Dell unveils new PCs targeting emerging markets

Dell unveils new PCs targeting emerging markets
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First Published: Wed, Aug 27 2008. 05 10 PM IST
Updated: Wed, Aug 27 2008. 05 10 PM IST
AP
Beijing: Dell Inc unveiled four low-cost computer models on Wednesday designed for China, India and other emerging economies, in a new bid to tap the potential of high-growth markets outside the United States.
“The two notebook and two desktop PCs are the first Dell models designed especially for emerging markets,” said Steve Felice, Dell president for the Asia-Pacific region.
“They are meant for small business users and are to be sold in 20 countries across Asia, Africa and Latin America, he said.
Strong sales in Asia helped Dell perform better-than-expected results in the first quarter despite a slowing US economy. Now with report of its latest quarterly results awaited on Friday analysts are watching whether it can maintain its growth pace.
Dell and rivals Hewlett-Packard Co, Taiwan-based Acer Inc and China’s Lenovo Group are expanding aggressively in emerging economies as sales growth in the US and other developed markets slows.
“Dell’s first-quarter sales in China, India, Russia and Brazil markets known collectively as BRIC, grew by 58%, about 10 times the US rate,” said Felice. He said that Dell expects further 20-30% annual growth in these markets in the coming years.
Prices for the new Vestro notebooks will start at $475 and for the desktop PCs at $440, according to Felice.
Dell, based in Round Rock, Texas, broke with its usual development and marketing strategy for its latest products, he said.
The move reflects a growing focus by global computer, automobile, consumer goods and other companies on creating products for increasingly prosperous customers in China, India and other emerging economies.
Beijing-based Lenovo, which acquired the IBM Corp PC unit in 2005, is targeting China’s vast but poor rural market with a basic PC released last year and priced as low as $220.
According to Felice, industry forecasts say China’s computer sales should grow from 50 million units last year to 500 million by 2015, or double that year’s projected US sales.
The new Dell models were created by a Shanghai design center set up to focus on emerging markets, Felice said.
Dell built its US business with Internet and phone-based direct sales but has added retail distribution in China and elsewhere to reach more buyers.
In China, its computers are sold in 2,700 outlets of the Gome and Suning electronics store chains, which Felice said accounts for about half of Dell’s Chinese sales. Dell has a total of about 13,000 retail outlets worldwide.
“These economies are growing so fast that we don’t want to miss out on the opportunity,” Felice said. “But if we just use the direct model, it might take too long to get there.”
Dell is trying to expand its presence in China outside Beijing, Shanghai and other big eastern cities and sees 50% of potential sales in small, inland cities, Felice said.
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First Published: Wed, Aug 27 2008. 05 10 PM IST
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