Marketing Background
Market Analysis
Seniors are a fast growing segment of computer and Internet users (34 million); this because
going online has been shown to improve health and well-being (those who use computers are
less likely to become depressed than those who don’t). In fact the head of one of the country’s
leading senior care facilities encourages seniors to stay young by keeping connected through
computers; they’ve even started in some new hospitals to offer computer training facilities and
in-room computer use. Seniors use the computer for various things, most of which are basic and
mundane. Some examples are: Ninety-four percent of seniors who use the Internet do so to stay
in touch with friends and relatives (great way to promote intellectual vigour and independence
and nearly 3 in 5 seniors said that Internet use improved their connections with family), seventy
percent of senior internet users gather health information online, seventy percent of seniors
access news and events via the internet, they use it for word processing, online shopping, online
games (instrument in keeping mind sharp) and teaching themselves about using computers
Gartner report shows that PC shipments have increase 15 percent, despite economic slowdown,
which shows a definite increase from the already 1 in 5 older adults who already have a home
computer.
Internal Influences
With U.S. and Canadian market maturing, Dell is making a big push to increase its market share
overseas, where it generates about half of its sales already. Dell reprioritized, made all sorts of
investments, wrote off a bunch of things, and still managed to grow their earnings by 15% and
made $2.9 billion in profit. China is the second –largest country in the world for Dell sales, and
it’s growing fast (the number of machines sold grew 51%). They as a company are focused on
the next billion computer users, and they are not in the developed countries. Dell didn’t have
clear strategy, now they are trying to grow faster than the industry. It seems to have been
working since over the last 9 months Dell has grown at 50% (faster than the industry) and 99%
growth in India. Dell as a company has focused efforts on improving the customer experience
and on its financial performance.
Competitor Analysis
HP is dell’s number one competitor, as the market leader HP holds 40 percent of the laptop
market, compared to Dell who only has 10 percent, this according to IDC estimates. HP offers
similar products to Dell, although they are more user friendly, with simpler and more appealing
interfaces. Similar to Dell they market more through online direct response emails and online
banners, but they have also delegated a large budget to magazine, newspaper and billboard
advertising. They have delegated the most budget wise of all of Dell’s competitors. Hp uses deal
registration as a deal- specific tool for pricing and for tracking of partner benefits, but does not
have a customer registration according a spokesman for their company. Dell’s market
capitalization is now $24 billion, compared with $93 billion for Apple and HP’s $87 billion. The
net cash on Apple’s balance sheet is about the same as Dell’s market cap.
Apple although behind Dell in the market share holding with 3.3 percent, spent the second
largest amount on advertising behind HP. Apple’s budget for 2008 came to $486 million. Apple
is still primarily a consumer play company. The biggest impact on PC designs and standards
adaptation will come from how Apple’s moves. Mac focuses on increasing features and
functionalist, rather than lower price points.
Target Market Analysis
Based on the compilation of the market research key points mentioned above in the market
research section and further research from the same articles of reference (which can be
found in the bibliography), a target market for Dell has been created below:
Silver Surfers
Demographic
Seniors (ages 55+) who are members or have
been a member of a middle class income
Psychographic
Simplicity is a necessity, health conscious,
value family and staying in touch, interested in
news and events, interested in working longer,
their lifestyles although one would assume to
be slow moving is pretty face paced (not
compared to younger audience)
Geographic
Urban community seniors specifically seniors
in senior homes and health care institutions
across Canada (developing at a later date into
U.S.)
Consumer Behaviour (Loyalty)
Costumer service important, the more
customer friendly the better. Time efficient in
product shipment important. And finally cost
in relation to their position (ex. Senior
discount) Good experience = return for
upgrades or additional Dell products
Product Analysis
Dell changed its president a few years ago, which set the company off tracks, I that time period
Dell lost its reputation for quality and solid customer service. Since the reinstatement of their
original president Dell has taken charge and implemented super fast manufacturing techniques
and is in the midst of perfecting a strategy of selling directly to costumers, in particular older
cliental within the U.S. and Canada. Dell its self has repurchased about 10 percent of its own
shares within the last couple of months, which proves that they have great confidence in their
investments. As a company they said that they are focused on “planting seeds for the next fiveten years.” Dell plans to introduce a new line of subnotebook computers.
Marketing Communications Plan
Positioning Strategy Statement: For senior citizen’s or the family’s helping the citizens who
want to be more connected to family and friends, more informed about today’s news and events
and wants to join the modern world and the families helping their senior members join the
modern world that need a low cost and simple way of doing this. Unlike other computer
companies, our campaign will target specifically the Silver Surfers and their families, focusing
on what they need and want, rather than just a general audience.
Budget: The total budget allotted for this marketing plan is 2.3 million (see below budget
summary for complete breakdown of the budget)
Advertising Objectives: To launch an IMC campaign targeted to silver surfers in homes, to
reposition Dell’s image as a company towards the silver surfer market to encourage purchase
increase by 25% by December 2009.
Creative Plan
Direct Response
Objective: To communicate to seniors in homes across Canada, that Dell offers a new line of
computers and service specifically targeted towards their wants and needs, which will increase
brand image by 60%, therefore resulting in an increase sales 25 percent by December 2009.
