Overview. Taiwan's Acer is a leading marketer of notebook and desktop PCs. However, they have had very limited success in breaking into the all-important American market. Partly as a result, Acer refocused and concentrated its efforts on the growing Chinese market. They believe they have a much greater probability of success in China given the shared language and culture. They are attempting to "remake" themselves as a "local" company based in China.

1. Acer's strategy has been described as "divide and conquer." Explain.

2. How did the "global markets-local markets" paradox figure into Stan Shih's strategy for China?

3. Can Acer become the world's third largest PC Company, behind Dell and Hewlett-Packard?

4. Even before the current economic crisis deepened, growth in the U.S. PC market had begun to slow down. Despite strong competition from Dell and Hewlett-Packard, Acer's U.S. market share increased from 1 percent in 2004 to 3.3 percent by the end of 2006. What are Acer's prospects for gaining further share in the United States?

CASE2: DIRECT MARKETING (DELL)

The case let discusses the direct business model of Dell Computer Corporation (Dell). It shows how the company attained a competitive advantage by pioneering the direct business model in the computer manufacturing industry. The case let discusses the various strategies that Dell adopted to ensure the smooth functioning of its business operations. It also focuses on how the company utilized the Internet to optimize its business model.

Issues:

The concept of 'direct business model' in the computer manufacturing industry

How Dell achieved success through the 'direct business model'

E-commerce - How it can help optimize sales

Introduction

Dell Computer Corporation (Dell), the world's largest direct selling computer company, was founded by Michael Dell in 1984. By 2002, it had become a premier computer manufacturing company with its customer base spread across 170 countries worldwide.

Headquartered in Austin, Texas, the company primarily offered notebook computers, desktop computers, networking products, servers, hardware and software data storage products, printing and imaging systems, workstations, etc.

It also provided services such as designing, developing, and implementing end-to-end technology solutions, assisting customers in planning, deploying, and maintaining of the product, etc...

Questions for Discussion:

1. How far did direct marketing help Dell in achieving success?

2. Do you think Dell was successful in providing quality customer service? Justify your stand.