Dell Does Retail About Face

In a post last September, I urged Dell to get into retail:

The big-box electronics retailers are exactly where you should be. Get into lots of them. Best Buy and Costco and Office Depot. You need retail saturation and volume fast, not boutiques rolled out at a leisurely pace. Support these retailers by focusing on brand advertising that extends your old "Easy as Dell" theme to the consumer who wants to see it, talk to a salesperson about it, take it right home and use it. Advertise simple product choices with simple names that convey ease and reliability. Think "computer as appliance." Back this with execution. Keep your costs down and your product and customer service quality high. Stick to Dell's traditions. Stay with what has made Dell great. Just add the distribution channel that extends your reach to today's home and small business consumer.

Your CEO Kevin Rollins said that Dell was "reevaluating every element of the business model. We want to do things more effectively." He called it Dell 2.0. That is fine, but choose wisely what you change. Preserve your core, it is who you are. Do not give up on being the low-price leader in brand name computers. Become great at retail distribution.

I then got a snarky email from someone at Dell telling me that, ahem, retailing through others was just not Dell's thing. This ignored the availability of Dell laptops in Costco, but lets not quibble details.

Well, Kevin Rollins is gone and Michael Dell is back at the helm. With its market share plummeting and rival HP now the leader in PC shipments, Dell has done an about-face and decided to enter the messy retail fray in a bigger way. It will sell two low-end desktop models through Wal-Mart as the first step in "a global retail strategy that you're going to hear a lot more about."

Just keep it simple, fellas. Simple choices, simple branding, well-configured. Make it a real appliance buy.

Copyright © 2007 Philip Bookman

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