COMPANY ANALYSIS DELL INC. By Siti Rabiatul Adawiah Bte Maarof CEB100073 Wong Chee Kang CEB100092 Muhammad Afiq Bin Abdul Ghani CEB090035 A group project submitted to Ms. Izzal Asnira bte Zolkepli Lecturer of E-Marketing CBEB 2316 Faculty of Business and Accountancy, University of Malaya May 2012 EXECUTIVE SUMMARY This report analyzes Dell Inc. ’s online strategies by using the concepts and terminology of E-Marketing. It identifies the online strategies of Dell Inc. by study into related articles and also press release by the company.
The online strategies of the company were being studied from the overview of its internet properties and marketing implications which examined the company’s official website from its online content, properties and also the design of the website and its usability. Website design and usability are very important especially when a user first log into the website, a good website design with highly usability features will definitely help to retain the user on the website for the next minute and Dell did it so well on this.
The discussion on the marketing mix strategy which explained how Dell Inc creates benefit and value to its customer also included in this report. Internet creates opportunities for company like Dell, so this report examined how the company uses the Internet marketing mix in value creation and retains the customers using customer relationship management features. Brand of a company is a promise of the company to its customer. So, branding strategy have been analyzed either online or offline.
Consumer characteristic which influences the company in many ways for instance like market segmentation and also brand position is very important to a company. As this report discussed more on company’s strategies that relate to E-Marketing, website of Dell Inc was being analyzed from few areas which were website currency, content and user engagement opportunities, usability, navigation, access and other company owned sites. Apart from the website analysis, business model which discussed the e-business model used and also its revenue stream sources is part of his report. Lastly, the EMarketing Metrics which examined and used to evaluate the company performance were being introduced to evaluate the company’s E-Marketing strategies. After the analysis and discussion were being carried out comprehensively, a conclusion and outlook was made for Dell Inc which consists of the evaluation of the company’s online properties and also recommendations for improving the business model and opportunities. I INTRODUCTION Dell has experienced rapid growth over the past two decades.
Throughout this period, Dell has continued to increase its standard of excellence by adding more features in their marketing strategies such as applying emarketing system in their marketing strategy instead of using traditional marketing. Nowadays many companies compete with each other by applying e-marketing in their business because the uses of internet are increasing time to time. So Dell also takes an action to do the same strategy in order to increase their excellence in their business. The purpose of this document is to evaluate the uses of e-marketing system in Dell and how the effectiveness and efficiency they applying this system.
Based on this analysis, a recommended strategy will be outlined to Dell which will guide them back to its roots. The key competencies of Dell are more to customer focus, manufacturing process, supply chain management, creates value to the customer, customer service and human capital management. Their strategy has been matching its core competencies with the key factor of industry success. The PC industry has become strongly competitive in worldwide that lead to the reduction of differentiation among competitors and increase price sensitivity among customers.
Even though Dell has been considerable growth, the company begins to lose its competitive edge in critical business segments. In order to avoid this situation, Dell needs to improve in some areas which are customer service, customization options, increased marketing presence and retail solutions tailored to global environment. If Dell able to adapt in these business segments, it will ultimately determine its ability to maintain its predominant position as one of the PC producer. II ACKNOWLEDGEMENT Foremost, we would like to express our sincere thank to our E-Marketing lecturer, Ms.
Izzal Asnira Bte Zolkepli for her patiently guidance, advise, immense knowledge and most important her mentorship during this semester in the area of electronic marketing. Her assistance and guidance helped us all the time of the research and writing of this assignment. We couldn’t have imagined having a better lecturer for this course. Sincere thanks to all of our course mates for the constructive comments and discussion we had during the lectures. Thanks for their constructive comments which added more ideas into this assignment, also thanks for their friendship and moral support.
Our deepest appreciation also goes to those who indirectly contributed to the success of this written report. Our acknowledgement also goes to the Faculty of Business and Accountancy, University of Malaya where provided us conducive environment which facilitated our learning. Last but not least, we would like to thank to our family members for supporting us spiritually and in everywhere they could throughout our life. May, 2012. III TABLE OF CONTENTS EXECUTIVE SUMMARY……………………………………………………………………………….. I INTRODUCTION………………………………………………………………………………………… II ACKNOWLEDGEMENT ………………………………………………………………………………..
