Welch Leadership

Executive Summary

This report analyzes Black & Decker’s marketing problems and gives recommendations on marketing strategy in consideration of the possible implication and risks involved.

The focus will be on Professional Tradesmen market segment under the Power Tools Division. Growing at 9% in 1990, it is the fastest growing market in the Power Tools market segment. However, B&D only managed 9% market share as the market leader is Makita Electric of Japan, having 50% of the market share followed by Milwaukee at 10%. B&D research concludes that product quality is not the issue as its products in Professional Tradesmen are highly competitive with its competitors. The issue is perception of B&D brand, often perceived by trade’s people as good only for Consumer market rather than Professional market. Moreover, B&D Professional Tradesmen products are not highly differentiated in color, black / charcoal grey, often the favorite color used by competitors in Consumer’s market. B&D’s also do not have big market share in all of Professional Tradesmen distribution channel especially the Home Centers. Home Centers like Home Depot and Home Club experiencing rapid development and one of the reason’s of Makita’s success for being the market leader.

The recommended strategy is to use a new brand name, DeWalt, one of existing B&D brand line in stationary woodworking equipment. B&D research shows the trades people are aware and receptive to the brand. Another recommendation is to multi brand existing B&O product line, focusing on strong product line. The risk would be using extra resource to promote new brand as well as promoting multi brands. It is recommended that B&D have strong color product differentiation between its Consumer products and Professional Tradesmen. B&D must also seek ways to improve its distribution channels, focusing on Home Centers and taking advantage on conflicts by retailers with Makita, the market leader to improve its sales in the distribution channels.

1.0 Introduction

The purpose of this report is to analyze Black & Decker’s marketing problems and give recommendations on the marketing strategy in consideration of the possible implication