About DELL :

Dell at a Glance

Globally 2nd in computer hardware design, manufacturing and distribution with a market

share of around 16%.

Founded by Michael Dell in 1984.

In 1985, the company produced the first computer of its own design — the "Turbo PC",

sold for US$795.

The volume of sales are Greater than $50 Million per day through the internet with yearly

revenue of $55.908 Billion with employee base of 78,000.

Ventured in areas of storage products, workstation systems, online technical support,

appliance servers, network switches, standards-based point-of-sale offering for retail

customers.

Board of Directors

1. Michael Dell

Chairman of the Board and Non-Independent Director

2. James W. Breyer

Finance, Leadership Development and Compensation (Chair)

3. Donald J.   Carty

Non-Independent Director

4. William H. Gray, III

Governance and Nominating (Chair); Leadership Development and Compensation

5. Judy C. Lewent

Finance (Chair), Audit

6. Thomas W. Luce, III

Audit, Governance and Nominating

7. Klaus S. Luft

Audit

8. Alex J.   Mandl

Audit (Chair), Governance and Nominating

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9. Shantanu Narayen

Leadership Development and Compensation

10. Samuel A. Nunn

Presiding Director, Finance ,Leadership Development and Compensation

11.Ross Perot, Jr.

Governance and Nominating

Vision Statement:

Its the way we do business. It's the way we interact with the community. It's the way we

interpret the world around us-- our customers needs, the future of technology, and the

global business climate.

Mission Statement:

Dell's mission is to be the most successful Computer Company in the world at delivering

the best customer experience in markets we serve.

Financial position:

As of 2010, Forbes estimates Dell's net worth at $13.5 billion.

Net Income $1,433 million in 2009

Major competitors:

Major competitors of dell are

Apple

Hewlett-Packard (HP)

IBM

Samsung

Sun Microsystems

Gateway

Lenovo

Sony

Acer

Toshiba

Asus

Hcl

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Product mix:1.Laptops

Dell™ Inspiron Mini 10 Dell™ Inspiron 15R New Laptop

Dell(TM) Studio 15 Laptop Alienware Laptops

2.Desktops

Studio One 19 Inspiron TM   One 19 Desktops

3. Monitors

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4. Acessories

3. Projectors

Brands :

Dell uses several brand-names for its product ranges, including:

OptiPlex for office desktop computer systems

Dimension for consumer Desktop computer systems

Latitude for commercially-focused laptops, Adamo – Luxury, high style, first class

Inspiron for consumer laptops, Studio – student computer

Precision for workstation systems and high-performance laptops

PowerEdge for larger corporate servers

PowerVault for direct-attach and some network-attached storage (NAS)

Dell EMC for storage area networks

XPS for enthusiast/high-performance systems

Axim for PDAs utilizing Microsoft's Windows Mobile

Dell Digital Jukebox (DJ) MP3 Players

Dell monitors LCD/ plasma TVs and projectors for HDTV and monitor use

Dell On Call - extended support services (mainly for the removal of spyware and of

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viruses) Mini Notebooks – portable, low cost

Alienware – performance at any cost, high style points for unique design

Product lifecycle of DELL:

Product Life Cycle stages in the company – Below is the product life cycles that any product

goes through from the time it is introduced till and till the time the company stops producing

it as it is no longer profitable.

For a company in the hi-tech hardware industry like Dell, technology keeps changing

very regularly which means that products and components have very short life cycles.

Therefore proper management of the product life cycle and constantly keep introducing

new products is one of the keys to remain competitive in this industry.

a. Introduction – This is a time when the product has been introduced and volumes are

low. However since the product technology is new at this point, the components maybe

on long lead times that affect the delivery schedules of the system. At this time, the most

important thing for Dell would be top correctly estimate the new components needed so

that these new systems are not on too long a lead time. Ex Adoma

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b. Growth – This is time where the volume growth takes place very fast. So the challenge

for Dell would be to work closely with its suppliers to ensure that no they are in a

position to supply these parts and ensure that the supply chain isn’t affected due to parts

shortage. Ex studio

c. Maturity – This is the time when there are huge volumes but the profits are lower as

competitors have also come up with similar products. Also demand is more predictable

than in the previous two stages. Here Dell should work to lower the per unit costs of the

components as there is price competition and also ensure that it has proper supply as well.

