Dyson is a world-renowned electrical products company. Today I will analyze Dyson from two aspects.
1: Critically evaluate the long term sustainability of Dyson’s global competitive advantage
From the perspective of “economies of scale”: Dyson began to seek to transfer production to Malaysia. In my opinion, in part due to the fact that Dyson is trying to reduce production costs. Because of the transfer of production to Malaysia will certainly reduce the cost of unit goods.
Although the transfer of the production line is a substantially fixed cost expenditure. The good sales reactions in the Asian and American markets partly explain why Dyson is willing to generate a large fixed expenditure to transfer the production line to Malaysia, and the strong market prospect gives them the confidence to recover the expenditure. So this approach is beneficial for the sustainable development of the company.
As for Consumer preference, To some extent, the high pricing strategy of Dyson company has turned the product of Dyson vacuum cleaner into a sign in the industry. Although the price is on the high side, it gives consumers the impression of high price, good quality, and good effect. With the emergence of low-priced similar products, the sales volume of Dyson’s products will be challenged, but the perfect impression he left to consumers can also maintain a fixed consumer group to some extent.
As for Switching costs, “only 35% of Dyson owners would buy another one compared with 50% five years ago”, changing from Dyson’s products to cheaper products will not cause great trouble to consumers, unless the experience of cheaper products to consumers has a huge gap compared with Dyson’s products, I think Dyson should like apple to launch a discount like old for new service or enhance the interaction function or connection between various products of Dyson, so as to Stop consumers from turning to similar products of other brands
All in all, I think Dyson’s global competition strategy has a sustainable development prospect, but at the same time, there are many things that can be improved.
2. Suggestions for the sustainable development of Dyson’s global strategy
I think Dyson should hope that Apple will launch discount services such as old for new, or enhance the interaction function or connection between Dyson’s various products, such as the sharing of charging parts between Dyson’s washing machine, hairdryer and vacuum cleaner, and the purchase of other Dyson products with discounts if Dyson’s products already exist, or the use of Dyson’s product group can provide consumers with Suggestions for healthy life based on big data analysis. In this way, consumers can be prevented from turning to similar products of other brands.
Dyson can consider making products suitable for local demand in Asia and North America, so as to recover the cost of transferring production to Malaysia as early as possible.
For the domestic market in the UK, Dyson can take into account the disguised price reduction to attract consumers, or maintain its share in the domestic market.