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Marketing
Strategy:
The Marketing Budget
By Ralph E. Grabowski
IEEE
Entrepreneurs' Network (ENET)
Tuesday, March 6, 2007, Waltham MA
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New
data
In honor of
the
IEEE Entrepreneurs' Network, I
began accumulating the human impact of Marketing; the jobs
created by the winners, or lost by the basket cases; and the
engineering slots fashioned
or vanished.
This
evening, I first published the human impact of Wang Laboratories and Digital
Equipment Company (DEC) as contrasted with Dell Computer.
DEC and Wang are gone,
shedding 177,000 jobs and 56,000 engineering slots between them. If each
employee had a spouse and two children, that would represent more than 10% of
the entire population of Massachusetts – gone.
If all the technical
folks were IEEE Members, they would represent more than 15% of the entire
world-wide IEEE membership losing their jobs.
By contrast, Dell has
grown to
- more than $60 billion
in revenue,
- more than $100
billion in market capitalization, and
- more than 60,000
employees.
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| M/E |
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a
Super Success
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| >1.5 |
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Dell
Computer, PC's 1998. http://www.dell.com
Climbed from startup to an $18 Billion
annualized sales rate and a $93 Billion market capitalization in 14
years. Dell maintains this high M/E Ratio™ in spite of investing
$250 million in 1998 in R&D.
"Your
evidence, Ralph, of the relationship between market research and success
is right on!
"We
are absolutely customer-data driven at
Dell Computer. We invest in understanding the customer, the
industry economics, and the market segmentation; to help us developing
the business model. My time is spent on the customer, on strategy,
and on product direction." Michael S. Dell, Founder,
Chairman, and CEO of Dell Computer. |
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Flaming Failures
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| 0.004 |
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Digital
Equipment (DEC), PCs & mini-computers 1990s. Pioneered
minicomputers, and had two lines of PC products developed and in the
market several years before Michael Dell started Dell Computer.
$17.2 Billion value lost. 145,000 people and 45,000 engineers no
longer work for DEC. |
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| <0.001 |
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WANG
Laboratories, PCs & minicomputers 1984 - 1991. Bankrupt in
1992 with 32,000 employees and 11,000 technologists. |
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