Dell and the power of bundling

[Jason Dunn]

Now that is has been confirmed that Dell is releasing a Pocket PC, we're free to speculate on what it will mean for the marketplace in the latter part of this year. The one thing I haven't seen mentioned yet, and I'm surprised, is the power that Dell has when it comes to bundling. When someone is buying a new computer, Dell almost always has some sort of free upgrade or bundle offer - more RAM, more hard drive space, perhaps a discounted Pocket PC? They have the ability to bundle together solutions unlike any other company I've seen - imagine a "back to school" bundle with a low-end PC and a Pocket PC with a Stowaway keyboard for keeping a student organized. Through sheer market force Dell will be a significant player in increasing Pocket PC market share - if their device is decent that is. I can't see Dell releasing anything of poor quality though.<br /><br />And speaking of their device, at a $299 price point, you know that it won't be a power user device, right? It seems that every time we talk about a low-end device, some of you chime in with complaints like "32 megs of RAM? How lame is that! I want 128!". Remember: different price points, different target markets, different needs. Dell is not setting out to take on the high end iPAQ 3970 or Toshiba units. If you are a power user, this is not the device for you. They're aiming a wooden stake at the heart of Palm by going for price point that Palm is making money at - I doubt there's much profit to be had at the $150 and below level.<br /><br />Welcome to the game Dell - here's hoping you hit a home run!

[Foo Fighter]

As I mentioned in the other news thread, the only problem I see with Dell's strategy is that consumers rarely buy products sight unseen. Especially mobile devices, where the touch and feel are very important. Dell has to find a better way to expose consumers to their new offering, or it won't take off. The price is dead on. How long have I been bitching that Pocket PC needs a $299 entry category??? Now we have it!

But Dell will have to use other marketing tactics, besides the Dell Dude.

[TBone]

Maybe it's true that consumers won't buy the unseen, but Dell has one serious factor going for them: the kind of reputation and efficiency that other manufacturers only dream about. I bought a Dell laptop three years ago, and it's still one of the most solid, well-built machines I've had the pleasure to use. Nowadays, the support and quality you get from them is stunning, and I would probably take a chance on their PocketPC based solely on that.

That is, if I hadn't just bought a 'Vox.

[Jason Dunn]

As I mentioned in the other news thread, the only problem I see with Dell's strategy is that consumers rarely buy products sight unseen.

That's what HP and Compaq said when Dell started selling direct. :-) I had never laid eyes on the computer I bought for Ashley, but I ordered it based on pictures and Dell reputation. People like you may want examine the screen for ClearType flaws, but the average consumer will not - they'll just order it if they think it's something they need/want, and it has the Dell brand on it. 8)

[splintercell]

Well, you may not necessarily have to buy the unseen. If I recall correctly, Dell recently announced a plan to create kiosks with their equipment in some retail chains (I suppose like Best Buy, et al). This was aimed at precisely that group of customers, who would like to buy their equipment, but the last barrier is the "touchy-feely" factor. These kiosks would have Dell staff to demonstrate their wares, but no inventory - instead people could use one of the computers to order online.

Granted, other manufacturers have had varying experiences with the "store within a store" concept, but Dell may have to expand that way to push its slowing growth.

And a nice PDA offering would be great eye-candy for such kiosks.

[PJE]

As I mentioned in the other news thread, the only problem I see with Dell's strategy is that consumers rarely buy products sight unseen. Especially mobile devices, where the touch and feel are very important. Dell has to find a better way to expose consumers to their new offering, or it won't take off.

But Dell will have to use other marketing tactics, besides the Dell Dude.

I expect word of mouth will get the numbers up - there are 8 Dell laptops in my company (25 people total), so in large corporations I expect to see quite a few early adopters who can risk $300. Others will check these units out before buying online.

I would only buy one if I'd either held it in my hand or had the option to put it back into a pre-paid shipper and send it right back...

My 2c

PJE

[ipaqpocketpccanada]

I've posted this thought on my site...

Stiff competition ahead or more affordable iPAQ on the way? (http://ipaqpocketpccanada.com/)

Competition often brings out the best, that Brighthand article (http://www.brighthand.com/newsite/features/hpipaq_future.html) on the future of the iPAQ, there was mention of an iPAQ 2200 which would go away from the expansion sleeves and sell for $300US.

I think it'll be interesting to see what will transpire over the next little while.

