July 13th, 2006
Dell revamps prices - is it enough?
Today Dell outlined plans to simplify product pricing and reduce on the number of mail-in rebate offers for consumers and small businesses. A dramatic simplification.
In a revamp that will take 18 months, Dell plans to Management is choosing to tackle the small problems and hoping that the big ones (mainly poor tech support and customer services) will just go awayreduce the number of promotions it runs per product line by 70% and the number of promotions for individual products by 80%. The idea is to have better prices across the board rather than having a complicated scheme where the price that someone pays depends on what offer they come across. According to Ro Parra, senior vice president of Dell’s Home and Small Business Group, this is what customers want. Wow! Customers want simplicity, what a notion.
But it doesn’t end there. Customers will also see a huge reduction in rebates and the end of mail-in rebates. Instead of the traditional mail-in rebate scheme, the company will shift to a system where customers can file for rebates online, simplifying the process. I should note that Dell is carrying out all this restructuring as their stock price is a shade away from hitting a 52-week low.
I’ve never hidden the fact that I see rebates as nothing more than a scam. Companies get to charge full price for a product in the hope that you forget to claim your rebate. If you do take up the challenge to claim your rebate, you have to work for it - collecting bits of paper, writing down numbers, filling out forms and then mailing this information back to the company within a specific timeframe. You then get your money back, while the company has had an interest-free loan. It’s far more honest and easier for the customer if the price is dropped at the point of sale.
Blogging. Simplifying the pricing structure. Cutting back on rebates. These are all small steps towards making Dell better, but it looks like management is choosing to tackle the small problems and hoping that the big ones (mainly poor tech support and customer services) will just go away. It’s not the "taking money off the customer" part of the company that has a problem, but the "how we treat the customer once we have their money" part, and the rot must go pretty deep because it’s the part that Dell seems most reluctant to do something about.
Adrian is a technology journalist and author who has devoted over a decade to helping users get the most from technology. He also runs a popular blog called The PC Doctor. See his full profile and disclosure of his industry affiliations
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| 07/14/06
