Dell India to employ indirect marketing

Chennai: Dell India Private Limited today commenced commercial production at its four lakh units per annum plant at Sriperumbudur near Chennai.

The Rs2,000 crore company says it has chalked out an ambitious indirect sales strategy of selling through the traditional distribution network. The company's parent, US-based Dell Inc that Michel Dell started in 1984 while still at college, is famous for its direct sales model that made news when he decided to distribute through retailers in the US, the UK and Japan.

The Indian company will also go beyond direct sales in six months time, says Rajan Anandan, vice president and general manager, Dell India, in line with the global policy of selling through retailers. The company is studying the computer retailing industry in depth so to eliminate inefficiencies in the system.

Globally too, the $57 billion turnover Dell is taking measured steps in its indirect strategy even as the company has sold 70,000 units in two months time through Wal-Mart chain in the US. The company does not supply to all the retail outlets in the US, as it is choosy, says Kip G Thompson, vice president, global facilities and strategic growth. He also says that the new channel strategy would not erode the company's margins, as the product offerings will be different. The one big challenge faced by the company is building up the capacity to cater to the needs of the new channel.

"For Dell, going indirect is not a big issue unlike other computer manufacturers who went for direct sales from being indirect. We have the customer data, brand equity which will be leveraged advantageously," he adds.

In India, the indirect channel strategy gains importance as Dell India is targeting the small and the medium enterprise and the individual segments. The company has launched new models under the brand Vostro, XPS and Inspiron targeting these segments. The company has also launched notebooks in five colours.