The Black and Decker is the large producer of power tools and accessories, household products, outdoor products and hardware. It has the number one market share position in the Consumer and Professional-Industrial segment but insignificant share in the Professional-Tradesmen segment. Below I will answer the questions posed in the case and will make analysis in order to understand the situation and make some recommendation for Black and Decker situation.
1. Black and Decker has 9 % share compare to Makita 50 % in Professional-Tradesmen segment because Black and Decker is mainly focused on Consumer and Professional-Industrial segments and has significant market share in those segments. Black and Decker associated more as a consumer brand than as professional-tradesmen. This image has negative effect on the professional segment. Besides, Black and Decker has variety of household product and heavily advertise them. All these factors affect company’s image and contribute to the perception of Black and Decker as a basically consumer tools oriented.
The causes of poor market performance among tradesmen are following:
- Black and Decker name not attractive to professional market;
- Black and Decker name associates with household products;
- Black and Decker has no access to the some channels that Makita has;
- The variety of household products destroy the reputation of Black and Decker as a professional-tradesmen tools;
- Presences of competitors (Makita, Milwaukee);
- Lack of differentiation, distinctions between consumer and professional tools (same color);
Factors that are not cause of Black and Decker poor market performance among tradesmen:
- Wide product line;
- Price below most competitors;
- Cost leadership;
- High quality, performance, reliability, durability;
- Brand strength (rank # 7 in the USA and rank # 19 in Europe);
- Brand recognition;
- Excellent service;
- Product development; laboratory tests;
2. The buying behavior of tradesmen impacts the situation as well. Some of them were using consumer tools in professional fashion due to the lack of differentiation between these tools. This lead to the perception of the Black and Decker’s tools as an inferior product because consumer tools are not indented for professional use. Since consumers and professional tools have different purpose and used differently (professional tools are used more often and more intense) the use of consumer tools by professional negatively affect the perception about quality of professional tools. As we learned from the case tradesmen were looking for high quality, long lasting, and durable tools. So the wrong usage of the Black and Decker tools affects overall perception of Black and Decker’s professional-tradesmen tools. Furthermore, tradesmen prefer to buy tools in home centers such as The Home Depot and Lowe’s but Black and Decker has insignificant share in these distribution channel compare to Makita.
3. Makita’s competitive...