PLAYA DEL CARMEN, Mexico — While the luxurious resort excelled at several unusual products — margaritas, salsa dancing, exquisite foods and tranquil swimming pools — Continental Tire the Americas L.L.C. focused its efforts on one major product — tires — during its annual Gold Dealer trip.
Or, more specifically, the tire maker's executives focused on how the company devotes its time and resources into building the Continental and General brands to be the best brands possible in order for tire dealers to succeed in the changing marketplace.
That was the overriding message during Conti's 12th Gold Dealer trip, held April 9-12 at the opulent Paridisus Playa del Carmen resort, located about 45 minutes south of Cancun on the Yucatan Peninsula. A record number of 356 dealers and spouses — including 63 first-timers — qualified for the trip, based on reaching sales goals during the previous year. A handful of dealers earned two extra days at the all-inclusive resort, extending their trip through the weekend.
Executives from Continental A.G's North American subsidiary — including Bill Caldwell, vice president of sales and marketing; Travis Roffler, director of marketing; Chris Charity, vice president of sales; Joe Maher, product manager; and Debbie Richards, director of the Gold program — addressed a group of more than 400 dealers and spouses during the mandatory business meeting on April 10.
"It's always a product discussion," Mr. Caldwell told Tire Business. "(Dealers) see new lines here, and what we've tried to accomplish over the past years is a continued development loop where we're bringing product all the time, so were not getting stale, not getting old. We have fresh performing products that they can rely on us and always see in this meeting."
The Conti executives used the stage to unveil a pair of new products from the Continental lineup as well as discuss three other recently released General Tire products:
- Continental TrueContract Tour and PureContact LS, both of which will replace existing Conti passenger tire lines, set to launch in June; and
- The General G-Max RS — General's inaugural ultra-high-performance entry — and Grabber APT and Grabber A/Tx light truck tires.
In addition, the Conti team also shared its ongoing marketing, dealer-, and consumer-focused initiatives, including:
- The ongoing push of Conti's sports marketing campaigns, which includes continued sponsorships in soccer (U.S. Soccer and Major League Soccer); college basketball (Conti sponsors 31 NCAA college basketball programs); motor sports, particularly the ARCA oval-racing series; and professional fishing (the latter two with the General brand).
- Several improvements on incentives offered to dealers, as well as marketing tools designed to sell the Conti and General portfolio. In fact, Mr. Roffler said General Tire will redesign its website within the next few months.
"Investments that we're making in those areas (products, marketing and the dealer incentive program) and the brand-building is a long play for us, and it really has to be a constant play for us, to a level of consumer awareness that we think is necessary for us to grow," Mr. Caldwell said.
"And that's not a switch you turn off and on through the years. We've tried to be consistent there in all of those areas. We've become a reliable partner for these dealers."
The two newest additions to the Conti lineup are evidence of that, Mr. Roffler said. Both contain proprietary compounds and a more robust construction that provide significant improvements over the products they're replacing.
In fact, the TrueContact Tour has the same tread pattern as its predecessor, the TrueContact, Mr. Roffler said, but the difference is that the compound provides a 27-percent improvement in treadwear, allowing Conti to offer a 70,000-mile limited treadwear warranty.
"The industry has suffered some self-inflicted gunshot wounds, running these mileage warranties up to crazy amounts." Mr. Roffler said. "Sometimes it was market ploy, something it wasn't, but I think we want to get mileage warranties to an area where they are accurate in all conditions. That is running tires in Florida, where they use ground-up shells on asphalt, to the challenge of the heat of Texas on a summer day, vs. the potholes in other parts of the country."
The line, which Conti said provides strong, all-season performance in dry, wet and snow conditions, will be available in 45 sizes covering 15- to 19-inch rim diameters, 45-65 aspect ratios and T, H and V speed ratings.
Mr. Caldwell said there was nothing fundamentally wrong with the TrueContact.
"But this is a perfect example of what we talked about," he said. "Our R&D efforts were to find a way to make it better. We could have gone three more years with the current product, but our commitment is to maintain the lifecycle of products, and when we have new and better technologies that we can apply to the tires, we do that."
