Dell’s Channel Challenge

As news broke yesterday that Dell products — a limited selection of notebook and desktop PCs as well as monitors, printers, and ink cartridges — would be sold as of November 11 in 1,400 Staples Inc. stores across America, I wondered again how long Dell could manage to both sell its products directly online and through channel partners.

Yes, not all Dell products are available in the stores of its retail partners. Some Dell notebooks and desktops can only be ordered directly from the company. Moreover, Dell is trying hard to position this move as part of a strategy to provide its products wherever and whenever customers wish to buy them.

But the seismic shifts in the PC market, which has seen fast growth in emerging national markets such as China and India and a sharp preference for notebooks over desktops nearly everywhere, makes it difficult for Dell to walk this channel-conflict tightrope.

Staples definitely sees a competitive dynamic in its relationship with Dell, as the following excerpt from a Wall Street Journal story makes evident: 

For Staples, the agreement is part of a long-running "Easy Button" marketing effort that aims to simplify shopping for its customers, Staples merchandizing head Jevin Eagle said. "Our customers will be able to touch and feel the products (as opposed to viewing them on a computer screen) before buying a Dell product and they’ll be able to get it on the same day."

There’s the rub for Dell. It’s new channel partners will not only be selling its products as competitive offerings to other PCs and peripherals already available at retail, but they’ll also be selling Dell products in competition against Dell itself.

Increasingly, no matter what Dell says, it will be in channel conflict with its retail partners. There are ways to resolve such conflict, of course, and it will be interesting to see how authoritatively and quickly Dell takes action.

One response to “Dell’s Channel Challenge

  1. Pingback: Personal Computers and Tech News » Dell’s Channel Challenge

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