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Executive Summary:
The report in the following is an analysis of the marketing aspect of the leading tire company in the world. The company chosen for the analysis is Bridgestone Tyres. In the following report, the business relationship of the company with the rest of the industry is given some light and focus (Franzen & Moriarty, 2009). It is also concerned about the different segmentations that have been done by the company as a seller. The business strategies to attract audiences and maintain a world-class reputation in the market are also a point of discussion in the above topic.
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1. Overview
The report displays the business-to-business marketing strategy for the supply of tires to the international market. The company that is focussed on is Bridgestone Tyres.
The report is used to analyze the different B2B marketing strategies that are taken by Bridgestone as a company towards the clients, the market differentiation, and also an analysis of the continuous increase in the value of the products of the company. This increase in value is achieved by making sure of the effective market positioning and the strong relations that the company maintains with the rest of the industry (Blog. frontierstrategygroup, 2012).
Effective marketing has a great role to play in the business-to-business relations that are exchanged between two companies or a company and the industry to which it belongs. Marketing also takes into account the different features that also play roles in the promotion of the company namely the task of advertisements, promoting the products, stating the right & most appropriate prices for the products, and positioning in the market. B2B marketing rotates around the needs of the other businesses and at the end of the day is based on the responsibility of creating consumer-driven products (Kotler, 2000).
2. B2B Market
In the world of marketing, B2B Marketing is considered to be more in number of sales and more in the volume of purchase. A B2B company has less number of buyers, as they only sell goods to another business and not directly to the customers. Although the techniques used in B2B marketing are based on the same techniques of consumer marketing their way of execution is unique.
3. Company Profile
Bridgestone happens to be a multi-national automobile and truck parts that had its inception in the year 1931 in the city of Kurume, Fukuoka Japan. By the year 2015, Bridgestone managed to be one of the top tire manufacturing companies that was a bit ahead of the previously top-notch company Michelin. Today, Bridgestone Tires as a company has more than 140 production factories and is spread across 24 nations in the world (Loveridge & Mok,2012).
The initial Bridgestone tire was manufactured in the year 1930 on the 9th of April by the Japanese Tire Division Society. A year after the manufacture, the then-founder was independent of the others and then went on the path of establishing the company as one of the best companies.
The mission of the company completely rests on the words that were given by the founder, “Serving Society with Superior Quality”. In the process of fulfilling the mission, the group company has made use of the concept that is based on giving the foundation of demonstrating the sustained objectives of the employees.
The employees commit to the customers by providing them with world-class products and services for the welfare of the communities that are served by the company (Mangold, 2012). The essence of the company comprises the words in the mission statement along with the integration of the corporate culture with diversified companies all around the world. It also shares the values given by the company around the world by making products, offering services, and taking the world ahead in the direction of prosperity.
The company aspires to offer the best to the customers and the society. This includes the services that the company provides and does not limit itself to a single part (Prabakaran & Panchanatham, 2013). It also concentrates on the technological developments and corporate activities that the company is involved with. The commitment of the company is rooted in the policy that it is driven by. The policy of not looking for what the company can benefit from, but looking for the safety of the customers and providing them with the best products is what the employees are concerned with. With the mission, the workers of the company work hard to make the company the most trusted and countable in the world.
External Environment through PESTEL Analysis
The PESTEL Analysis of Bridgestone is as follows:
Political Factors
- The political factors are mainly related to the government laws, different security measures as well and certain restrictions applied on the company by the government. Since the inception of the automobile industry, they have suffered restrictions by the law and regulations. These were mainly related to the environmental norms which were important for any car company to fulfill.
- Foreign policies as well as taxes are very critical for this industry.
- The introduction of new schemes is done due to the regulations according to which high mileage cars were produced and also there was more number of new cars produced as well as sold.
Economic Factors
The economic factors for the automobile industry are:
- Production of more tires led to an increase in the revenue in the marketing as well as designs of the new products. Hence, the majority of the revenue was held even though the supply was more than the demand.
- In developing countries like India and China, there was excellent capital along with more buying power as well as personal growth in the market, globally.
Social Factors
Social factors are mainly related to the different cultures and economies throughout the world along with the different patterns of buying behavior as well as the capacity of the customers. Following social factors affect the automobile companies like Bridgestone.
- A different pattern of liking towards cars by the customers ranges from cars being a status symbol to being fuel efficient as well as low in emission.
- Fluctuation in the buying behavior of the customers because of the recession in the mature markets.
- Issues related to the environment along with the awareness about the damaging effects.
Technological Factors
- To acquire an advantage over the competition in the market enhanced use of technology.
- New as well as advanced use of technology to get more profit out of the competitive market.
- Changing/restricting such technological processes that hurt the environment.
Environmental Factors
- Increasing awareness about global warming as well as the greenhouse effect.
- Change in the customers’ preference of car tires which are more eco-friendly, hybrid as well as reliable.
