Study of case study method in marketing research( Instance DELL Computers) Nitu Basumatary PhD Scolar Kokrajhar,Assam ABSTRACT This paper examines the marketing practices of Dell Computers Inc. Dell Computers Inc. is a for-profit manufacturer of personal computers. This paper details the history of the company, which made its name in the PC industry by offering a unique custom configuration of personal computers and portables. This writer of this paper focuses on the pricing, product placement and promotion of Dell's various computer related products. This paper also discusses the Dell "Build-to-Order" strategy which proved successful in marketing as well as an overall strategy in supply chains across the country. This paper details how Dell has not only cornered the personal computing home office market but also the manner in which it derives a substantial amount of its revenue from its small business.clients. From.the.Paper "Dell Computers is a for-profit manufacturer of personal computers. Early on in its corporate history, Dell Computers made its name in the PC industry by offering a unique custom configuration of personal computers and portables. Thus, Dell made its mark by developing distinctive competencies in the then still-evolving PC market of the 1980's. The then, small, Texas based firm resolved to show to the world that Dell Computers was not simply Nitu Basumatary PhD Scolar Kokrajhar,Assam Page 1
technologically astute-in fact, the company placed a rather low priority upon this aspect of Dell in its marketing, pricing, promotions, and placement in the PC market. The company did not emphasize that Dell was on the cutting edge of every new technical development. Rather, the Dell Company stressed that the company had sound knowledge of how to manufacture, design, and market its products or services effectively in a way to keep costs low for the average consumer or small business.". Chapter 1 Introduction This chapter of part 1 contains the introduction about the topic you choose. For example if your topic is dell computer. Then in this section you will the give the intro about the meaning of computer and the company profile of dell computer, earning of money and the effect of computer on marketing can also be written in this section. DO NOT insert the information about the area, scope and the limitations of your study and leave if for the next chapters Product profile A computer is a programmable machine designed to sequentially and automatically carry out a sequence of arithmetic or logical operations. The particular sequence of operations can be changed readily, allowing the computer to solve more than one kind of problem. Conventionally a computer consists of some form of memory for data storage, at least one element that carries out arithmetic and logic operations, and a sequencing and control element that can change the order of operations based on the information that is stored. Peripheral devices Nitu Basumatary PhD Scolar Kokrajhar,Assam Page 2
allow information to be entered from external source, and allow the results of operations to be sent out. A computer's processing unit executes series of instructions that make it read, manipulate and then store the data. Conditional instructions change the sequence of instructions as a function of the current state of the machine or its environment. The first electronic computers were developed in the mid-20th century (1940 1945). Originally, they were the size of a large room, consuming as much power as several hundred modern personal computers. Modern computers based on the integrated circuits are millions to billions of times more capable than the early machines, and occupy a fraction of the space. Simple computers are small enough to fit intomob, and can be poile devices wered by a small battery. Personal computers in their various forms are icons of the information age and are what most people think of as "computers". DELL Inc. was founded in 1984 by Michael Dell, the longest-tenured executive to lead a company in the computer industry. As DELL is quickly adapting to market trends and listening to its customer needs, the company has started to use indirect distribution channels globally. DELL Middle East is undergoing a dramatic growth phase at present. Dell Computer s Market Position in Early 2000 Going into 2000, Dell Computer was the U.S. leader in PC sales, with nearly a 17 percent market share, about 1 percentage point ahead of second-place compaq. Gateway was third with 8.9 percent, followed byhpi.e Hewlett- packard with 8.8 percent and IBM with 7.2 percent. Dell overtook Compaq as the U.S. sales leader in the third quarter of 1999, and it had moved ahead of IBM into second place during1998. Nitu Basumatary PhD Scolar Kokrajhar,Assam Page 3
