Read CNN post here. The first job I ever did was selling Dell computers. Michael Dell was my idol. For the rest of the 90s there were several case studies on Dell and how its mail order model is trumping the internet. Its internet ready they said. Because its direct to customer model, they had a huge advantage in ecommerce. Its B2C model was touted as the model of the future. You could configure your PC online and have it delivered to your home.
The biggest advantage was not having middlemen, the resellers and hence it gave Dell flexibility when it came to pricing the product. Everyone else faced resistance from their resellers if they undercut them on the direct B2C channel.
On top of it, the advantages of negative cash cycle. Dell got its monies upfront, unlike when selling through resellers was taught in the B schools.
In 1998 when Steve Jobs was brought back to Apple as an interim CEO, Michael Dell remarked on a TV show that Apple shareholders will be best served, if they simply wound up and gave the money back to the shareholders.
Well, how the times have changed since!!
The truth was Dell was never Big in B2C. Most of its business happened in the B2B. The stories and case studies were all great for PR, but when it came to the crux of it, Dells model was still selling undifferentiated product, the PC.
With the tablets coming in, the paradigm has changed. Dell which was always a one trick pony really could never diversify and hedge its risks. As the PC dies, so does Dell.
Bye Bye Dinosaur...
The biggest advantage was not having middlemen, the resellers and hence it gave Dell flexibility when it came to pricing the product. Everyone else faced resistance from their resellers if they undercut them on the direct B2C channel.
On top of it, the advantages of negative cash cycle. Dell got its monies upfront, unlike when selling through resellers was taught in the B schools.
In 1998 when Steve Jobs was brought back to Apple as an interim CEO, Michael Dell remarked on a TV show that Apple shareholders will be best served, if they simply wound up and gave the money back to the shareholders.
Well, how the times have changed since!!
The truth was Dell was never Big in B2C. Most of its business happened in the B2B. The stories and case studies were all great for PR, but when it came to the crux of it, Dells model was still selling undifferentiated product, the PC.
With the tablets coming in, the paradigm has changed. Dell which was always a one trick pony really could never diversify and hedge its risks. As the PC dies, so does Dell.
Bye Bye Dinosaur...
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