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Dell's Direct Sales Approach Wilting

by , 12:10 PM EDT, April 30th, 2007

The Dell direct sales model has been a big success at Dell. Lately, however, the systems is showing signs of weakness brought on by new customer buying patterns, according to the New York Times.

Dell, under pressure from HP and Apple, has found that its traditional direct sales model isn't working as well as it once did. As a result, Michael Dell resumed the management of the company in January and is looking at news ways of selling Dell's computers. "The direct model has been a revolution, but it is not a religion," Mr. Dell told his employees last week.

Analyst Samir Bhavnani has believed that the dynamics of the market have been changing for some time. Consumers shifted from desktop systems to notebooks, and it hasn't been as easy for Dell to configure notebooks on the fly -- which has incurred costs. "In addition, consumers were showing a preference for touching and feeling a notebook PC before buying it," Damon Darlin reported.

As a result, Dell's new management team has been putting into place a new manufacturing and distribution system and trying to create a sense of urgency with the employees. "This is a defining moment in our history and in our relationships with our customers," Mr. Dell wrote.

Apple's combination of a set of retail stores where customers can touch and feel new computer and the on-line store has certainly been a hit with their customers. Even when customers prefer to buy a Dell PC, they're likely to be influenced by the appeal and potential of their local Apple store offerings.

Previously, Dell has experimented in Dallas with a mall presence, but one could still not walk out of the store with a computer -- only order one based on the display models. Time will tell if Dell can succeed with a new retail approach selling commodity PCs as Apple has done with uniquely designed, valued and marketed Macs.

Observer Comments

Show: Subjects Only | Full Comments
Close Name:Biff Posts: 1479 Joined: 08 Apr 2004
Subject:

I can't believe that Dell would try to copy Apple!

View Name:Guest
Subject: While You Wait PC
Close Name:Biff Posts: 1479 Joined: 08 Apr 2004
Subject:

There is no way they could pull that off. Think of the staffing needs and potential for human error. Yikes! I'd be more inclined to guess that Dell would only stock certain configurations and to sell directly in their stores. They can just copy Apple. Only, they'll have that cool Dell image to give them the edge. Hehe.

Close Name:Rainy Day Posts: 607 Joined: 07 Jun 2005
Subject: I have an idea…

Why don’t they just close down the company, sell everything, and give it to their shareholders?

View Name:Guest
Subject: Dell XPS 210
View Name:Guest
Subject: Prefer a Dell?
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