Compaq Computer Corp has taken a much-anticipated tack by targeting fast-rising rival Dell Computer Corp with a move toward a more direct sales model for the small and medium-sized business (SMB) market. The number one PC maker launched what it called a massive direct sales and marketing effort in the US, which it says will offer the utmost in customer choice and value to customers that prefer to buy direct. Central to the new program is the launch of the competitively-priced Prosignia line of desktops, portables and servers designed specifically with growing businesses in mind. The machines – which start at around $1,200 for desktops and $2,000 for laptops – will be offered in what the company claims are thousands of configure-to-order models both over the phone and on the company’s web site. The important thing, said chief executive Eckhard Pfeiffer at a press event in New York, is that they can be purchased direct from the company at costs that match or beat those of Dell and the other direct vendors. The company also promised that machines purchased directly will ship as fast as the next business day, and within an average of five business days – faster than the seven days that Dell typically takes to ship its PCs to customers. And if customers choose to go through the reseller channel, Pfeiffer added, they can still take advantage of the same low prices. Compaq hopes to achieve that through the new Agent Reseller Program, which keeps the channel in the loop by continuing to offer resellers commission for their part in the sale even though they are only being asked to provide the follow-on services that customers require. Perhaps more that anything else, the reseller program, with its near disregard for margins, bears out the seriousness of Compaq’s battle with Dell in the SMB space. Dell aside, Compaq insists that its latest move is about providing the greatest amount of choice to its customers – especially in the SMB market, which now accounts for roughly 30% of the total PC market and is growing faster than any other segment. Essentially the company wants to offer its goods any way the customer wants to purchase them. When addressing the issue of how Compaq could compete with pure direct marketers through such a hybrid approach, Pfeiffer said: customer choice is our strategic advantage. For those who choose to buy direct, Compaq is also offering expanded online and pre-packaged services, as well as more flexible leasing plans. The move is not the first foray into direct sales for Compaq, which earlier this year started selling direct to large corporate customers after the acquisition of Digital Equipment Corp. As a result of that initial move, Compaq claims that 20% of its total North American business is now handled directly.