This will be done through a brochure like direct response which will showcase Dell’s line of
senior products. The tone will portray that Dell is caring, helpful and knowledgeable through a
comedic and serious empathetic headlines and images. The overall feeling will be that seniors
can get all they want and need through Dell.
TV (Connection to families of seniors)
Objective: To communicate to the families of seniors in homes, that Dell offers a new line of
computers and service specifically targeted towards the wants and needs of their senior family
members (making it easier on the families who worry about them and want an easier way to
communicate with them), which will increase brand image by 60%, therefore resulting in an
increase sales 25 percent by December 2009.
This will be done through a variety of advertising; a TV commercial set to broadcast on major
Canadian stations during prime middle age viewing time, a magazine ad in popular middle age
magazines and personal emails to existing customers of Dell. All the ads will be very similar, the
tone will include independence, happiness and good health as the key factors, portrayed through
images of happy seniors on the computer and people helping the senior on the computer and
empathetic headlines.
Media Plan: To use advertising, direct Response, sponsorship to launch and reposition Dell to
the silver surfer.
This will be done through a variety of advertising; a TV commercial set to broadcast on major
Canadian stations during prime middle age viewing time, magazine ad in popular middle age
magazines and personal emails to existing customers of Dell. All the ads will be very similar, the
tone will include independence, happiness and good health as the key factors, portrayed through
images of happy seniors on the computer and people helping the senior on the computer and
empathetic headlines. As well as a sponsorship which will be done as a write in contest, the top
winning homes will get new computers.
Marketing Communication Mix
Advertising (TV, magazine)
Objective: To communicate to the families of seniors in homes, that Dell offers a new line of
computers and service specifically targeted towards the wants and needs of their senior family
members (making it easier on the families who worry about them and want an easier way to
communicate with them), which will increase brand image by 60%, therefore resulting in an
increase sales 25 percent by December 2009.
Magazine Ads- A double page spread is to be put into major magazines More and Chatelaine for
a 6 month period between January 2009 and June 2009 (winter/spring months), which is when it
is said that seniors are their loneliest because they are forced to stay in because of the cold.
Finally in the smaller magazine Senior Living a 12 month run of the same advertisements will
occur between the months of January 2009-December 2009, it has been decided to run this
campaign longer in the Senior Living magazine because the readership of this magazine isn’t
constant from month to month (people pick it up free at a Shoppers whenever they are available),
therefore we feel that it will take long to reach the market in this magazine.
TV Ads- Similar to the Magazines in strategy the commercials will be showcased between the 6
pm News on CTV Monday to Friday and on Saturday during W-Five, during the months of
December to February. We feel by choosing these time frames we will target the educated, issue
concerning customer, who at that time of the year is looking for a practical gift to give the
seniors in their life.
Both the magazine and TV ads will have seniors and their family members in a situation where
communication would have been key. Empathetic and comedic headlines will promote the tone
of independence, happiness and good health as the key factors.
Direct Response
Objective: To communicate to seniors in homes across Canada, that Dell offers a new line of
computers and service specifically targeted towards their wants and needs, which will increase
brand image by 60%, therefore resulting in an increase sales 25 percent by December 2009.
This will be done through a 4 page brochure like direct response which will showcase Dell’s line
of senior products. The brochures will be directly mailed in bulk to senior homes across Canada
throughout a 3 month period, between the months of December 2008 and February2009, as these
are the months with prime present buying sales. The tone will portray that Dell is caring, helpful
and knowledgeable through a comedic and serious empathetic headlines and images. The overall
feeling will be that seniors can get all they want and need through Dell.
Also communication through Dell’s email database will target existing customers by sending
them the same magazine advertisements through email, enticing them to purchase a gift for that
senior on their list, to get them connected. This will also be done through December 2008 to
March 2009, as these are the prime months for present purchases.
Sponsorship
Objective: To communicate to seniors in homes across Canada, that Dell offers a new line of
computers and service specifically targeted towards their wants and needs, which will increase
brand image by 60%, therefore resulting in an increase sales 25 percent by December 2009.
To be set up as a contest, with seniors across Canada coming together in their senior homes to
write a 2 two page minimum description of why they feel their Senior home needs Dell
Computers. Top winning homes across Canada will win computers along with accessories so that
a computer lab set up can be established in their senior homes. This sponsorship will occur
during the month of October 2009, this being the International Violence against seniors month. A
great opportunity to join seniors and their senior home staff together in the contest, showing that
Dell cares.
CTV NEWS AT
6PM M – F
10 times weekly
$970X 8 weeks
$776,000
CTV W-FIVE
2 times weekly
$350X 8 weeks
$5,600
More
2 inserts
$11,855X 6 Issues
$142,260
Chatelaine
2 inserts
$34,865 X 6 Issues
$418,380
Senior Living
magazine
2 inserts
$350X 12 Issues
$8,400
Once every week for
existing customers
$10,000X 4 month
period
$40,000
$10,000 X 3 month
period
$30,000
Email Advertising
Direct Response
Sponsorship
879,000
Total
2,300,000
Dec Jan
Feb
TV
CTV News
8 week
flight
CTV WFIVE
8 week
flight
Magazine
More
6 Issues
Chatelaine
6 Issues
Senior
Living
magazine
12 Issues
Direct
Response
Mail-out
Email
Advertising
Sponsorship
Mar
Apr
May June July Aug Sep
Oct
Nov Dec