E-commerce Change the World

On December 2007, the 1st Dell’s store called Dell Direct Store is open at Mid Valley Megamall, one of the biggest shopping mall in Kuala Lumpur. Here I want to correct that Dell Direct Store@Mid Valley at previous actually is a showroom for public to feel and test out the machine and do not involve of any selling on that time. After a few month later, Dell Direct Store had changed to a real retail store. Why Dell decide to open a brick-and-mortar store and also selling online?

Before starting our discussion on reasons Dell goes retail, I would like to introduce some about the Dell to let the readers have a clearer picture on this post. Dell is founded in 1985 by Michael Dell to offer personal computer via mail order. As the advanced technology and germination of e-commerce, Dell implemented aggressive online order-taking instead of mail-order. Starting 2002, Dell opened kiosk located in shopping across the US in order to give personal service to customer who preferred this method of shopping to using the internet or the telephone-system. On January 30, 2008 Dell shut down all 140 kiosks in the US due to expansion into retail stores.

According to research firm Gartner, HP took an 18.2% market share at year 2007, while Dell’s share slipped to 14.3%. Before the year of 2007, Dell was the largest personal computer manufacturer and hold majority of the market share on the world. It is possibility that Dell wants to follow the way of HP’s success as selling of HP computer in the online stores and also physical stores.

Previously, Dell computer only sell computer online and result the consumers cannot fell and touch the product. Customers nowadays are reluctant to believe what appear in the online world although the online shopping website such as Dell provides 360̊ views of the products where you can rotate the product. The wise move of dell goes retail benefits customer who wish to scrutinize the product before make purchase.

In the year before 2008, Dell sells its computer with only target those who have the computer and internet connection. Many of the first time users or not online-trading literate like a fresh university students who purchase the computer do not have the idea of purchasing online and further let this great opportunity flow to competitors.

Some other factors such as online fraud is increasing, lower price due to direct sales model hurt brand equity, online payment still not popular in Malaysia, credit card only available for those who have a satisfactory income, and etc are causes of sales of Dell computer drop in Malaysia.