Technology and Computers market has become the important part of the entire global market. There are number of companies who have already stepped in to this business and thus made it highly competitive. The U.S. market is currently most crowded with the computer manufacturing companies. The major companies are HP, Lenova, Compaq, Apple and Dell.
Dell is one among these companies that has well thought out marketing strategies. These are the strategies that have taken this young company up to high levels of success. Dell Corporation brought the concept of direct marketing and just in time inventory that highly reduced the costs and provided high profits. It is due to these achievements that Dell is now competing with the leading players of the computer manufacturing market.
Dell is one of the largest computer hardware manufacturing American companies that also offer its services all around the world. The company was founded by Michael Dell in 1984 with only small amount of capital. The Dell Corporation has achieved high levels of success in just a small time and now competing with the oldest players of computer hardware market. According to the Fortune Magazine, Dell is the sixth largest company of Texas by total revenue, ranked number one in most appreciated American companies and third in global companies. The 2009 statistics of market share showed Dell at the second position after HP in U.S. And global market.
The company follows the direct marketing and just in time methods and that's what has become its core competency. These marketing strategies and methods have helped the company in delivering the quick and reliable services to its customers all around the world.
The company provides various products in different market segments. It offers its services to the businesses, government institutes, SMEs and also to the home users. Dell offers exclusive desktops and laptops for the small businesses like OptiPlex, Vostro and Latitude and XPS for the home users. There is a large variety of systems offered by the company as according to the use. In addition to providing the PCs and other products, the company also offers the repair services and softwares. The company earns 81.3% from the product dealing and 18.7% from the services. As according to the 2010 report, the company's net income increased by $2.63 billion and reached 83.8%.
The Dell Corporation has captured the international market in just a small time. Though, Dell has manufacturing plants in U.S., Malaysia, China and Ireland but it deals in with the customers all around the world via their online and telephonic customer services. Currently, dell has partnership with 24,000 retailers in the world that assist the company in delivering the Dell products and components to the foreign clients. (wikinvest, 2012)
The Direct Model of Dell
Dell highly focuses on going global and providing services to the customers all around the world; therefore it follows the direct marketing method. The company takes the customized orders from customers directly via their online services and delivers them within 4-5 business days to any part of the world. This is where the company leads in from the other competitors. Since, Dell doesn't keep the inventory but only take customized orders from the customers as according to their needs. So, customers can experience the latest technology at the best price.
The Dell Corporation doesn't employ the intermediaries that is retailers and wholesalers but deals directly with the customers. Therefore, it costs low to the user and the company also. Moreover, the services provided are the most reliable and as per the needs of the customers. Dell has the highly efficient supply chain management keeps on improving the system and ensuring the best product at the lowest cost.
Domestic and International Business Environment of DELL Computer Corporation
Dell Corporation headquarter is situated in U.S.. There are manufacturing plants of Dell in other countries as well but the company deals via an internet and telephonic communication in majority areas. The company has partnership with reputable suppliers in different countries; thus ensuring reliable services. Like, Dell offers its customers to have the components of their own choice in PC. So, if they don't want the entire PC having the components of the same company then they can customize it by ordering at DELL customer support.
The domestic market of Dell Corporation that is U.S. is highly dense with IT and computing companies. Therefore, the competition is really tough in America but since, Dell deals all around the world so their major part of revenue is generated through other parts of the world.
Dell has well-planned market segments ensuring to provide high quality services to the customers all around the world. They deliver products from the big businesses, government institutes to the home users. The company deals through its call centers with the customers all around the world. There are about six call centers of Dell in Europe and Asia. Customers can toll free number and place their orders or get the other services easily. The call from any particular area is automatically transferred to the respective CSR who can communicate with the customer in their language. The customers are contacted through emails or fax and they just need to pay for the order by means of credit card.
Since, most of the customers prefer on trying the product before purchasing therefore Dell is planning to set up their plants in other countries and especially the developing countries where higher opportunities of growth can be availed as compared to the local market.
In 1990s, Dell tried to manage the retailing business as well but it experienced the downturn and therefore it continued to manage the direct marketing method. However, they continually focused on delivering the customers with the best product at low price and that's made the company one of the leading PC enterprises in the global market. (Dell, 2012)
Setting the plants around the globe will help Dell Corporation increasing profits and growth which is not as possible by only functioning in the domestic market. This will also help the company lowering the cost by availing the benefits of the host country's resources like in Asian countries there are lots of opportunities of economic growth and Dell, by providing the low cost products can increase its revenue. Moreover, this will reduce the domestic market dependence and also flourish the export market.
Since, Dell has exclusive marketing strategies, efficient procurement, manufacturing and distribution process therefore, there are number of opportunities for the company in other countries. Company has the established partnerships by which it can produce superior products at low cost.
China and India have the big information technology and computing market. Dell enjoys the plus point in the market share of these countries. Dell India is the second biggest after U.S. employing 13,000 people. However, 90% of the Dell computers are manufactured in China and since, these countries have high growth opportunities thus giving boom to the company as well as China also supports the company building its position in other countries. Dell, by its award winning customer support and services has developed loyal relations with the foreign clients and thus there are high opportunities for the company in different countries.
Currently, Dell is all dealing by means of an internet and supplies the products all over the world. This setup requires the company to strengthen its economy forecasting teams. Since, the change in exchange rates can cause the company to bear heavy losses. Therefore, it is important to make decisions intelligently and manage risks that whether to invest in particular project or not.
Low cost, customized products and in time deliver are the key tactics to lead in the market. Dell is skilled in these areas but till when, the company can have competitive advantage. Though, the Direct Model of Dell has made great contributions in lowering the cost and providing the customers with the best product they need; therefore, other companies are also switching their strategies towards direct marketing. There is a tough competition in IT and PC technologies market in U.S.. Therefore, it could place the Dell Corporation in risk.
The Dell Corporation was majorly dealing with the foreign customers just by means of telephonic communication and website. But since, the other players have also transformed their marketing strategies therefore Dell had to add competitive advantage so that to survive and lead in the computer manufacturing market. Since 2007, Dell started emphasizing on globalizing the business by traditional means. During that era, the sales of Dell experienced downturn of 25% because of the change in strategies. However, it is expected that Dell will achieve its old position in the computer manufacturing market. But it is important for Dell to expand its business by setting plants in other parts of the world so that to fulfill the expectations of the customers and come up with the competitive advantage.
Dell's International Marketing Strategies in Developing Countries
Dell Corporation already has well-planned marketing strategies that is…