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Segmentation analysis

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Presentation on theme: "Segmentation analysis"— Presentation transcript:

1 Segmentation analysis
Market Leader B & D Makita Distribution Channel Grainger Home Depot Kmart Market Segments INDUSTRIAL TRADESMAN CONSUMER

2 Color schemes of various brands
Figure D Color Differentiation Professional & Tradesman Makita - Teal Milwaukee - Red Bosch – Dark Hitachi - Green Black & Decker - Grey Consumer Wen Private Label Black & Decker Craftsman Skil

3 What should B&D do? Concede segment build share Sub-brand
Drop B& Dname DeWalt New name

4 What do you think of this plan?
• Do these cosmetic changes really offer any true competitive advantages? How would you respond if you were Makita? Has B&D’s analysis taken this into account? • Does Makita have any real competitive weaknesses to exploit?

5 % agreeing with statement (Brand X "………….")
Table 4 Percent Agreeing with the Statement Those Who Prefer Milwaukee Makita B&D Milwaukee B&D Those Who Prefer Makita Makes High-Quality Tools % % % % Makes Durable/Rugged Tools % % % % Proud to Own % % % % Easy to Get Service % % Stands Behind Products % % 44% % 56% %

6 What Happened? 1991 1994 Makita Other Other Makita Black & Decker

7 Why was it successful? • positioning in terms of service turned their weakness (association with the consumer channel) into a strength because the already existing B&D 117 customer service centers permit DeWalt to make a credible guarantee of 48 hour turn around on repairs. • added value from service guarantee permitted them to charge premium prices (further supporting high quality image)

8 What did you learn? What surprised you the most?

9 Market share of tradesman segment
Other Makita Black & Decker

10 What research did B&D do?
• visited tradesmen at their job sites • visited Home Depot, and quizzed product demonstrators • conducted lab tests of its performance and reliability • conducted "blind" field testing • analyzed market shares by firm, by channel, & by product type • took a "total product" approach – looked beyond the technical aspects of the tool to evaluate how people felt about using it • understood that tradesmen did not want to be "marketed to“ in a conventional sort of way

11 The cola "taste test" Group 1 Group 2 “A" = RC Cola “B" = Coke
“C" = Shaw's Group 2 "a" = Coke "b" = Coke "c" = Coke What are some reasons for having such a design?

12 A blind rating of Coke in 3 successive sips

13 Brand Recognition

14 Brand rated as best

15 Guesses about identity of "A" [RC]

16 Guesses about identity of "B" [Coke]

17 Guesses about identity of "C" [Shaw's]

18 Coke vs. RC: Stated preferences vs. actual preferences
% preferring Coke to RC stated actual Preference taste test

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