Legal Factors
- More stringent pollution laws in Europe as well as the US.
- Strict implementation of EURO law in developing countries. For, the BHARAT norm in India is formed on the grounds of the EURO norm.
4. Products & Services
The range of products coming from the company has a wide diversity starting from motorcycle tires, car tires, commercial vehicle tires, specialty tires, and a lot more diversified products as well. In the segment of passenger tires, the company manufactures different types of tires that can fit in cars of all variants.
Moreover, there is a wide variety of tires when it comes to the segment of passenger tires. Bridgestone provides several offers on a wide range of tire choices to meet the expectations and demands of many kinds of drivers and riders (Sukholthaman & Shirahada, 2014). All the tires can be suitable for any type of driving style taken by the users.
When it comes to the Ecopia tires manufactured by Bridgestone, it refers to the ones that are very commonly used by the normal drivers in the cars that are used on a frequent and regular basis. These tires are helpful and suitable to use in day-to-day life as it has the feature of saving fuel by consuming less fuel.
Consumption of less fuel can be a factor to be looked at for normal users as they look forward to less consumption of fuel. These tires also have the special feature of performing well on the roads as they have a very good grip and control with the roads.
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5. Market segmentation
Market Segmentation:
In the business of tires, Bridgestone has a lot of market segmentation along with some facts and figures in it. In the business of manufacturing tires and tubes for passenger cars, buses, trucks, vehicles used in construction & mining, agricultural machines, aircraft, and bikes the company has the following figures for four years.
The segmentation of the market by the company was done depending on factors in the
Macro segments
A macro segment of the market was the division that was done based on the following four factors geographic area, customer type, customer size, and product use.
Geographic area: It is a key factor in dividing the market that talks a lot about the culture and the requirements of the company. The geographic location of the market defines the culture, language, and attitudes in the business of the company. When it comes to Bridgestone tires it becomes a general phenomenon as it manufactures tires for all terrains.
Customer type: The type of customers of the company is another measurable factor that is required to divide the market. The type of customers will decide the amount of sales in a particular. For Bridgestone, it is important to check the type as it caters to specific segments.
Customer size: It is an important parameter in the segmentation of a market as it decides the number of people and number of units to be manufactured. Bridgestone as a company manages it by enhancing the same in the populous countries and the ones that have a lot of population in cars.
Product use: The segmentation done by the company based on the use of the products happens to be variable as it manufactures a wide range of products thus it has a huge amount of usability too.
Micro segment
Purchasing criteria: It is the factor that sets the market based on the criteria that the customers have before buying a product. At times customers go for the tires that are just fit for the rugged terrains and hence this can be an answer to a particular segment of the audience.
Purchasing Strategy: The purchasing strategy of the customers is a determining factor of the market segmentation. It defines the amount of sales and profit that a company will gain from a particular segment.
Importance: As a segmentation factor, the importance of the product is given a very vital place by the company. Bridgestone makes sure that the importance of the brand is given top priority and that its value is maintained.
Personal characteristics: This decides the popularity of the brand. Bridgestone manufactures customized and personalized tires for the ones who want some specifications in them.
6. Sales and positioning:
The net sales of the company in the above-mentioned vehicles in billions were 2536.7 in the year 2011. The same in the year 2012 increased to 2554.1 and then increased to 3033.7 in the year 2013 (Blog. frontierstrategygroup, 2012). Finally, the base of the analysis rests in the year 2014 when the net market sales in billions went to 3088.6. This gave an overall increase in sales of more than 84% in the business segment.
Other than tires, the company manufactures chemical products and the products that are used in the industries. Other than these, Bridgestone is popular in manufacturing sporting goods like golf balls, golf clubs, and bicycles. In this segment, the company had net sales of almost 487.6 billion in 2011 (Loveridge & Mok, 2012). The figures in the year 2012 increased to almost 485.6 million and a total of 534.4 in the following year. Finally, in the year 2014, the net sales went up to 585.3 million. This made a remarkable point to ponder about. The company made a total of 16% net sales in the business segment of the products that have been mentioned.
Talking about the nationwide segmentation of the company, it has some remarkable facts to reveal. The net sales in Japan from the year 2011 to 2014 have gone up from 674.2 million to 694 million. This has made a leap of almost 19% in the positive direction for the company in Japan. The case in the United States of America happens to be quite remarkable too. Initially, in the year 2011, the net sales of Bridgestone were 1273.3millions and it increased to a total of 1746.3 million in the year 2014. This proved that the company saw a total of 47% increase in sales in the four years (Loveridge & Mok,2012).
The case in the European countries has been a bit fluctuating as in the year 2011; the company had total sales of 418.8 million that then reduced to 348.2 million in the subsequent year. 2013 did not see a lot of increase in sales but the year 2014 saw a total of 434.1 million in the net sales of the company. This overall gave a total of 12% increase in the net sales of Bridgestone.
