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B&D Case Analysis

Decent Essays

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 …show more content…

Even though the portion of Professional-Tradesmen segment in the Black & Decker’s total revenue is small, there is still a possiblilty of its success in the section because it has a relatively high growth rate of about 9%, comparing to Professional-Industry segment’s stagnant growth and Consumer segment’s 7% growth rate. The first and second option are not that optimal as the third option. If Black & Decker chooses the first option, it might result in giving up possible future profit. The second option uses sub brand name while also exposing Black & Decker Brand name to consumers. However, it might be difficult to conduct this option to consumers who have negative image toward Black & Decker brand name, especially the tradesmen, because Black & Decker`s negative image will also affect the image of sub brands. On the other hand, there is one proven possibility of option number 3. The Black & Decker succeeds in having higher favorability rate at the survey by using the brand name Dewalt which Black & Decker bought in 1960. If Black & Decker conceals its brand name and use that brand name, it can avoid negative effect from unfavorable image and get profit from the Professional-Tradesmen segment. Statistic also shows that DeWalt had acheived an “Is One of the Best” agreement percent of 63% from tradesmen, comparing to B&D’s 44%. Further research also proves that 51% of tradesmen would have purchase interest in the DeWalt brand. On top of the positive image

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