CYPRESS, Calif.—Throughout much of its history, Nitto Tire has been considered an underdog.
The company and tire line that were founded in 1949 in Japan often have struggled during their 60-plus years of existence, several times teetering on bankruptcy or insolvency even after Toyo Tire & Rubber Co. Ltd. acquired the business in 1979.
This is why Nitto Tire U.S.A. Inc. President Tomo Mizutani adopted the word “underdog” to describe the firm he has led since 1992. He doesn't want anyone to forget Nitto's roots.
That will be hard to do, considering Mr. Mizutani has put up a large poster of the underdog—literally a photo of his own dog Atom surrounded by tires—in the company's offices in Cypress, Calif.
But the days of Nitto as a hardscrabble organization are about to change—in a big way.
Parent company Toyo recently announced plans to double Nitto-brand sales to $1 billion globally by 2016, an effort that will be led by Mr. Mizutani and the Nitto Tire U.S.A. unit.
It's why the poster of the underdog also carries the phrase,“Underdog Billionaire”—in a style reminiscent of the film “Slumdog Millionaire”—to signify the company's goals.
A U.S. company
The Nitto brand was reborn in the U.S. in the late 1990s after again falling on hard times in the late 1980s and early1990s and is why Toyo Tire President Kenji Nakakura now considers it to be an American brand, Mr. Mizutani said during an interview with Tire Business at the 2011 Specialty Equipment Market Association (SEMA) show in Las Vegas.
Toyo acquired the business three decades ago when it was facing bankruptcy, and even under the new ownership Nitto continued to struggle into the early 1990s. Sales had all but disappeared in Japan, according to Mr. Mizutani, and the only place where the brand still had a foothold was in the U.S.
When Mr. Mizutani joined the company, Nitto had annual sales of $6 million, an inventory of 9 million tires and again was facing the prospect of being shut down.
But Mr. Mizutani and his team were able to turn around the company's fortunes, with the Nitto brand reaching $100 million in sales by 2004.
Mr. Nakakura said that even though Nitto is a Japanese-owned company with a Japanese name, “you were reborn in the United States. So that's why the operation's headquarters stays in the U.S.”
One of the first expansion targets is China, where Toyo recently signed an agreement with international tire distributor YHI International Ltd. to introduce the brand through YHI's subsidiary in Shanghai.
Nitto also is cultivating sales in other emerging countries in Asia and Oceana, as well as the Middle East and Latin America. Additional plans call for tackling Europe in the near future.
Toyo will supply tires to Nitto from six plants located globally: in White, Ga., which recently underwent its third expansion; in Kuwana and Sendai, Japan; in Zhangjiagang City, Jiangsu Province, China; and in Malaysia through its recently acquired Silverstone Bhd. Tire Co. and another nearby factory under construction.
Since those early struggles, Nitto-brand sales have grown steadily.
Now Mr. Mizutani is charged with taking the brand to the next level and to broaden its reach worldwide.
He aims to do that using the tenacity and drive that comes from a company used to being the underdog, but also by taking advantage of the Internet—what he describes as the great equalizer.
The Internet gives smaller companies a chance, Mr. Mizutani said.
Using the analogy of a sumo wrestler, Mr. Mizutani said the big guy always wins; the small guy has no chance.
But today, a sumo tournament is more like horse racing. “If you have technique, if you have speed, you can win,” he said, adding that sometimes being big can be a disadvantage.
“What I try to say is the rules changed. So in the digital age, small companies have a good chance.”
Push into online
That's why he has pushed Nitto to become a leader and innovator in online tire marketing.
The company claims it already leads the industry in the number of Facebook fans, with more than 1 million, while the closest competitor, Falken Tire Corp., maintains nearly 350,000, according to Nitto.
The tire marketer also is stretching its online efforts into other areas, including content marketing, where a company publishes its own content on a website, gaining influence in the market and eventually becoming the “thought leader” in the industry on the subject being covered, said Stephen Leu, who handles marketing research for Nitto and is leading the company's online efforts.
An example of this can be found at www.make¬up.com, a site owned by cosmetics company L'Oreal Group. It's filled with do-it-yourself editorial material.
“It's all self-help videos and there's very little corporate branding,” Mr. Leu said. “But if you scroll to the middle (of the page), you'll see it's actually published by L'Oreal (USA). This is content marketing at its finest. It's not self-serving but is actually providing your consumer base added value, information they didn't know.”
Nitto is in the midst of developing its own premium content site targeting the auto enthusiast, which fits with the company's image as an enthusiast tire brand.
The initial editorial topic will look at the set-up and preparation that companies go through prior to exhibiting at the annual Specialty Equipment Market Association (SEMA) show.
The tire marketer is coordinating this effort with its creative agency and has hired freelance contributors, mainly former automotive magazine writers, to help develop the content. The site is expected to launch in the first quarter.
Nitto also is looking to connect with customers and to develop content through something it's calling the Nitto Lightbox. The goal is to generate consumer-produced content that can be archived and retrieved when needed.
“For us, we're a very limited staff, so we can't always be out and covering auto shows and going to different events to take pictures,” Mr. Leu said. “So what we're trying to do is outsource that effort to the crowd.”
Nitto is focusing its effort initially on multimedia, photos and videos, and is promoting the opportunity through press releases.
Contributors will receive points based on the level of usage of the photos and videos provided. While the prize pool is still evolving, points can be used to purchase items such as Nitto apparel. A $2,000 cash gift card is offered as a grand prize.
Nitto also is testing a tire dealer portal it has developed that will allow dealers to archive their customers' information on the website and from there be able to send service reminders and coupons. The site also offers a place for a discussion forum or chat room.
Harnessing the ‘passion'
While the company's number of Facebook fans continues to grow, it is still fleshing out its strategy on how to communicate effectively with this group.
Under consideration are ways of developing two-way discussions. Nitto is particularly interested in what its Facebook fans have to say about its products, both positive and negative.
The key is to be transparent and fair, Mr. Leu said. If someone directs a complaint via Facebook towards the brand, “we don't censor them, we don't delete it, we don't ignore it,” he said. “You need to actually address that.
“If it means taking the conversation off line, if that's what's needed, you have to do that. But you have to show them that you are there and you are responsive.”
Mr. Mizutani describes as “fantastic” the opportunity to hear what consumers are saying via Facebook. “They will tell us what's happening, what they like and dislike,” he said. “They tell us straight.”
As he considers the possibilities such information provides, Mr. Mizutani talks excitedly about the need for manufacturers to make the tires people want, or as he puts it: “the right products.”
These are tires consumers love and in which they see value.
His hope is to create customers who are so passionate about Nitto tires they might consider putting a tattoo of a Nitto tread pattern on their arm or neck.
In this way, Facebook is like word-of-mouth advertising.
Before the digital days, word of mouth was limited to family and friends, Mr. Mizutani said, but through the Internet, and especially on Facebook, such comments can reach thousands, potentially millions of fans worldwide.
Mr. Mizutani is counting on that as he goes about expanding the Nitto brand globally.
To reach this reporter: [email protected]; 330-865-6131.