III TABLE OF CONTENTS…………………………………………………………………………………. IV Chapter 1: OVERVIEW- INTERNET PROPERTIES & MARKETING IMPLICATIONS…………….. 1 1. 1 Website Analysis………………………………………………………………………………. 1 1. 2 Web and Other Online Content………………………………………………………………… 2 1. 3 Website Properties……………………………………………………………………………… 2 1. 4 Website Design and Usability Features………………………………………………………… 3 Chapter 2: BENEFIT, COST AND VALUE CREATION –THE MARKETING MIX………………….. 5 2. 1 Creating a Positive Customer Experience……………………………………………………… 5 2. 2 Benefit, Cost and Value Creation………………………………………………………………. 5 2. 3 Internet Marketing Mix…………………………………………………………………………7 2. Customer Relationship Management Features…………………………………………………. 8 Chapter 3: CONSUMER CHARACTERISTICS AND BRANDING STRATEGY…………………….. 10 3. 1 Branding Consistency Online/Offline Strategy………………………………………………. 10 3. 2 Market Segments Served………………………………………………………………………. 10 3. 3 Brand Position…………………………………………………………………………………12 3. 4 Offline versus Online Customers …………………………………………………………….. 13 Chapter 4: WEBSITE ANALYSIS……………………………………………………………………….. 14 4. 1Currency……………………………………………………………………………………….. 14 4. 2 Content Including Multimedia and User Engagement Opportunities…………………………15 4. 3 Usability, Navigation, Access…………………………………………………………………. 6 4. 4 Other Company Owned Sites…………………………………………………………………. 17 IV Chapter 5: BUSINESS MODEL…………………………………………………………………………18 5. 1 Specific E-Business Models Used…………………………………………………………… 18 5. 2 Level of Commitment to E-Business………………………………………………………… 18 5. 3 Customer Value………………………………………………………………………………19 5. 4 Revenue Stream Sources…………………………………………………………………….. 20 Chapter 6: E-MARKETING METRICS…………………………………………………………………21 6. 1Site Objectives……………………………………………………………………………….. 21 6. 2 Metrics likely used at Dell’ site………………………………………………………………22 Chapter 7: CONCLUSION AND OUTLOOK………………………………………………………….. 5 7. 1 Evaluation of the Company’s Online Properties…………………………………………….. 25 7. 2 Recommendations for Improving the Business Model or Opportunities ……………………26 REFERENCES……………………………………………………………………………………………27 APPENDICES Appendix 1: Website Currency and Quality Assurance Checklist………………………………. 30 Appendix 2: Balance Scorecard Metrics Model…………………………………………………. 31 Appendix 3: Dell’s Official Web Site……………………………………………………………. 31 Appendix 4: Users Engagement – Dell’s Social Media………………………………………….. 32 V CHAPTER 1 OVERVIEW – INTERNET PROPERTIES & MARKETING IMPLICATIONS
Internet has its unique properties such as global reach and task automation which create opportunities that well beyond of those with traditional marketing. These internet properties has enable a more effective and efficient way in executing the marketing strategy and marketers eventually change their marketing strategy to fit to these internet properties. Thus, this chapter studies about the marketing implications of internet properties on Dell? s official website. 1. 1 Website Analysis Dell has their own website which is www. dell. com which is to sell its products such as desktops, laptops, hardware and so forth.
Throughout this website, we can see Dell also provide some features to their visitors such as community site, service site and also information site that provide its latest information and news to their customers. From the website as we can see, Dell has included all features in their website in one page that can ease their visitors to look one by one. For the products, Dell has categorised their products based on the segmented market. As we can see at the top of the page, there are four tabs which are categorised as; For Home, For Small and Medium Business, For Public Sector, and For Large Enterprise.
So these ease the visitors that want to buy the product online they just have to click either that four tabs based on their purpose of buying. For example, one of visitor want to buy a new PC for his personal, so he just has to click on the For Home tab and see what are the items that suggested by Dell in that category. If the customer agreed to buy, he/she has to login to Dell account and click the item that he wants to buy and follow the following instructions. There is login navigation at the right top of the home page. Dell also categorised their product by differentiating on the budget of their customer.
So they have segmented their market for every people in all level of incomes. There are items that for low budget, middle budget and also for high budget. Dell website can be reach by all people over the world. Visitor can open the Dell website based on their language. What they have to do is when they open the Dell website which is www. dell. com, they have to go to one option bar below the mini sections to choose their country. When they click on the country, the Dell website will transform the language and the currency also will be hanged based on the country chosen. At the bottom page, we can see the section that put together all link from the above site of page which are shop site, participate site, support site, company information site, and my account site. All this link is to make ease for visitor if they cannot find or difficult to find the section that they want to surf in this page. *Further details of website analysis please refer to the Chapter 4 – Website Analysis 1 1. 2 Web and Other Online Content From the Dell website, we can see the contents in the website are originally from Dell.
All the contents are fresh and keep up to date. So the visitors can receive what Dell is trying to deliver to them through the website. For example as we can see in the Dell website, they have update their latest news and promotion deals on the highlight section with the short and nice sentences but at the same time the visitors will be want to know what are news or promotion deals from Dell. In the future, visitors will want to visit the Dell website to know what the latest information from Dell is and maybe they will purchase something from the Dell website.
So that is the way Dell can capture internet user to visit their website and buy their products. In Dell website, there is the highlight section that shows the latest news such as new product released and also the promotion for certain items sell by Dell. So if visitor want to know what are the news or promotion from Dell, they have to click on the news at appear on the highlight section. Below the headline section, there are three mini sections which are What? s New section, Headlines section and Dell Deals section. For the What? New section, this section provides visitors about what are the new items released by Dell. For Headlines section, its provide the news that related with Dell while for Dell Deals section, it is a section that shows all the promotion deals made by Dell at that current time. Dell website also includes a mobile content features that can be access by mobile with either mobile site looking or desktop experience. This is also depends on the type of mobile phone that the user use whether it is traditional mobile phones or smart phone? s. Traditional mobile phones are the phones with browsers that cannot render a normal esktop webpage while smart phones are the phones with browsers that render a normal desktop webpage. The Dell website is a website with dedicated mobile content so content could be simply reformatted for the typically smaller mobile displays. 1. 3 Website Properties Dell Inc. relies heavily on internet and information technology in daily operations. The rapid changes in technology had changed the way marketers and companies formulate their strategies and executing marketing plans. Below are some of the website properties that is necessary for company like Dell to have it and the implications of the properties. I) Mediating Technology Peer-to-peer relationships such as social networks and business partnerships can be formed regardless of geographic location. Dell uses social networks such as Facebook and Twitter to form the borderless relationship with its customers and by using dell community. With technology, dell also manages to communicate and share data with businesses in its supply chain to make it more efficient and cost effective. II) Network Externality Business can reach more markets with automated communication, and consumers can disseminate the brand opinions worldwide in instant.