[Paragon]

If they can produce a $300.00 Pocket PC more power to them. If HP decides to go ahead with the 2200 I sure as hell hope that the $650-$700 3900 Ipaq does not subsidize the low end device in hopes of higher total market share. I'm sure they must see it would be easier to squeeze an extra $50-$100.00 out of a high end item then it is to increase the profit margin on a $300.00 device.

I have never been a big fan of a cheap low end PPC. If someone wants a low end device let them buy a Palm. I don't give a hoot what marketshare PPCs have. I care about the quality and features of the devices, combined with reasonable price.

Let the Palm OS guys blow their brains out for little or no profit.

Dave

[danmanmayer]

If i was buying a dell and could get a pocket pc thrown in for an extra 100 bucks or something, I would definately do that. It would just be easier and I am sure dlell will make sure it works really well with all their pcs, then Dell is still know for some of the best support in the business. So with these reasons and a nice price point it sounds good. The only thing is i would have to call myself a power pocket pc user. I want built in wireless or cell phone and that is the bottom line, dell won't be offering this. Well at least not for now.

[JMountford]

The Dell Pocket PC is a great idea for corporate users and even home buyers that do not allready have PDA's or are looking to upgrade from a Palm.

I honestly do not see a lot of current PPC users running out and buying a low end device, something like we have allready had for a year or so.

I wish Dell luck I truly do. I said in one of the related Dell Threads here that what is good for Pocket PC Market Share is good for the Pocket PC community and I truly Beleive that.

[Jonathon Watkins]

....what is good for Pocket PC Market Share is good for the Pocket PC community....
Sounds true - the more the merrier - more devices, more programs, more momentum etc.

Only thing is..... can PocketPCThoughts cope with an influx of Dell Dude style nubies? :wink:

Dude, like, how do I use this tiny shiny thing with my Dell?

[JonnoB]

As I mentioned in the other news thread, the only problem I see with Dell's strategy is that consumers rarely buy products sight unseen.

That's what HP and Compaq said when Dell started selling direct. :-) I had never laid eyes on the computer I bought for Ashley, but I ordered it based on pictures and Dell reputation. People like you may want examine the screen for ClearType flaws, but the average consumer will not - they'll just order it if they think it's something they need/want, and it has the Dell brand on it. 8)

More of the 'herd mentality'... As with the iPaq, uneducated PPC people will buy because of name and reputation, not function. Dell will be successful because the consumers and businesses that buy Dell computers will be a Dell PocketPC because when they need a PocketPC they will only think of them just as right now, most think iPaq and PocketPC are the same thing.

[nishka]

I think these Dell PDA's will sell quite well, especially to enterprise customers currently paying twice as much for an Ipaq.

This is the price point Microsoft needs to really start beating up on Palm. The next step will be to break into the $99-120 territory with a stripped down ARM-based product.

[fulltilt]

It's gotta be real easy to upgrade and load s/w for the folk out there that aren't that clued in....

Someone at a meeting the other day asked me to comment on my 3870....I said it's great...she asked about loading s/w and rom updates etc. I asked how are you generally with computers - she answered, hopeless....
I feel for her the case was lost. It may be true that a lot of potential dell buyers fit this category - buy 'cos it's bundled. but then can't get into the groove when an update like EUU1 comes out...
mmm...is this making sense?

[heliod]

Maybe it's true that consumers won't buy the unseen, but Dell has one serious factor going for them: the kind of reputation and efficiency that other manufacturers only dream about. I bought a Dell laptop three years ago, and it's still one of the most solid, well-built machines I've had the pleasure to use. Nowadays, the support and quality you get from them is stunning, and I would probably take a chance on their PocketPC based solely on that.

I would bet on that. Does anyone remember what was the price of notebooks before Dell entered this market? And what it was a year after that?

Dell plays on its reputation and quality of products and services, and many people will buy based on that. Others will wait for the results of the reviews on the Web sites. For the very skeptic, maybe these kiosks will do it...

Anyway, a $299 device was the good news we were needing for this Christmas, and I would not be stunned if the 1.5 million devices mark would just not be enough...

[heliod]

I have never been a big fan of a cheap low end PPC. If someone wants a low end device let them buy a Palm. I don't give a hoot what marketshare PPCs have. I care about the quality and features of the devices, combined with reasonable price.

I prefer to see power users buying high end PPCs and low end users buying low end PPCs, since the more devices we have outside the more services we will get. And the same goes for software, accessories, etc.