Your Adarsh™

Letz mint some ‘ka-ching’

*I don’t like computers in Walmart !

Dell and Walmart have been in news combinedly for some time now. You know what? Dell wants Walmart to sell computers for them. I don’t like this . Cramer likes Walmart now coz they are expanding to Asia. People on Fast money like Walmart too…I love walmart though it doesn’t really make fast money. But this deal does not speak good of Dell. This would hurt them more than it would benefit!!! Ouch

People assume ‘Walmart’ as the Poor Man’s ‘Target’ with their everyday low prices tag. It is kind of like JC Penny for Macy’s. Kinda wierd comparision but almost near I guess. Would you like to go to Target or Walmart when your girl friend asks you somethign? These days kids do not want to go to Walmart, they love to go to Target. I know computers are not too much with kids, but why is dell going to a retailer?? Walmart is great, they have great deals they are like the biggest diversified super market, but doesn’t really impress me with computers. Dell could have gone to some Computer guys, Best buy , Circuit city, office depot, Fry’s, oh man there are so many!!!!!!! This deal is just going to STOMP DELL with a tag – cheap brand.

Once Dell gets that poor man’s brand sticker on it, no body would want to put them in their living rooms!!!!!!! What would you prefer showing a Kia Rio to your neighbour or a 2008 Mustang/Corvette? It’s the same here. It’s all the brand name and the tag you attach to it. may be they’ll increase their revenue initially, but later on this is going to effect them big. This is my thinking. Appreciate your comments.

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June 9, 2007 - Posted by | Blogroll

3 Comments »

  1. Hi Adarsh,

    To put our retail strategy into perspective, it is important to note three things:

    — Our retail strategy is just beginning to unfold, and it will be aggressive and global. Stay tuned!

    — Our retail business will augment our direct business model, not replace it. We view them as two separate businesses to fuel our growth.

    — It’s all about choice. We’re confident we’ll be successful because we’ve listened to the marketplace and are evolving to give a wide range of customers and prospects a choice that makes sense for them.

    Comment by johnp@dell | June 11, 2007 | Reply

  2. John,
    I love the idea to go retail. But how can you justify the profit/revenue ratio when selling in Walmart? I am very sure, if you have them at Walmart, you are going to have them put up cheaper prices as time goes on!!! Walmart tag itself is ‘Everyday Low Prices’. I see it like this, though the idea was good to have a retailer, I still opine walmart wasn’t the right choice. (I love both companies, but the business models don’t go together)
    Your point of looking it as a separate business is awesome. But I’m not convinced that Dell will reap healthy growth from this part of business (Please note that the comment is only related to walmart not other retailers!)
    May be you gain revenue, but at what cost or what profit? You gain a revenue of say X millions, but making lesser profit %, than the previous business model, would actually attenuate the growth and bring down the overall profit/revenue ratios, inturn creating a barrier to the expansion. Please feel free to leave your comments/crtique opinion. Appreciate your comments and ideas.
    Adarsh.

    Comment by youradu | June 11, 2007 | Reply

  3. Hi Adarsh,

    Glad to hear you like the idea of a Dell retail strategy. As a practice we don’t discuss revenue and profit from a single relationship, but we do believe that the scale of our unfolding global retail strategy will lead to success — both financially and in our ability to provide choice to our customers.

    Comment by johnp@dell | June 13, 2007 | Reply


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