Dow Jones ousts GE
Tom Dougherty, CEO – Stealing Share
20 June 2018
Dow Jones kicks out GE. Now what?
In 1896, the stock market adds GE as one of Dow Industrial Average’s first companies. As of June 26th of this year, it will no longer be part of the DJIA.
I typically don’t talk too much about the stock market for a variety of reasons. I think there remains far too much internal strife in quarterly performance, often a the detriment of long-term initiatives. Now, GE gets the boot and it just doesn’t feel right somehow.
The DJIA says it’s committing to reflecting the broader consumer and health care sectors of the US economy. GE’s replacement, Walgreens Boots Alliance, the parent company of (you guessed it) Walgreens, certainly meets that criteria. It comes at the expense of a company that feels as tied to American growth as any in the history of US. I mean, this is the company started by Thomas Edison, for chrissakes. Not to mention the fact that General Electric is pretty involved in US healthcare.
“But now the manufacturing giant must honestly look at itself, and make its brand relevant enough for Dow Jones to reconsider it.”
An invigorated GE brand would help
Perhaps it’s the nostalgia. GE is not what it used to be. It has undertaken a difficult transition, including the loss of its finance division. General Electric won’t go the way of the Polaroid or Blackberry. You may not know this, but all but two of the original 12 companies that started the DJIA, only American Tobacco and US Leather remain in business in one form or the other.
From a brand perspective, audiences gave meaning to the GE brand. Who knows what it really means anymore. We know GE is big. I see its equipment everywhere when I talk to doctors in the course of a brand project. (We do a lot of medical business.)
While GE certainly sits on the cusp of new technology, the brand itself feels kinda old. Maybe that was part of the rationale for dropping it from the DJIA. I don’t know. But now the manufacturing giant must honestly look at itself, and make its brand relevant enough for Dow Jones to reconsider it.
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