“If I went back to 1999,” Mr. Brennan said, “there were 198 million passenger and light truck tires sold in the U.S. We're at 204 million today, so the market is flat. If we want to grow, we've got to take it from somebody.
“We all say we're going to grow,” he continued. “How in God's name are we going to do that when the market is flat as a pancake? Everybody can't grow — you've got to be strong to grow.”
Falken will be boosting its advertising and promotions dramatically, with 2016 marking the most diversified ad buy the brand has ever had, including print, digital, billboards and TV.
“We're even wrapping our delivery trucks for the first time, so it will be a mobile billboard as it goes down the road,” Mr. Brennan said.
One of the primary ways Falken is seeking to improve its brand position going forward is through its marketing partnership with MLB, replacing Bridgestone Americas' Firestone brand as the official league tire sponsor.
Falken's MLB contract kicked off with this year's post season, giving the brand exposure with fans directly at all of the playoff games, including the World Series. As part of the agreement, Falken will have signage behind home plate during 95 nationally televised games throughout the regular season, and it also will buy TV commercials.
The company's contract runs through 2017, with plans to continue it if things go well, Mr. Brennan said. Neither Falken nor MLB disclosed the value of the contract.
Mr. Smallwood told Tire Business prior to this agreement he was never an advocate of sports marketing, a view that stems back to sales and marketing roles he held in the late '90s.
“All the psychology of research was coming out and saying the high impressions is meaningless if there's no emotion attached to the impression, so I was always a big believer that in any kind of advertising, any kind of branding, there had to be emotion attached to the brand,” he said.
“My feeling has always been that on sports marketing it's very difficult to have feelings or emotion attached to the brand. If you see a Falken logo on the inside of the field, and that's all you have, where's the emotion? There's no meaning to it, and that's why I never was a big fan of that.”
Mr. Smallwood said what ultimately changed his mind were “pure numbers.”
“We spent a lot of money in motorsports — crazy amounts of money in motorsports,” he said. “The people who know us hold us in extremely high regard, but those are the people who know us. Then there are the other 320 million people in the U.S. who simply don't know us, and that's where the problem comes in.”
In the first three weeks after inking its deal with MLB, Mr. Smallwood said Falken's website traffic grew dramatically.
As for why the company chose MLB, Mr. Brennan said it came down to demographics and availability.
“The people who watch baseball don't know Falken,” he said. “It's new eyeballs. The other issue is it comes down to what's available. The NBA already has a tire sponsor, NHL has a tire sponsor, NFL has a tire sponsor, so to get an exclusive where we can actually get something that's a big enough soapbox, it was MLB. And we wanted exclusive rights.”
Mr. Smallwood added that Falken can offer a lot of advantages for MLB as well.
“Our goal was always to find people we could cross-market with — other brands that we can work with where there's value,” he said. “You never want to be in a one-sided relationship.
“If you look at Major League Baseball, at the beginning of the year when they put in the new commissioner for baseball, one of the key initiatives they gave him was to reach the youth market…. We are a very strong youth brand, and so there's really a great fit for the both of us. We're weak in the older demographic, they're weak in the younger demographic, but we can come together and help each other.”