The Vancouver tire market is about to get a whole lot more competitive.
On September 23, Edmonton-based Fountain Tire, which is 49% owned by Goodyear Canada and deals exclusively in Goodyear products, will break the news it has purchased 10 Goodyear Certified Auto Service locations across Vancouver.
The purchase marks Fountain Tire’s first foray into the West-Coast city, where it hopes to open a number of additional outlets on the way to becoming a major player in the b.c. marketplace.
The 40-year-old company, which operates a total of 108 tire outlets, including the 10 new Vancouver stores, is already a force to be reckoned with in Alberta. It operates 80 locations across that province with solid representation in both rural markets, where it has been strongest traditionally, and the cities of Edmonton and Calgary, where it more recently opened a slew of outlets.
The balance of Fountain Tire’s outlets are located in b.c.
With its move into Vancouver, Fountain Tire is employing an expansion formula it has already used successfully in Edmonton and Calgary. First, it purchases and converts to its Fountain Tire brand all the city’s company-owned Goodyear outlets. (This is made possible by Goodyear’s decision to bow out of tire retailing in Western Canada.)
Next, it makes offers to the owners of Goodyear franchise outlets to join the Fountain Tire chain. Finally, it looks for opportunities to open new outlets.
Brent Hesji, a partner at Fountain Tire and the person who oversees the company’s marketing, says Fountain Tire’s goal is to expand its b.c. presence to 50 stores as quickly as possible.
‘Without a strong presence there, the cost of buying media is horrendous,’ says Hesji.
Fountain Tire’s competitors in the b.c. specialty retailer market include Kal Tire, which has 100 retail outlets, mostly in b.c. but with some outlets in Alberta, Big O and Tirecraft. Additional competition comes from independent tire retailers, gas stations and mass merchandisers such as Canadian Tire and Wal-Mart.
The conversion of the Vancouver Goodyear stores to the Fountain Tire banner will be supported by a three-month, mixed-media ad campaign created by Toronto agency Due North. Media will include radio, newspaper, direct mail and in-store.
The campaign will centre on a sweepstakes draw, already being promoted in Alberta, that gives consumers a chance to win a Hummer XLC2 all-terrain vehicle, Nissan Altima and four-wheel-drive Honda. Leading up to the draw, which will be held December 9, the company will tour the Hummer around Vancouver, displaying it at the various Fountain Tire locations on advertised dates.
California-based comedic actor Thom Sharpe, who has been a spokesman for Goodyear Canada since 1991 and who has acted as Fountain Tire’s spokesman for about two years, will continue in that role in the new campaign.
Mark Weisbarth, president of Due North, says Sharpe’s presence provides continuity as the stores shift identity from the Goodyear to Fountain Tire brands. ‘We want people to know the locations are changing ownership, but we also want them to know the new owners will still carry Goodyear products,’ says Weisbarth.
Hesji says the company engineered a similar transition using Sharpe in Alberta, adding that despite the actor’s previous association with the Goodyear name, consumers in the province have come to accept Sharpe as the Fountain Tire spokesman.
Advertising for the retail chain carries the newly adopted tag line, ‘The Tire Experts.’
According to Hesji, Fountain Tire’s strong heritage in rural markets might lead some people to associate the retail chain more with farm and heavy construction tire products than with automobile tires. He says the positioning statement is meant to underline the fact Fountain Tire carries tires for all types of vehicles.
Hesji says that, as soon as Fountain Tire reaches the 50-store mark in b.c., he will begin looking to expand east into Manitoba and Saskatchewan.
He says the company’s growth is fueled in good measure by its ownership structure and focus on customer service, explaining that 50% of the equity of each outlet is held by the store manager with the other 50% held by Fountain Tire.
‘A guy who owns half a business always sees the customer as their livelihood, rather than as someone who’s preventing them from leaving at 5:00 p.m.,’ says Hesji.
