In com101 Class 6 we spent plenty of time talking about the marketing strategy, specifically we took Dell as a successful example. Dell changed its marketing strategy and tried to avoid being stuck by a wide range of competitors and focus on creating values and delivering solutions for its customers. This allowed them to cut the cost of the middleman and therefore earn more profits. More significantly, it was able to directly understand the market demand so it could fast react to the flexibility of the marketplace.

Indeed, the graph above illustrates that Dell has been through a rapid and dramatic increase since 90’. Especially after 94’, its revenue increased 21790 in short 5 years, which was more than 7 times greater than that of the last five years. Also, its inventory remarkably declined because of this shift of its marketing strategy as it provided Dell with high efficiency as well as quick returns to the investors. Dell transformed to a $12 billion company in just 13 years. The success of Dell Company points out the marketing problems of other companies that existed for many years.

However, their combined new strategy also has drawbacks, which should be aware of before running their company in the future. They should continuously analyze the shortages and take action. First of all, what is likewise the most important one is their poor customer service comparing with their “big dreams” in eliminating the retailers. The withdrawal of their retailers straightly leads to the limit of choices and limit of customer experience. Clients are used to testing and trying the products in person to see if they truly want them. With the development of the technology, creating 3D models on the Internet can be a really convenient way to solve the problem. These 3D models need to be exactly the same with the products and provide the customers with a Full-circle Appraisal of the products on the Internet in order to improve their on-line shopping experiences and to win a better patent among customers. The second weakness is that although they can exclude the retailer employees, they should not rush to do it. Why? Their relatively new way of marketing needs more customer services to help people to purchase their products and to get used to this buying experience.

References:

Magretta, J. (n.d.). The Power of Virtual Integration: An Interview with Dell Computer’s Michael Dell. Retrieved from http://hbr.org/1998/03/the-power-of-virtual-integration-an-interview-with-dell-computers-michael-dell/ar/1

What is the strength and weaknesses of Dell? (n.d.). Retrieved from http://www.answers.com/Q/What_is_the_strength_and_weaknesses_of_Dell