7. Targeting:
As a company, Bridgestone aims to satisfy the needs and demands of drivers all around the world. It has expertise in the automobile industry and is concerned with all types of cars, bikes, and heavy vehicles. It targets to cater to the needs of SUVs, luxury cars, passenger cars, heavy vehicles, and racing cars.
As a company, it is renowned as the maker of products with innovative ideas the features of environment friendliness. The products are made with full care and the point of not harming the environment is given top priority.
8. SWOT Analysis:
According to the SWOT analysis of the company, it is found that all the points are given equal importance.
Strength:
When it comes to explaining the strengths the company has its roots in reputed companies and thus the foundation pillars have been set well. It has a total of 52 enterprises and employees more than 50k workers all around the world to make the brand the best one. It has a very good name in the section of racing cars (Walker et al., 2003).
Weakness:
Talking about the weaknesses of the company, it still needs to look into making important shares in developing countries. Additionally, the products from the company are perceived to be at very high rates. Thus it acts as a weakness to the company.
Opportunities:
The company has a very nice opportunity in the emerging and developing countries of the world. With some of the extra points that the company gets with eco-friendliness, it takes the initiative to make products better (Sukholthaman & Shirahada, 2014).
Threats:
Threats to the company are the stiff competition from other national and international brands in the world. The Japanese and US economies have not grown to the maturity level and so do not treat the company as a good one. The exchange rates happen to be fluctuating and hence it proves to be a threat to the organisation.
9. Market Share and Sales Forcast:
Bridgestone was established in the year 1931 and today has a turnover of more than $23.2 billion all around the world. The global tire market share of the company happens to be almost 18.2% of the total market share. The company sells its products in more than 150 countries and thus it has an objective to spread the business to more countries.
10. Marketing strategies that can be implemented
For the attainment of their objectives, the organization can look to make use of a marketing mix strategy. The marketing strategy for the new product is as follows:
Product Strategy:
As we know Bridgestone stands as the leading brand in the world of tires, and it has formulated ways to serve almost all divisions of the automobile industry. The manufacturers are looking forward to including innovations in the new tires so that it has new features in them. The company has a deep focus on the manufacture of the products and getting valued customers all around the world.
Pricing Strategy:
Trying hard to reach the effective economic background of the countries, it has aimed to sell the products over the internet media at lower costs. Moreover, it has been proposed that the company will provide lease services to small companies.
Place Strategy:
Bridgestone gives first-hand input products to the buyers and the shareholders. It also focussed on bringing coordination between the sales department and the production department to make the supply chain clear and transparent.
Advertising strategy:
The company has started to make visual and graphical ads that depict the logo of the company. It is done with the help of developed photography techniques. This has made the process of advertising better.
11. Conclusion:
All companies need to focus on building good and effective relationships with the help of marketing strategies. A strong brand name is also helpful to make the marketing better. This has been marked in the case of Bridgestone and it helps in motivating the customers to become potential buyers of the company and maintain a balanced relationship with them.
12. References
Blog.frontierstrategygroup.com (2012) Custo Brasil | Emerging Markets Insights [online] Available at: http://blog.frontierstrategygroup.com/tag/custo-brasil/ [Accessed: 11 April 2016].
Franzen, G., & Moriarty, S. E. (2009). The science and art of branding Armonk, N.Y., M.E. Sharpe.
Jaray, S (2006). Marketing (Australia Wide). AussieBookSeller. Artarmon.
Kotler, P. (2000). Marketing management (The Millennium). Prentice Hall International. New Jersey.
Loveridge, R., & Mok, A. L. (2012). Theories of labor market segmentation: a critique. Springer Science & Business Media.
Mangold, M. (2012) Creating sustainable Competitive Advantage [e-book] Available through: Ivyc http://www.ivyc.net/summary.pdf [Accessed: 11 April 2016].
Mitina, I. I., Mikhailov, S. I., & Fomina, A. A. (2013). New-generation, high-performance tire rubbers: the present and future market for SKD-ND (polybutadiene rubber on a neodymium catalyst) and DSSK (solution-polymerization styrene-butadiene rubber). International Polymer Science and Technology, 40(7), T5.
Prabakaran, N., & Panchanatham, N. (2013). Brand Value of Bridgestone Tyre Limited-A Study concerning Puducherry State. International Journal of Marketing & Business Communication, 2(3), 57.
Sukholthaman, P., & Shirahada, K. (2014, July). Eco-value co-creation towards a sustainable tire scrap recovery network: Case of Bridgestone Thailand. In Management of Engineering & Technology (PICMET), 2014 Portland International Conference on (pp. 1710-1718). IEEE.
Walker, O, Boyd, H, Mullins, J & Larreche, J. (2003). Marketing Strategy: A decision-focused approach. Tata McGraw Hill. Noida.
Wedel, M., & Kamakura, W. A. (2012). Market segmentation: Conceptual and methodological foundations (Vol. 8). Springer Science & Business Media.
