Black & Decker 2008
Running head: BLACK & DECKER
BLACK & DECKER
Marketing MBA 504
Introduction Duncan Black and Alonzo Decker, SR., in 1910, started a machine shop business and in 1917 receiving the world’s first patent for a power drill. The company was later named Black & Decker, (B&D) and over the next 73 years they became one of the most well known brands and market leaders of power tools, accessories, lawn, garden supplies and residential security hardware worldwide. In 1990 B&D grew to a record $4.8 billion dollars in sales with 50% of their business coming from outside the United States. “The B&D name enjoyed substantial equity in both the United States and Europe. An independent survey of 6,000 brands showed (B&D) brand-strength ranking to be #7 in the United States and #19 in Europe” (Dolan 1995). B&D was focused on three very different market segments in the industry; Professional-Industrial Tools, Professional-Tradesman Tools and Consumer Products. The focus of this report will be on the Professional-Tradesmen market segment under the Power Tools Division. “Tradesmen” segment are electricians, plumbers, carpenters, framers, roofers and general remodelers working in residential construction. We will first determine the cause of B&D 9% share vs. Makita’s 50% share. Second, we will describe the buying behavior of the tradesman and their impact on the situation. Next, we will look at Makita’s and Milwaukee’s competitive strategies. Finally, we will discuss the action alternative that B&D should pursue.
What is the cause of B&D 9% share vs. Makita’s 50% share?
There are several reasons why B&D leads in Professional-Industrial and Consumer product segments but trailed in the Professional-Tradesmen segment. It is clear from the tests preformed by B&D that their products were comparable when it came to the products quality. To determine the cause of B&D lackluster share performance we will look at the four P’s of Marketing
BLACK & DECKER
Marketing MBA 504
Introduction Duncan Black and Alonzo Decker, SR., in 1910, started a machine shop business and in 1917 receiving the world’s first patent for a power drill. The company was later named Black & Decker, (B&D) and over the next 73 years they became one of the most well known brands and market leaders of power tools, accessories, lawn, garden supplies and residential security hardware worldwide. In 1990 B&D grew to a record $4.8 billion dollars in sales with 50% of their business coming from outside the United States. “The B&D name enjoyed substantial equity in both the United States and Europe. An independent survey of 6,000 brands showed (B&D) brand-strength ranking to be #7 in the United States and #19 in Europe” (Dolan 1995). B&D was focused on three very different market segments in the industry; Professional-Industrial Tools, Professional-Tradesman Tools and Consumer Products. The focus of this report will be on the Professional-Tradesmen market segment under the Power Tools Division. “Tradesmen” segment are electricians, plumbers, carpenters, framers, roofers and general remodelers working in residential construction. We will first determine the cause of B&D 9% share vs. Makita’s 50% share. Second, we will describe the buying behavior of the tradesman and their impact on the situation. Next, we will look at Makita’s and Milwaukee’s competitive strategies. Finally, we will discuss the action alternative that B&D should pursue.
What is the cause of B&D 9% share vs. Makita’s 50% share?
There are several reasons why B&D leads in Professional-Industrial and Consumer product segments but trailed in the Professional-Tradesmen segment. It is clear from the tests preformed by B&D that their products were comparable when it came to the products quality. To determine the cause of B&D lackluster share performance we will look at the four P’s of Marketing