With automated communication features that available on Dell official website, Dell is able to reach out to the global market and its consumers can share their opinions and ideas on Dell community which is a worldwide community of Dell. III) Time Moderator In today? s world, with technology everything is possible. Thus, consumer hold higher expectations about communication especially with Tech Company like Dell. Dell need to make sure an efficient communication and also continuous improvement and faster work process within the company.
IV) Information Equalizer Dell employed mass customization of communication, and consumers have more access to product information and pricing. V) Task Automation Dell uses a lot of self-service online application such as from select to the payment of computer by customers which lower the costs. The automated transactions process enables company to be more cost effective. Exhibits 1. 3. 1. Internet Properties. Source: Adapted from Exhibit 1. 6 Internet Properties and Marketing Implications pg 34. (E-Marketing 6th Edition, New Jersey, Prentice Hall, 2012) 1. Website Design and Usability Features Dell has customised their website for their target audience. From a quick scan of Dell website, visitors should be able what Dell offer and how it can benefit them. A good website will have headlines and text that speaks to the target audience? s needs and wants. Many websites simply list what their company does without saying how they can benefit their target audience. So Dell has designed the website for the target audience with ease features such as shop category that consist of four different target audiences, community sites, after sale service and so forth. Dell website has the user-friendly navigation characteristic. Dell already organized the website and named in a way that the target audience will easily understand. For instance, Dell named the items page under the name „Shop?. So when the visitors open the Dell website to find the items that they want to buy, they just have to click on the „Shop? link. The navigation on Dell website are keep consistent from page to page. Dell website also has provided search box on the right top of the page in order for the visitors quickly find what they are looking for.
Dell also has include site map in their website in order to make the visitors easily get reach quickly to where they want to look for. Dell has a good design in their website which looks simple and professional design. In making a good website for capturing audiences, the website should have attractive layout that is easy on the eyes. The colour contrast should be well and the text or font size should not require audiences to wear a magnifying glass to read. For Dell website, the layout design is simple with consist of only two colours that are safe matching which are background colour is white and font colour are light blue and black.
For every page Dell has a consistence layout, also in the other 176 global Dell sites. The blue colour shows the image of Dell that significant with blue colour on their logo. The branding is managed since the logo appears always in the top left corner and the company name is constantly seen on the screen. The font size is in regular size that can be read without magnifying glass and for those visitors who are cannot read with that particular size, there are other options of font size. The audiences just have to click on the link „Large Text? t the bottom of the Dell webpage and the webpage will transform to bigger font size. So it is easy for everyone who visits the Dell website. Dell also designs the website with minimal scroll down page. For a good websites, they should have a high speed. Speed in this context means how many seconds for visitors will wait for a page to load before they are give up and leave a website. There are many factors that affecting the loading time of websites such as coding, number of graphics, server speed, traffic volume on the website, and also the capabilities of the visitor? s computer.
Based on our analysis and observation on Dell website, the website does not consist a lot of graphics and the loading time from page to another page also only about for 2-3 seconds. The web presence is warm and welcoming and beyond that a fast loading time acts stimulating for potential buyers to return. Dell website is reachable in the search engine optimization (SEO). SEO is one of the most commonly neglected aspects of website. Users may search for to find a product or service that Dell offer such as laptop, PC or hardware. So when users try to find all those things in the SEO, the suggested link of website will come out.
Since dell is not ranked among the very top sites when searching for its Meta keywords it is useful to reconsider search engine strategy. Overall, the Dell website has including most of good characteristics in designing their website. They capturing their target audience with the simple and professional design and at the same time they can increase their market shares with unique and modern marketing strategy. 4 CHAPTER 2 BENEFIT, COST AND VALUE CREATION – THE MARKETING MIX Value is the entire product experience and exactly defined wholly by the mental beliefs and attitudes held by customers.
Value also involves customer expectations and applied at all price levels. (Strauss & Frost,2012). The current value plus the potential value plus the non-monetary value equals the total value of any given customer. Measuring customer value is important to manage customer relationships based on their value. (crmlandmark. com, 2012). 2. 1 Creating a Positive Customer Experience The customer experience can be defined as the internal and subjective response customers have to any direct or indirect contact with a company. The challenge to achieving a good or positive customer experience culture change is in truly understanding what s going on at the frontline from the customer? s viewpoint. Customer satisfaction surveys offer very little in terms of identifying the real drivers of customer loyalty. The critical measurements are more in the emotional range of delivering an experience that is aligned to the brand promises. ( FrameWorks Group,2008 ) To succeed with all customers, social and more traditional, companies need to create and maintain consistency of experience across all channels. A complete interaction experience goes well beyond just listening to your customer. It branches out to action, enablement and empowerment.
Not only do companies need to learn how to interact well with customers using all channels from the phone to social media, they also need to ensure experiences for the customer that deliver real value to the customer in exchange for time, attention, actions, information, and anything else that companies want from customers. (Mitch Lieberman, 2011) Dell Inc. takes the lead in reducing restore time from days to just minutes with Dell Appasure, Appriver, and Software-as-a-Service (SaaS), the provider to sustain high performance and continue superior business in order offering awards-winning e-mail and Web security solutions.
This business approaches with a focus on creating a positive customer experience from first contact to “post-op” support. Besides of that, Dell AppAssure adds great value to AppRiver? s customer centric philosophy by making it easy for the company to retrieve messages in minutes, ensuring fast, reliable brick level restores for their customers who may be affected by disaster or server fail. (Dell,2012) 2. 2 Benefit, Cost and Value Creation Product benefits are the key components in the value proposition. The internet increase customer benefits in many remarkable ways that have revolutionized marketing practice.
