B&D Case

Student

Prof. Pinegar

Marketing - B&D Paper

March 8, 2004

President DiCamillo,

In 1991, the Black & Decker Corporation faces a major challenge within the power tools

industry. Today, the industry features three major market segments: Professional-Industrial,

Professional-Tradesman and Consumer1. Professional-Industrial tools are sold to larger

companies who bought tools for their workers, Professional-Tradesman tools were sold to

independent contractors and other workers who used their own tools on the job site, and

Consumer tools were sold to households1. At this time, the Black & Decker Corporation holds

the #1 position in both the Consumer and Professional-Industrial market segments; however, we

struggle in the Professional-Tradesman segment with a market share of 9%1. According to

product research, the products that Black & Decker has to offer are rated high on performance,

durability and reliability2. Despite these results, sales are still down, so we must turn to another

possible cause of the problem: brand name. The results of telephone surveys and Black &

Decker’s Annual Image Study show that the Black &Decker brand received an impressively high

percentage of awareness among consumers in the Professional-Tradesman market segment at

98%, but the brand image suffered with only 44% of the respondents saying that Black and

Decker tools are “One of The Best”3. Because the Black & Decker brand has developed a

negative reputation within the Professional-Tradesman segment, the company needs to change its

strategy. Three options arise: harvest the division by focusing on maximum profit for the short

run regardless of market share in order to put money into the other segments, sub-brand current

Black & Decker products in order to re-establish the brand, or re-brand the tools in the

1

Harvard Business Case 9-595-057: The Black & Decker Corporation (A): Power Tools Division, p. 1

Harvard Business Case 9-595-057: The Black & Decker...