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Sunday, July 16, 2006

Computer Business Dell Announces Decreased Promotions and Simpler Pricing

Recently struggling computer business Dell, Inc. stated last Thursday it would be drastically decreasing mail-in rebates on products and services as it pushes to create a simpler pricing plan. This promotional decrease for U.S. consumers and small businesses will be phased over the course of 12 to 18 months and is part of the computer business’ strategy to help growth.

Dell asserted that the net price of PCs will stay the same, but that the computer company is dealing with many challenges, particularly in light of HP’s recent rebound and thus the return of a major competitor. The efforts of HP and other rivals to give lower prices because of cheaper materials and better manufacturing techniques has sent Dell into a spin. Similarly, the computer business has had trouble with customer service, partially due to the sheer amount of paperwork necessary for mail-in rebates. August will mark the beginning of the 12-18 month cycle of cut-backs, beginning with Inspiron notebook computers and Dell televisions. Dell is expecting to reduce the number of promotions for each line of products by 70 percent.

Computer business Dell is hoping that streamlined pricing will help create more direct relationships with customers. The addition of paperless rebates (those that can be redeemed online) will also help customers enjoy more benefits more simply. Those that have criticized Dell for previous practices have often noted that when people are faced with mail-in rebates they often do not even cash them in. Some still speculate that this new turn will hit customers in a bad way and further alienate them from buying Dell products.

Still, these plans are the result of the company spending $100 million on customer service improvement that included expanded sales and support employees and a larger call center network.

Added By: Computer Consulting 101