Kumho Will Release New Tires and Boost Sports Marketing in 2018
Kumho Tire USA Inc. is building on double-digit growth in passenger and light truck sales in 2017 with new products for the marketplace and social media marketing campaigns aimed at sports fans in 2018.
The company recapped its performance in 2017 and previewed plans for 2018 at its dealer meeting in Cabo San Lucas, Mexico, Dec. 6-10.
Following the release of six tires in 2015 and four tires in 2016, Kumho took a break from product launches in 2017 so dealers could “digest everything,” according to Jim Mayfield, executive vice president, North America. The strategy worked as the company saw marked improvements in sales of several products in 2017 versus 2016.
The tires generating the most significant growth were:
- Crugen HT51, an all-season tire for SUVs, CUVs and light trucks, up 98.2%;
- Solus TA31, an all-season touring tire, up 74.6%;
- KL33, an all-season CUV and SUV tire, up 67.9%:
- Road Venture AT51, an all-terrain tire, up 15.4%.
Sales of the Ecsta PA31, a high-performance all-season tire, rose 6.2% in 2017 versus 2016. Sales of the Solus TA71, a grand touring all-season tire, were up less than half a percent.
Sales fell 2.1% for the Solus TA11, a touring all-season tire. Mayfield said the decrease was much smaller than the overall market decrease in the base touring T-rated segment. “We’re pretty pleased, we held our own with the TA11 in a market that was falling much more substantially than that,” he said.
Mayfield told dealers the company will introduce two or three new products a year and retire others in a planned product replacement cycle for all of its tires. For 2018, two passenger tires and a commercial tire are set for release.
- The Crugen HP71, a CUV/SUV tire, will replace the KL33 in the fourth quarter of 2018. The HP71 will be available in 53 sizes for 16- to 22-inch rims in H- and V-speed ratings.
- The Ecsta PA51 is an all-season ultra high performance tire that will initially replace the Ecsta 4X II and later the Ecsta PA31. “The PA51 line will incorporate a much broader range of sizes and speed ratings and will eliminate two lines that we have now,” said Mayfield. The PA51 will be offered in 64 sizes for 15- to 21-inch rims and W-, V- and Y-speed ratings. The PA51 will launch in the third quarter of 2018.
- The KLD 11e is a Smartway-verified drive tire for linehaul applications that will be introduced in 2018’s second quarter.
Mark Hadley expects the PA51 will simplify inventory issues created by the overlap between the Ecsta 4X II and the Ecsta PA31. “I like the fact that they’re continuing to clean up the lines. The PA51 is replacing two lines essentially,” said Hadley, who is president of Advantage One Tire Network LLC, which is part of the Best One Group.
Drew White, purchasing manager for Tire Rack Inc., is looking forward to the new Kumho products. “There was a period of time up to 2016 where we were really hurting for new product, and they were losing shelf space to competitors. Last year they came out with all the new products, and it’s nice to see the plan for somewhat more consistent replacement of product in the market.”
White also praised Kumho’s fill rate, which was over 90% in 2017. “One major thing they’ve done a nice job with is fill rates. They’ve really done a nice job of having the product available when you need it. Among the manufacturers that we carry, Kumho consistently has had one of the top fill rates over the last 12 to 24 months.”
Jack Williams Tire Co. Inc. has had a very good year with Kumho, according to Bill Hamlin, director of vendor relations. The company has 36 retail outlets in Pennsylvania and 12 warehouses serving wholesale customers in five states. "Some of the new products have been gaining acceptance both with our dealer base as well as with consumers. Any time you have new products it seems to take a while for them to catch on."
Hamlin singled out the innovation of Kumho's products, especially the severe-snow certified Crugen HT51. "Having an HT product line in a light truck application with a snowflake is important in our neck of the woods because we get people concerned about the snow but they don’t really want a winter tire. It’s good to have a product that will perform year-round yet still give them the traction they need."
Kumho plans to expand marketing activities related to its sponsorship of the National Basketball Association and NBA G-League (formerly the D-League). “Our primary direction and focus moving forward is how we activate our NBA partnership,” said Brian Gallagher, senior marketing manager. “Our objective is to build out these programs to influence consideration, trial and purchase intent for our products.”
At this moment, the NBA is the hottest property for sponsors, according to Gallagher. “That’s where we have an advantage with our partnership with the league, which is exclusive to the tire business versus our competitors, so it gives us a little bit of a competitive advantage.”
In 2017, the sponsorship involved a national branding campaign, team sponsorships with the Charlotte Hornets and Atlanta Hawks, individual player sponsorships with Isaiah Thomas, Kelly Olynyk and Shawn Livingston, and an intensive marketing program during the NBA’s All-Star Weekend in February 2017.
In 2018, the company plans to reach more consumers with exclusive video content on the NBA's social media channels as well as its own. Gallagher pointed to the success of “The Handles,” a monthly highlights reel which chalked up more than 17 million views on Facebook, Instagram and Twitter during the 2016-2017 season. “The Handles” is off to an impressive start for the new season, with 3.3 million views across the three social media platforms between Nov. 30 and Dec. 4, 2017.
Gallagher says the company’s goal is to amplify fan base engagement through social and digital channels. A new sponsorship with John Wall of the Washington Wizards will enable the company to engage with customers in a more personal way through social media. Content featuring Wall will be more of a lifestyle play as the NBA All-Star will talk about what he does off the basketball court.
“Everybody can show a highlights reel,” says Gallagher. “People want to know what he’s doing when he’s not in the locker room so it will be content you don’t typically see with these people. It’s going to be exclusive.”
As controversy surrounding the parent company’s ownership plays out in Korea, Kumho Tire USA Inc. is keeping its attention on its customers and markets in the U.S. Says Mayfield, “There are issues they are dealing with over there that are out of our control. We’re not focused on that, we’re just focused on doing our business here in the U.S. We’ve been successful and we intend to continue to be successful.”