DELL'S TV TRYOUT COULD LEAD TO $20 MIL BLITZ;DIRECT MARKETER OF COMPUTERS TESTS HOW WELL EFFORT GENERATES PHONE ORDERS

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Dell Computer Corp. Feb. 27 begins testing the effectiveness of TV advertising, a possible prelude to Dell eventually spending up to $20 million a year on the medium.

Over the next one to three months, Dell and agency Goldberg Moser O'Neill, San Francisco, will test several versions of a 60-second commercial on national cable networks and in three spot markets.

Dell, the world's largest and the U.S.' No. 2 direct marketer of personal computers, will try out various types of programming to gauge how TV can generate phone orders.

"We're trying to test as much as we can test [to] find out where, when and how it works for us," said Anita Howard, marketing communications manager for the Dell Direct division, which targets small- and medium-sized businesses.

ONLY SCANT USE BEFORE

Dell has done limited TV before, using the medium in 1991 to trumpet its top showing in a J.D. Power & Associates survey. But this is the first major attempt by Dell to use TV as a distribution channel, supplementing the estimated $35 million to $40 million Dell will spend this year in computer and business magazines and newspapers.

Dell's foray into TV is heavily subsidized with co-op money from Intel Corp., which is paying up to 75% of the cost of TV buys to encourage PC marketers to use the medium. Intel's contribution is a rebate of 2% of what PC marketers spend on chips.

UNCOMMON APPROACH

While a host of PC companies have moved into TV to sell consumer PCs, Dell is unusual in trying the medium to sell business PCs.

"The business person watches TV just like anybody else," Ms. Howard said.

Dell will use a humorous spot-within-a-spot theme in which a kidnapped business executive struggles to escape-until all his attention is consumed by a Dell PC featured in a spot on his TV. Dell will sub in various PC deals during the test.

Ms. Howard and Mike Massaro, chief operating officer at Goldberg, declined to discuss spending.

But based on the Intel co-op formula and Dell's chip purchases, Dell's U.S. TV spending over time could jump to $15 million to $20 million annually if the marketer decides to go full bore.

Ms. Howard stressed that Dell won't make any decisions until after the TV test.

GATEWAY ALSO TESTING TV

Mail-order rival Gateway 2000 last year began testing TV with folksy image ads to draw in more diverse consumers. Dell, following the strictly-business credo of founder and Chairman Michael Dell, is focusing on business customers and selling PCs, not image.

"Michael Dell's philosophy is if we don't advertise, the store's not open," Mr. Massaro said. But "you've got to sell stuff in his store."

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