Dell To Spend 'Hundreds Of Millions' In Consumer Ad Campaign

Dell is looking to change its image as a cheaper alternative in the computer hardware market, and it's planning to spend "hundreds and hundreds of millions of dollars" on a new advertising campaign

The campaign, which features the tagline ’You Can Tell It’s Dell" is expected to accompany the release of several new products from the vendor, beginning with a new line of XPS laptops announced last Thursday. Equipped with Nvidia's 3DTV Play software and a host of high-definition entertainment capabilities, the XPS is geared toward high-end users.

"With more performance capabilities than many desktop PCs, XPS laptops are the perfect choice for people who demand high performance, premium technology and the best entertainment experience," Dell said in a press statement on Thursday.

Dell didn't include pricing as part of the press release, a decision that appears to be part of a broader strategy that includes capturing the consumer market and establishing distinct brand.

"We're going to stop mentioning price as the single important aspect," Paul-Henri Ferrand, chief marketing officer for Dell's global consumer, and small and medium business division told Reuters last week. ’You can still be different even if you’re using common components,’ Ferrand said. ’We need to reinvigorate the brand.’

Next: Reactions From Dell Partners

Some partners believe the advertising campaign reflects a somewhat outdated way of thinking, while others see larger issues for Dell than the health of its brand.

"This is 1990’s thinking in a post major recession world," said Allan Walters, senior vice president at Saratoga Technologies, a Johnson City, Tenn.-based solution provider. "I think people have moved past caring about what the specific technology is."

Walters said most IT customers simply want to know whether their systems add value, are affordable and cost-effective, and are easy to work with.

Stephen Monk, vice-president of operations at Miles Consulting, a Folsom, Ca.-based Dell partner, said Dell is making more products for the consumer market, but took issue with the quality of some of its recent offerings.

"There is probably a bigger push to say 'Hey, we are Dell" the way Microsoft and some other companies do. They've been moving towards the trend of trying to have a more well-rounded and higher end product," he said.

Next: Issues With Dell's Products

Monk identified more pressing problems for Dell's channel partners which may have created the need for an advertising campaign, but would not be resolved by one.

"Our customers are getting less and less returns from their Dell products and more part failures. I don't know that the branding in and of itself is going to help with that," Monk said.

While Walters agrees that there will always be a small segment that might care about what computer they have, he says there are two problems with trying to focus on the type of branding Dell is pursuing. "For one, Apple has already beaten Dell to the punch," he said. "People that care about what technology they are using are largely choosing Apple devices. Secondly, the market for custom computers is much smaller than it used to be."

Dell's campaign seems to be targeting Apple, which has branched out into a variety of niche markets by advertising heavily to consumers and offering products with a distinct design and interface.

Last week Steve Felice, president of Dell's global consumer and small and medium business division, responded to Apple CEO Steve Jobs's claim that the barrage of tablets set to hit the market in the coming year would be "DOA, dead on arrival."

Next: Dell Enters The Ring With Apple

"Apple is known for dictating what's going to happen in the marketplace and what a consumer should buy. We're at the opposite end of the spectrum, emphasizing customer choice," Felice told Reuters . "It's a bit premature to tell customers what they're going to like and what they don't like."

Jobs distinguished Apple's highly successful iPad tablet from its competitors, citing the availability of thousands of apps to iPad users compared to "none," according to Jobs.

Regardless of whether Jobs is correct in that estimation, he has drawn criticism from Jim Balsillie, the CEO of RIM, which makes the Blackberry as well as the enterprise-oriented Playbook tablet, for trying telling customers what to think. However, Jobs pointed out an important perceived advantage among some solution providers for the Cupertino, Ca.-based manufacturer -- namely applications. With more riding on content and applications, there may be less riding on the brand of hardware.

"People are moving away from the device and more into what can the device do or attach to," Walters said. "Apps, Websites and content are the driving forces behind device adoption not the technology itself."