Makita Competitive Strategy Case Study

This case study examines Makita's competitive strategy within the professional tradesman power tool segment, highlighting its strong brand image, low pricing strategy leveraging home centers, and channel protection advantages over competitors like B&D. It also analyzes Milwaukee's position as a high-quality, premium-priced brand within the same segment, noting its strong customer preference and brand awareness. The analysis contrasts Makita's value-focused approach with Milwaukee's premium positioning, illustrating the competitive dynamics within the market.

Question: What is Makita’s competitive strategy and what role does Milwaukee (the #2
brand in the segment) play?
Answer
The public image of Makita was well-established in the Power Tool industry, especially in the
segment of Professional Tradesman. The brand was perceived to a reliable brand, credible and
strong. A distinct advantage was given to Makita over the B&D as it was offered no channel
protection. Therefore, the products were sold at the membership clubs. The customers had an
idea that the brand Makita just produced the power tools and not anything else; therefore they did
not have any preconceived notions or attitudes related to it. Again, Makita got advantage over
B&D as B&D was producing the consumer products like the vacuums. The prices charged by
Makita are low and it is able to offer the products at such low prices because it is able to
capitalize 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 it
operates within the Professional Tradesman segment Milwaukee. It forms 10% of the
Professional 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 over
the B&D because it is regarded as a high quality tool, durable. Also, a large number of people
are aware about this brand and thus the company and most of them agree that it is one of the best
brands available in the market.