For branding, many marketers have noted that a brand is a promise to customers. Delivering on this promise build trust, lower risk and help customers by reducing the stress of making product switching decisions. Customer support during and after or customer service reps help customers with installation, maintenance problems, and service warranties. (Strauss & Frost,2012 ) 5 The benefits of price through online are perhaps one of the most obvious benefits of online shopping. Online retailers like Dell carry significantly less operating costs such as rent, property taxes, utilities and even in ome cases labor, they are in a position to offer many products at lower prices that traditional bricks-and-mortar stores simply cannot compete with. The “Direct Model” that Dell has created in order to prosper as a business in the industry of e-commerce fully explains Dell? s overall intentions and success. It has five different facets to it that prove Dell effective when utilized all at the same time. These are taken directly from their website and they are. Dell believes that the most efficient path to the customer is through a direct relationship with no intermediaries to add confusion and cost.
Dell is organized around groups of customers with similar needs. This allows their teams to understand the specific needs of specific customers without customer needs being “translated” by inefficient resellers and middlemen. Dell keeps things easy for our customers which make them the single point of accountability so that resources necessary to meet customer needs can be easily marshaled in support of complex challenges. Dell provides customers exactly what they want in their computer systems through easy custom configuration and ordering.
Build-to-order means that we don’t maintain months of aging and expensive inventory. As a result, they typically provide our customers with the best pricing and latest technology for features they really want. Dell is a low-cost leader company. They mainly focus resources on what matters to customers. With a highly efficient supply chain and manufacturing organization, a concentration on standards-based technology developed collaboratively with the industry partners and a dedication to reducing costs through business process improvements, Dell consistently provide our customers with superior value.
They believe that standard technology is the key to providing our customers with relevant, high-value products and services. Focusing on standards gives customers the benefit of extensive research and development from Dell and an entire industry not from just a single company. Dell obviously knows the business world very well. By cutting out middlemen Dell has saved a ton of money in inventory cost as well as the hassle inventories can create. By providing an easy to use ordering website and a build-to-order system, Dell has enabled its customers to easily create exactly the computer that they would like to purchase.
Not many corporations can give their customers exactly the technology and components they desire by themselves. In fact, with Dell? s standard-based technology, they are able to give their customers flexibility and choice which is more of an amenity compared to other corporations. ( cashflowec. com,2012 ). Dell controls its inventory and costs by being a demand-pull company; ell makes the computers to order. Dell is more efficient and therefore more profitable because it can buy its component parts based on the customer? s demand and not have to worry about building up its supply of inventory that may or may not be used. bluwiki. com,2012 ) 6 2. 3 Internet Marketing Mix The term product includes items such as tangible goods, services, ideas, people, and places. All these can be marketed on the Internet. With the internet? s unique properties, customer control, and other e-marketing trends, product developers face many challenges and enjoy a plethora of new opportunities while trying to create customer value using electronic marketing tools. To create new products, organization begins with research to determine what is important to customers and proceed by designing strategies to deliver more value than competitors.
Price is the sum of all the values that buyers exchange for the benefits of having or using a good or service. The internet? s properties, especially in the role of information equalizer, allow for price transparency-the idea that both buyers and sellers can view competitive price for items sold online. A distribution channel is a group of interpedently firms that work together to transfer product and information from the supplier to the consumer. It is composed of producers, intermediaries and buyers. The structure of the distribution channel can either make or impede possible opportunities for marketing on the internet.
Four major elements combine and affect the internet marketing strategy which is type of online channel intermediaries, lengthog the online channel, functions performed by members of the channel and physical and informational systems that link the channel members. (Strauss and Frost,2012 ) The Internet provides opportunities for an organization to enhance its business in a cost-effective and practical manner. That is, the Internet can be used to conduct marketing research, reach new markets, serve customers better, distribute products faster, solve customer problems, and communicate more efficiently with business partners.
The benefit of Internet marketing includes the improved flow of information, new products and customer services, improved availability, improved market transparency. When manufacturers connect directly with consumers and shorten the distribution channels, inefficiencies can be eliminated, product delivery time can be decreased, and manufacturers can build closer relationship with consumers. Consumers use the Internet to reduce costs, find products otherwise unavailable, or increase their shopping convenience. Online consumers expect easy, understandable, and secure ordering and payment systems. Mehdi Naimi Nezamabad,2011) With the Dell Direct Model, Dell does not only strategize to be the low cost leader of computer hardware products, but also differentiates its computer hardware offerings, ranging from PCs and notebooks to workstations and servers to other peripherals such as storage, network switches, printers, enterprise software, etc. For example, Dell offers two lines each of personal computers (PCs) and notebooks, namely Optiplex™ and Dimension™ PCs, and Latitude™ and Inspiron™ notebooks. The Optiplex™ and Latitude™ product lines have a longer product roadmap lifecycle, thus more stable and helps meet corporate customers? sset stability and depreciation lifecycles. In contrast, the Dimension™ and Inspiron™ product lines have shorter product roadmap lifecycles, thus experience more frequent new technology updates and introductions. Further product differentiation at customer level is possible via “ChoiceBoards” available during the online buying process that enable customers to self-select or change the product configurations for e. g. opting for 512MB of main memory instead of the default 256MB 7 main memory, or selecting a 80GB hard disk instead of the offered 60GB hard disk, or to include a colour inkjet printer. ChoiceBoards enables mass customization. Slywotzky, 2000, Pg. 60 ) A differentiation strategy requires the products and services to become differentiated for different customer segments, thus again this results in the need for a dynamic pricing strategy. With the Dell Direct Model, Dell positions itself as engaging the customers directly without traditional sales channel intermediaries. Dell develops direct relationships with the customer. In the supply chain management process, Dell employs the direct distribution channel strategy beginning with its suppliers of materials and components, Dell as the assembler, and sells directly to the customer either via offline means e. . telesales and field sales and/or online via the Internet acting as the cyber-intermediary or cybermediary. Since Dell? s products and services are not digital products that can be delivered or transmitted across the Internet to the customer, product delivery or shipment fulfilment is outsourced to a logistics service provider for e. g. DHL, FedEx. In the direct distribution channel strategy, Dell is responsible for the transactional functions that involve contact with buyers, marketing communications, matching products to buyer? s needs, negotiating pricing and process transactions and facilitating functions such as market research.
