[photopress:IT_michael_dell.jpg,full,alignright]Bit of bias on the part of the writer. Dell has always produced good PCs which are favorites with journalists especially at the low end of the market which is where most journalists operate.
Many IT journalists use the Dell direct-sales method and sort of build their computers by working through the pick-and-chose website. Yes, we want Windows XL instead of Windows Vista. But we would like two gigs of memory and a NVidia graphics card. So each computer becomes individual to its owner.
In China that is not the way the system always works and now Dell is going to go direct while still offering built-to-order machines.
In March, CEO Michael Dell, who is a remarkably pleasant cove and easy to get on with, came to Shanghai to show a new low-priced desktop PC designed by Dell’s Chinese engineers specifically for domestic customers. Over the past year, the company has also opened nine kiosks in Chinese shopping centers.
Despite all of this Dell’s market share among domestic consumers is tiny, just 2.5%. Now Dell is teaming up with the biggest Chinese electronics retailer, Gome.
Gome has almost 1,000 shops in 200 Chinese cities. In the first phase, due to start next month, Dell plans on moving into 50 Gome shops in bigger metro areas, with further expansion in 2008.
The move is an acknowledgment by Dell that stubbornly sticking with the direct model doesn’t work in a market where few consumers are keen on shopping on the phone or via the Internet. Probably the situation will change with time but Dell needs a lot more than 2.5% of the market.
Source: Business Week