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Can Dell Turn His Firm Around

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Dell’s hiring of Mother is one strand of its founder’s strategy to fix the struggling company, writes Gemma Charles Beleaguered computer giant Dell is set to turn up the marketing volume following its appointment last week of Mother to create a global ad campaign.

If there were ever a sign that Dell, which has built its business on selling PCs directly to the consumer, wanted to overhaul its image, the hiring of the creative hotshop is surely it.

Dell is a company used to success and its launch has become business legend. In 1984, while still a student at Texas University, Michael Dell founded what would become Dell Corporation, following a time-honoured entrepreneurial tradition, by trading computers from his room. The company grossed more than $73m in its first year of trading.

Recently Dell has encountered a rockier path, culminating in it losing its position as the world’s top PC manufacturer last year to a resurgent Hewlett- Packard. Chief executive Kevin Rollins resigned and Dell with battery like dell Inspiron 1000 battery , dell Inspiron 2200 battery , dell 312-0292 battery , dell INSPIRON 2600 battery , dell INSPIRON 2650 battery , dell 1G222 battery , dell BAT3151L8 battery
dell Latitude X300 battery , dell W0465 battery , dell Inspiron 2000 battery , who had stepped back from the day-to-day running of the business, returned to the frontline to replace him in January.

A look at the two companies’ results reveals why Rollins had to go. While HP posted a 26% year-on-year increase in profits to $1.55bn (Pounds 781.7m) in the quarter to the end of January, Dell’s income for the quarter ending 2 February fell by a third to $673m (Pounds 339.4m).

Dell’s core positioning of being the cheapest on the market has been eroded by new entrants including Taiwanese brand Acer, which grew by 155% between 2004 and 2006 to become the bestselling laptop manufacturer in the UK, according to Mintel.

Michael Lamer, senior research analyst at technology intelligence group IDC, points out that 85% of Dell’s business is B2B, which enabled it to boom around the turn of the century when the business market was going through a state of renewal. Now that growth is being driven by consumers, it is struggling. ‘Al though Dellhasbeengood in marketing to the type of buyer who understands what they are looking for, such as gamers, it is missing out where the mass market is concerned,’ he says.

The fact that some consumers want to see and touch their potential PC purchases places Dell and its arms’length sales model at a distinct disadvantage, adds Lamer.

As well as having to deal with shifts in the market, Dell’s reputation has taken a battering. A groundswell of discontent emerged a couple of years ago when influential US journalist Jeff Jarvis began to blog about his frustrating experiences of Dell’s customer service system. The phrase ‘Dell hell’ was born and consumers’ horror stories about dealing with Dell spread online before migrating to traditional media.