In business school, the Black & Decker case study is a classic!
Back around 1992, the problem was that B & D’s commercial-grade products were charcoal-gray, and their consumer-grade products were black. A lot of their really cheap competitors also used black or charcoal-gray for their colors, as well. At the time, their main competitors in the professional-tradesman arena (contractors, construction workers, etc.) were Makita and Milwaukee Power Tools, each with their own bold, distinctive colors. Makita was kicking the snot out of both Milwaukee and B & D, and Milwaukee was starting to pull ahead of B & D.
B & D were huge in the consumer goods marketplace (coffee makers, popcorn makers, blenders, etc.) and they had a very high name recognition value, due to all the marketing for those consumer goods. However, that brand recognition worked against them, because there was a perception that B & D was synonymous with “cheap” and “consumer-grade” products, not to be used by professional tradesmen. Interestingly enough, they had done research where they took similar products from B & D, Makita, and Milwaukee and removed all identifying marks and colors, then put them to use in real situations. The B & D products performed equally with the other two brands, demonstrating that B & D’s quality was high, but they had a perception problem.
B & D was literally faced with the possibility of exiting the power hand tool market, and they were the ones that had invented the market!
As mentioned upthread, DeWalt was a manufacturer of radial arm saws for the lumber industry, but the brand had been retired due to liability concerns. The DeWalt brand was already part of the B & D “stable” of brands; that is, they did not go out and purchase DeWalt. They resurrected the brand name and applied it to their professional-grade tools, along with the “industrial yellow” color.
They could have co-branded their products by calling them “Such and Such by Black and Decker”, but that would not have helped them overcome the perception problem. Therefore, they had to do something to get separation from the B & D name.
At the time, studies had shown that the DeWalt had a high name recognition factor, so they chose to rebrand as DeWalt. (This was around the same time that Honda was introducing the luxury brand of Acura, and Toyota was bringing out the Lexus, both for the same reasons: to get separation from their cheaper, “consumer-grade” lines.)
Again, as mentioned upthread, perception is everything, especially in a macho environment such as a job work site. The guys are always sizing up each others’ … tools … (ahem, the powered kind). Same thing with their trucks. There is an inherent “ego-expressive” quality about what you use to make your living, especially in a testosterone rich environment where you only make money when you are working, and you are losing money if your tools are broken.
The color of the drill or saw or whatever was a very powerful influence. You could see from across the job site what a particular guy was using. Good or bad. But B & D suffered because a cheap knockoff’s black or charcoal-gray color was indistinguishable from their charcoal-gray products.
By completely changing over the name and color of their tools, B & D was able to successfully rebrand themselves and separate their professional-grade tools from their consumer-grade tools. And they totally dominated the market in the years immediately following.
Now, all of this happened a long time ago when we all wore onions on our belts, and so, today, the landscape may be completely different. DeWalt tools may or may not be of as high quality as they were 30 years ago. Makita and Milwaukee may or may not be better than they were 30 years ago. (Both Makita and Milwaukee are owned by the same “umbrella” corporation.) Other brands may have risen to take their place.
But the really strange thing is the important part that the color played in the whole rebranding effort.