Last month, Dell (NASDAQ: DELL) announced it would implement a new marketing strategy beginning in June in an attempt to boost their sagging market share. The plan is to shift from an exclusively direct marketing paradigm to incorporate a retail element as well, and who better to partner with to enter the retail market with a bang than Walmart (NYSE: WMT)?
June is upon us, and I finally saw a commercial on television for Dell computers at Walmart last night. The price point is attractive, and this looks like a great way to reach a target demographic that Dell probably wasn't selling to before. Let's face it. Dell had to think of something to save themselves. Why not take the easy way out and bank on the reach of Walmart to drum up some needed business.
At the end of the day, I wonder if Dell's direct marketing strategy is its only problem. From what I understand, Dell used to be known for great pricing and great customer service. That's what set them apart from the competition, particularly as Gateway's customer service was heading down the toilet. While I definitely think selling through Walmart is a great way to boost sales, I'm not sure if it will solve all of Dell's problems.
What do you think? Can Walmart save Dell?
Dell's strategy of not maintaining any inventory and only building a system once an order was received has always seemed like a smart move to me, so I don't understand this approach of leveraging "brick and mortar" as another sales channel, but if you're going to partner with a retailer, nobody does it better (well cheaper) than Wal-Mart.
Now, if they want to get really ambitious they should have the computer assembly done onsite so the customer comes in, makes their component selection and it gets built on the spot at the Wal-Mart. If they can automate this and position the assembly system where you can see it, like a car-wash, that would be something!
Posted by: Scott | June 18, 2007 6:42 AM | Permalink to Comment