Worldwide, Dell Computer ranked second in market share (10.5 percent) behind Compaq (14.0 percent). IBM ranked third worldwide, with an 8.2 percent share, but this share was eroding. Since 1996, Dell had been gaining market share quickly in all of the world s markets, growing at a rate more than triple the 18 percent average annual increase in global PC sales. Even though Asia s economic woes in 1997 98 and part of 1999 dampened the market for PCs, Dell s PC sales across Asia in 1999 were up a strong 87 percent. Dell was also enjoying strong sales growth in Europe. Dell s principal products included desktop PCs, notebook computers, workstations, servers, and storage devices. It also marketed a number of products made by other manufacturers, including CD-ROM drives, modems, monitors, networking hardware, memory cards, speakers, and printers. The company received nearly 3 million visits weekly at its Web site, where it maintained 50 country-specific sites. It was a world leader in migrating its business relationships with both customers and suppliers to the Internet. In 1998 the company expanded its Internet presence with the launch of www.gigabuys.com, an online source for more than 30,000 competitively priced computer-related products. Sales of desktop PCs accounted for about 65 percent of Dell s total systems revenue; sales of notebook computers generated 20 25 percent of revenues, and servers and workstations accounted for 10 15 percent of revenues. Dell products were sold in more than 170 countries. In early 2000, the company had 33,200 employees in 34 countries, up from 16,000 at year-end 1997; approximately one-third of Dell s employees were located in countries outside the United States, and this percentage was growing Profiles of Selected Competitors in the PC Industry Below are brief profiles of Dell s principal competitors in the global PC market. Compaq Computer Compaq Computer Corporation was the world s largest supplier of personal computer systems and the second largest global computing company (behind IBM), with annual sales of $38.5 billion and profits of $569 million. Compaq became the world s largest Nitu Basumatary PhD Scolar Kokrajhar,Assam Page 4
seller of PCs in 1995, displacing IBM as the world leader Compaq had very strong brand recognition because of its status as the global market share leader in the PC market.. IBM IBM was considered a "computer solutions" company and operated in more segments of the overall computer industry than Dell. It had the broadest and deepest capabilities in customer service, technical support, and systems integration of any company in the world. IBM s global services business group, the company s fastest-growing group, was the world s largest information technology services provider, with 1999 sales of nearly $32.2 billion. IBM had a lineup of over 40,000 hardware and software products. Hewlett-Packard. HP s product line also included scanners, digital cameras, storage devices, and networking software and equipment. HP s strong reputation with corporate customers in most all parts of the world, and its growing strategic emphasis on PCs, workstations, and servers. HP ranked fourth worldwide in desktop PC sales, first in worldwide sales of workstations, first in worldwide sale of handheld PCs, first in worldwide sales of both midrange and high-end servers running on UNIX operating systems, and among the top five worldwide vendors of servers running on Windows NT and Windows 2000. Over the past several years, HP had moved to improve operating efficiencies by outsourcing manufacturing assembly, reducing inventory and field-sales costs, and improving supply chain management. These efforts, combined with lowered component prices, had made HP aggressive in competing on price against its PC, workstation, and server rivals. Nonetheless, Hewlett-Packard s PC division, despite growing unit volume, was thought to be only marginally profitable. However, the company s sales of workstations and servers were major contributors to revenues and profits. Nitu Basumatary PhD Scolar Kokrajhar,Assam Page 5
Gateway Gateway, formerly called Gateway 2000, was a San Diego based company (recently relocated from South Dakota). Going into 2000, Gateway was the number one seller of PCs to consumers. It was also a major contender in the small-business, educational, and government segments. Despite growing at a rate of nearly 38 percent annually in the 1994 97 period, Gateway saw its profit margins erode steadily from a high of 9.6 percent in 1992 to only 1.7 percent in 1997. Since then, however, company cost-cutting efforts and efficiency improvements had resulted in eight straight quarters of year-over-year margin improvement. Profits in 1999 were at record levels. Nonetheless, Gateway was feeling the pressures of falling PC prices and stiff price competition although 1999 unit sales were up 32.3 percent over 1998 levels, revenues increased only 15.8 percent. The company s entry-level PC models, which started at $799, accounted for 20 percent of its sales to consumers. To reduce its reliance on traditional PC