Black and Decker Corporation – Power Tools Division

Black and Decker Corporation – Power Tools Division

Black and Decker Corporation – Power Tools Division


1) PROBLEM DEFINITION: What is the cause of Black and Decker’s 9% share vs. Makita’s 50%? Identify the key problem in a single sentence, and elaborate.

2) BUYER BEHAVIOR: How does the buying behavior of the tradesman impact the situation? Be specific.

3) COMPETITIVE ASSESSMENT: What is Makita’s competitive strategy and what role does Milwaukee (the #2 brand in the segment) play? Do these brands have any vulnerability which can be potentially exploited by Black and Decker?

4) MARKETING STRATEGY: Which action alternative should Black and Decker pursue? Justify your choice and to clearly spell out what you intend to do (details of marketing mix and implementation). Also, explicitly consider and reject plausible alternative courses of action.




PROBLEM DEFINITION: What is the cause of Black and Decker’s 9% share vs. Makita’s 50%? Identify the key problem in a single sentence, and elaborate.

The rephrased question is: why the brand awareness, the very good positions in the Consumer and Industrial segments and the known high quality of the products and the services are not enough to attach #1 position or to have a segment share similar to Makita’s?
The main causes of this difference in Power Tools Professional-Tradesman are wrong brand perception and inadequate distribution channel.
Black and Decker was branded as Home Tools. Tradesmen viewed Black and Decker tools more for home use than for job site. It appears that professional-tradesmen didn’t want to use similar tools that house wives used at homes (in 1990, Black and Decker was #1 market share position in Consumer segment).
The evidences from Exhibit 2 data show us that Black and Decker lacked in capitalizing one of profitable distribution channels – Membership Club. Additionally, Makita who distributed its tools through membership clubs, in which Black and Decker did not take part, demonstrated to be very successful...