Logistical functions are outsourced. In the upstream portion of Dell? s direct distribution channel model, Dell utilizes B2B e-commerce and EDI technologies with its suppliers, while B2C e-commerce and EDI technologies are deployed in the downstream portion of the distribution channel supporting traditional telesales and field sales activities. (amrjournal. blogspot,2008 ) 2. 4 Customer Relationship Management Features Customer relationship management (CRM) is the process of targeting, acquiring, transacting, servicing, retaining and building long-term relationships with customers.
CRM is based on data, information, customer insight and knowledge. A company needs lots of data to know how its tactics works at acquiring, retaining and building customer relationships. (Strauss & Frost,2012) CRM increased revenue from better prospect targeting, increased wallet share with current customer, and retaining customers from longer periods of time. CRM tactics can also decrease costs, resulting in greater profitability. Finally, CRM tactics help companies manage their all important reputations in the social media. (Strauss & Frost,2012). Dell is one of the most successful and profitable computer corporations in history.
It has been known for its innovative customer service and product custom configuration. As it continues to grow, it is faced with the challenge of how to maintain its customer relationships and inventory management, while continuing to meet the demands and requirements of its customers. Dell? s collaboration with other computer software companies has allowed it to become a leader in customer relationship management (CRM) and supply-chain management (SCM). A long-term relationship with the customer insures their repeat business. It costs more money to gain new customers than it does to retain current ones.
Dell? s goal is to provide customers with their technological, as well as 8 customer service needs. There are three types of software that facilitate Dell? s CRM which is marketing automation software, custom designed Web pages containing purchase data and a system that benefits the sales, marketing, financial and management segments of Dell. (Klinker,Terrell & Mahfouz,2006) Dell is leveraging the technology inherited when it bought Boomi in 2010 to create new Integration Packs designed to easily and securely integrate data between applications in the cloud.
The first of the Integration Packs, announced May 15, are aimed at synchronizing critical data between financial applications Intuit QuickBooks and Microsoft Dynamics GP with sales force CRM. According to Dell officials, the Integration Packs will improve order accuracy and eliminate time-consuming manual data re-entry between systems. The easy deployment of the Integration Packs ( thanks to a user-friendly wizard ) and the automated features that remove manual steps that can lead to mistakes and lost time will make data integration efforts go more quickly, according to Paulette Altmaier, vice president and general manager of Dell? Cloud Business Software unit. “Our customers tell us integration is a core requirement to successful adoption of cloud applications,” Altmaier said in a statement. “With Dell Integration Packs, we make integration easy and cost-effective for small and medium businesses to seamlessly share data between applications and drive faster time-to-value. ” (Jeffrey Burt,2012 ) It shows that Dell concerning their relationship with customers and has their own strategy to build and keep maintaining long term relationship with customers. 9 CHAPTER 3 CONSUMER CHARACTERISTICS AND BRANDING STRATEGY 3. Branding Consistency Online/Offline Strategy Brand consistency is where a business attempts to communicate messages in a way which doesn? t detract or wander away from the core brand proposition. For example, a single logo is always used in a similar way on all marketing materials, a single typeface is used with particular guidelines on typography, consistent colour ranges are applied and similar design styles, so that everything visual is inter-linked and has a link back to that core brand proposition. (attitudedesign,2008 ) As a brand, it? s important to take steps to ensure that you? e carefully crafted brand image is appearing consistent in every facet of your strategy. Brands need to appear to be saying the same thing wherever they can be found and that includes online, offline and outdoor marketing efforts. If there? s a disjoint in any part of branding, consumers will grow sceptical over whether they can trust you as an authority and whether they want to invest their time and money in your service. Companies will have different sets of audiences, and will need different strategies to address their different demographics.
However, on the whole, the values your brand holds should be conveyed consistently and style of conversation should be similar across the channels using for different audience segments. (sebastiandyer. com,2012 ) Dell is a large company struggle with brand consistency, online reputation and social media interactions. For starters, Dell identifies “major influencers who have their own blog-driven communities or participants in important ones” and brings them to Dell headquarters to speak with founder Michael Dell.
This not only gives these influencers a positive perception of the company, but also includes them in important corporate conversations. The result is that their perception and subsequent communications about, the Dell brand will be positive and consistent with that of the company. Dell not only brings in-house experts (from all levels in the company) to targeted communities (based on their skills/subject matter expertise) but also makes “employees rock stars” so that they can feel ownership over community engagement and the relationships which result.