Ex latitude

d. Decline – This is the stage where the product’s sales would be dipping and Dell would

soon need to stop producing this product. The decision that Dell would need to take at

this stag would be to ensure that prices of components are at their lowest as this is old

technology. Dell would also need to plan for this stage in advance so that other parts of

the sales/supply chain are not affected when Dell stops production of that product.

Ex inspiron

Product life cycle management:

Because Dell's customers were largely high-end repeat buyers who rapidly adopted new

technology, Dell's marketing could focus on managing product lifecycle transitions. The

company's direct marketing provided real-time customer feedback, which led to the rapid

rounds of learning essential to product development and crisp lifecycle timing. Dell

became expert at curtailing the end-of-life tail of its six-to-nine-month product cycle.

Pricing of DELL with its competitor HP:

In 2006, Dell cut its prices in an effort to maintain its 19.2% market share. However, this

also cut profit-margins by more than half, from 8.7 to 4.3 percent. To maintain its low

prices, Dell continues to accept most purchases of its products via the Internet and

through the telephone network, and to move its customer-care division to India and El

Salvador

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According to me dell can maintain its pricing of products at the same level which help the

dell to maintain and expand its present market.

Dell can discount certain products in maturity stage to gain market share and can sell

most of the products

It is currently following low pricing mechanism which may affect the profit in longer run

PRODUCT NAME

DELL DELL PRICE

HP HP PRICE

MINI LAPTOP

$279.00   $279.99*

Everyday computing Laptops

$449 .00

 $429.99*

Ultra-Portable Laptops

$510.00  $529.99

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ENVY Laptops

ADAMO model $1134 $1,299.99

Marketing strategy:

Dell’s marketing strategy research papers point out that Dell Computer Corporation is

defined by its direct model approach to selling, which is in turn dominated by the

company’s intent to generate as many sales as possible on the Internet.

 Dell's marketing strategy sees the Internet as the purest and most efficient form of the

direct model for sales, service, and support, as well as the most efficient means of

customer communication both presently and in the future. 

Currently the company receives more than 2.6 million visits each week to its more than

80 country-specific sites.  This resulted in more than $40 million in revenue per week

being generated by the online marketing of Dell. 

The company touts its site as allowing existing and potential customers to access

information regarding its products, configure computers to the customers liking, and then

make the purchase.  Dell sees this process as the most efficient method of selling because

it allows the consumer to guide the process.

While the consumer is choosing and configuring their Dell computer, as well as after the

purchase at the Internet site, the customer has access to volumes of support and technical

information. 

Instead of sales people answering questions, the customer is left to find their own

answer.  This presupposes a base line of technical knowledge in the customer, which

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guides the information-gathering process.  Without this base line of knowledge, the

customer will have difficulty making sense of computer hardware jargon that defines the

capabilities of PC units. 

In addition, such a technically unsophisticated customer may have difficulty in even

formulating the questions that should be asked in order to evaluate if a particular Dell

computer will meet their needs.  Individuals who are making their first computer

purchase are unlikely to have access to the Internet or the navigational expertise to find

Dell’s site. 

The marketing model of Dell Computers, however, does not differentiate between types

of customers, and instead treats each potential customer as if they have equal technical

knowledge.Dell’s Direct Method provides two distinct advantages: 1. reducing marketing

and sales cost by eliminating markups of distributors and retailers and 2. building to order

reduced inventory costs and risks of retaining inventories.

Dell’s Direct Model is the main reason why it has achieved its stellar status in business

today. This strategic model enables Dell to interact with customers directly providing

them with fast, reasonably-priced and friendly means of production and distribution.

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Dell Market Structure

Dell classified the market into 2 categories namely

1. large customers (B2B model)

2. small customers (B2C model)

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Market share of laptop manufacturers

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Distribution of dell products:

Manufacturing

Dell has a general policy of manufacturing its products close to their customers. The

assembly of desktop computers for the North American market takes place at Dell plants

in Austin, Texas and in Winston-Salem, North Carolina, with servers built in Nashville,

Tennessee. Dell, Inc. assembles computers for Europe in Limerick, Ireland.

