Macy's & Dell: Dude You're Getting A Pink Laptop
Color and personalization of the new XPS M1330 notebook are how Dell is choosing to highlight its design innovation and separate itself from competitors. The PC maker debuted its new line of notebooks Tuesday in an unusual way in an unlikely setting: a runway show in Macy's Herald Square. The launch is all part of Dell's efforts to regain market share lost to competitor H-P by rebranding with a more stylish edge. The new XPS M1330 retails for $1,450 and comes in a range of new colors. Check out the new product line:
Consumer products Sr. Vice President Alex Gruzen says the new colorful notebooks are part of Dell's effort to grow via the consumer space. Currently the consumer market makes up only 15-20% of business. Bear stearns analyst Andy Neff says the consumer space isn't really an issue for Dell. He's more concerned about them locking in key corporate customers and addressing internal issues like "weak products and poor service quality." The larger trend of focusing on personalization at the company could be a positive sign that Dell is responding to criticism that it its problems emerged when "it began to focus on revenue growth instead of consumer satisfaction." Bear Stearns is currently Market Weight on Dell shares.
Will the new slogan "Yours Is Here" deliver the message to consumers that Dell is the computer maker of choice? ThinkEquity's analyst Eric Ross says campaigns like this one may not be enough. He also says that competitor H-P's slogan "The Computer Is Personal Again"is a clearer tagline than "Yours Is Here" when it comes to communicating the focus on personalization. He's got a sell rating on Dell shares and a $20 price target. Overall, Ross was skeptical about the launch saying, " I think a lot of this is desperate grasping at trying to be next big PC. Dell is missing brand and that will cause them to stumble."
Here's what is curious about the launch today: the location at Macy's Herald Square. The department store doesn't sell computers and Dell management said that Macy's will not sell the new product line. The retailer will only showcase the product for the next two weeks in a mini-lounge on the 8th floor of the world's largest store. Dell chose an unusual method of showcasing the new push with a runway show of models illustrating the color options--not the actual notebooks.
The models wore all white and colored light was projected onto them to show the eight new color choices for the laptops: yellow, blue, alpine white, red, pink, black, green and espresso. The notebooks themselves were kept separate from the show and displayed in the mini-lounge. Dell's spokesman Bob Kaufman said that the company will have other lounge displays at entertainment and cultural events going forward. ThinkEquity's Eric Ross said the tactile experience would be a successful one if launched in international marketplaces like China. Take a look at the runway show in the video piece below.
Wall Street has been curious about which retailers will partner with Dell ever since the announcement that the PC maker will sell at Wal-Mart . Gruzen wouldn't elaborate on Dell's retail strategy other than to say that there will be announcements about brick and mortar partners over the next few months. Management clearly did not want to talk about the broader retail strategy or how the runway show fit into the broader business model of positioning the brand. Gruzen refused an interview with CNBC due to a tight schedule but did stick around the launch to answer questions with trade publications.
An interesting choice considering the very visual nature of the product launch itself. CNBC will be following the Dell turnaround story from both the tech and retail angles. Hopefully, we can work with the company to deliver more news to you on just what they're thinking.
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