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Question: What is Makita’s competitive strategy and what role does Milwaukee (the #2brand in the segment) play?AnswerThe public image of Makita was well-established in the Power Tool industry, especially in thesegment of Professional Tradesman. The brand was perceived to a reliable brand, credible andstrong. A distinct advantage was given to Makita over the B&D as it was offered no channelprotection. Therefore, the products were sold at the membership clubs. The customers had anidea that the brand Makita just produced the power tools and not anything else; therefore they didnot have any preconceived notions or attitudes related to it. Again, Makita got advantage overB&D as B&D was producing the consumer products like the vacuums. The prices charged byMakita are low and it is able to offer the products at such low prices because it is able tocapitalize on the Home Centers premises. So, this is the competitive strategy of Makita.Milwaukee also plays a role here because Makita is the leader in all the product lines that itoperates within the Professional Tradesman segment Milwaukee. It forms 10% of theProfessional Tradesman segment. The brand is perceived to be of high quality by the customers.It is sold at premium pricing averaging 10%. The preference for Milwaukee is 91% higher overthe B&D because it is regarded as a high quality tool, durable. Also, a large number of peopleare aware about this brand and thus the company and most of them agree that it is one of the bestbrands available in the market.
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