offering tires to the world that are the most technologically advanced, as well as being safe and effective. It continually invests in research, experimentation, and testing to better its products. Bridgestone wants its name to be known in every household and across America and to boast a prestigious reputation
in high- quality. This marketing plan outlines how Bridgestone Americas will widen its coverage, grow their market, and improve their reputation.
This section of the Marketing Plan covers three aspects of corporate strategy that influence the marketing plan: (1) the mission/ vision, (2) goals, and (3) core competence/ sustainable competitive advantage of Bridgestone.
The mission and vision of Bridgestone can be best summed by the mottos of the original founders. Ishibashi of Bridgestone’s philosophy on how to influence the corporate world of tire technology as well as affecting the community in a positive way was “Serve Society with Superior Quality.” Harvey of Firestone’s mission was to be the
“Best Today- Still Better Tomorrow,” which showed his motivation in trying to constantly improve his products to offer the highest degree of excellence. The combined values of these two innovators are representative of the current passion that Bridgestone
Firestone has today in trying to offer the highest quality products to the largest consumer base possible, while providing excellent customer service as well as satisfaction.
The current slogan of
Bridgestone hopes to achieve the following goals within the next five years.
1. Focus on giving back to the community and staying involved in relief efforts.
2. Actively participate in recycling in order to protect the environment. For example, initiating projects such as tire use in playgrounds and in artificial reefs.
3. Take advantage of opportunities in Latin America. There is renewed growth in the sales and profits in this geographic area and Bridgestone needs to act on those.
4. Improving within every company-owned store the service offered, such as having vehicles ready when promised and to have problems with vehicles that are brought in fixed right the first time.
1. To minimize loss claims on vehicles by customers by improving service and products.
2. Increase sales by promoting the “fighting tire.”
3. Increase dividend payouts to attract stockholders. This will increase
Bridgestone’s capital in the long run.
Core Competency and Sustainable Competitive Advantage
Bridgestone seeks to provide high quality tires that are dependable to the consumer, because safety is the number one priority to the company. Bridgestone wants its customers to be able to rely on its products and focuses its efforts on continually technologically improving its tires. These competencies can be translated into a
sustainable competitive advantage by Bridgestone broadening its market base to include not only new geographic areas, but also new consumers within areas, such as appealing to younger customers through new marketing programs. Bridgestone aims to work on satisfying all the needs of its consumers.
The situation analysis begins with a SWOT analysis. After this, the levels of the tire industry, competitors, the company, and its consumers are described and analyzed.
Continuing to hire new highly skills management teams
Rebates on tires, to make them more attractive to buyers
New marketing campaign designed to attract a younger buyer
Hiring large number of new employees
East Africa Firestone is claiming to sever all ties with
Rebates cut profits; tend to attract bargain hunters, doesn’t gain customer loyalty
New campaign costs significantly more money
Large number of employees need to be trained well, and know our services
Paid out $240 Million to Ford to settle dispute about tires
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Money entering the corporation, through sales due to rebates on tires
Becoming more efficient in manufacturing
Experimenting with new rubber to make tires last longer
New technological advances can be expensive to implement
Longer lasting tires cuts into profits
Partnership with General
Motors. Bridgestone tires will be factory-equipped on certain vehicles
Established brand, draws customers in, and our quality product keeps them coming back
New technology in run flat tires, could help our industry
Hard to please today’s ever changing market, customers have more information readily available to them
New low price tires, while not quality, steal our market share
Highly competitive in foreign markets
Pollution laws in foreign markets make production easier, and cheaper
Competitors with new technologies that reduce their total costs
Foreign markets raise costs of doing business
Pollution in a River in East
Africa could have legal repercussions
According to AutoBusiness, the tire industry has been constant for the past century. There have been no new great contributions. Despite mergers, material improvements, and design changes, which have made tires cheaper, long-lasting, and effective, it is still a commodity product. The industry has potential for change through factors such as the growth of global brands, new design of tires (such as the development of run-flat tires by Michelin) which may affect the design of vehicles, new manufacturing techniques which will alter the economics of the industry, and national and regional legislation, which is in part because of the Firestone recall, which is changing product specification and the whole life cost of the tire. The current total industry revenue is
$60,071 million dollars.
Competitors in the Tire Market
Bridgestone’s main competitors in the tire market include Continental, AG,
Goodyear Tire and Rubber Company, BFGoodrich Tires, Cooper Tire and Rubber, and
Bridgestone Americas Holding Inc. has such an extensive background, with strengths coming from both sides of the merger in 1990 between Japan’s Bridgestone company and America’s Firestone company. The merger created a huge advantage for
Bridgestone in the international market. They were automatically global. Bridgestone also has an advantage because they have been in the tire industry for a very long time.
