Black&Decker Business Case Study
Research Paper (undergraduate) from the year 2006 in the subject Business economics - Marketing, Corporate Communication, CRM, Market Research, Social Media, grade: 1.0, Western Carolina University, course: Marketing Management & Mature Consumers, 7 entries in the bibliography, language: English, abstract: During the 1984-1992 period Black and Decker had established themselves as a leader in the power tool industry. It was their feeling however, that the market for such tools was maturing to the point where expansion within the industry would provide little or no additional revenues so they decided to diversify. Black and Decker began their expansion operation by acquiring General Electric’s small household appliance segment, the leader in the industry. The success of the GE deal, and the reorganization efforts of their new CEO Nolan Archibald, led Black and Decker to continue on this path of acquisitions and diversification in other areas 1 . By diversifying, Black and Decker lost focus of its core products (power tools). Customers began to think that Black and Decker tools were losing quality because of their lack of specialization. When they decided to divest the other business ventures, the customers’ view of Black and Decker tools was positively affected as they regained market share. However its image could be better, so by advertising and sponsoring home improvement television shows, Black and Decker could have a better image and gain more market share. Black and Decker has divested much of its broad enterprises including its household and recreational outdoor products in favor of a more focused business model in the power and professional tools market. They also need to regain their reputation of quality by advertising and sponsoring home improvement television shows 2 . However, Black & Decker has now a diversified product line that competes in the consumer and professional power tools markets. The company also has a fastening business and a home and hardware business that provide diversification from tools. Such diversification helps mitigate the volatility associated with cyclical swings in any particular market. Black & Decker is known for its innovation, which would help the company to continue to develop new products for these and other markets. The company has come up with numerous "firsts". For instance, it introduced the portable drill, cordless power tools, and laser levelers. This high degree of innovation has resulted in a reasonably high vitality index, which measures the portion of total sales derived from products introduced in the last three years [...]
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2000 Business Week Acquisition of Emhart advertising and sponsoring allowed Black assets Black & Decker Black and Decker Brand Names Becomes brand preference CEO Hates CEO Nolan coffeemakers Consumer Brands container forming machinery customers Datamonitor Decker Corporation Decker sold Decker tools Decker was able Decker’s Diversification Strategy DEWALT Discount Store Divested Business Units Electric’s Houseware Division food processors Force in Housewares forming machinery division glass container forming hand mixers home improvement television household products housewares category http://www.bdk.com Industrial Products Group Jennifer Reingold K mart KNOWLEDGE HAS VALUE laser level market share market’s initial Mattson million Nihat Canak Nolan Archibald º º º ºº outdoor products division percent Plan Your CEO Porter-Cable and Delta power tool industry Press Release private label product life cycle product lines products introduced professional tool Radford recreational outdoor products shoppers SnakeLight sponsoring home improvement Strategic Recommendations toaster ovens tools market Wal-Mart www.GRIN.com