The Dell Promotion and Price Paper

The Dell Promotion and Price Paper

Michael Kunkel

University Of Phoenix

MKT 421

Robert Walker

01/09/06

The Dell Promotion and Price Paper

Promotion is the most important component in the 4 P's, so understanding how to promote a product is crucial to any company. No company knows this better than The Dell Corporation. Dell uses many different promotional methods to get their computer products seen by their targeted consumer markets. In today's paper I am going to start off by discussing some promotional vehicles that Dell uses to promote their computer products. Secondly, I am going to briefly analyze how the selected promotional methods position the products to appeal to its target audience. Lastly, I am going to identify where the products are in its product life cycle, and will describe how this life cycle stage affects the pricing strategy.

The Dell computer Corporation uses many different promotional methods to market their computer products to the appropriate target markets. Dell advertises heavily on television, on the Internet, in print such as magazines and newspapers, as well as, uses direct mail ad campaigns. All of these promotional vehicles have been designed to give Dell the competitive edge that they need to be the number one computer seller in the world.

"Dude, you should have bought a Dell", became a very popular television advertisement for Dell back in 2002. That one advertisement brought Dell's market share up 16.5 percent, which was more than double the previous year, according to The Wall Street Journal. In fact, these commercials had an addictive effect on the consumers that bought Dell products, and Dell used this ad and others to capitalize on the consumer computer market. Dell also used television advertisement in a slightly different way to sell their computers to the general public. Dell computers can be found on the popular QVC and QVC.com

Dell also used the Internet very successfully to market their computer products. One of Dell's most successful advertisement ideas came from the "Taguchi method", which was an Employee Purchase Program email advertising campaign. The aim of Dell's EPP email campaigns is to sell computers, software and peripherals to these individuals for their personal use leveraging the fact that they are already familiar with the brand because they use Dell computers at work. This ads campaign catapulted Dell's sales from 8.9 million before the advertising campaign, to 63.1 million after this campaign (www.1.us.dell.com). In addition to using the Internet, and television for advertising their computers, Dell also takes advantage of direct mail campaigns, which includes ads in Newspapers, Magazines, and a catalog that Dell sends out to its previous customers. Dell also has a website that they use quite effectively to allow consumers and businesses looking for computers to purchase them online. Dell's website is very sophisticated as it allows you to choose a bone stock computer, and add or subtract hardware so that the consumer or business person can build the computer the way they want it.

I will now analyze how all the above listed advertising methods help to position Dell's products to appeal to their specific target markets. Dell was very clever about how their advertising was put together. In many ways, Dell was able to bring a family member into your house to sell you that computer buy the use of cleaver television advertising. For example, Let's go back to "The Dell Guy", Steven. Those ads were some of the most successful ads in the history of Dell, and Dell was able to do this by using a cool college kid that many consumers could relate with. These commercials had many one-liners that made the ads famous; "Dude your getting a Dell" was the most famous of the one-liners. These ads became so popular that every time the Dell guy was seen on the street he had people coming up to him yelling "I want a Dell, Dude!" and "Can I have a hug!" It's almost like he became a member of everyone's family.

Another method that Dell uses to position the product and make it appeal to its target market is by offering their target market customers incentives to buy their computers. Dell always has computers on sale, and Dell also almost always has some promotion offering free shipping, free memory upgrades, free CRT monitors, and free printers. They reason that Dell does this is to make it very difficult for a consumer or business to say no to a purchase. Dell knows that selling the computer is the most important part, and is willing to give an incentive to make a sale. These incentives work very well, and make Dell computers very appealing to all of Dell's target markets. Dell also sends out a monthly publication called "Power Solutions" which is a magazine that provides clear, timely, and accurate information and support for issues related to Dell computers. Power Solutions,