Dell's assembly plants in Penang, Malaysia, and in China assemble 95% of Dell laptops;

the remaining percentage comes from Dell European Manufacturing Facilities 1, 2, and 3

in Limerick. Dell plans to consolidate manufacturing to Malaysia and China in 2007 and

has also decided to enlarge its plant in Malaysia. For additional quality, Dell routes these

computers through 'fulfillment centers' in the United States.

Distribution:Dell entered the PC industry at a time when most companies sold through small,

specialized, high-cost dealers which provided customers with support on both how to

purchase and how to use computers. This high-cost channel was quickly obsolete and

most PC suppliers switched to large, megastore retail chains (CompUSA, Computer City,

etc.).

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While the other suppliers were struggling with retail channel evolution, Dell took a

radically different path by finding a means to sell products which normally required both

significant customer assistance and local stocking without a dealer or distributor network.

Dell created a new channel option by bringing new technology to traditional roles played

by the distribution channel. Dell takes orders over the telephone, internet it allows

purchasers to customize products to their own needs, it assembles products largely to

order, and it achieves rapid delivery. The combination provides a high degree of

customer service at a previously unattainable cost structure. With this distribution change

as a major element of its strategy, Dell grew to a profitable $7.8 billion business at the

time when many larger computer companies were giving up on the PC market.

Dell shows how a company can meet most of the same end customer needs as its

competitors through a radically different distribution approach. As enabling technologies

(telephone communications, call centers, shipping logistics, etc.) evolve, more suppliers

will supplant traditional sales and distribution approaches and, therefore, gain

competitive advantage.

However, simply copying a model which has worked once is not a guaranteed path to

success. No other “mail order” computer company has managed to match Dell’s growth

in sales and profits. Dell built a strong overall business model and established its position

before others had a chance to copy the model.

According to me dell can make shipment free for certain products since the competitor is

having this strategy. Dell can have physical shops in India and china since the direct sell

through internet is not up to the level in those regions

Dell use RFID in manufacturing and shipping which is helpful to check the status of the

product

According to me

Dell’s success is a combination of:

Direct Sales

Build-to-order

Supplier Integration

Together these allow for maximum effectiveness with minimum cost

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Promotion:

Dell advertisements have appeared in several types of media including television, the

Internet, magazines, catalogs and newspapers. Some of Dell Inc's marketing strategies

include lowering prices at all times of the year, offering free bonus products (such as Dell

printers), and offering free shipping in order to encourage more sales and to stave off

competitors. 

The biggest area of expansion for Dell is the consumer market. In order to

develop more sales in this market Dell needs to focus more advertising on the

needs and wants of the consumer. Dell promotes its direct model,

which is a key factor Dell needs to create a better position for itself in the

consumer market. With all of the PCs in the market being more or less equal,

Dell needs to focus on what differentiates its products from the competition,

namely service and support.

The advertising campaign need to focus on the

emotions of the PC users as oppose to merely their logical side. With a strong

emotional ad campaign focusing on the anxieties and fears of the consumers

when it comes to making the decision for a computer purchase Dell can

reassure the consumers that we are there for them. The direct model and more

importantly the virtual integration should be the focus of the campaign as

oppose to a "teen-age" part-time employee at your local mall.

Why would anyone want to go into a super store where the salesperson pitches

everything under the sun to you before you finish telling them what it is you need. With

the build-to-order direct way Dell operates "you tell us what you want, we don't

tell you what you want."

In 2007, Dell switched advertising agencies in the US from BBDO to Mother. In July

2007, Dell released new advertising created by Mother to support the Inspiron and XPS

lines. The ads featured music from the Flaming Lips and Devo who re-formed especially

to record the song in the ad "Work it Out".

Dell recently began using the slogan "Yours is here" to show that it customizes computers

to fit customers' requirements.

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Various dell ads are:

SWOT Analysis of Dell Computer

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Strengths

Dell's Direct Model approach of enables the company to offer direct relationships with

customers such as corporate and institutional customers. Their strategic method also

provides other forms of products and services such as internet and telephone purchasing,

customized computer systems; phone and online technical support and next-day, on-site

product service. This extensive range of products and services is definitely one of Dell’s

strengths.

Dell Computer's award-winning customer service, industry-leading growth and

consistently strong financial performance differentiate the company from competitors for

the following reasons:

Price for Performance – Dell boasts a very efficient procurement, manufacturing and

distribution process allowing it to offer customers powerful systems at competitive

prices.

