Black Decker Case Marketing
Marketing Concepts and Commercialization
Business Case Analysis
Black & Decker
Background
Black & Decker Corporation is one of the largest manufacturers of power tools and accessories, residential security hardware, outdoor tools and numerous other products. The two largest product groups of B&D are power tools & accessories and household products representing 29% and 15% respectively, in terms of sales. During the 90s the portable power tool market accounted for 1.5 Billion and is segmented in 3 major groups, Professional-Industrial Tools, Professional-Tradesmen Tools and Consumer tools.
The Professional-Tradesmen segment is the smallest, at $420 million, but growing at a faster rate of 9% compared to the 7% Consumer tools maintain and no growth for Professional Industrial division. Black & Decker’s Professional-Tradesmen segment shows a substantial low market share. This situation is intolerable because without the success of this segment, B&D goal of being market leader could never be reached.
Problem Identification For Long Term Strategy
Black & Decker needs to address the negative perception the Professional-Tradesmen tools have. Being known as a consumer brand, does not necessarily help the professional-T segment. The perception that all B&D tools are for house shores and the misuses of the consumer tools in the job site, are really taking a toll on the company. B&D low prices in contrast to major competitors reinforce customer perception of the correlation between low prices and low quality.
The Professional tool users want to be observed with equipment considered to be sharp and of high quality. Therefore, this low quality perception needs to be addressed. According to the data from the case, the distribution channels are another issue. The distribution of the Professional-Tradesmen tools have been inefficient and its distribution channels are very limited.
Black & Decker has decided not to use major distribution channels like the discount oriented
Business Case Analysis
Black & Decker
Background
Black & Decker Corporation is one of the largest manufacturers of power tools and accessories, residential security hardware, outdoor tools and numerous other products. The two largest product groups of B&D are power tools & accessories and household products representing 29% and 15% respectively, in terms of sales. During the 90s the portable power tool market accounted for 1.5 Billion and is segmented in 3 major groups, Professional-Industrial Tools, Professional-Tradesmen Tools and Consumer tools.
The Professional-Tradesmen segment is the smallest, at $420 million, but growing at a faster rate of 9% compared to the 7% Consumer tools maintain and no growth for Professional Industrial division. Black & Decker’s Professional-Tradesmen segment shows a substantial low market share. This situation is intolerable because without the success of this segment, B&D goal of being market leader could never be reached.
Problem Identification For Long Term Strategy
Black & Decker needs to address the negative perception the Professional-Tradesmen tools have. Being known as a consumer brand, does not necessarily help the professional-T segment. The perception that all B&D tools are for house shores and the misuses of the consumer tools in the job site, are really taking a toll on the company. B&D low prices in contrast to major competitors reinforce customer perception of the correlation between low prices and low quality.
The Professional tool users want to be observed with equipment considered to be sharp and of high quality. Therefore, this low quality perception needs to be addressed. According to the data from the case, the distribution channels are another issue. The distribution of the Professional-Tradesmen tools have been inefficient and its distribution channels are very limited.
Black & Decker has decided not to use major distribution channels like the discount oriented