© farhan mir 2008 ims e-commerce & applications bba (hons) 7 th cases on retailing & e-...

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E-Commerce & E-Commerce & ApplicationsApplicationsBBA (Hons) 7BBA (Hons) 7thth Cases on Retailing & E-Cases on Retailing & E-CommerceCommerceLectures 4,5,6Lectures 4,5,6

Course Lecturer: Farhan MirCourse Lecturer: Farhan Mir

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Proactive & Direct Proactive & Direct MarketingMarketing

Dell Dell ComputersComputers

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Dell’s Direct MarketingDell’s Direct Marketing

Michelle Dell a fresh graduate from University of Texas started the company in 1983Rather maintaining old PCs or upgrading them (What he started earlier at his company) he realized he could purchase new components from supplier and built is own oneHe thought he could sell these PCs direct to customer at lower (discount) pricesDell advertised in Magazines and the number of orders increased significantly

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Dell’s Direct MarketingDell’s Direct Marketing

Within two years it grew from nothing to a $70 Million business

Initially consumers ordered PC and them the business climbed to highs when small and large business started to place orders

In 1990s Dell started new venture in Europe to extend it’s market and increased its product line and establish a name as far as quality is concerned

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Dell’s Direct Marketing…Dell’s Direct Marketing…

In early 1990s Dell establish links with retailers for selling their PCs where customers could have latest brands and after sales service from partner retailers like BestBuy, PC World and Business DepotAlthough there was growth in companies overall posture but lot of investment was done and indirect channels acquired profit share of Dell therefore there was decrease in stock price of Dell and need for an alternative solutionReturning back to its old direct marketing model Dell again saw a boom in it’s business in the mid and late 1990sIt became the US No. 1 computer manufacturer and worlds No. 2 in 2000, establishing new unit in Malaysia and new plants in Europe

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Dell’s ModelDell’s Model

Dell developed and exercised a model that was not only very unique but it also focused on speed and few inventoryThis eliminated the reseller’s margins and cost associated with InventoriesDell’s model was based on Information Technologies throughout it’s network, especially among it’s partnersThe Direct Model also strongly serve Customer Service and Support (one of the focused themes of Michelle Dell)

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Dell’s Direct Marketing: Here Dell’s Direct Marketing: Here comes the Web comes the Web Michelle Dell was always fascinated by the growing phenomenon of Internet and World Wide Web

An idea stuck at his mind that “why not a customer could order a computer online?”

They were selling on phone and those customers were the first willing to place orders online

Internet proved to be a more comprehensive yet very efficient extension of Dell’s Direct Model

Dell enhanced it’s offerings by providing personalized pages for each customer online

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Reactive Direct Reactive Direct MarketingMarketing(& Customized E-(& Customized E-Catalogs)Catalogs)

Ford Ford MotorsMotors

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Regional Services Regional Services (Store)(Store)

PeapodPeapod

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