- Summary: Dell launches a new ad campaign today on network and cable TV (to be followed by print and online ads) with a radically different message. Instead of stressing price and performance, Dell's new ads will focus on its ability to customize computers for individuals, and will emphasise the company's brand. Dell hasn't disclosed the cost of the new campaign, but did report ad spending of $776 million in 2005. Dell's new ad campaign follows a similar "personal" campaign launched by HP in May, dubbed "The Computer is Personal Again".
- Comment on related stocks/ETFs: Dell's new campaign plays to its competitive strength -- its ability to customize PCs for individuals due to its build-to-order manufacturing process. If successful, this could change investor perception that Dell's direct distribution strategy no longer offers the competitive advantage it once did. The key question for Dell (DELL) and HP (HPQ) is the extent to which users really need to customize their PCs, or whether, say, 5 configurations adequately address the needs of most types of users. Dell's ability to convince PC buyers of the advantates of individual customization, together with its price advantage, will determine whether Dell can recapture US retail market share from HP. Meanwhile, both the Dell and HP ad campaigns are negative for Apple's stock (AAPL) since they attack Apple in its core market -- consumers interested in photos, music and video.
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