de Luca, Guerrino 1952–

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Guerrino De Luca
1952–

President and chief executive officer, Logitech International

Nationality: Italian.

Born: September 1952, in Lanciano, Abruzzo, Italy.

Education: University of Rome, BS.

Family: Married Daniela (maiden name unknown); children: one.

Career: Olivetti, 1977–1988, research and development; manager of product development and sales for networking unit; Apple, 1988–1995, vice president of business marketing; 1995–1997, president and CEO of Claris Corporation (subsidiary of Apple); 1997, corporate executive vice president of marketing; Logitech International, 1998–, president and CEO.

Address: Logitech International, 6505 Kaiser Drive, Fremont, California 94555; http://www.logitech.com.

■ Guerrino De Luca had the experience that Logitech needed when he became its president and chief executive officer in 1998: he was an engineer who knew marketing. Under his direction, sales of Logitech products exploded. In 1999, after 19 years in existence, the company sold its 200 millionth mouse; it sold its 300 millionth mouse in 2000, its 400 millionth in 2001, and its 500 millionth in 2002. De Luca led Logitech into new markets such as those of Webcams and gameconsole controllers, rivaling IBM and Microsoft in the worldwide sales of computer peripherals.

APPLE

De Luca received a bachelor's degree in electrical engineering from the University of Rome. He began his career at Italy's Olivetti, working in research and development and eventually becoming the manager of product development and sales for Olivetti's networking unit. After 11 years at Olivetti, he took a job at Apple, spending most of his time in Paris, where he took charge of Apple's European marketing. In April 1995 he

was appointed president of Claris Corporation, a subsidiary of Apple that developed personal software. In the mid-1990s Apple was suffering from net losses and demoralized management, and in February 1997 De Luca was appointed executive vice president of marketing and made responsible for directing Apple's worldwide sales efforts. He worked 18-hour days, seven days a week trying to repair Apple's sales efforts, until he quit out of exhaustion, leaving the company on September 17, 1997.

LOGITECH

Logitech had had problems in the 1990s: when personal-computer sales dipped in 1992, Logitech mouse sales dipped as well, because the company sold its mice primarily to computer manufacturers. Logitech proceeded to sell its European and American factories in order to pay debts, leaving most of its manufacturing to be carried out in China. The then CEO Daniel Borel decided to try to separate Logitech sales from computer sales by emphasizing direct retail markets, producing peripherals that computer owners would buy independently in order to enhance their technological experiences. In spite of Borel's efforts, Logitech continued to suffer from poor marketing strategies until De Luca joined as president and CEO in February 1998, with Borel becoming chairman of the board.

De Luca brought to his work an ebullient personality and a mischievous streak, as well as a talent for mixing comfortably with his employees, which enabled him to learn from workers what was working well and what was not. He quickly made his presence felt at Logitech by reorienting the corporate culture to being consumer rather than technology directed—meaning the company would tout style and special features instead of merely pushing out the latest technological advances. De Luca pushed wireless and optical computer interfaces; he also engineered the purchase in November 1998 of the QuickCam division from Connectix for $25 million, thus increasing Logitech's worldwide share of Webcam sales from 4 to 50 percent. That year Logitech introduced the first computer video camera with a built-in microphone.

From 1998 to 2000 Logitech's stock price quadrupled, and sales grew 30 percent annually. In 1998 Logitech shares were worth $8 each; in August 2000 they were worth $33 each after briefly hitting a high of $39. For fiscal 1999 Logitech grossed $470.7 million, while netting $7.1 million. In 1999 Logitech pressed into the Internet market by introducing iTouch software that enhanced keyboard functionality in navigating the Web. In 2000 Logitech provided Apple with a new mouse to ship with its Macintosh computers; Logitech was in possession of 30 percent of the computer-mouse market worldwide. "You have your hand on your mouse 50 percent of the time you're using the PC. It's about time people paid attention to it," De Luca told Forbes.com (August 28, 2000). For fiscal 2000 Logitech grossed $615.7 million, netting $30 million.

In 2001 personal-computer sales dropped 14 percent during a global downturn in the high-tech industry; yet Logitech stock increased 60 percent on sales of $944 million and profits of $75 million. De Luca remarked on Forbes.com, "We are in the PC industry but we are not influenced by PC sales" (November 5, 2001). That is, his marketing strategy had successfully persuaded retail consumers to buy Logitech products not as necessary components of new computers but as enhancements for computers they already owned. In 2001, 85 percent of Logitech's income resulted from retail sales, the remaining 15 percent being earned through personal-computer manufacturers. In January 2001 De Luca dyed his hair fuschia before a meeting with Zurich bankers, which he had promised to do if his sales staff met their goals for 2000. The incident solidified his reputation as a good-natured leader. His daughter told him his pink hair was "cool." In 2001 Logitech expanded into the game-console market by introducing a cordless joystick and a steering wheel for Sony's PlayStation 2. In addition, De Luca directed the purchase of Labtech, the manufacturer of computer speakers and headsets.

In 2002 industry analysts and journalists expressed worry over Logitech's expansion into accessories for game consoles and handheld computers, as well as into the manufacture of trackballs, wireless and optical mice, and computer video cameras during a period of lagging computer sales. Yet Logitech achieved a 37 percent gross margin in 2002 while capturing 45 percent of the world computer video camera market and 55 percent of the world trackball market, and it sold over 3 million units of a new line of cordless keyboard-mouse combination. Financial analysts had trouble understanding how Logitech's optical-mouse sales remained strong; De Luca noted that his company's own survey indicated that consumers liked the way the optical mice glowed. He had hired a European design firm to create mice that were not only comfortable in the hand but looked sleek and stylish. Logitech ads showed him smiling and toying with mice that were both functional and beautiful.

In 2003 Logitech reached $1 billion in revenue for the first time. For the fiscal year 2003, Logitech netted $94 million. Still, in Business Week De Luca insisted, "We can never afford to think we walk on water" (June 17, 2002), reminding himself that any success could be fleeting. But he seemed to have tapped into an essential truth in marketing: people want beauty in their lives, even in everyday tools such as mice and keyboards, and will pay for it.

See also entry on Logitech International SA in International Directory of Company Histories.