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“When the going gets tough, the tough get going.” Dell has lost significant PC market share to Hewlett-Packard over the past few quarters, so according to industry analysts, Dell has wisely decided to focus on small business users—one of the company’s strengths.
Enter in Vostro—desktop computers, printers and monitors designed with small business users in mind. Not only has Dell designed the products with the needs of small business in mind, the company has also instituted a dedicated support center and free support tools for a full year after customer purchase. Great idea: the entire Vostro program is designed for companies with fewer than 25 employees—which accounts for a huge percentage of businesses across the country.
Additionally, the Vostro set-up process has been streamlined and made easy; six steps and six minutes connect a Vostro PC to a company network. Dell has also announced the Vostro PCs will ship without any “trialware,” Dell’s tag for unwanted software applications many PC makers load into new computers. Dell customers had complained about this in the past, and the company was listening.
According to Merle Sandler, senior research analyst at IDC, “They (Dell) still have a lot of brand equity in the small business market, and they’re extending that with this offer. With the services, they become a trusted advisor, and hopefully down the road they can turn that into a revenue stream.” Other industry analysts aren’t so sure. Gartner described Dell’s new venture in this way: “looks more like a branding exercise than a finely tuned small business strategy.”
The Gartner report concludes in this manner: “Dell will have to enhance Vostro with a rich set of services and a complete go-to-market strategy to make a difference”. It looks as though this is Dell’s ultimate plan. And if all works according to plan, the company has a real chance to move past product sales to strengthening its relationships with its key customers: small business owners. Michael Dell, in a recent press conference stated: “Small business is a rapidly growing market. It’s also a place where there is enormous demand and need for technology. . . Our customers all tell us, ‘Make it simple.’”
So, by listening to its customers, giving them what they want, and hopefully working the bugs out of product and service, Dell could have another major hit on its hands. Vostro—remember that name. Let’s see how this unfolds. . .
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Comments
Ted,
I don't have data to support this but anecdotal evidence suggests that Dell needs to do more than create products that meet our wants and needs. Why? From my experience sitting on budget teams looking to replace or add computers, Dell has a brand image problem that centers on customer service and poor quality of business products.
Posted by: Lewis Green | 08.15.07
Thanks,Lewis:
This is Dell's opportunity to "make good" with small business owners. It has built considerable equity with this group over the years.
The company management knows it has experienced some glitches in customer service. For this program to work, customer service has to stellar, and the quality of the products has to be unimpeachable. Let's see if Dell can take everything up a notch and make Vostro a great resource for small business. They've invested into this program heavily, and I'm personally rooting for them to succeeed with this. If small businesses are the beneficiary of Vostro with computers and programs tailored to fit their needs better, then, it's a win-win.
Posted by: Ted Mininni | 08.15.07
I will say this, Dell has definitely beefed up its blogging and social media efforts in recent years, and has gone from totally ignoring bloggers, to reaching out to us and trying to include us in their thought processes. If nothing else, the effort is definitely there.
Posted by: Mack Collier | 08.15.07
Hopefully, Mack, Dell's efforts in communicating with its customer base, has led to frank and honest conversations that will help the company to better serve them. Since Michael Dell returned to the helm of the company this past January, it will be interesting to see how Dell refocuses on improving its customer products and services going forward. The company has got to get back to "brass tacks". Thanks for bringing this up, Mack.
Posted by: Ted Mininni | 08.15.07
There is a huge confusion with all the marketing terminology both new and traditional. What´s a brand or how does one make use of branding? Whatever the definition may be, most of us will agree it is a long-term task. What about short-term branding? Dell sells through business-building short-term activities for the most part. But seems to forget success in the long-run results from cummulative short-term tactical successes.
What about PR. At the same time Dell was facing problems with overheating laptops in the U.S., in Mexico they were launching a major TV campaign to mass market laptops for as low as $500.oo. The TV spots seemed to have been edited on a powerpoint template as the coice over hurried a direct marketing copy recipe extracted from a DM 101 textbook. Do you call that brand communications? At first it they we selling strong. After two weeks, Dell seemed to be selling huge amounts of Toshiba and HP laptops. When too much focus is placed on short-term results, a bit of branding might be just what is required.
Posted by: Jorge Martinez | 08.16.07
Jorge,
You're absolutely right in your observations. So many businesses scramble to achieve quarterly results to please their shareholders, they tend to think in terms of the short term. Since Dell has launched this new initiative, they have got to think about the long term now. Their brand communications ought to be focusing on acknowledging their recent problems, how they are working diligently to fix those problems and what they plan to offer their customers going forward. PR is a big issue for companies large and small, as you point out. Thanks for adding something substantial to this conversation, Jorge.
Posted by: Ted Mininni | 08.16.07
I agree with Lewis. We had a Dell and it defuncted in less than a year. We jumped through a lot of hoops to get it fixed. While their customer service was steller, it could not revive my faith in a product that was fundamentally flawed.
Posted by: cindy@staged4more | 08.16.07
Cindy,
It is unfortunate that you had a defective computer. Even though the service you received was excellent, this has obviously dissuaded you from purchasing Dell products in future. Proving once again that brand loyalty is a function of delivering on the brand promise--that includes the two components others have cited in their responses: excellent quality and great customer service. Thanks for writing in, Cindy.
Posted by: Ted Mininni | 08.16.07
Ted,
I've had nothing but great experiences with Dell. I've purchased two Dell PCs over the past several years, and have nothing but good things to say about their customer service support. For one thing: when I've encountered problems, the tech people I've contacted have been easy to understand, and helped me out of dilemmas in a matter of minutes. To someone like me who is not very tech savvy, they've been a lifeline. This just goes to show you how our personal brand experiences shape the image we have of companies. . .this Dell conversation covers the good, the bad and the ugly depending on people's individual experiences. Isn't that true of everything?
Posted by: Claire Ratushny | 08.16.07
Once again, as you point out, Claire, brand images are built one customer at a time. Had you had a bad experience as Cindy did, you'd feel differently. The bad press Dell has gotten when customers have had either poor customer service, poor quality merchandise, or both, is hard to overcome. The company has a real opportunity, with its Vostro program, to put its best foot forward. Let's hope they do.
Posted by: Ted Mininni | 08.17.07
Ted,
From your original post and your replies, you sound as if you have inside information. Do you have a relationship with Dell?
Posted by: Jay Ehret | 08.18.07
Hi Jay,
No, I do not have an inside relationship with Dell. Like any other business person, I take some time to catch up on latest developments in various industries, including high tech and electronics. My firm does brand identity and package design and we've collaborated with companies in this sector recently. It's important to have a "finger on the pulse".
Also, I've recently studied Dell in more detail in conjunction with an article I've written on the topic of mass customization. Dell furnishes one of the best examples of this business model.
Posted by: Ted Mininni | 08.20.07