sales, Gateway took aggressive steps in 1999 to diversify its revenue stream. In February, Gateway became the first PC maker to bundle its own Internet service with its PCs; at the same time, following Dell, Gateway launched an online software and peripheral Web store with more than 30,000 products. Meanwhile, Gateway increased its service and training offerings to consumers and small businesses at its 280 Country Store locations worldwide.. Gateway also took aggressive steps in 1999 to boost its sales to small businesses, government agencies, and educational institutions. It established a sales force operating out of its 280 Country Stores that called on area businesses and other organizations. An alliance with GE Capital was formed to promote technology solutions for large enterprises. In Europe, Gateway entered into a two-year partnership with ComputaCenter, Europe s leading information technology systems and services company, to sell and support Gateway PC products throughout Europe. During 1999, Gateway increased its sales over the Internet by 100 percent over 1998 levels. Nitu Basumatary PhD Scolar Kokrajhar,Assam Page 6
To further enhance the Gateway brand with consumers, Gateway committed to sponsorship of the 2002 Winter Olympic Games in Salt Lake City, plus it entered into brand-enhancing alliances with Fidelity Investments and Nickelodeon. Gateway planned to open more than 100 new Country Store locations worldwide during 2000, including 75 in the United States. In early 2000, Gateway introduced a new line of home and small-business desktop PCs powered by Athlon microprocessors made by Advanced Micro Devices (AMD). The new Gateway Select PC line represented an effort to counter the difficulties the company was having in obtaining adequate supplies of Pentium microprocessors from Intel. Toshiba Corporation Toshiba was a $45 billion diversified Japanese electronics and electrical equipment manufacturer with 300 subsidiaries and affiliates worldwide; it ranked as the world s 26th largest corporation in terms of revenues and the world s seventh largest computer and electronics company. Toshiba produced and marketed portable and desktop computers, servers, voice-mail systems, digital business telephone systems, interactive voice-response systems, cable modems, networking systems, and digital, medical, and PC cameras. In the PC arena, Toshiba s biggest strength was in notebook PCs, where it had an 18 percent global share in 1999. The company s Toshiba America Information System (TAIS) division, headquartered in Irvine, California, had annual sales of approximately $2.5 billion across the United States and Latin America. The TAIS division offered a wide array of portable PCs, selling both direct and through dealers one of its largest U.S. dealers was Computer Discount Warehouse. In the mid-1990s, TAIS enjoyed a commanding lead over its U.S. laptop rivals in both channels, but its lead had been shrinking in recent years. During the 1996 99 period, TAIS s share of portable computer sales in the United States was in the 15 to 20 percent range. It had a negligible share of the desktop PC market. Nitu Basumatary PhD Scolar Kokrajhar,Assam Page 7
Chapter 2 Analysis Methodology of the research 1.The source of data collection is secondary.the sources are reliable because the Information has been collected from the companys websites. The data can said suitable also because enquiry has been made on comparative studies. The research can be said as Analytical Research, because the facts and information collected are already available on Internet. Findings Based on the data collected it has been found that Dell Computers is a market leader with A market share of17% followed by _ Compaq with16% market share, _Gateway with8.9% market share, _Hewlett Packard with8.8% market share, _IBM 7.2% market share Dell Computers has also strong market position in European countries in terms of sales and profit. Its major products are desktop pc, notebook computers, work stations, servers and storage devices. Dell computers also do the marketing of other manufacturers products such as,cd ROM drives,modems, monitors, networking hardware,memory cards,speakers and printers. It also provides the service marketing of internet websites,say for example website called gigabuys.com Nitu Basumatary PhD Scolar Kokrajhar,Assam Page 8
Chapter 3 Conclusion This case study reveals that for successful marketing research is necessary for any product specially the IT product. Research also necessary to its employees to keep them motivated and focused towards the company goals and objectives. The company should make new marketing strategies on new products Based on research. Nitu Basumatary PhD Scolar Kokrajhar,Assam Page 9
Chapter 4 Bibliography www. Gooogle.com www. Dellcomputers.com www.personelcomputers.com Research Methodology Methods and Techniques by C.R Kothari Nitu Basumatary PhD Scolar Kokrajhar,Assam Page 10