Currently, Bridgestone’s revenue is $20,678 million dollars. Bridgestone is in control of
34% of the total tire industry. (Appendix B, Reuters.com)
May through September is the busiest time of year for Firestone because all the children of customers are out of school. College kids are coming home and need work done on their cars. Families are also going on vacation and need their cars to be maintained when driving long distances. In August and September College students are going back to school and need maintenance done before returning and parents have less time because of younger kids being back in school. Therefore they need their car maintenance up to date. The percentage of men versus women that purchase from
Firestone is becoming more even as time passes. Women are becoming increasingly more prevalent in the business as the primary purchasers.
This section describes the five-year marketing and product objectives for
Bridgestone Tires and the target markets, points of difference, and positioning of its lines of tires.
Marketing and Product Objectives
Bridgestone Firestone’s marketing intent is to broaden its market and make its brand name known worldwide.
Current Markets. Current Markets will be grown by expanding product lines and increasing the technology of tires, new tires will be designed. Also, Bridgestone will improve customer loyalty. This will be done by creating customers that will buy from Bridgestone for life, by improving the service of tire stores and promoting repeat purchasers and advantages for Bridgestone’s consumers.
New Markets. Bridgestone is currently undergoing a new campaign to attract the younger generation markets. It is also gearing advertisements towards women.
Bridgestone also hopes to take advantage of opportunities in foreign countries where the market is improving, such as in Latin America and Costa Rica, and to widen the market base in these geographic areas.
Global Markets. Bridgestone caters to 20 countries all over the world. Bridgestone should increase this number, as well as make sure it increases its number of outlets in each country, to internally increase the specific markets of individual countries.
Tire Sales. Bridgestone hopes to improve tire sales by creating more companyowned stores, to expand its market. The goal is to add 500 more outlets, which may be company-owned or otherwise. One of Bridgestone’s major competitors is
Goodyear, which is publicly traded, which produced $3 billion in revenue for 2004.
Bridgestone hopes to be more competitive with this industry competitor and increase sales within the next five years to reach this mark.
New products. Through technological advances, Bridgestone will design new tires that will be more effective, safe, and cost-efficient, not only for its consumers, but in the production of these tires. New product screening has been taking place, and there are continually new products that are brought into Bridgestone’s line and introduced into the market. Within the five year plan, Bridgestone’s goal is to create at least 10 new products, and to have successfully introduced these products to the market, as well as improving the production and efficiency of products and services that are already available.
The target markets for Bridgestone tires are as varied as their products are. The different categories of tires are performance, specialty, winter, touring, passenger, and light/ medium truck. Performance tires are marketed to customers who have highperformance vehicles and prefer higher end tires. Specialty tires are marketed to law enforcement and high-speed emergency use. Winter tires, which are good for adverse winter conditions, are geared, specifically in America, towards northern states and in mountainous regions. Touring tires are for comfort and smooth rides, are geared toward owners of luxury vehicles, and are more expensively priced. Passenger tires are for allweather conditions, come with a reliable warranty and are the most popular tire bought.
These tires have the widest market, and are geared to the everyday consumer. Light/ medium truck tires are designed for durability and are offered to truck owners. Other
tires include heavy-duty machinery tires which can be sold wholesale to separate businesses, especially construction and mining companies. Smaller kart wheels are sold to race car owners and are advertised through races and sometimes through sponsorship.
Points of Difference
The points of difference, which which makes Bridgestone unique in relation to its competitors, fall into these categories:
Tires for Law Enforcement Vehicles: Tires are very good traction and handling capabilities, and have passed the Los Angeles County Sheriff’s Department and
California Highway Patrol high-speed wear tests.
Passenger tires: Tires are available for “Soccer Moms” as well as people who travel often. They have good handling in both wet and dry conditions and boast a very smooth ride for children and comfortable ones for those on long journeys.
The Brand: Bridgestone Firestone is a very well-known name. It has been in the industry for a long time, 1900 for Firestone, 1931 for Bridgestone, and 1990 since the merger, which not only gives this company plenty of experience, but they have a serious global advantage because the merger between Bridgestone and
Firestone united the hemispheres.
Tire Service: Service stores pride themselves in setting their service centers apart from competitors because of the steps taken in cleanliness, and the amenities offered to its customers. Waiting rooms are comfortable and clean, providing airconditioning and a nice atmosphere to relax and wait for the car service to be completed. Entertainment is provided such as newspapers, magazines, television,
as well as nice decorations that are pleasing and attractive to the eye.
Refreshments are also offered such as coffee and water.
