Dell Computer Company

Dell Computer Company was established by Michael Dell in 1984, and it has grown to be the industry leader in the personal computer industry through aggressive risk taking and cost lowering strategies. The strategic idea that Michael Dell had while starting his company when he was 19 years old has not changed as the company has transformed into a billion dollar corporation. This strategic plan encompasses the aspects of individualized products and direct sales to the end customer, lowering retail costs. (Dell Case Analysis, 2004)

The low overhead costs created by their partnerships with suppliers and amazing use of just-in-time inventory help to reduce retail prices, leading to the successes of Dell accumulates today. Down to business approaches, such as being one of the first companies to make e-commerce and internet usage a centerpiece in their corporate strategy has also benefited the personal computer leader. (Dell Case Analysis, 2004)

The explosion of business over the internet helped Dell tremendously. As they followed the vision of built-to-order personal computers and direct sales from the company's inception, the internet gave computer buyers a more convenient medium to purchase Dell computers. The quality control measures Dell undertakes also promote customer loyalty. As purchasing products over the internet became more popular in the late 1990's, there is a noticeable increase in Dell's sales and market share during the same period. Dell's computer prices were already attractive, as there is no retail middleman to mark up prices between the factory and the end consumer. Dell's low prices were especially attractive considering the purchased computer is totally customized to the customer's specifications.

Most recently, Dell's segmentation strategies were geared toward a younger demographic. Marketing toward teen to college aged students with the "Dude, you're getting a Dell," advertising campaign works toward creating life-long customers. Many people will purchase their first personal computer during their high school and college years, and Dell's low prices and award winning technical support and customer service make this a perfect demographic for the computer giant to target. (Dell Case Analysis, 2004)

While the threatening Y2K scare led forecasters to predict a heavy decline in the personal computer market, Dell's sales growth in the United States and Europe increased dramatically during this time. This increase is likely due to falling personal computer prices and the rising trend of internet purchasing behaviors. The most predominant speed bump in Dell's business strategy came with the Asian economic crisis in the late 1990's.