Magazine article Management Today

Dyson's Clean Sweep

Magazine article Management Today

Dyson's Clean Sweep

Article excerpt

The revolutionary Dual Cyclone vacuum cleaner is wiping the floor with the competition - indeed, sales now top [pounds]8 million a month, more than either Electrolux or Hoover.

In the spring of 1993 Hoover launched what was to become perhaps the greatest disaster in the history of sales promotion. In a few short months, it sold hundreds of thousands of vacuum cleaners by offering free flights to America with each sale. But managers underestimated how many people would respond to the offer, and the miscalculation has done the company lasting damage. Just then, into this already saturated market, came James Dyson with the product that bears his name, the Dyson Dual Cyclone. In a sector not known for its progressive ideas, the Dual Cyclone represented perhaps the greatest leap forward since electric-powered suction did away with the need for manual bellows.

Early in 1995, Dyson's upright cleaner overtook the leading Hoover model in sales, according to independent figures. Its sales have trebled since then to more than 30,000 a month; other models hover around 5,000. With the recent addition of two compact models, sales of Dyson's premium-priced cleaners now top [pounds]8 million a month, more than either Hoover or Electrolux.

It might never have been like this. Back when they each commanded 40% of the market, both companies had the chance to take up Dyson's idea. Like a number of other companies, Electrolux liked some things, but disapproved of the fact that the cleaner required no bag - something the companies rely on to generate after-sales profits. Hoover's views remained a mystery. 'We never met because they wanted me to sign a piece of paper saying that anything that came out of a conversation between me and them belonged to them. Considering that I was going along with a new technology, this seemed like a pretty rotten deal,' says Dyson.

The Cyclone story began in 1979. While looking for a way to avoid the mess created in spray-painting another of his inventions, the Ballbarrow (a wheelbarrow with a ball), Dyson found that other companies used systems of spinning airflow - in effect, mini cyclones - to produce orderly paint droplets. He then took apart his domestic vacuum cleaner and made a rudimentary cyclone of cardboard. It worked - up to a point. Five thousand prototypes later, Dyson had a machine ready to market - a machine in which a high-speed air vortex whizzed dirt particles to the rim of a cylindrical collector, and which, without the dustbag that on conventional machines becomes gradually more clogged, continued to perform at the same level. All you had to do was empty the collector from time to time.

A former colleague, Jeremy Fry, with whom Dyson had worked when designing a stable landing craft for engineering company Rotork, had put up half the money to get Dyson to this point. Already mortgaged to the hilt, Dyson raised the rest by selling his vegetable garden and persuading Lloyds Bank to make him a loan. Once Electrolux and the rest had rejected Dyson's idea, Rotork decided to take it on. The machine was made by Zanussi and sold by the direct-selling company, Kleeneze, but never really took off. A licensing deal with the network marketer Amway for the American market quickly turned sour. Then Rotork wanted out.

By the end of 1984, Dyson was back to square one until, that is, he received a phone call from the London agent for a Japanese importer of Filofax and other stylish goodies who had seen his product in a design annual. Within four weeks, he had a new agreement. Six months later, his cleaner was in full-scale production with every detail of its design intact down to the eccentric pink and mauve colour scheme Dyson had concocted.

All well and good, but the Japanese cleaner cost [pounds]1,200. This was all right for people who saw it as a designer collectable. But this was not where Dyson wanted to be. He invested the profits from the Japanese sales in refining his design to the point where it could be positioned for the mass market with a [pounds]200 price tag. …

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