Dell´s Strategy in India.

Dell’s presence in India is no surprise. India is one of the most important emerging markets
in the world. For years, selling PCs in Asia largely meant China. However, PC makers have
recognized the importance of the giant Indian market, its booming economy and annual
growth at more than 9%.

Dell started in India about seven or eight years back by opening a customer contact center
at Bangalore in 2001. In 2003, the second contact center opened at Hyderabad. The
company operates its services from four centers based at Bangalore, Hyderabad,
Chandigarh and Gurgaon. Dell started in Bangalore providing customer support to English
speaking countries and later also began providing technical support, procurement of
financial back office and Knowledge process outsourcing. After the U.S., Dell India is the
second biggest center with 23,000 employees. The strategic importance of India to Dell is
evident from the fact that India was one among three locations (the other two being US and
UK) where Dell’s Latitude E series and Precision notebooks were launched. In India, Dell
already has a 23,000-strong workforce in about 10 years of operations and business from
India is closing in on the $1 billion mark. Dell has nearly 13 per cent share of the Indian
market.

Case Updates/Snippets

• Dell’s channel strategy is to make technology more available to small and medium
businesses (SMBs). Dell’s channel partners contribute 22% to its total revenue globally.
Out of 10 million SMB customers across the globe, Dell caters to 12,000 SMB customers in
India. As per estimates, SMB market in India has over 7 to 13 million customers. Among
the BRIC countries and U.S., India is ranked second for the number of SMBs.
• Stiff competion between Dell and HP in the Indian PC market: According to IDC, since
2005, HP has held the number one position in the Indian PC market every quarter (for the
past six years). However, in the second quarter (April-June, 2010), Dell replaced HP for the
first time with a 15.2 percent share. HP followed at 14.3 percent and Acer at 11.5 percent,
though HP still led in the desktop segment. Dell was helped by strong marketing and its
channel partners base while HP was disrupted by its move from a national distribution
model to a network of regional distributors.
• PC Market in India:In 2009, 75 lakh PCs were sold. In 2010, the expected PC sales are 90
lakh. For the first six months ended June 2010, sales totaled about 45 lakh. [Note: 10
lakh=1 million, PCs include desktops and notebooks.]