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Strategies & Market Trends : The Thread Formerly Known as No Rest For The Wicked -- Ignore unavailable to you. Want to Upgrade?

To: kathyh who wrote (51190)	6/15/1999 4:45:00 PM
From: Esway	Respond to of 90042

E-commerce ringing Dell's bells PC maker sees better sales, lower commissions By Tom Murphy, CBS MarketWatch Last Update: 4:30 PM ET Jun 15, 1999 Silicon Stocks Chat: Tech Stock group MINNEAPOLIS (CBS.MW) -- Dell Computer, which proved the efficiency of the direct-to-customer sales model in personal computers, on Tuesday said its foray into e-commerce is showing impressive results. "It's the biggest change since Michael founded Dell." Joe Marengi, Dell Computer The rate for closing sales on the Internet is 20 percent higher compared to the company's old model, but commissions are 35 percent lower, Senior Vice President Joe Marengi told investors at a U.S. Bancorp Piper Jaffray conference. If that isn't enough, Marengi said the company (DELL: news, msgs) has 25 percent fewer service calls, which normally cost the company from $3 to $8 each. "The Internet changes everything. It changes the way we do business, it changes the way you do business, and it going to be with us a long time," he said. "We're shifting our entire business to the Internet. It's the biggest change since Michael founded Dell." Dell shares closed up 1 5/16, or almost 4 percent, to 34 5/8 after he spoke. The development of a successful model to sell computers through the Internet has been a key goal for Dell for well over a year, and Web sales have nearly quadrupled in that time. Marengi said the company's experience has helped it get ahead of competitors who are just building a Web presence now. "If we execute (Dell's strategy), we believe many competitors will drop further behind over the next two years," he said.