Word: delling
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...first trend is the ever popular commingling of computing and entertainment in your living room. Yet Dell lives at the office. "We're seeing more and more of our technology intersecting with home entertainment," says Ro Parra, a senior vice president of Dell's home and small-business group. To entice gamesters and movie watchers, Dell has unveiled new models in its multimedia XPS line. The units range from a $3,500 desktop-notebook hybrid with a 20-in. screen and a remote, to a $2,270 gaming desktop with a swanky scarlet-and-gray exterior and high-end specs...
...second reason for Dell to go retail is more prosaic. For years, Dell's direct-shipment model proved especially good for selling to businesses, which generate 80% of its sales. But the business market is becoming more commoditized, and prices are in a free fall. So everyday shoppers are powering the industry's growth. The consumer market grew at twice the pace of the enterprise market last year, according to technology-research firm IDC. Result: Dell's stock has plummeted 52% in the past year. The company's sales grew a lackluster (for Dell) 14%, to $56 billion, in fiscal...
Many of the challenges facing Dell seem to spring from the very innovations that made it a juggernaut. By selling direct, Dell keeps a lid on overhead and offers customized computers at competitive prices, with relatively swift delivery. As the price of computing dropped, Dell was consistently able to shed costs and maintain a price advantage over rivals. But this year Dell's competitors have attacked that price gap. HP slashed thousands of jobs and reduced the number of assembly plants, streamlining its supply chain and enabling it to go head to head with Dell on low-end machines. Retailers...
...opening stores, Dell is acknowledging that retailers are in a better position to address the increasing number of consumers who view computers as an entertainment purchase. Walk down the aisle of your local Best Buy, and you will see that desktop screens are as likely to display Sid Meier's Civilization as H&R Block's TaxCut. "It's not just a PC anymore. I'm connecting this box to the rest of my life," says Michael Vitelli, senior vice president of consumer electronics. "Dell made its money when the computer was a static box. People want...
...ability to walk out of the store with a computer. The new stores won't carry inventory, so consumers will have to wait a few days for delivery. That lowers operating costs, but Vitelli says the impatience of the gotta-have-it-now mall shopper is not on Dell's side: "Are you going to go to the restaurant, look at the menu and say, 'That's great. Send me the meal in 10 days...