Ralph E. Grabowski - marketingVP - fact-gathering, analytical Marketing to steer the enterprise

 

Home

Potential Clients

My Work

Client Results

Research

Published Papers

Guest Lectures

They said it!

Resources

Contact

 
Marketing is an investment
 

Investment evidence
the Marketing/Engineering Investment Ratio™ (M/E Ratio™)

"Your evidence of the relationship between Market Research and success is right on!  Dell's M/E Ratio™ is North of 1.5."  Michael S. Dell, Founder, Chairman, and CEO of Dell Computer Corporation

 
 

Contents

 

M/E Ratio™, 
the Marketing/Engineering Investment Ratio™

 

 

 Invest-
 ment
 ratio

 Period of
 developing
 the product

 Period of
 ramping up
 purchase orders

Marketing

1

 

Engineering

1

 

Promoting
+ Selling

 

3

 

 

     

 

5

 

───────────  time  ───────────►

product life cycle

    Figure 3, the Marketing/Engineering Investment Ratio™ (M/E Ratio™)

 

The Marketing/Engineering Investment Ratio™ (M/E Ratio™) was developed for the first annual MIT Enterprise Forum Spring Workshop, "How To Create a Successful New Business."  This new metric separates the functions of marketing from promoting and selling, and installs marketing (market research) concurrently with engineering.

"WHEN you make the market research investment is key.  There is no point in doing market research after the product is developed.  Market research must be done up front!"  Seth Taylor, Ph.D., Founder and President, MolecularWare, MIT $50K Entrepreneurship Competition Grand Prize Winner 1999

As you can see from Figure 3 which was created before the data came in, I first taught that the M/E Ratio™ ought to be 1:1.  I was wrong!  The M/E Ratio™ of successful technology-based companies is more than 2.5:1.  Next, here is the data.

 

 
Site Map   Download   Copyright© 1996-2016 Ralph E. Grabowski