Whats Dell Doing at Wal-Mart?
Posted on: Friday, 1 June 2007, 12:00 CDT Last week, Dell announced that it would begin selling two Dimension desktop computers through Wal-Mart Stores. It was a watershed moment. For years, Dell embraced the tagline “Be Direct,” a phrase that highlighted one the company’s main differentiators: It sells directly to consumers rather than by way of retailers. The Wal-Mart deal, limited as it is, represents the most visible departure from the company’s hallowed mantra. But the change is at least as much talk as substance. For example, for years Dell has been selling to Ingram Micro (IM), one of the few remaining large commercial dealers. Ingram sells those Dell products to smaller firms called value-added resellers [VARs], which in turn sell them to end users. While some of Ingram’s customers’ customers insisted on Dell systems, Dell (DELL) treated Ingram as the end customer to maintain that illusion of directness. Clearly, Ingram was passing those tens of thousands of units along to some
