Dell to open more Asian outlets

PC maker looking to expand retail footprint in region with more brick-and-mortar shops to tap consumer demand for new computers this year, company executive reveals.
Written by Kevin Kwang, Contributor

SINGAPORE--Dell Computer is targeting to expand its retail strategy with plans to open more brick-and-mortar shops in the Asia-Pacific region, according to a company executive.

Citing figures from the company's 2009 internal survey, Ian Chapman-Banks, Asia-Pacific general manager for Dell's consumer business, said one third or 33 percent of consumers worldwide were planning to upgrade or purchase new computers this year. To tap this demand, the PC maker will be focusing on the rollout of its retail footprint across the Asia-Pacific region, Chapman-Banks said in an interview with ZDNet Asia Monday.

Dell previously marketed itself as the poster boy for a direct online sales model but began its foray into the retail market in 2007, opening several outlets across the globe including Singapore and Taiwan.

"Dell has a phenomenal presence online, and what we want to be able to do is give everyone the same experience through brick-and-mortar shops," Chapman-Banks said, adding that this has been the company's philosophy for the past two years.

He named Australia, Korea, Thailand, Indonesia, Vietnam and New Zealand, as some countries in which Dell has been building up its retail network.

The rationale behind this push is the focus on the "path to purchase", he said. Consumers these days tend to check products online before meeting up with family or friends and heading to a retail outlet to get a hands-on experience of the product and purchasing it, Chapman-Banks said.

Reuben Tan, IDC's Asia-Pacific senior manager of personal systems research, agrees. "The direct business model [of selling products online] doesn't really work in Asia, and Dell has probably recognized there are lots of untapped potential using the indirect retail channel. But, it's a hard balance to finetune," he told ZDNet Asia in a phone interview.

Strong 2009 performance
According to Chapman-Banks, Dell had a positive showing last year, clocking a 24 percent fourth quarter year-on-year growth in the Asia-Pacific PC market, excluding Japan, which includes desktop and laptop computers.

"We're pretty pleased with our performance. Obviously, everyone looks back on [2009's] first quarter nuclear winter, and to grow over 2008 makes Dell [employees] in Asia very motivated."

However, Tan noted that the 24 percent figure seemed "aggressive", compared with the growth projection for the overall market. He said the PC industry's growth rate last year is estimated to be 12.4 percent, based on forecast figures for the fourth quarter of 2009. Shipment numbers for the quarter are still being finalized.

The IDC analyst attributed Dell's performance to strong uptake in PC sales in markets such as China, India and Thailand.

Asked if Dell will introduce new products in the tablet computer sector, following Apple's announcement of the iPad last Wednesday, Chapman-Banks acknowledged that there is currently "a thirst for smaller screens" among consumers.

However, he noted that the "physical keyboard experience", which is absent in touchscreen mobile computing devices such as the iPad, remains a key element for users. As such, demand for netbooks will continue to exist, he added.

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