Dyson: A Case Study in Reinvention

How Dyson Has Constantly Reinvented Itself and Dominated Multiple Markets

Dyson Has Constantly Reinvented Itself and Dominated Multiple Markets, but is its Latest Ambitious Product Release A Step Too Far?

A quick look around my flat over the Christmas & post wedding period, and you would be forgiven for thinking my wife is a Dyson brand ambassador. Not only have we spent a lot of money on each Dyson item, but they also incite the kind of excitement in my wife that defies the product itself. 

How can a vacuum cleaner, hair dryer, or air purifier get you excited and hot under the collar? Objectively these are some of the most boring types of items you can find in a house. Dyson somehow manages to do that, and my wife is by no means unique here. In fact, I find them quite satisfying too.

So I decided to do a bit of research of my own, to try and discover how this iconic brand has managed to position itself as a leader of so many different categories. How did my wife and I end up spending over £1000 on 3 devices that fundamentally just blow and suck air in different ways - and even weirder, how did they make us feel good while doing it?

Dyson was formally founded in 1991 by James Dyson, an inventor and engineer - and now 4th richest Brit in the world according to the 2022 Forbes Rich List, with a net worth of ~$9.2B. The company initially focused on developing innovative vacuum cleaners that were designed to be more efficient and effective at cleaning than traditional models.

James Dyson was 42 years old when he founded the company we know today, but his journey started some time before that. Before founding the Dyson company, James Dyson was an inventor and industrial designer. He developed and licensed several inventions, including the "Ballbarrow," a wheelbarrow with a ball instead of a wheel, and the "Dyson Bagless Cyclone," a vacuum cleaner that used cyclonic separation to improve suction. 

He licensed the technology for the latter to a Taiwanese manufacturer in the early 1980s, but was disappointed with the resulting product, which he felt did not live up to his design's potential. This led him to pursue the development of his own vacuum cleaner, and ultimately led to the formation of the Dyson company in 1991, using the funds he had made thus far from his licensing agreements.

One of the key innovations that Dyson brought to the vacuum cleaner market was the use of cyclonic separation technology, which allows for the effective separation of dust and debris from the air using centrifugal force. This technology was incorporated into the first Dyson vacuum cleaners, which were launched in 1993 and quickly gained popularity among consumers, after 5 years in development, and no less than 5127 prototypes (yes that’s the actual number).

In the years since its founding, Dyson has continued to innovate and expand its product line beyond vacuum cleaners. The company has developed a range of other household products, including air purifiers, hand dryers, and lighting products. It has also expanded into new markets, such as personal care and beauty products, with the launch of its Supersonic hair dryer in 2016.

During its three decades and counting, Dyson has consistently demonstrated the ability to incubate and invest in new innovations whilst remaining profitable as a business. They have now successfully built up a brand that spans multiple categories.

So what has contributed to Dyson’s ability to reinvent itself?

Firstly, Dyson's culture is centred around innovation and problem-solving. According to James Dyson, the company's founder, Dyson's culture is based on “solving the problems that others have ignored, and solving them first using our technology and ingenuity”, and this has been reflected in the company's approach to product development and its willingness to take risks and try new things.

But these aren’t just empty words either, Dyson puts its money where its mouth is via huge financial bets focused on research and development into new products and categories. The company has a dedicated team of ~14k people including ~6k engineers and designers who are constantly working on new ideas and technologies, and this has allowed Dyson to stay at the forefront of innovation in a number of different markets. In fact, as of 2022, Dyson had a total of 10552 patents and patents pending.

[Note: usually I source my own data and charts, but in this case, Dyson’s corporate structure was too complex to unravel, so this graphic from the FT will need to do!]

Another important aspect of Dyson’s identity is its commitment to quality. The company has a reputation for producing high-quality products that are designed to last, and this has helped it to build a loyal customer base and establish itself as a trusted and respected brand, even as a ‘new entrant’ in completely different categories.

Dyson successfully leverages its strong brand identity across categories. Always tastefully leaving you in no doubt that you are looking at a Dyson product, and therefore one that can be trusted.

Not only does Dyson have the habit of entering new markets, but it also has a track record of doing it while completely blowing mainstream price points out the window, and establishing higher and more controlled pricing than any of its competition.

Their unfaltering attention to tiny details, and over-engineering for life’s daily tasks, together with the high price points has, in my opinion, created a new concept - the ‘appliance as a status symbol’. In this sense, Dyson’s brand and marketing strategy has been a resounding success, spanning decades.

