Bio

Memo

To: Joe Galli

From: W. Dean Maruna

Date: 7/27/06

Re: Marketing plan for Black & Decker targeting Tradesmen

Black and Decker has a low market penetration within the Tradesmen market segment due to the perception that Black and Decker is a consumer product and therefore lower quality. While B&D has a high brand name product awareness, within this market segment, brand name awareness is not buying the company anything. I recommend that B&D drop the name from its line of product tools sold at Home Depot, Lowe's and Ace Hardware. While internally this may not be a popular decision, the fact is that only 9% of this market segment believes that the creator of the power tool makes a power tool FOR THEM. B&D should leverage the strength of the DeWalt name with this market segment to create a new line of products that will appeal to Tradesmen.

Black & Decker Marketing Plan

Customer:

-Tradesmen Ð'- Electricians, Plumbers, Carpenters, Framers, Roofers, and General Remodelers working in Residential construction

-9% growth rate in 1990

-Purchase tools at Home Depot, Lowes, and Ace Hardware stores

-$420MM market, B&D has only 9% market share

-Color of product is a differentiator within this market; black/grey are considered consumer product colors

-B&D is perceived as a strong consumer brand within this market

-Purchasing habits Ð'- Owns approximately $3K in power tools with life span of 3 years. Each tradesmen is spending about $1K/year in replacing tools.

Branding:

Black and Decker should create a new line of products branded with the DeWalt name. DeWalt was a leader in sales of large radial arm saws and a well-known brand name within the Tradesmen market. While many tradesmen may never have used a DeWalt product, as they had not previously produced a portable power tool, 51% of tradesmen stated they would have some purchase interest in a DeWalt product. Compared to the 9% market share that B&D has in this market currently, this number is impressive. The new line of products will be branded with the DeWalt name and each tool will be yellow in color. The color yellow not only represents safety in the construction industry, but is also the color of the DeWalt logo. These tools will be easy to recognize and differentiate from other brands as there is no other market leader within this segment of products with a line of yellow tools. B&D should position itself as both a leader in quality, but also "Made in America." This target segment of users tends to be patriotic and proud of their country and B&D can use the "Made in America" claim to differentiate from foreign-owned Makita.

Product Features:

Based on extensive field research testing, B&D product quality was found to be highly competitive in many of the product categories. B&D should focus on the quality of its products to differentiate from its competitors. B&D will offer a 1 year guaranteed warranty on each of its DeWalt branded products and offer a 24 hour help line for customer service. B&D already scored higher than Makita in standing behind its products and easy to get service, so these qualities should be the basis of differentiation with Makita products. The benefit to the customer is that if they ever have a problem with a DeWalt portable power tool, they know they can get the tool replaced quickly and easily at the nearest retailer. The color of DeWalt's product also has a perceived benefit to the customer because yellow represents safety.

Packaging: