Being at the market top and evolving by giving the best quality and affordable products is what Dell gives its customers. It has one of the most unique business models in the industry.
Thus this makes us keen to know the business model of Dell.
In this blog, we will be discussing the dell business model, marketing mix, and competitor analysis.
Before we start with any of those, let us know about Dell as a company.
Dell is a multinational computer technology company that deals with computers, laptops, and other related products. It was established in 1984 by Michael Dell. It has its headquarters situated in Round Rock, Texas, U.S, and has its branches all over the world. It has employed around 165,000 employees all over the world. It ranks as the 34th company in Fortune 500 as of 2020. Dell makes amazing computers & provides the best services & products to people in the best way.
Dell is involved in manufacturing and selling:
- Personal computers (PCs)
- Data storage devices
- Network switches
- Computer peripherals
- MP3 players
- electronics built by other manufacturers
Dell has the widest customer base with a generating-revenue business model through acquisition since its inception; notable mergers and acquisitions include Alienware (2006) & Perot system (2009).
- Business/Corporate Class
- Home Office/Consumer class
- Peripheral Class
- Service and Support Brands
Let us now start with the business model of Dell.
Business Model of Dell
Dell is all about technology and computers. It’s one of the largest technology corporations in the world. The third-largest PC vendor in the world after HP & Lenovo. From 2000 until 2006 Dell delivered more complete computer systems worldwide per quarter than any other PC manufacturer.
The business model that dell used is that:
When he started his business there were many large companies it had to compete with like Apple. He started a business in which it eliminated the middlemen which charged almost 10% of the profit while selling. This elimination of middlemen leads to discount-priced products for the customers. It gained many customers over the years due to this strategy. It also provided the best after-sale service for its customers in the market which helped it grow in the market with low cost and high-profit margins. This business model which was used by dell was later termed as the direct model of selling which was the best for new startups to use to enter the market and attract more customers and get more profit.
Let us now learn more about how the business works and see what are the new changes it has made.
Dell Success Factors
- Excellent Brand Reputation: As a brand, Dell has nurtured a very strong brand reputation and dell always make changes and become innovative
- Expanding Company(diversified offering): From desktop to gaming laptops, laptopi3, tablets, smartphones, TVs, software, cloud services, data centres, and networking, Dell caters to a wide range of tech needs. Diversified offerings enhance stability.
- Quality Products: Dell always sells quality products like the most durable and practical laptops in the market through direct selling and e-commerce. But the biggest thing about this company is they provide cheap services for customizations.
- Personalized Customization: Technologically spoilt consumers of the 21st-century demand VIP treatment and services that allow for personal customization. Dell is one of few lappy(laptop) & technology companies that allows its customers to walk into its shops and customize their laptops. Through this strategy, they earned 79 billion money.
These four factors are the core pillars of Dell’s success story. With brilliant innovative ideas, diversified offerings, they outmanoeuvred well-established companies like HP, Acer & Lenovo.
Let us now see the Marketing mix of Dell.
Marketing Mix of Dell
Dell is one of the long-reigning consumer brands. The Marketing Mix’s of dell talks about how dell has improvised technology and the computer to gain a competitive position.
1. Product Mix of Dell
- Dell believes in providing changing benefits to the changing needs and demands of the customer’.its not about providing products or services.
- It has extensive spices of both business class and home/consumer class products and services.
- Dell always customizes its designs, develops, manufactures, markets selling techniques, and supports a wide range of products that in many cases are customized to individual customer requirements.
- Examples:- a few eg of products for professional and individual customers are Dell gaming laptop (precision workstations), OptiPlex desktops, Dimension desktops, Inspiron and Latitude notebooks.
2. Price Mix of Dell
- Pricing strategies usually change as the product passes through its life cycle because there are constraints on the company’s freedom to price a product at a different stage.
- The main goal of Dell is to provide a low price and profitable PC for the customers.
- For the above reason, Dell’s product and services pricing reflect the affordability of the local consumers.
- Because Dell products are so innovative and creative, the price is largely dependent on the options and services added to the product.
- Dell is one of the cutthroat competitors whose price gain in market share
3. Place Mix of Dell
- Dell’s goods and services are moved from the manufacturer and services provider to the user or consumer.
- It has been able to affect the location strategy aspect of its marketing campaign through various digital marketing strategies.
4. Promotion Mix of Dell
- Marketing communication is one the best strategy for its marketing which is used by Dell.
- It always changed its techniques by engaging in wide marketing campaigns.
- They use different marketing strategies for their products primarily by advertising on television and the Internet, advertising in a variety of print media, and mailing or emailing a broad range of direct marketing publications, such as catalogues, and customer newsletters, promotional materials.
- Dell has started promoting its products through retailers like Wal-Mart, GOME, and Carrefour, Best Buy, Staples.
Let us now see the Digital Marketing Strategy of Dell.
Digital Marketing Strategy of Dell
Dell strategically plans its offerings based on Psychographics & Demographics factors. It targets tech-savvy people, Professionals & Executives. Moreover, it makes the customer engagement channel strong to stand ahead of other companies.
A powerful connection with customers as well as serviceability are the winning factors in the hardware & software industry and that is what dell is working on. Dell’s strategy is global. It realizes that being geographically closer to the customer is essential in carrying out its marketing strategies as well as in enabling it to build a customer base.
They made their positions themselves based on customer & benefit-based positioning strategies to differentiate themselves from the other players in the market.
Nowadays, the dell laptop is known as a gaming laptop which is called Alienware, and dell is promoting these gaming laptops through games like spiderman miles morales or assassin creed syndicate.
Dell is an excellent example of how to start a company and take it to success. It has had a unique blend of business strategies and marketing strategies that have transformed the company. It has used one of the best business models to initially start its company which is cutting the middlemen and giving the price cut advantage to its customers. It also has some advantages in the form of brand reputation, diversification, and quality of products served in the market. Dell also has a well-organized marketing mix. The company has different products made especially for those categories like different products for professional and personal uses. And the low price strategy which is implemented is very helpful for them in the market along with its promotional methods used to attract customers.
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