As Dell Australia welcomes on board a new managing director, David Miller, we ask for his views on the current PC market in Australia.
Dell has recently gained the number one spot in global PC sales. In Australia, however, Dell is second to HP in both PC and server sales. How can Dell capture the No. 1 position?
This isn't something I'd want to put a specific time frame on. You have to remember that Dell is 18 years old in the US and not yet 10 years old in Australia. To be at the number two position in this market is an incredible success story, especially when you consider where we were just five years ago.
The important point to remember is that Dell only goes after profitable market growthâ€"not just unit market share for the sake of being able to claim a No. 1 position.
The market is littered with players that could make that claim for a very short while. Our customers in the US and around the world have voted with their purchase orders to make Dell No. 1. We're quietly confident that with our continued and passionate focus on superb customer service, great technical support, high quality products, direct relationships, value pricing, and everything else a direct business relationship with Dell brings, we'll get there in time.
What percentage of corporate sales in Australia is made through Dell's Premiere Pages [customised portals for corporate accounts]?
It's about 45 percent of our total corporate business and it continues to increase. We've found that online sales and support through secure extranet pages on dell.com is a great way for customers to empower themselves, as well as driving efficiency and removing cost.
You've just taken on the Managing Director role for Dell Australia and New Zealand. What was your previous role?
I was the VP for Dell's Industry Solutions Group in the US. Basically, that's our OEM business where Dell products are used for specific industry solutions.
In the US, Dell sells networking equipment, cameras, and even Apple iPods. How long before we see similar peripheral products on offer here in Australia?
We have plans to broaden our products portfolio of both Dell and non-Dell products, but I won't put any specific dates on the launch of these new products. Again, Dell will only enter a market or a geography when the market size is such that we can do so profitably. We're currently assessing a number of new market opportunities here in Australia.
One of the products we're looking at now is the recently announced Dell PDA.
In your estimation, how loyal are Australian IT consumers to a single brand?
Certainly from the corporate customers I've met since I joined the ANZ team, I'd have to say our customers are very loyal to Dell, and that pleases me enormously. I can't comment on the brand loyalty of our competitors.
What's your response to those who characterise Dell as -merely a distribution channel" or a -middleman"?
We have direct relationships with our customers, from individual consumers through to global customers, major Australian corporations, all levels of government, and small and medium business.
These customers appreciate the benefits of a direct business relationship, our ability to factory install software and hardware thereby cutting down the time it takes to deploy hardware, our post-sale service and support, our pricing and our people. It becomes a natural extension of our customer service that we sell non-Dell products (like Microsoft licences, Lexmark printers, APC UPS devices, networking products, and many other goods).
So in that sense, yes, we are a middle-man. But it is the -direct Dell relationship" that our customers are embracingâ€"the rest comes naturally because we make it very easy for them.
Is Dell an innovator?
Absolutely. Do we reinvent technology? No. Have we developed an innovative way to build, supply, sell, and support hardware? Definitely. And can we do it profitably? Just look at the financial results we posted on November 15. I can think of many competitors of ours that would love to be generating the financial results that we are. It all comes down to the famous -Dell model".
Gateway had a direct business here in Australia. Why didn't they last?
Gateway had a direct businessâ€"that's right. They also had a network of stores. So did Compaq. So did Apple. They all failed. Start building in unnecessary costs like that and you're bound to negatively impact your prof-itability. Gateway also had a focus on the consumer and the small business market. Dell's initial entrance to the Australian market was the corporate and government markets, and our business scaled accordingly. Over time we've entered the education and medium business markets while we've also broadened our product portfolios of Dell products and third-party products.
We're now a serious player in the consumer market and are using TV as our primary marketing vehicle to drive enquiries to our call centres and Web sites.
What are Dell Premier Enterprise Services (PES)? What kind of organisation would benefit most from these services?
PES is a suite of services specifically designed for customers that are purchasing our servers and storage solutions. It includes four-hour and two-hour on-site service contracts, service account managers, priority queues, and a range of value-added services not normally sold with client products.
You now offer RedHat Linux as an alternative OS in your server line. What percentage of customers in Australia are choosing Linux over Microsoft?
I'm not prepared to break out data like that. That said, Linux is a small but growing part of our business today, especially in the education market.
Do you have any comment on the November US District Court ruling regarding Microsoft? How will it affect Dell?
That's a question best left to Microsoft. We don't see it directly affecting Dellâ€"the bigger question is how it will affect our mutual customers.
Dell now partners with EMC for storage, and Oracle for database-configured products. What other partnerships is Dell looking at?
We have excellent relationships with Intel, Microsoft, and SAP as well. We have a range of sizing tools for Exchange, SQL, SAP, and Oracle that ensures we capture relevant customer data when we're configuring our servers and storage to suit their needs. These relationships benefit our customers around the world because no one (in my view) enjoys stronger customer relationships than Dell does.
Michael Dell regularly meets with Larry Ellison, Bill Gates, and Craig Barrett and is able to provide relevant customer feedback at the most senior level. And we enjoy relationships with these companies at a local level as well.
Tell us about DSI (Day Sales in Inventory) and how it affects Dell's operations.
DSI is a measure of how much inventory you have on hand. Dell never builds anything until we have a confirmed customer order, so our inventory holdings are only of components, and we have about four days' worth. With component prices dropping on average by 1 percent per week, we are able to drop prices on finished systems very regularly.
This is one of Dell's distinct competitive advantages over our competitors that mass produce (vs our model of mass customise)â€" they have to clear holdings or finished goods in their warehouses and in the channel before they can pass on new pricing from Intel and all the other component suppliers. It also means that Dell products are -fresher" than any other that have been sitting on a store shelfâ€"if it's been there for a week or more, it will never be as new as a Dell machine.
What percentage of Dell's worldwide revenue does Australia account for?
We don't break this data out. Asia Pacific accounts for about 10 percent of Dell's global revenues.
What are your predictions about the PC market in the coming year?
We don't like giving predictions on the PC market in terms of unit terms. What we can say is that the PC industry continues to be a very exciting one. We've just witnessed the launch of the Intel 3GHz processor with hyperthreading which allows us to do true multi-tasking like never before.
Around this platform we are seeing great strides in digital devices for images, video, and musicâ€"better technology and lower pricesâ€" and the PC is very much becoming the centre of our digital worlds. Who knows what the coming years will mean? The PC may be at the centre of controlling our home's environments and security. We'll have better ways of working remotely using rich content over broadband. Maybe (just maybe) prices on broadband will come down to the point where demand increases exponentially.
And when most homes are connected like this, the opportunities for remote learning and remote working are very exciting.
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Sorry to say but The Dell website shopping for any product other than dell sucks i just purhased a sandisk sd card which while shopping was saying 3-5 days delivery and as soon as the status changed to In Production the packet come as estimated shipping by 2nd August and worst part being i can not even cancel the order i spent 1 hour with dell representative which said in last it can not be returned all you can do is refuse the Packet.
Sory to say but this is really frustrating and iit is happening for the 2nd time with me.
I appreciate the Dell.com deals and marketing stratgey but such a poor response where i didn't make any mistake anywhere is horrible and will let customer think rtwice before buying anything from Dell in future.