A view from Craig Smith, editor

Editorial: Dell goes crying to Mother

This column is being typed out on a Dell desktop PC, monitor and associated peripherals. I have no idea which of the many Dell sub-brands this particular unit carries, and judge it to be of insufficient interest to readers to warrant my clambering around the back to find out.

After it is filed, it will appear on the subs' desk to receive the kind of polish that only a gleaming white iMac could dole out - a computer I covet and which, had I any sway with Haymarket's IT department, would adorn my own desk.

So here it sits, my Dell, performing the tasks asked of it perfectly well and without complaint. As gratitude for six years of mostly uninterrupted service it gets about as much emotional engagement from me as I would lavish on my toilet cistern; for as long as it functions, it is all but invisible to me.

I am not alone in my disinterest; 85% of Dell's business is based on business people like me, whose computing box is selected, set up and maintained for them. Dell equals dull. It is part of the office furniture, and about as likely to make an appearance in my home as my office chair is to replace the sofa.

That is the worrying part for Dell; the lustre this functional direct-to-consumer brand once had has worn thin. The recall of 4m of its laptops last year due to a fire risk from their Sony-supplied batteries is a red herring, as is the high level of dissatisfaction with Dell's after-sales customer service. Brands such as Ryanair and IKEA famously underinvest in customer service to sustain their business models and prosper, precisely because their customers know the price they pay doesn't cover adornments.

Another distraction for Dell is Apple. 'Look at what Apple has achieved,' brand consultants will effuse, unhelpfully. An Apple computer is neither the most powerful nor the most flexible you can get for your money, as its customers recognise and loyally ignore. Dell, on the other hand, was recognised as being about the best computer you could get for your money - value derived from a superior 'pull' business model that pays for no components until after the customer has paid for their order.

These days the Dell proposition is less clearly defined; customers cannot be as sure that they're getting the best deal by buying the brand, which in a commoditised market is more than enough doubt for it to lose its market-leading position to a competitor such as Hewlett-Packard. What's worse is that it has responded to its critics not by taking the opportunity to reinforce the 'quality at a low price' message, but by diluting this core offer.

Dell has tried extending its brand into TVs, handhelds and music players. It has invested heavily in improving its customer contact centres worldwide. It has opened kiosks in shopping centres overseas and a store and service centre in Dallas, Texas - adding cost and confusion to the direct-to-consumer model.

Despite all this, as a core of computer and gaming enthusiasts well know, Dell still makes some of the best kit around for the money. A refocus on cost-cutting under the returning stewardship of Michael Dell and an unapologetic return to the attributes that made the Dell brand great are well overdue. The appointment of creative agency Mother before the root problems are fixed is premature.

Can Dell turn his firm around?, page 15.