Essay on Dell Situational Analysis

1436 Words Nov 16th, 2010 6 Pages
2.0 Situation Analysis

Dell is now entering its twenty fourth year of operation. While its products were once well received, sales have now slowed. Dell was once the leading PC seller, its stock price is now deflated. Dell’s stock prices haven’t been this low since before Michael Dell retook his position as CEO of the company, in February 2007. Dell’s sales are down and for once, Hewlett Packard shipped more PCs than Dell. Innovation and increased marketing are vital if Dell hopes to regain their, once held, top spot.

2.1 Market Analysis

As once company to beat, Dell once had what it took to be number one in its industry. Dell has infinite knowledge of the pc industry. Dell fell quickly to a problem common to those on top, the
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▪ Communication. Maintenance of close ties with their most profitable corporate customers. By keeping open lines of communications, installing custom software, and keeping up with its customer’s business inventories for them, Dell is increasing customer loyalty and satisfaction. Dell has also built and maintained a Premier website for corporate customers. The website can be accessed by any customer subsidy worldwide, and not just a company’s purchasing agent. Through the website customers are able to purchase computers according to the automated policy (Kotler & Lane, 168).

▪ Marketing Mix. Dell’s expansive product mix allows it to attract new customers, as well as, cross sale to existing customers.

2.2.2 Weaknesses

▪ Dell’s customer satisfaction rating has been on a steady decline. While Dell has approximately 18% of the worldwide market, their complaints to ConsumerAffaris.com accounts for about 58% of the complaints received in the last twelve months.

▪ Lack of proprietary technology. Dell’s largest competitor, Apple Computers , One of Dell’s largest competitors, Apple, has launched a new marketing campaign pointing out the short comings of PCs. Apple is seeking to covert PC users, one at a time.

▪ By utilizing a Just in Time System, Dell is highly reliant on their suppliers. This can leave them vulnerable to supply and demand shocks.

2.2.3 Opportunities

▪ Strong potential for market growth

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