Caterpillar Case Study

Caterpillar Case Study
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Caterpillar Case Study 2
Introduction
The history of Caterpillar is all about doing, creating, building, problem solving, innovating,
testing, servicing and improving (Caterpillar, 2019). Caterpillar have survived in the industry
through their segment strategies, staying relevant from its appeal has allowed their business
model to blossom. Their top competitors in the market have the will to go the distance with
similar type equipment, but Caterpillar is not only a name it’s a brand that is trusted in the
industry. With their global three tier business model, Caterpillar differentiate from the
competitors and have a bright future ahead of them.
Caterpillar has divided its product strategy into three segments: World Class, Mid-Tier, and Low-
End. The company is focused on innovating high-tech machinery for the growing World Class
segment and leaving the Low-End segment to local competitors that will eventually be
consolidated (Kotler and Keller, 2016). The company does not focus on just one particular type,
however, its focus is base off multiple needs in the construction and farming industry.
Construction activity plays an integral part in infrastructure and industrial development. The
industry generates substantial employment and provides a major growth impetus to other sectors
-05:00 through backward and forward linkages, including cement, steel, bricks/tiles, sand/aggregates,
products, aluminum, glass, and plastics (Dash, 2018). There are many needs from small
Strategy
construction to big industry needs and Caterpillar provides from the low-end to high-end, along
with great customer service to establish the brand.
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needed.
provided all the
Competitors services for the industry without major error, causing them to lead the industry in
Advantages
the right direction. With great service and production around the world, the company has
Organizations such as Deere & company, Volvo, and Komatsu competes with Caterpillar in the
established a brand that people trust. Moving forward, Caterpillar will continue to grow through
agricultural and forestry-related equipment. These companies offer some of the same equipment
its research and development and innovating productions. The brand alone is differentiate from
to get the job done for a cheaper rate. In Komatsu case, location for currency plays a factor in
the others and will hold up in the market, which will keep Caterpillar ahead of its competitors.
their advantage. When the early 1980s recession hit Caterpillar hard and international
competitors like Japan’s Komatsu gained market share. High prices and inflexible bureaucracy
nearly sent the company into bankruptcy. In 1982 alone, it lost $6.5 billion, laid off thousands of
Caterpillar have established itself in the market through great customer service and product
employees, closed several factories, and suffered a long United Auto Workers strike (Kotler and
differentiation to establish their brand. The company research and development department keep
Keller, 2016). When the market dip Caterpillar was affected causing to shift their plan and
the brand ahead of its competitors, along with their innovating ideals to establish and improve
downsize, while its competitor gained position.
their products for customers use. Caterpillar will continue to lead the market in their industry if
Competitors Disadvantages
they stay on track and continue to grow.
Competitor’s equipment may be the same, however, performance is a great deal when it comes to
getting the job done right. Caterpillar offer various type of equipment for small or larger jobs that
needs to be accomplished and some of the competitors do not hold up to the different variations.
Overall is brand, Caterpillar have established a trusted brand servicing many customers around
the world to include the military, providing equipment on time and assembled at the location
-05:00 Caterpillar grew steadily at first, hitting a few critical milestones including the use of its
References
contracts and strong overseas demand kept sales strong through the mid-20th century, as did
Caterpillar. (2019). About the Company: Our Legend. Retrieved from
https://www.caterpillar.com/en/company/history.ht
innovations like the diesel tractor and rubber-tired tractors (Kotler and Keller, 2016). Caterpillar
Growth
ml
Conclusion
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Kotler, P., & Keller, K. L. (2016). Marketing management [VitalSource Bookshelf version]
(15th ed.). Retrieved from
https://online.vitalsource.com/#/books/9781323591512
Dash, M. (2018). Working-Capital Management and Profitability of the Construction Sector in

Bangalore.
Journal of Commerce & Accounting Research
, 7(4), 40–46. Retrieved from
http://search.ebscohost.com.libraryresources.columbiasouthern.edu/login.aspx?direct=tr
e&db=bsu&AN=130523192&site=eds-live&scope=site
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competitors and have a bright future ahead of them.

with great customer service to establish the brand.

Dash, M. (2018). Working-Capital Management and Profitability of the Construction Sector in

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