B&D Case Analysis

1143 words 5 pages
1. What is the cause of Black & Decker 9% share and Makita’s 50% share?
The Black & Decker Corporation has three major segments which are Professional-Industrial tools, Professional-Tradesmen tools and Consumer tools. It is making good profit in Professional-Industrial and Consumer segments but has only 9% share in Professional-Tradesmen, compared to 50% share of Makita (Table A).
One of the reasons of this difference is that due to the popularity of Black & Decker in the Consumer segment, tradesmen view Black & Decker’s products as for use at home rather than professional, according to the brand perception statistics of Professional-Tradesmen segment buyers(Figure C).
The other possible reason is that Black & Decker has black/charcoal
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Since it is easily distinguishable among other products and has high brand perception, many customers would easily select Makita’s product. Makita can also construct a unique brand image color in the mind of customers.
However, the main weakness is that it actually does not have strong competitive advantage in product quality. It would be hard to maintain strong perception if customers become aware that the product quality does not exceed competitors’. According to figure E, Black & Decker actually has more advantage regarding product quality which is a huge threat to Makita. In addition, retailers are not positive toward Makita which can give damage to market share of Makita.

The main strength of Milwaukee is that it has high customer loyalty. Table C and D show that Milwakee is regarded one of the best products and high preference rate. This infers that it has more loyal customers compared to other brands.
The main weakness is that high brand perception does not lead to purchasing of their products. According to Figure C, Milwaukee has highest brand perception with Makita. However, Table A shows that Milwaukee’s market of tradesmen segment is much lower than Makita.
4. Choose the action plan on page 10
Option 3 - drop the Black & Decker name from the Professional Tradesmen segment is the best choice among the three options. Although the Black & Decker brand name has positive reputation among consumers, it has a negative brand image


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