The PC giant wants to make everybody aware that it also makes smartphones.
Being a late entrant has many disadvantages, one of them being convincing people that you also exist in the marketplace. Personal computer maker Dell, which is a leader in the Indian PC market, is facing the same problem with its entry into the blazing mobility segment of smartphones and tablet PCs — a space occupied by well-entrenched players like Research in Motion (RIM), Apple, Samsung, HTC and Nokia.
That explains why Dell still has a negligible presence in the smartphone space. Though it launched two “smart” devices in November, not many users in India are aware that Dell makes smartphones, too. But the world’s second largest PC maker isn’t giving up on its bid to make its voice heard – reason why it revived its marketing campaigns this month with television and print media ads.
Dell had first launched a marketing campaign around Christmas last year in 2010, and a roadblock was used in the television ad campaign for Dell Streak . A ‘roadblock’ is the term used when all other advertising is halted and only a single brand is visible through ads for a set duration. In Dell’s case, a roadblock was imposed for a period of two hours on the top general news channels, where the Dell Streak ad was showcased during the ad breaks exclusively.
Dell simultaneously is building a new distribution channel for smartphones and partnering with telecom service providers to promote its products. The company does not use celebrity endorsers. Instead, it has used people from the industry like Raman Roy, the chairman and managing director of Quattro BPO Solutions, to endorse its products. “These are people who use our products. We believe it’s the best advertisement,” remarks P Krishnakumar, Executive Director (Marketing) for Dell India CSMB and APJ mobility.
He believes the efforts are paying off and the “response to our smartphones has been good”. Dell, however, does not give country-wise sales break-up.
Around 130 million handset units are sold in India annually. Smartphones comprise 7-10 per cent of that market, says Krishnakumar. “The opportunity is this market, hence, is huge. There’s a lot of room for us despite our late entry,” he asserts, adding: “Our approach is to keep our products affordable and on open platforms. We do not like locking-in our users.”
Dell’s focus on this segment makes business sense both globally and in India. For instance, the worldwide smartphone market, according to International Data Corporation (IDC), is expected to grow 55 per cent year over year in 2011. IDC expects vendors to ship 472 million smartphones in 2011. The figure is expected to nearly double to 982 million by the end of 2015.
“Mobile phone users around the world are turning in their ‘talk-and-text’ devices for smartphones as these devices allow users to perform daily tasks like shopping and banking from anywhere,” says Kevin Restivo, senior research analyst with IDC’s Worldwide Quarterly Mobile Phone Tracker. “The growth trend is particularly pronounced in emerging markets where adoption is still in its early days. As a result, the growth in regions such as Asia/Pacific and Latin America, will be dramatic over the coming years.”
But what about distribution? For smartphones, Dell India has tied-up with phone distributors in around 40 cities. The distributors, in turn, take care of redistribution to tier-II cities. “The target audience is the mobile professional and Gen i,” says Krishnakumar.
Dell currently has two broad products in its India portfolio. The first combines features of both a Tablet PC and smartphone, and is called the Dell Streak. The second is the XCD28 (nowXCD35), an Android phone designed especially for the Indian market. Currently, Dell has six smartphone products (including the Streak) in its Indian portfolio. While some are Android-based, others are Windows-based.
Dell hopes this strength in the PC market will have a rub-off effect on smartphones, too.
