Group members Budirman B Daud 805014 Datu Zakariah B Datu Bistari 808744 1.

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DELL LEVERAGE THE INTERNET, DIRECTLY, BUT FOR HOW LONG?

Group members Budirman B Daud 805014

Datu Zakariah B Datu Bistari 808744

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Introduction Michael Dell started the computer business

in 1984.At the beginning the transaction is from

Manufacturing shipped to wholesalers and after that to the retail store.

Dell computers was priced $3,000/unit at that point of time.

Dell used Information Systems since 2004 to reduce their computer price.

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Q1 Explain how selling direct has given Dell a competitive advantage?

1. Create a New ServiceDell has created a new service to its customer by creating a web page for its customer easy to order the computer. The web page is “http://Dell.com”.

2. Enhance ProductDell was enhancing their product by listening very carefully to its customer need. Means, Dell already know what are its customer will request for software, hardware and feature in the future. Dell know how to make its customer more valuable when use its product.

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Q1 Cont…

3. Differentiate Product and ServicesDell will make their product different with the

other product because the computer can design by its customer when they make order. This is through Dell new services which is the customer can choose their software and hardware base on their needs and budget.

4. Lock in Customer and SuppliersDell has make its customer and suppliers difficult

or expensive to switch to another product because the product that their had buy is expensive.

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Q1 Cont…5. Raise barriers to market entry

Dell has raised barriers to market entry by offering a cheap computer with same quality. This will make the new entry companies died because they can not compete price with Dell.

6. Establish alliancesDell has establish alliances with its suppliers by share

the product quality, inventory and related subject via secure Web Site.

7. Reduce CostDell has reduced its cost because the supply chain

has reduced. Means, no need through the wholesalers and retail stores which only will make the computer price more expensive.

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Q2 What information systems does Dell need to have to sell directly to the consumer? Visit http://dell.com for inspiration and ideas.

The information system that Dell need to have to sell directly to the consumer is through their web site to collect its consumer information such as name, address, and email. By getting all this information Dell would easy to promote their product and at the same time Dell easy to deliver the computer to its customer.

The next slide will show the step of process.

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(Step 1)

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(Step 2)

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(Step 3)

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(Step 4)

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(Step 5)

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Q.3. Beside selling direct, what other programs has Dell created that give it a competitive advantages

It provides basic technical support & customer can upgrade this basic by purchasing one of four higher level support.

Dell offers deployment service to organizations to configure & deploy Dell systems, both hardware & preinstalled software.

Dell offers additional services to maintain and manage Dell systems once they have been deployed.

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Q.4 Consider Dell’s recent financial troublesA. What are the implications of the company’s

tactics when revenue falls 63% but sales fall only 23%?

The implications of the company tactics was that Dell should mark-up the pricing of all the products its sell to increased the revenue but at the same time, value added feature should be introduced such as online helpdesk to assist customers.

Sales can be increased by doing aggressive marketing through the electronic channel such as TV and Dell’s website.

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Q.4-bIntel sells CPUs and memory, and its sales have

stabilized. Dell & HP make computers, and their sales continue to decline. Assume the sales of other PC manufacturers are similar to those for Dell & HP. What do you conclude?

In my opinion Dell & HP should diverse their manufacturing & sales to include CPUs & memory, due to customers now days prefer to upgrade their computers & Laptop then buying new PC/laptop, being the reason it will only cost them a fraction compare to buying a new PC.

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THANK YOU