Dyson has leveraged all forms of advertising over the years. From their first TV ad in 1993 (shown above), through to digital advertising and even influencer marketing now in the modern era. The budgets have been very big, but then again, they are selling unique but mass market products at very high price points. Dyson’s differentiation helps to convert the masses, and their high price points comfortably absorbs their multiple heavyweight ad campaigns and product launches, keeping the campaigns profitable.

There are several threads that have been continuously present in Dyson’s marketing. Despite the media landscape changing dramatically over the last 30 years, Dyson’s brand message and style of delivery has remained consistent.

• The Product is the Focus - Dyson centre all of their ads firmly around the product itself. This is where their product and marketing/brand strategy come together. By creating futuristic, colourful, designs - they create a level of intrigue and brand identity that feels completely effortless. You see the product and are immediately intrigued, and immediately recognise that it is a Dyson product.

• Illustrate Vividly - the product shots that Dyson choose to use are almost always extremely illustrative. When the design is simple and clearly visible, they show it in use. When there are hidden or technological aspects, they rely on vivid illustrations that show you the thought, detail, and innovation that has gone into the design. These immersive visualisations and animations of technological innovations feature prominently, and are often complemented by deconstructions of the products.

• Glamourise the Technology - the illustrations and animations are styled to be natural and sexy, not scientific. Making what could easily be a scientific barrage simple, sleek, and even sexy.

• Keep it Simple - Dyson manage to illustrate their complex product and innovations in very few words. Their copy is kept extremely simple, having let the product and illustrations do the heavy lifting.

Of course, when making such investments in marketing new and future products and categories, it’s helpful to have a profitable company that can fund this activity in the first place. In this sense too, Dyson has been incredibly successful. Remaining consistently profitable since its inception.

[Note: usually I source my own data and charts, but in this case, Dyson’s corporate structure was too complex to unravel, so this graphic from the FT will need to do!]

The most resounding success has been Dyson’s entry into the hair care market. Since the launch of its first hair dryer, the Dyson Supersonic in 2016, the company has seen strong sales and has gained a significant share of the hair care market. Dyson has also expanded its hair care product line with the launch of the Dyson AirWrap styling tool and other hair care devices, which have also been well-received by consumers. Dyson has succeeded in ramping up sales and market penetration in the hair care market to the extent that it is now considered a major and leading player in this space.

Are there any failures lying behind Dyson’s successes?

The answer to this is a resounding yes. It’s highly improbable that a company like Dyson can take so many risks and big bets without suffering its fair share of losses. It comes with the territory. Perhaps the most resounding public failure has been the ill-fated Dyson electric car.

The company announced in October 2017 that it was ending its plans to develop an electric car, citing that despite significant investment, it was unable to find a way to make the project commercially viable. Dyson had been working on the car for more than two years, and had invested over £500M in the project (with plans to spend £2B more). The company had announced its intentions to develop an electric car back in 2015, with the goal of launching the vehicle in 2020.

Dyson's electric car project was led by a team of engineers and designers in the UK, and the company also acquired a battery technology start-up, Sakti3, as part of its efforts to develop the car. However, the company ultimately decided that the car project was not financially viable, and that the market conditions and regulatory environment were not favourable for the project.

There have been multiple other failures for Dyson over the years, in addition to the Dyson car … and probably even more failures behind the scenes that didn’t make it out of the lab. Dyson is a great example of embracing failure, and not being afraid of learning from it.

The fact that Dyson remains privately owned has probably contributed to this characteristic - not being at the mercy of public shareholders and the need to maximise near term returns. Dyson is free to invest in R & D and new innovations at whatever pace it sees fit. However, it has also managed to balance that whilst remaining extremely disciplined - knowing when to cancel and withdraw from potentially expensive or even destructive projects is a hard art form to master, and requires strong leadership to exercise.

So what’s next for Dyson?

In their annual report, Dyson references multiple areas of research and interest. These include Electric Motors, Sensing and Vision Systems, and Solid State batteries; as well as more bleeding-edge high-tech areas such as Robotics, AI, and Machine Learning. So who knows what we can expect from this ambitious and innovative company.

First though, they are going to attempt an entry into the Audio market this year, with the Dyson Zone - a pair of air purifying luxury headphones priced at ~£750.

Wacky, dystopian, futuristic? You can take your pick of adjective. But this wouldn’t be the first time an odd looking set of headphones completely disrupted the market at a new price point.

P.s. If you don’t remember thinking that AirPods looked odd, this is more testament to how much Apple have penetrated the market now, than your ability to remember back to 2016 - they were ridiculed on a large scale back then! Clearly Apple had the last laugh here though.

Ultimately, the success of this product is a complete unknown right now as it is just being released. But this makes for an interesting thought exercise. Why don’t you leave your prediction in the comments, and see how things pan out over the next 12 months?