BtoB

Dell's new deal

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"There's no reason we couldn't be doing half our transaction volume over the Internet," Scott eckert figures to sell more than $500 million in computers online in the next year. And he's not satisfied.

"There's no reason we couldn't be doing half our transaction volume over the Internet," says Mr. Eckert, the 29-year-old director of Dell Online, the World Wide Web effort of Dell Computer Corp., the Round Rock, Texas-based direct seller of PCs that racked up $7.8 billion in sales in fiscal 1997.

The way Dell sells online is a lesson for marketers looking to tap the promise of electronic commerce.

Converting big accounts

Mr. Eckert estimates that almost 90% of the orders now taken at dell.com are from consumer and small-business customers.

Dell as a whole, however, gets 90% of its orders from business-to-business customers, many of them in the Fortune 500, many with worldwide operations.

It's in mirroring the company's overall b-to-b action that Mr. Eckert hopes to eventually draw 20% of Dell's business to online, which could mean $2 billion to $3 billion in sales by the year 2000.

For major online accounts, which have their own Dell sales representatives and Dell support people on site, Dell moves beyond dell.com to build what it calls Premier Pages, small password-protected subsites with addresses known only to the client. None of the sites sits behind a client's firewall.

"That makes it easier for us to deploy it," Mr. Eckert says. Clients find the security procedures adequate, he says.

Sites contain relationship data

The sites each have 10 to 15 Web pages that contain "all the elements of the relationship with Dell," Mr. Eckert says.

The site includes standard configurations set by each organization and the price point negotiated with Dell based on volumes.

"It has tech support for those products, marketing and product information," says Mr. Eckert, as well as links to the client's Dell account team.

Mr. Eckert's goal is to implement electronic data interchange technology on the Premier Pages, so clients can link Dell purchases back to their internal payment systems.

For international customers, Mr. Eckert's team (he declines to say how big his team is or how big dell.com's budget is) has built sites in French, German and Japanese. As with Premier Pages, the international sites are physically located in Texas.

And like dell.com, the international sites use Dell's popular configurator, which allows online buyers to select the computer features they want. The company also displays prices in local currency and sets prices by market.

Not just a side business

All of this is part of Dell's effort to maintain its rapid corporate growth.

"I'm not just worried about dell.com," Mr. Eckert says. "I'm worried about Dell Computer. We try to use dell.com as an extension of the way we do business in every geography . . . it becomes a core part of the way we do business."

Today, most of that business is done with major accounts, many of them overseas.

"We're just scratching the surface," he says. "We need to offer Premier Pages to thousands of accounts, not hundreds. We need to do this EDI stuff, and do asset management for customers, helping them maintain databases of systems."

Nicole Vanderbilt, senior analyst at Jupiter Communications, a New York market research firm, says Mr. Eckert is on target with his goals and his execution is flawless.

Web key to global growth

By building more international sites, Dell should be able to give a big boost to its Web business, Ms. Vanderbilt says.

"Siberian Outpost, a retail site that sells computer equipment, has 50% of their sales coming from outside the U.S. because they have created relevant sites to different regions around the world, including language translation."

Evan Schwartz, author of "Web-onomics," an electronic commerce book, calls dell.com a self-service site, "which provides the ultimate in customer control and convenience."

But he also emphasizes the savings here to Dell.

"If you call an 800 number, you have to talk to a person to take your order," he says.

The savings on international sales are even greater, he believes.

"They get one-third of their revenue from overseas," Mr. Schwartz says. "It's an incredible cost advantage to set up foreign-language Web sites and have people around the world get self service. . . . It's one reason Dell is so incredibly profitable."

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