Ten years ago, who would have thought that when the world?s second largest computer maker decides to roll out its maiden campaign for the small and medium business (SMB), the test market would be the Indian subcontinent and the poster boys a clutch of Indian entrepreneurs!
That?s exactly what Texas-based Dell Inc did, when it came out with its first SMB campaign, Take Your Own Path, in print on October 29. The new campaign represents a strategic shift from the company?s earlier stance of targeting just the large corporations.
India is the priority market for Dell and revenues from the market are expected to touch a billion dollar mark next year.
?The campaign is targeted at becoming brand leaders in SMB segment in which Dell sees large growth opportunities and has a market share of 3%,? Mark Jarvis, chief marketing officer, Dell, said while unveiling the campaign in India. ?The spirit of this campaign is akin to humble beginnings of Michael Dell when he dared to take his own path,? he added for good measure.
Dell?s print ad will run in the Asia Pacific and Japan region, beginning with India. The phased rollout would later include OOH (out-of-home), digital and broadcast spots, besides SMS campaigning.
The campaign features the likes of Raman Roy, chief executive officer of Quatrro, P Rajendran, co-founder and chief operating officer of NIIT, besides less-known ?heroes? such as Sanjan Ratnam, who is introduced as a bridal fashion designer, Prasad Bidappa, an image consultant and VK Prakash, a filmmaker.
The common thread? They all started small before they hit big. The tagline runs, ?I Choose My Own Path. I Choose Dell.?
The switch from big enterprises to the SMB sector was not accidental for Dell. After having established itself as a category leader in the Indian enterprise market (Dell commands 22% share in big enterprise, while overall, it ranks third, after HP and HCL Infosystems, according to IDC figures for Q2 CY08) it made sense for the company to shift its marketing resources to the SMB sector, which is growing at a scorching pace.
According to a MAIT (Manufacturers? Association of Information Technology) sponsored ITOPS (IT and Office Products Survey) study released in July this year, while the total desktop market in India grew just 1% in 2007-08, the growth for household and the SMB segment was more robust. So even while total sales to the business sector declined by 18% (the decline in big enterprise sector was almost 33%), sales to small and medium enterprises grew by 25% and 8%, respectively.
?We estimate that there are about seven million SMBs in India, of which 3.92 million are IT addressable. This is the segment that we would want to aggressively target through this campaign,? explains P Krishnakumar, director, marketing for Dell, India.
As per the Q2 CY08 IDC reports, Dell grew in the SMB segment at the rate of 150 %. (The market average was 23%.)
The picture overall, is even better with notebooks. Here, sales grew by 114% in 2007-08, as consumption in large and medium enterprises grew by 51% and 123% respectively, while SMB grew by as much as 174%. Overall business consumption for notebooks was far healthier (than for desktops)-almost 93%.
Simultaneously, server sales increased by 35%, particularly as sales to small and medium enterprises grew by 127% and 121% respectively, even though it declined by 37% to large establishments.
Quick to respond to this changed scenario, Dell launched an SMB-friendly product in the market (the Vostro A Series priced Rs 39,900 onwards) and claims to have improved service under ProSupport besides launching a new channel programme dubbed PartnerDirect. It?s also opened a retail format in association with Tata Croma and Staples and two exclusive Dell stores in New Delhi and Coimbatore in October this year.
?Our studies showed that Indian SMBs value products that are priced right and are backed by great support. ProSupport is meant to address specific SMB pain points?the fact that these companies rarely have an IT help desk and the support needs to help the end-users themselves,? elaborates Krishnakumar. In other words, ProSupport seeks to demystify technology to SMB owners.
To aid the process, they also launched a dedicated SMB portal, http://www.takeyourownpath.com, where SMB owners can directly engage with Dell?s support team. It features content specific to SMB needs?how to draw a business plan, balance sheets, payrolls etc.
This new thrust on improved service and customisation is also evident in the brand tagline ?Yours is here,? that?s meant to counter HP?s famous ?Your computer is personal again.?
An example of Dell?s customisation is a tie up with financial accounting company, Tally. The accounting software will come pre-loaded on select Dell Vostro systems for the initial subscription period.
Dell sees a big opportunity with the SMB sector not just in India but in other emerging markets as well. That?s evident in the unprecedented move made early this year when it established a new agency under the WPP Group to bring all 800 employees from their advertising, marketing and public relations divisions in 15 offices under the common umbrella of a full-service agency that was code named Da Vinci. In June, it got christened Enfatico and was handed its first brief-to work on the brand?s India campaign.
The SMB campaign is a big gamble for Dell. One that has cost $4.5 billion in a three-year contract with the international agency. Next on the agenda is a series of such SMB campaigns for other Bric countries through Enfatico (WPP?s other enfant terrible, Ogilvy, incidentally handles rival Lenovo account; which is why it had to establish a separate agency solely to handle the Dell account), over the next few months.
Will the gamble pay off? Krishnakumar is positive, it will. ?The campaign is a part of our targeted outreach programme for the SMB. When we came into India about eight years ago, our focus was on large corporate market. After consolidating our hold on this segment, we have decided to expand to newer segments such as the SMB and the consumer.?
In a recent print interview, a senior Dell executive took a very pointed dig at HP and Lenovo for using Bollywood stars to endorse their products (Shah Rukh Khan for Compaq and Saif Ali Khan for Lenovo).
It remains to be seen whether Dell?s ?real business heroes? would be able to pose any serious threat to HP and Lenovo?s ?reel heroes?.