Dell goes so far as to “Screen community members ” and personally engage with unhappy ones to alter their perception of the brand. (Anna Ritchie,2011 ) 3. 2 Market Segments Served As per Philip Kotler? s definition “Market Segmentation is subdividing of market into homogeneous sub-set of customers, where any subset may conceivably be selected as marketing target with to be reached with distinct Marketing Mix “. The word segmentation arises from the Latin word segmentum, from secare „to cut?.
It serves this very purpose in marketing. Market Segmentation is done to “cut” heterogeneous markets into more identifiable consumer groups. ( MBAGuys. net,2010 ). Segmentation is one of the most important concepts in marketing. Firms vary widely in their abilities to serve different types of customers. Hence, rather than trying to 10 compete in an entire market, firms should segment the market. Through the process of market segmentation, firms will identify those parts, or sections of the market, that they can serve best. lexicon. ft. com ). The importance of market segmentation cannot be undermined and it is one of the corner stones of this process. It helps in identifying sales which developing what customer “needs” and building solution based on these needs. Dell’s Individual Consumer-based segmentation approach There are 4 customer groups Dell has segmented and targeted, the individual and home users, the small and medium size business, the large enterprises and the public sectors such as hospital and educational centres.
Dell is segmenting its customer based on their different level of demands and needs towards computer technology. Home users and small medium size business mainly look for factors such as the performance and features of the products and they shop from a variety of vendors and use an array of information sources including reviews, editorials, word of mouth in making their purchasing decision. When these customers purchase for the first time, they evaluate the experience significantly through their overall perception of the price and service.
Home users and small medium size business primarily purchase laptops, desktops, printers and other accessories for the reasons such as gaming, entertaining and business but they both only require a low level of standardization on the products. The “relationship” customers, they are the large enterprises and public sectors however, vary very much in their needs, demands and purchasing behaviour compared to the former kind . Originally when Dell segments the global market according to the different characteristics in consumers? needs and behaviours, the purpose is to better fulfill different customer groups? eeds with a wide variation of products alternatives designed especially for individuals or enterprises. In addition what comes as another side benefit from having fine market segments is that Dell can identify potential target groups outside the United States for instance the enterprises that need server or storage systems from Sweden. ( Hui Lin,Akiko Yamamoto & Bo Chen,2006 ) Dell’s diffusion-based segmentation approach Second, Dell is using diffusion-based segmentation approach to segment its global market serving the purpose to introduce new product.
This approach refers to that countries can be divided into groups according to the similarities in a typical pattern of how new products gain market penetration (Gatignon and Van Den Bulte, 2004). These patterns include the economic variables, cultural variables and information access which are the major determinants of the illustration of Dell? s diffusion-base segmentation. Economic variables include economic wealth and openness of the economy in foreign countries. A general finding in adoption research is that higher-income consumers are generally the first to adopt a new product (Rogers, 1995).
The reasons lie on wealthier consumers can better afford a new product when it has high price at the beginning of introduction and they are relatively “risk lovers” (Stremersch and Tells, 2004). Cultural variables cover issues such as uncertain avoidance, need for achievement and industriousness. Uncertainty avoidance refers to the degree to which the members of a society feel uncomfortable with uncertainty and ambiguity (Hofstede, 11 2001). Dell divides its global customers into 4 groupings based on their different requirements for products.
In addition, Dell has two major product categories; one is consumer-based products such as personal laptop, desktops and perhaps some electronic accessories, the other product category is designed for companies, the technologybased product which consists of storage and servers. It is hence equivalent to say that Dell slices its customers into 2 groups – the individual customers who purchase average home PCs and the “relationship customers” (enterprises and public sectors) who purchase technology-concentrated products.
Nevertheless, the cultural variables do not seem to perform a significant impact on Dell? s forecast of the global customers? targeting and segmenting and for this reason not the new product penetration path in foreign countries either. (Hui Lin,Akiko Yamamoto & Bo Chen,2006 ) 3. 4 Brand Position Brand positioning is the sum of all activities that position the brand in the mind of the customer relative to its competition. Positioning is not about creating something new or different, but to manipulate the mind set and to retied existing connections (Ries & Trout, 2001:2-5).
Kotler and Keller define brand positioning as an “act of designing the company’s offering and image to occupy a distinct place in the mind of the target market. ” The objective of positioning is to locate the brand into the minds of stakeholders, customers and prospect in particular. A recognizable and trusted customer-focused value proposition can be the result of a successful positioning without doing something to the product itself. It’s the rational and persuasive reason to buy the brand in highly competitive target markets (Kotler & Keller, 2006:310).
Therefore it is essential to understand and to know the position a brand owns in the mind of a customer instead of defining what the brand stands for. To position a brand efficiently within its market, it is critical to evaluate the brand objectively and assess how the brand is viewed by customers and prospects (Ries & Trout, 2001:193-206) ( Ronald,2009 ) Dell is one of the widely known global brands that have found itself in this dilemma. The recent announcement by Michael Dell that the brand will earmark $1 billion for organic growth and innovation compliments the brand? s recent spate of external growth.
The brand that started as a budget personal computer company has long expanded beyond just that. Given the tremendous growth in emerging economies and midmarket opportunities, Dell has begun to focus on achieving 5 to 7 percent growth in education and health care markets. In recent years Dell has acquired almost 11 companies. Given such an aggressive internal and external growth strategy, there arise some very crucial challenges. Not only is Dell? s brand portfolio a collection of acquired firms, but its own organic growth and innovation alters the strategic scope of its brand.
