Dell Uses the Indirect Approach

Dell seems to have some problems not only with its hardware and supply chains but also with its direct sales strategy that worked good (not brilliantly) for a while and then began to bog down. As they search for a way to revitalize their presence on the computer hardware market the idea of using the indirect sales strategy surfaced again. Traditionally, Dell would sell its products only through its Web based store through a few retail dealers like Wal-Mart and BestBuy. Now they are tying everything they can to regain at least a part of the market share they once dominated.

The Internet services company Carphone Warehouse is now offering one of the Dell's laptops as part of a broadband promotion. CPW is tempting customers onto its AOL Broadband service with the offer of a free Dell Inspiron laptop and wireless router. All customers have to do is sign up to a 24 month contract at a rather low price. The same laptop model was available for sale from Dell's online store at a price of $817, a rather big difference.

According to the Wall Street Journal, cited by ChannelRegister, customers will get a voucher for the free laptop and will be able to upgrade to swankier models if they wish. The firms are still debating who will actually hold the stock when the deal goes live in September.

In May, Michael Dell admitted, "we have not done as much in the channel as we probably should have - certainly not as much as we could have. So now we're going after it." Even if Dell is a U.S. market centered company now it is considering opening a sales channel for either direct purchases or retail dealers in Europe. The company is working with Wal-Mart and BestBuy from a long time, but it never really advertised that fact and from the resellers' point of view Dell has the bad habit of blowing hot and cold.