Customization - Each Dell system is built to order to meet each customer’s specifications.

Reliability, Service and Support – Dell’s direct customer allows it to provide top-notch

customer service before and after the sale.

Latest Technology – Dell is able to introduce the latest relevant technology compared to

companies using the indirect distribution channels. Dell turns over inventory for an

average of every six days, keeping inventory costs low.

The company's application of the Internet to other parts of the business --including

procurement, customer support and relationship management -- is growing at a rate of 30

percent. The company's Web site received at least 25 million visits at more than 50

country-specific sites.

Weaknesses

Dell’s biggest weakness is attracting the college student segment of the market. Dell’s

sales revenue from educational institutions such as colleges only accounts for a measly

5% of the total. Dell’s focus on the corporate and government institutional customers

somehow affected its ability to form relationships with educational institutions. Since

many students purchase their PCs through their schools, Dell is obviously not popular

among the college market yet.

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For home users, Dell’s direct method and customization approach posed problems. For

one, customers cannot go to retailers because Dell does not use distribution channels.

Customers just can’t buy Dell as simply as other brands because each product is custom-

built according to their specifications and this might take days to finish.

Opportunities

Personal computers are becoming a necessity now more than ever. Customers are getting

more and more educated about computers. Second-time buyers would most likely avail of

Dell’s custom-built computers because as their knowledge grows, so do their need to

experiment or use some additional computer features.

Demand for laptops is also growing. As a matter of fact, demand for laptop has overtaken

the demand for desktops. This is another opportunity for Dell to grow in other segments.

The internet also provides Dell with greater opportunities since all they have to do now is

to visit Dell’s website to place their order or to get information. Since Dell does not have

retail stores, the online stores would surely make up for its absence. It is also more

convenient for customers to shop online than to actually drive and do purchase at a

physical store.

Threats

In a volatile market such as personal computers, threats abound. Computers change in a

constant sometime daily basis. New software, new hardware and computer accessories

are introduced at a lightning speed. It is essential for Dell therefore to be always on the

lookout for new things or introduce new computer systems.

The threat to become outmoded is a pulsating reality in a computer business. Not only

that, companies must produce products that are high in quality but low in price. This is

one challenge that Dell contends with.

One of the biggest external threats to Dell is that price difference among brands is getting

smaller. Dell’s Direct Model attracts customers because it saves cost. Since other

companies are able to offer computers at low costs, this could threaten Dell’s price-

conscious growing customer base. With almost identical prices, price difference is no

longer an issue for a customer. They might choose other brands instead of waiting for

Dell’s customized computers.

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The growth rate of the computer industry is also slowing down. Today, Dell has the

biggest share of the market. If the demand slows down, the competition will become

stiffer in the process. Dell has to work doubly hard to differentiate itself from its

substitutes to be able to continue holding a significant market share.

Technological advancement is a double-edge sword. It is an opportunity but at the same

time a threat. Low-cost leadership strategy is no longer an issue to computer companies

therefore it is important for computer companies to stand out from the rest.

Technology dictates that the most up-to-date and fastest products are always the most

popular. Dell has to always keep up with technological advancements to be able to

compete.

My Suggestion :

If I were the marketing manager of DELL, I would like to adopt following strategies;

1. Dell can open physical shops in India, china, brazil. Since e marketing in this place

cannot increase it volume of sales

2. Dell can introduce high priced product with limited edition which can make dell to get

a competitive gain in prestigious market where apple are present.

3. Nowadays hp introduces a concept of no shipping cost on certain products. Similarly

dell can implement it.

4. Dell can also try to bag many government contracts in which the new comers are

bagging it.

5. Dell can concentrate on desktops, printers, projectors, accessories where hp os going

for product diversification

6. Dell can look into promotional activities with an innovative approach.

7. Dell can improve its B2B market whereas presently it has more market on B2C

market.

8. The demand for dell is growing .but the supply is somewhat low, thus it can look into

demand rather than order.

References:

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Dell.com

Cio.com

Idc.com

Wikipedia

Google.com

Quest.com

I2.com

Center for research on information technology , University of California, Irvine.

Businessweek.com

http://www.intel.com/ebusiness/pdf/affiliates/i2-dell.pdf

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