Bridgestone makes buying tires easy and convenient. Information is offered as to what is the best type of tire for specific cars and what is most cost-efficient for the customer. Service centers are convenient and are open seven days a week. Warranties also provide the customer with a guarantee that they, and their tires, will be taken care of in case of a problem. Bridgestone reassures customers that buying tires for their vehicles is painless, easy, fast, and that Bridgestone is making a commitment when a consumer purchases a tire.
A large part of involvement with each firestone store is personal selling. Tires are an expensive item and customers want to be able to rely on someone who knows what they are talking about and can sell them a safe and high quality product at a reasonable price. The managers are given a certain quota of how many tires need to be sold in a month, as well as for the whole year, and they are expected to meet those quotas. The managers must establish a relationship with between their regular customers and come up with strategies to boost their tire sales for any given month. With tire sales, a manager has to think about the basics. The manager needs to have a well-rounded knowledge of the tires that are sold in their store in order to determine the customer’s needs. A manager needs to probe the customer by asking questions about the vehicle that the tires will be used for. Managers need to ask questions such as “Who drives the car? How long do they plan on keeping the car? And how is the car used?” For example, if it is the child of
the customer who will be driving the car then they would probably want a higher quality tire rather than the cheaper one to ensure the child’s safety. However, if the customer just drives it to and from work they might not need as expensive of a tire. If a customer drives a luxury car such as a Lincoln, he or she is probably going to be looking for a smoother ride and the manager would need to select a tire based on that necessity.
Another part of personal selling is advising the customer of the needs of their vehicle to continue to run smoothly (such as oil changes) as well as any preventative maintenance (brake fluid flushes, transmission fluid flushes, etc…). This is in order to extend the life of the car.
Robert Williford, a Bridgestone store manager in Yorktown, Virginia, stated that it is important to, “Never pre- judge a customer based on their appearance. A manager should always approach each customer the same, and never assume that a customer is not willing to spend the money needed to maintain their car.” (Williford, Robert, 2005).
Many Types/Styles Full Product Line
Gain Market Share Defend profit
Make Profit, but keep low prices
Small Promotion Promotion Inform People
Place (distribution) Limited
Stress Points of
Carry product more Carry Product still places more places
Sale of Old product to make room for new
Bridgestone has a very wide and varied product line. There are many different categories, as well as many different sizes and options within each category. The tires that are best producing of profits are kept in the product line, and those that are not are faded out of production. Bridgestone introduces many types of tires to test out how well they are received by the public. If they are a popular, then more capital is invested in improving the quality and trying to make it better. Currently, there are more than 8,000 different tire types.
On the whole, Bridgestone prices at the same level or below that of competitors, but the price of specialty tires or high-performance varies depending on the type and design. An example of pricing against competitors is a tire for the 1996 Jeep Cherokee
4 X 4 SUV. BFGoodrich sells its Radial Long Trail tire for $81.00 and Goodyear sells its
Fortera HL tire for $101.00. Bridgestone sells its tire, the Destination LE for $71.00. All three tires are of the same size, have similar tread patterns, and fairly close wear warranties. Bridgestone is trying to attract customers by pricing below its competitors.
The overall objective in pricing is to make a profit, while providing a quality tire. Certain constraints Bridgestone encounters are the demand for quality tires at a price, the cost of introducing a new tire, the cost of manufacturing a high mileage tire, and the cost of technology. Although Bridgestone is well-established in the industry, the market is still highly competitive throughout. It must remain on its feet with regards to technology, so as not to fall behind and be taken over by other major industry leaders.
The key promotion strategies used by Bridgestone are ads for their sales in the local newspaper (placed in the sports section every week), banners out at the front of the store, stack all covers (cover stack of tires with questions like “when was the last time you had your oil changed?, or tire sales that the store is currently offering), Advo cards –
(mailer cards to zip codes that purchase the most or ones that are closest to the store), and
Bridgestone credit cards (make you a preferred customer which gives special discounts with statement or coupons). Another promotion is that if a customer has not been in the store in the past six months they will receive a coupon to get the customer to come back in the store. The most advertised discount is on oil changes. It is the most needed service on cars. When coupons are mailed out the most common one is for an oil change. One example of a discount Robert Williford is giving for his Yorktown, Virginia store is placing coupons for buy 3 get 1 free for tires in a letter from the Hampton Irrigation
Services. He is personal friends with the owner of the company and they made a deal to put these coupons in the letters because it benefits Robert Williford by giving him businesses and it benefits the owner of HIS by making it seem as if he is giving his customers a gift for the holidays.
Bridgestone Tires are available through outlets all over America. Consumers can buy them through company-owned stores, independent dealers, discount retailers, warehouse clubs. There are currently over 12,000 outlets nationwide.
