Why industrial design is the best investment for your R&D (evidence and ROI)

In the minds of many executives and investors, industrial design is still too often reduced to a coat of aesthetic varnish. A “nice-to-have” option added at the end of a project to make the product look good.

That is a major strategic mistake.

Industrial design is not a cosmetic cost centre; it is a lever for financial and operational profitability. Built in from the start, it dictates ergonomics, optimises manufacturing costs, strengthens perceived value and triggers the decision to buy.

Here is why – with figures and real cases to back it up – industrial design delivers one of the best Returns on Investment (ROI) of anything a company invests in.

1. What the figures say: Design outperforms the market

If you still doubt the financial impact of design, the macroeconomic data from the world’s largest consulting firms leave no room for doubt.

The McKinsey Design Index (MDI): In its extensive study The Business Value of Design, McKinsey followed 300 companies over five years. The verdict? The companies that integrate design best saw their revenue grow 32% faster and their total shareholder return (TSR) grow 56% faster than their competitors. (Source: McKinsey & Company)

The Design Value Index (DVI): Run by the Design Management Institute, this index showed that “design-led” US companies (such as Apple, IBM, Nike and Whirlpool) outperformed the S&P 500 by 211% over a ten-year period. (Source: Design Management Institute)

The impact on SMEs: According to the UK Design Council, for every pound (£) invested in design, a business can expect a return of £20 in additional turnover and a £4 increase in profits. (Source: Design Council)

2. Case study no. 1: Cutting production costs (the Decathlon approach)

The ROI of industrial design is not measured solely by higher sales. It is also, and above all, calculated through lower manufacturing costs (Design for Manufacturing).
The example of Decathlon’s Easybreath mask

Decathlon’s famous Easybreath snorkelling mask is a textbook case of successful industrial design. When the project was entrusted to designers, the aim was not only to create an innovative product, but to make it affordable.

The design approach: The designers worked on rationalising the components (one-piece plastic injection moulding, fewer seals) to simplify assembly in the factory.

The ROI: A drastic reduction in industrial cost prices, enabling Decathlon to offer a breakthrough product for under €25 while keeping a comfortable margin and selling millions of units worldwide.

What investors take away: Good design simplifies the product. Fewer parts, better-chosen materials and faster assembly translate into an immediate increase in gross margin.

3. Case study no. 2: Creating a competitive advantage and setting your own prices (the Dyson effect)

In a saturated market, how do you justify a price three to four times higher than the competition’s? That is the challenge of perceived value, and it is where industrial design excels.
The example of Dyson

Before James Dyson, the vacuum cleaner was a basic household appliance, hidden away in a cupboard and chosen solely on power and price.

The design approach: Dyson made the technology visible (the transparent bin that shows the cyclonic dust) and rethought the object’s architecture for perfect manoeuvrability. Industrial design turned a utility item into a high-tech status object.

The ROI: Dyson posts exceptional operating margins and dominates the global premium household appliance market. The company proves that design makes it possible to escape the race to the bottom on price.

4. Case study no. 3: Reducing the risk of commercial failure (the Medtech approach)

For an investor, the major risk is funding a product that will not find its market or that users will reject because of poor ergonomics. In the medical sector (Medtech), this can be fatal.
The example of GE Healthcare’s medical scanners

For years, MRI and CT scans were a major source of anxiety for patients, causing movements that invalidated the scans and cost hospitals precious time (and money).

The design approach: Industrial designers reworked the overall ergonomics : softer shapes, soothing lighting environments, simplified interfaces for technicians.

The ROI: A drastic drop in sedation rates among children, scans successful at the first attempt, and greater efficiency for hospitals. For GE Healthcare, this translated into widespread adoption of its equipment by healthcare centres.

Conclusion: Industrial design is a risk management strategy

Investing in industrial design is not an aesthetic expense; it is a strategy for maximising value and reducing risk.

For companies, it is the guarantee of a product that is optimised for the factory and wanted by the market.

For investors, it is a strong signal that the management team is not just developing a technology, but building a product that is viable, scalable and highly profitable.

When allocating your R&D budgets, ask yourself this: would you rather fund a technology that nobody knows how to use, or a market-leading product? Talk to an industrial designer from the scoping phase onwards. Your balance sheet will thank you.