© HSR B2B. All Rights Reserved. Makino 2002 Marketing Strategy January 14, 2002

© HSR B2B. All Rights Reserved.

Makino 2002 Marketing Strategy

January 14, 2002


2

The Market

The machine tool market is still in a deep trough, but is undoubtedly poised for an upswing later in 2002 or in 2003.

Bolstering marketing communications now will strategically position Makino to gain market share as the market begins to gain momentum.

Get out ahead of the curve.


3

The Strategy

2002 Strategic Imperative

• Makino has historically marketed an premium product line to an “elite” group of buyers.

• Makino will continue to market premium high-end products and is introducing a series of performance products at a lower price point, targeting a broader audience.

The strategy moving forward is to expand the appeal of Makino machines to a larger audience and extend the brand into the mainstream machine tool market, while maintaining and leveraging premium quality positioning.


4

Marketing less expensive technology to the broader audience group leads to the temptation to focus singularly on a “lower cost” message to the exclusion of the traditional attributes of the Makino brand.

The risk is erosion of brand equity.

Point of View

Therefore, the concept of affordability should be addressed in terms different than the cost of the machine. This requires finding a “higher ground.”


5

What is the “higher ground”?

“Metalworking companies need to reduce costs while improving quality and productivity.” Society of Manufacturing Engineers, Manufacturing Engineering, April 2001.

“With the pressure on most shops to reduce costs and increase productivity, every time saving feature on a machine tool counts.” American Machinist, August 2001.

At the highest level, industry in general is undisputedly obsessed with driving costs out of the manufacturing process.

Approximately 50% of companies justify machine tool purchases on the basis of price per piece cost estimates. Machine Tool Cost of Ownership Survey, September

2000.

“The decisive step in many equipment purchases occurs when the buyer reaches an understanding of how cash generated from a new machine can finance the expenditure in the short term and increase profitability over a longer term.” Modern Machine Shop, September 2001.


6

It’s not about the cost of the Makino machine.

It is about the huge reduction in manufacturing costs that Makino machines yield.

HSR Key Insight


7

Competitive Voices

Bostomatic specialize in high speed milling machines, leaders in this field

Charmilles very highest level of quality and service Technologies

Cincinnati superior technology and innovation

Haas higher accuracy, repeatability and durability

Hitachi Seiki precision CNC machine tools, productivity enhancing technologies

Mazak productive, precision and reliability

Mitsubishi large company, useful reliable, efficiencyMachine Tools

Mori Seiki reduce production costs

Okuma productivity and profitability

Toyoda precision, most productive and dependable

Sodick service and support

Competitors’ positioning is reduced to table stakes in comparison to the “higher ground” of reduced manufacturing costs


8

Makino is the most affordable machining technology because it drives the most costs out

of your manufacturing process.

This a unique, differentiable position that no other competitor is claiming.

Message

Based on the strategic imperative, key insights, target audience relevance and competitive positioning, the recommended message is:


9

Lowest cost per part – Makino machines generate the lowest overall cost per part versus the competition.

Unrivaled performance and flexibility- Makino machine tools are so productive and flexible they can do the same job with fewer total machines than the competition.

Lower operating costs – Because fewer Makino machines are required to do the job, less tooling, maintenance, energy, fixturing, operator expense is required for the line. The extra operating costs for additional competitive machines required to do the job often far exceed what appear to be lower up front costs of acquisition.

Unsurpassed accuracy - Higher part accuracy delivers more parts in spec. requiring less rework and generating less waste to keep unnecessary overhead expenses down and cycle times short.

Optimal applications engineering – Only Makino provides customers with their own applications engineers with the broadest depth of process, machine performance, technology and product manufacturing expertise for consultation to optimize your line and speed your cycle times.

More affordable than ever– Makino has an expanded line of new competitively priced machines designed for higher volume jobs (a51).

Evidence


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Affordable luxury Recognized leader in turnkey

engineering Superior technology Innovator Not apologetic for price

Brand character

Documents

© HSR B2B. All Rights Reserved. Makino 2002 Marketing Strategy January 14, 2002