MARKETING TECHNOLOGY: Net’s scope - Buying a Dell PC direct is easy, but is the after-sales support as efficient as it should be? David Sumner Smith reports

The growing popularity of buying products direct has meant big business for those companies that can get the balance right between convenience and service. Consumers like the ease with which they can buy direct, but many need the reassurance they get from a face-to-face transaction.

The growing popularity of buying products direct has meant big

business for those companies that can get the balance right between

convenience and service. Consumers like the ease with which they can buy

direct, but many need the reassurance they get from a face-to-face

transaction.



Dell Computers is tapping into this market and is successfully selling

PCs via mail order and the Internet. Its ’build your own PC’ web site is

boosting direct sales, but can it match this unique selling proposition

with solid support (see box)?



’Like everyone else, Dell’s activities on the Internet began with a

brochure site and achieved very little,’ says marketing director Dave

Moore. ’But within six months of beginning to use the Internet properly,

we were taking orders worth dollars 1m (pounds 600,000) every day, and

that doubled within the next eight weeks. Dell Computers in the US is

now taking more orders over the Net than on the phone and expects it to

grow to 50% or more of its transactional business by the year 2000.



Communication channel



’To use it properly it is essential to recognise that the Internet is

much more than a promotional medium. It is a two-way communication tool

which empowers its users. Visitors to the Dell Web site

(www.dell.com/uk) can configure the computer they want to purchase and

watch the price alter as they change its specification,’ he

explains.



Moore says potential buyers on the Net are more likely to complete the

purchase and have an average total purchase price 15% higher than with

other direct sales routes. What’s more, he claims, the cost of taking an

order on the Net is one-thousandth of the cost of doing it by

telephone.



’A large number of people here in the UK are already using the Web as

their primary means of communications, and we would never have reached

them through conventional media. Seventy per cent of private buyers

purchasing through the Web are new customers and so are 50% of the

commercial buyers.



We are also seeing a higher proportion of private customers; they

account for 10% of our business normally but half of all our Web

commerce.’



The volumes of business are not insignificant. Dell is the UK’s number

two supplier of personal computers, with an 11% market share. Ten per

cent of the company’s transactional business will be via the Net by the

fourth quarter of 1997 - helping to fuel an annual growth rate of 40% -

and the share is expected to rise to 40% within three years.



’There is no magic formula for success on the Internet,’ Moore concedes,

’and even if there was, it would change by next week. But we have learnt

the importance of treating our Web activity as a separate business

rather than an add-on supplement to normal sales. Dell UK has a

dedicated Web team with six staff, which is constantly improving the

site with facilities such as troubleshooting, product upgrading, order

status checking and career opportunities.



The Internet also has the potential to address problems faced with

equipment after purchase (see box). A semi-intelligent flow chart allows

Web users to identify and resolve problems themselves at any time of the

day or night and also lets them exchange e-mail with technicians.



However, unless the equipment works in the first place, this is of

little use.



A BUYER’S VIEW



Direct-sell schemes like Dell’s depend on solid after-sales support to

build consumer confidence. Tessa Curtis was recently persuaded to buy a

Dell PC direct, but when she ran into problems, Dell’s support was

nowhere to be found.



’I chose Dell because it seemed to offer a lot for the price and

promised much the same after-sales support as everyone else. So I bit

the bullet and bought by mail order.



Thirteen days later it arrived, with a stack of booklets but only one on

how to get started. Ten days later, disaster struck. After using a

CD-ROM for the kids - that claimed to work with Windows 95 but clearly

didn’t - the system crashed.



The documents were no help, so I rang Dell’s technical support line.



I rang not once but every day for six days trying to get through. Each

time I waited in a queue for up to an hour before having to hang up.

Finally, I rang just before the line opened and pleaded with the first

real person I spoke to for emergency help.



I was told Windows 95 had crashed and would have to be reinstalled by

me. Also, I learnt one of the hard drives on the computer may have

corrupted.



I was advised to buy an anti-virus kit (cost pounds 29.99 upwards)

before trying to re-install Windows. For this I would need some floppy

discs Dell would send, which should arrive in a week.



I was extremely unhappy, and urgently needed a working PC. I turned to

the small print of Dell’s support services. I found details of on-site

help (costs extra) and a ’total satisfaction’ return for refund promise

lasting 30 days (US and Canada only). Even the helpline is only free for

the first month - after that you pay.



My PC was finally fixed by a friendly techie. Now I know what I missed

when I bought direct.’



Tessa Curtis is BBC business correspondent



Dell’s marketing director Dave Moore says the company accepts that in

the last two months its technical support service has had problems.

Having taken on 15 more people to man the phones, Dell now hopes to deal

with 95% of calls within five minutes. Moore agrees that mail-order

customers get the same support as those buying PCs over the Net:

’Regardless of how you buy, we aim to provide the same level of

service.’