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Bridgestone is constantly experimenting with new products. Currently it is working with tire rubber to make it last longer. Bridgestone’s goal is to create at least 10 new products within five years. It has copyrighted many products that are used not just by its own company but by many within the industry. Included in these is a form of pitch noise reduction. Tread block elements are arranged to produce noise-canceling sound waves when the tire is in motion. Another element of its research and development is what is known as the “Ultimate Network of Intelligent Tire Technology or UNI-T
This is a combination of technologies that work together to create the most advanced tires available.
Past Sales Revenue
Bridgestone. has steadily increased its sales revenue every year for the past five years. Sales continue to rise at a steady, constant rate.
956.4 1,550 1,847 2,144 2,441 2,738
Year 2005 is almost to a close, but information is not released until December 31,
2005 for the annual amount. We have estimated the financial as follows (in millions): total revenue: $20, 900; gross profit: $7,701; total operating expense: $19,323; and net income: $1,253. The projections were based off past financial elements as well as the approximated 2005 financial elements.
Organization Structure provides a skeleton as to the outline of a company. The
Board of Directors is above the President and CEO. Bridgestone organization structure is
Vice shown below from the President and CEO down to the Sales Regions and
President and CEO
Accounting and Finance
To reach the specific financials goals set up in the projections for the next five years, Bridgestone needs to keep at its rate of expansion. For every year, at least two new markets needed to be added to the current market base. These may be geographic markets such as developments in certain areas or they may be demographic markets, with newly added consumers from markets such as different generations, to bridge the gaps.
Bridgestone should make use of its newly formed alliance with GM Motors and gain revenues through that source as well. It needs to also plan on having a 15-20% increase in tire sales per year and can do this through the expansion of markets, as well as by increasing its customer loyalty and rate of customer return.
Bridgestone needs to also take advantage of the economies of developing countries. If Bridgestone is pro-active about setting up centers and outlets in countries whose economies are on the rise, then they will be the first to establish itself within that country. These are countries such as Latin America and Costa Rica. Their need for commodity products is on the rise because their communities and markets are on the rise.
The demand for tires will eventually increase in these countries and Bridgestone should be there to provide the tires to the consumers. Bridgestone should also work on expanding outlets and adding company-owned stores in Europe and Asia.
A goal has been set to have two new markets added to the current market base. In order to make sure this happens marketing teams will need to stay focused and if it is not met then for the next year it will have to be more than two to make up for the previous year. In order to continue setting up in progressing countries Bridgestone may need to outsource some of the labor. Contractors will probably need to be hired for some of the work. A big focus needs to be made on the alliance with General Motors to make sure that all resources are being used there. To be sure that the 15-20% tire sale increase per year occurs, they will need to push this every month with the managers reminding them of this goal. If it is not reached in a particular year they will need to compensate with extra sales for the following year or two to catch up.
Harvey S. Firestone was born December 20, 1868 in Columbiana, Ohio. He worked for the Columbus Buggy Company until he founded Firestone Tire and Rubber
Company in 1900 at the age of 31. He started out his company with a mere 12 employees and today Firestone employs people all over the world. Harvey’s plan for his company was to be the “best today- still better tomorrow.” Firestone was close friends with Henry
Ford, and for years after their companies did business closely together.
Shojiro Ishibashi was born in the Japanese city of Kurume, as the son of a tailor.
At the age of 17 he succeeded his father as a tailor. He then proceeded to make great changes with the company. Instead of a tailor company, he changed it to a sock manufacturer. He also abolished the apprentice system, changing it to a wage system. In
1931, he created Bridgestone Tire Company Ltd. He made the company name by reversing the English translation of his own name, "Ishibashi," which literally means
"stone bridge" in Japanese. In 1990 Bridestone bought out Firestone and merged the two companies together.
(2005). Retrieved from Bridgestone America’s Holding, Inc. Web
. (2005). Retrieved from Bridgestone Firestone North American
Tire, LLC Web Site: http://www.bridgestone.com/news/index_bs.asp
(2005). Retrieved from Bloomberg.com Research Web Site: http://www.bloomberg.com/apps/quote?ticker=BRDCY:US
Income Statement for Bridgestone Corp.
(2005). Retrieved from Bridgestone Corp-
Income Statement on Reuters.com Web Site: http://www.investor.reuters.com/IS.aspx?ticker=BRDCY.PK&target
5. Kerin, Hartley, Berkowitz, Rudelius. (2006)
ed., pp. 47, 56- 69). New
York: McGraw-Hill/ Irwin.
(2005). Retrieved from Tires Overview from Reuters.com Web Site: http://www.investor.reuters.com/IndustryCenter.aspx?industry=TIRESS&target
Trends in the Global Tire Industry.
Retrieved from Autobusiness Online-
Automotive Reports, Publications, and Studies Web Site: http://www.autobusiness.co.uk/publications/tire/index.shtml
Williford, Robert. Personal interview. 13 Oct. 2005.