In such cases of multidimensional strategic scope readjustment, brands will have to follow three crucial steps to ensure that their brand positioning, their identity and their central message is consistently conveyed to all the key stakeholders. Firstly, align post-acquisition integration with the overall positioning. In the current era of hypercompetition and expanding markets, it is imperative that global brands alter their strategic scope. However, in order to diligently protect their overall market positioning, global brands should carefully analyze the extent to 12 hich their acquisitions align with their underlying positioning. Next, consistently convey the identity of the parent brand. In the case of Dell, despite the expansion of strategic scope into multiple industries, Michael Dell ensures that the core brand message of Dell is consistently conveyed. ( Martin Roll,2011 ) 3. 5 Offline versus Online Customers The most important thing is to remind the customers who love your products that you’re there and ready for their business, both online and offline.
E-mail marketing is the tool that keeps you top-of-mind and stimulates purchases via direct promotions and simple reminders. Here are three ways e-mail marketing can integrate online and offline business which e-mail closes the geographic divide, e-mail reminds customers you are there and e-mail fills stores (or tables, or appointment slots ) on otherwise slow days. The other great thing about connecting your online and offline presence via e-mail is the fact that your online presence can give far richer data about what interests your customers. Customers have different comfort levels.
Some prefer to shop in a physical store. Other web-savvy ones enjoy the ability to shop online. E-mail marketing is an easy way to let your customers know they have multiple purchasing options. That increases satisfaction and loyalty. The goal is to remind them to buy from you, whether they’re driving down the street, web surfing in their pyjamas, or some gotta-have-it-now combo that means more sales for you. And as we all know, sales are sales whether they come online or offline. Remind your customers you are in both places and watch your sales grow. vicbrand. com,2011) In targeting offline customers such as those in the Relationship segment, Dell typically engage the customers using direct sales and telesales teams, supported by custom configured Websites known as “ Dell Premier Pages ” that are specific to the customer account. The Premier Pages enables the customer? s purchasing department personnel to browse a catalogue of products and services containing pre-agreed product and service specifications and pricing, place orders and track order status. Premier Pages can also integrate with the customer? purchasing system via electronic data interchange (EDI). Dell uses telesales teams and http://www. dell. com/ to target Transactional segment customers. Dell? s online approach to target this segment is via mass marketing. Transactional segment customers are also encouraged to call in using toll-free numbers. 13 CHAPTER 4 WEBSITE ANALYSIS Website analysis is the study of the currency, content, usability, navigation, access and all the features in the website to determine whether the website is it a good website especially to the internet users.
Last updated/featured 10 May 2012 8 May 2012 3 May 2012 11 May 2012 **As on 11th of May 2012 After website currency checks exercise been conducted, we can conclude that the currency of Dell Malaysia? website should be rated as good because it scored well in the entire checklist for website currency checks. 4. 2 Content Including Multimedia and User Engagement Opportunities In measuring a website? content, it measures the depth and breadth of the content offering. Is the content serves it purpose and meet the needs of the customer?
Website content analysis which also includes multimedia in the site have to make sure that the company is delivering well organized, relevant, attractive content to the customer which can push forward the company brand and sales. The user engagement opportunities are one of the most important elements in a good website, which defines how the user can actually engage and interact with the company through the site. Dell Malaysia? website serves the main purpose of the company website which is to facilitate the sales and online sales are the company main selling medium of the company.
Once we logged onto the site, the landing page? content first shown are the latest sales promotion and the products that company are selling. At the top of the homepage, there are tabs for Home, Small and Medium Enterprise, Public Sector and Large Enterprise which the content is directly relevant to the target audiences. The website content are well organized where the suitable multimedia content are put on the site, graphics are well use to make the website look attractive and inviting to the users. The content in the site also depth enough, which it content all the information for the products e. . product specifications and prices. Website content of Dell Malaysia also included PC help & advices which provides the users with free advices where it is well written. Dell Malaysia? website also provides users with engagement opportunities which we can easily been discovered on the website. Users are allowed to create an account where their personal preferences will be saved and they can choose to constantly receive new letters from Dell Malaysia. When users sign up an account with Dell, they will be engaged with the company through updates from the company. In Dell Malaysia? ite, we also found a Dell community where users can actually engage themselves with the company by joining the community and they can actually provides their ideas to the company via the community. In the community, Dell make the users fell that they are further engage with the company by set up users groups and also owners club. Another engagement opportunity that the company has for users by finds them on their social sites like twitter and also Facebook, users are able to follow them on twitter and become the fans of the company by “like” them on Dell Malaysia official Facebook page.
In overall, Dell Malaysia? s website fulfilled the criteria of good content and users? engagement in website analysis. But in our opinion, Dell Malaysia can further improve the content of the website by adding more multimedia content like videos which may helps in making the website look more interactive. 15 4. 3 Usability, Navigation, Access The usability of a website means that users visiting the website will be able to quickly find what they are looking for and able to meet their purpose of visiting the site.
To ensure the internet users can easily access the information/products they are looking for and at the end make a buying decision, good website navigation is necessary. Easy and users friendly navigation on the website with optimize navigation structure will definitely helps to make the website serves it purpose better. The primary goal of Dell Malaysia? website is to generate sales, so the usability which includes the navigation and access are very important in order to lead the users to make a purchase.
Navigation I) The main navigation on the website which are different segment of users requirement are easily indentified, users can navigate through that and get into the segment which provides them with related products easily. The navigation labels are also clear, for instance for home means home users, and for large enterprise means for large corporate which are concise. II) Users can easily navigate and back to home page once click on the company? s logo on the website where people actually expected the logo will be the home button.
