Consumer electronics company Dell Inc. is expanding its sales model to include third-party vendors and retailers such as Wal-Mart Stores Inc. to counter slumping sales. The company last year lost its lead at the top of the PC market to Hewlett-Packard.
The expansion into retail stores is a change in strategy for the long-time direct marketing company that has relied on sales from its telephone and e-commerce stores for the last two decades.
“This is not an abandonment of our direct sales model – this is intended to be additive,” said Kent Cook, senior manager of consumer communications at Dell. “This is a response to customer demand. The direct model is great, but some consumers feel more comfortable going into a store to purchase electronics. We want to respond to our customers’ needs.”
The shift in sales strategy comes after New York attorney general Andrew Cuomo sued the computer maker, alleging that its sales practices had deceived customers. Dell intends to fight the suit.
The first retailer to partner with Dell is Wal-Mart, which will sell Dell Computer desktops in stores nationwide beginning June 10. Earlier this month, Wal-Mart announced it was expanding its electronics offerings.
Wal-Mart will carry two Dell models including the Dell Dimension Multimedia Desktop Computer that retails in a package bundle for $700 and will be offered in more than 3,500 Wal-Mart and Sam’s Club locations across the United States, Canada and Puerto Rico. A second model will be available in 3,000 Wal-Mart stores, in June as well.
Both companies will evaluate consumer feedback and purchase response and make changes accordingly in distribution or product.
To avoid competition with Dell’s own e-commerce store, the products will not be available at www.walmart.com.
“This is the first step in our new global retail strategy,” Mr. Cook said. “Wal-Mart is a proven brand with a strong presence in North America, and we’re looking for partners like them who can bring Dell products to more customers.”
According to Mr. Cook, the consumer electronics market is good.
“We’re sensing a lot of excitement about technology out there,” he said. “Our customers have been telling us that they want us to be in stores.”