Meanwhile the ultra-high-performance all-season PureContact LS is the next iteration of the PureContact line, with a new tread pattern, construction and compound. Mr. Roffler said it offers a 10-percent improvement in wet conditions, a 23-percent improvement in wear and reduction in noise to 71 dB from 74dB.
"When you improve noise level, you usually lose wet performance," Mr. Roffler said. "We pushed our R&D group — yes we understand there's a paradigm, but you have to figure out that. They turned in lockstep to develop this product. We give them crazy requirements...and they delivered."
The PureContact LS also offers a 70,000-mile treadwear warranty and will be available in 29 sizes, covering 15- to 20-inch rim diameters in H and V speed ratings.
Both products offer lower sidewall height sizes and up to 30-percent improvement in impact resistance to handle potholes and similar road hazards better, and they are backed by Conti's Total Confidence Plan as well as a 60-day customer satisfaction trial.
The product lines will be sourced mainly at three of Conti's North American plants: Mount Vernon, Ill.; Sumter, S.C.; and San Luis Obispo, Mexico. Pricing will be released soon.
Mr. Roffler said a select group of around 20 dealers is heavily involved in the product-planning process. They sign non-disclosure agreements, then offer feedback on what changes need to be made for the next iteration of a product, including tread pattern, design, sidewalls, etc.
"These guys truly feel like, A, we're open to listening; B, we do listen; and C, we take to heart what they actually tell us," Mr. Roffler said.
"If they give us suggestions, we may not be able to do all of them, but we're always listening. We heed there advice, and we try and implement a lot of what they tell us, while still keeping what I believe to be is the simplest associate dealer program in the industry. They've told us the KIS method a million times: keep it simple."
Mr. Roffler told dealers that the Conti's sponsorship efforts are working in four major areas (soccer, road racing, college basketball and professional fishing) resulting in more than 18 billion impressions and more than $340 million in exposure value for Conti in 2017. College basketball (nearly 7.5 billion) and Major League Soccer (more than 6.5 billion) account for the majority of those impressions.
Mr. Roffler said the demographics of stock car racing and fishing fit well with the General brand.
"We've carved out a space there," he said about professional fishing. He said stock car fans are very "grassroots," with truck ownership high. And they operate in areas and on tracks were Conti has a strong corps of dealers.
"All those truck drivers have wives who drive other cars too," Mr. Roffler said, "and we want to impress our brand upon them."
He said they approach the sponsorships three ways: Onsite, on television and through dealer participation. "We want to make sure we address everyone at those with each and every sponsorship we have," Mr. Roffler said.
With Conti's sponsorship deal with the International Motor Sports Association (including the WeatherTech SportsCar Championship, Continental Tire SportsCar Challenge and Prototype Challenge series) ending after the 2018 racing season, Mr. Caldwell said the tire maker would continue to explore other opportunities in motor sports.
"We're not holding back on our investment marketing. as a result of that decision, so we will find the next or the next or the next that fits the brand and is appropriate," he said. "We want to stay in motor sports. It's a big part of our company now, so there's a natural connection. So we'll find the next."
"The right opportunities have to come available," Mr. Roffler said. "Most of the big series are tied up contractually.... All the big series are spec'd and in long-term contracts. You can see when those contracts are coming up. Those are opportunistic-based. If there is an opportunity in one of those, we'll look at it."
Mr. Caldwell said Conti must continue to grow its 6-percent share of the North American tire market, despite flat market conditions. Mr. Roffler said one of every three tires sold globally is sold in the U.S.
"We have to, in today's market, earn business away from our competitors in the eyes of the audience," Mr. Caldwell said.
"I can give you all kinds of targets, but that's not as important to what we do every day. What we've learned over the last years is if we do it the right way, and if have a compelling proposition to a customer, either an end-consumer or dealer or a distributor, we'll grow.
"We try to focus on that, actions, not outcomes. If we take the right actions, we'll continue to grow. We want to be among the top tire manufacturers participating in this market."