Michelin is a well-known French tire manufacturer with a global representation. They produce high-quality tires for various vehicles including cars, trucks, motorcycles, and bicycles. Michelin is also known for its Michelin Guide, a rating system for restaurants and hotels. The transition from "selling tires to selling kilometers" for whole fleets is a strategic move by Michelin to move from selling tires to offering a complete mobility solution. This transition involves customers receiving tires-as-a-service (TaaS), where they pay based on distance driven, rather than buying and servicing tires independently. And while Michelin had a clear first-mover advantage in the industry at the time (2000 – 2003), this service still presented some downsides for Michelin.
Another company that has established this system successfully is the aircraft jet manufacturer Rolls-Royce. Under the name “TotalCare”, the price is calculated on a fixed per-flying hour basis. Thus, maintained engines are "rewarded". Advantages are waste reduction, efficiency increase, and others.
Among other things, Michelin's offer provides advantages such as planning security for the customer in terms of the monthly payment, longer tire mileage, and less impact on the environment. But why was the offer still problematic?
In this study, the analysis of the case studies and further data and references will address the central question: "Was this strategy successful, and should it be extended to private customers?" At the same time, an outlook on possible future developments will be given. A short analytical look at the connection to the Car Subscription sector will be taken.
Inhaltsverzeichnis (Table of Contents)
- The transition from “selling tires” to “selling kilometers”
- Was the transition successful?
- Implications for employees and customers
- Competitive Landscape
- B2C Market
- Conclusion
- References
Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)
This case study examines Michelin's strategic shift from selling tires to providing kilometer-based services. It analyzes the success of this transition, its impact on employees and customers, and explores the potential for expanding these services to private consumers.
- Strategic shift from product to service-based model
- Impact of the transition on business performance
- Employee implications, including job roles and skill requirements
- Customer experience and value proposition of the new service model
- Feasibility of expanding the service to the private market
Zusammenfassung der Kapitel (Chapter Summaries)
This section details the key themes explored in each chapter of the case study.
- The transition from “selling tires” to “selling kilometers”: This chapter delves into Michelin's decision to move away from its traditional product-based model and embrace a service-oriented approach, offering kilometer-based solutions.
- Was the transition successful?: This chapter analyzes the financial and operational performance of Michelin's new service model, evaluating its success in terms of revenue growth, market share, and customer satisfaction.
- Implications for employees and customers: This chapter examines how the transition has impacted Michelin's employees, focusing on changes in job roles, skills, and training. It also explores the impact on customer experience, including the value proposition and potential benefits of the new service model.
- Competitive Landscape: This chapter analyzes the competitive landscape within the tire and mobility industries, identifying key players and their strategies. It examines how Michelin's transition positions it within this competitive environment.
- B2C Market: This chapter explores the potential for extending Michelin's kilometer-based services to the private market, considering the feasibility, challenges, and potential benefits of such a move.
Schlüsselwörter (Keywords)
This case study focuses on the core concepts of strategic transitions, service-based business models, customer experience, competitive analysis, and market expansion. Key terms include "Tire as a Service" (TaaS), "Pay Per Use" (PPU), and "Michelin Fleet Solutions" (MFS).
- Quote paper
- Anonym (Author), 2023, Selling tires to selling kilometers. Was that strategy successful for the brand Michelin?, Munich, GRIN Verlag, https://www.grin.com/document/1421992
