Product and Brand Management

SECTION A | TEAM 05
Shalu Goel| D Ramesh| Rahul Chatterjee| Kritika Warkade
Black & Decker Corporation: Spacemaker Plus Coffee
Should Heiner Order a recall of the space maker plus coffeemaker?
According to CPSC (consumer product safety commission) the below are the safety guidelines for dangerous defects:
 Being coffeemaker is an object of high utility in everyday lives, there lies a significant over usage or misusage
of the product there is a serious issue of safety.
 Physical environment: coffee being consumed many a times in a day either in kitchen or in social locations, it
has a significant risk of manifestation in multiple locations.
 Case law involving health, safety knowledge of health hazard onus upon the manufacture for immediate recall.
Considering above safety issues by the product it is advisable to go for immediate recall.

What is the goal of recall?

Most of HPG sales in '1988(40%) was based on products which were three years old or less# This fact highlights how
critical was the new product business for the continued growth of HPG.
In addition, they wanted to grow further into the industry with a wide product range from irons, vacuum cleaners,
toaster ovens, coffeemakers and toasters. And to d this they heavily relied on providing superior customer satisfaction
as the dominant brand quality and innovative household products.
The main goal of the recall is:
1.To increase the sales in future. 2. The superior customer satisfaction would hurt their brand image if they don’t recall
the   product. One of the main goal of recall is to retain their customer centricity and brand loyalty.
How should the recall be organised to realize this goal?
From the past experiences it can be seen that return rates are generally low and since a high return rate would set a
precedent for future recalls management is generally passive when it comes to recall.
But since the major reason for the success of Black & Decker was due to its customer orientation and their high focus on
quality it becomes necessary to obtain a good recall rate to retain this image on the minds of the customer.
This proactive strategy would also help in ensuring that the damage to the brand can be limited.
The recall should start as soon as possible because past experiences show that with delay the recall rate generally
achieved is low.
Also efforts need to be put in increasing awareness among distributors and consumers regarding the recall.

Could HPG have avoided the need for a recall?

 The product was certified safe by Underwriters Laboratory.
 Also, to ensure safety requirements the product had two TCO’s (temperature cut-off) to shut the unit off in
case of overheating.
 Also, it was suspected that the fire was due to the customer not fully inserting the reservoir drawer.
These factors are in favour of the company avoiding a recall. But since the coffeemakers operated automatically and
there was a likelihood of the problem arising when the product was unattended it would have been difficult HPG to
avoid a recall.

What were the recall success factors?

 Product availability in the distribution channel or with the customer typically determined by the average age of
the product and its average useful life.
 Awareness among distributor and consumer.
 Benefits of compliance with the recall exceeding perceived costs of time, effort and lost product services.
What might have HPG done differently?
 The new design did not have any established standards.
 Hence a more stringent Failure Mode Analysis test may have helped in ensuring that the fire hazard be
avoided.