III) Site search are easy where the search box located at the top of the website and search results shown up are related to the keywords. Site map are also included where users can easily navigate over all the links in the website. IV) However, the links in the homepage are too many and users might get annoyed by looking and finding on the links. Access 1) The site load full content in a reasonable time, with a wireless broadband connection in the University of Malaya, we are able to access to the full content in Dell Malaysia? website within 5 seconds. After a few trials, we found no problem in the website to load the full content.
If a website took few minutes to load or having trouble to load all the content, users might just get away from the site. 2) Text to background contrast is adequate where it is easy to read at a glance for the users. Dell Malaysia? website uses a white background and black/blue colour text which is a very good contrast that enable easy reading. After analyzed the Dell Malaysia? website usability, we found that Dell Malaysia? website usability are good in overall but can be further improve where links can be categorized and the fonts size of the links can be bigger where increase the readability to users. 6 4. 4 Other Company Owned Sites Beside of the Dell? official site, Dell Inc. also owns other sites which are managed by the company for various purposes. Company uses other sites to better target into different market segment or serves different type of customers more efficiently. Beside of that, company also uses the sites to improve the relationship engagement with their customer in order to generate higher profits and have a better market position through internet. Below is the list of selected sites that own by Dell Inc. (excluded dell? official site) and its? urpose. Site Idea Storm http://www. ideastorm. com/ Purpose IdeaStorm was created to give a direct voice to our customers and an avenue to have online “brainstorm” sessions to allow you the customer to share ideas and collaborate with one another and Dell. Our goal through IdeaStorm is to hear what new products or services you? d like to see Dell develop. We hope this site fosters a candid and robust conversation about your ideas. (Source: http://www. ideastorm. com/idea2AboutIdeaStorm? v=1337146053540) Dell Auction http://www. dellauction. com Dellauction. om offers best-in-class auction functionality with all the reliability and security of the Dell brand. Bidding and buying on Dellauction. com is safe and easy. (Source: http://www. dellauction. com/cgibin/ncommerce3/ExecMacro/static/howTo. d2w/report? wl=75267554 The company? s official blog which the contents is written and updated by Dell? s staff. Dell University was created to help schools (high school/universities) to reap the benefits of technology on campus, easily and affordably. Where customers can find great solutions, advise and how-to? s , discussion and friends. Direct2Dell http://www. direct2dell. om Dell University http://www. delluniveristy. com Dell Community http://www. dellcommunity. com Table 4. 4. 1 As a conclusion, other sites that owned and managed by Dell Inc. play important roles in facilitate the selling activities of the company, improving company? s image, reach different market segments and most importantly improve the engagement with the customers and putting in a positive value in the mind of the customers by providing free helps and solutions, feedbacks and suggestion and etc. For instance the dell community which helps in engages the customers and the company to build a Dell? community. Another creative site that owned by Dell that deserved a mention is “IdeaStorm” which allowed customers to share their ideas and brainstorm with each others, this shows that the company is listening to the customers and at the same time allowed customers to share their ideas and eventually helps in develop Dell? s products. 17 CHAPTER 5 BUSINESS MODEL A business model is a method by which the organization sustains itself in the long term and includes its value proposition for the partners and customers as well as its revenue streams. Strauss, 2012). Business model helps company to achieve its company goal. Some time, a company may have one or up to few business models practicing where it is depends on the company goals. For Dell, the firm set itself as a high tech and innovative company so the firm connect and communicate with its customers and suppliers through internet or its website. Dell has go beyond the traditional business model 5. 1 E-Business Models Used E business model like any business model and what make e-business model different is the use of information technology.
From what we can conclude from Dell Malaysia? website, the company automates many business processes and Dell depends much on the E-business model in achieving sales. Dell sells their computers to the customers directly where there cutting out the middle man (retailers) by using their website. Below are the ebusiness models that are used by Dell. 1) E-Commerce – where Dell selling its products and services on its website and performs online transactions. Dell can also be known as an online retailer where they sell physical goods over the internet.
Dell provides several payment methods like credit card, cheque, direct deposit and so on where the e-commerce are being used. 2) Direct Distribution – Dell as the manufacturer sell directly to consumers without going through middle man or intermediaries. Dell eliminates the intermediaries such as retailers. By using this business model, Dell able to saved part of the inventory cost which otherwise will be paid to retailers. 3) Social Networking – as what we can found in the Dell community webpage, Dell established and manage few social networking account under the company which are Google+, Facebook, Twitter, LinkedIn, and also Youtube.
Social networks bring users together and engage with the company. They connect with their customers and generate sales indirectly with social network. 5. 2 Level of Commitment to E-Business Level of business Impact Business Transformation (competitive advantage, industry redefinition) Pure Play Enterprise Pure Dot-Co m (Amazon) Source: www. mohansawhney. com Figure 5. 2. 1: Figure exhibits level of commitment to EBusiness Click and Mortar (eSchwab, most retailers) Customer Relationship Management Brochureware E-Mail Effectiveness (customer retention) Efficiency (cost reduction)
Business Process Activity 18 After discussed the E-Business model used by Dell which are E-commerce, direct distribution and also social networking we can conclude that Dell is in the Enterprise level of the pyramid. Dell has automated numbers of business processes and shown a high level of commitment to the E-Business. Dell relying heavily on information technology system in their business and the future of Dell will be much more on e-business activities. 5. 3 Customer Value Value= Benefits – Costs Value is the entire product experience.
It starts with a customer? s first awareness of a product, continues at all customer touch points (including the web site experience and e-mail from a firm), and ends with the actual product usage and post purchase customer service. (Strauss, 2012). Value is also the mental beliefs and attitudes held by a customer again the company. Customer value also defined as the expectation from the customer, where whether the company? s products
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