• Jeff Matthews

Consumer Reports Says…Dell to Miss Numbers

Actually, I made that headline up.

What Consumer Reports actually says in its current issue is that Dell’s technical support is—as our readers already know (see “Dells Screws Up a Good Thing,” January 24)—bordering on K-Mart quality. Which is to say, it may actually be driving customers away.

“Get the most from tech support,” is what the Consumer Reports cover promises its readers. And based on the results inside the magazine, Dell customers are not getting very much.

In both laptops and desktops, Apple led the tech-support pack, being the only desktop vendor to have even satisfactory ratings for each of three measures—waiting time on the phone, how knowledgeable the support staff appeared to be, and whether they solved the problem. (Lenovo managed to tie Apple in each case in the laptop survey.)

Specifically, in desktops Apple scored 82 (out of 100) in tech-support satisfaction, compared to eMachines at 62, Sony at 57, Gateway and Dell at 54, HP at 53 and Compaq cruising in with a 46.

In laptops, Apple also scored an 82, with Lenovo at 69, Toshiba 57, Dell at 56 and the rest below 55.

Repair history showed the same general trend, with Apple desktops having the fewest repairs by far, according to Consumer Reports readers.

Meanwhile, Dell’s fiscal quarter ended a week ago, and it didn’t take the company’s bean-counters too long to figure out the numbers had come up short—with revenue up less than 10% and earnings per share down more than 10%.

CEO Kevin Rollins put the usual glossy spin on the announcement, saying “We are committee to delivering industry leading value to our customers, which ultimately results in industry leading growth for the company.” But based on our own informal survey of reader satisfaction, not to mention the Consumer Reports data, Mr. Rollins may want to re-examine the logic behind his bold statement.

A personal computer long ago ceased being a stand-alone box used for calculating spreadsheets or creating slide shows: it is the means to connect to the internet, upon which all businesses now depend.

When the box at one of those businesses goes down, the business—which may be one guy in his basement office in Livonia Michigan or a trader in a glass tower above Canary Wharf—goes down.

And when a business goes down, no amount of pennies saved by buying the box direct from Dell can make up for lousy tech-support-on-the-cheap.

Me, I think Dell needs to do a Microsoft: I think it needs to start spending some serious money to upgrade its customer service. “Delivering industry leading value” is no longer just cheap boxes. It’s great service, too.

Jeff Matthews I Am Not Making This Up

© 2006 Jeff Matthews

The content contained in this blog represents the opinions of Mr. Matthews. Mr. Matthews also acts as an advisor and clients advised by Mr. Matthews may hold either long or short positions in securities of various companies discussed in the blog based upon Mr. Matthews’ recommendations.

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GENERAL

The content contained in this blog represents only the opinions of Mr. Matthews. This commentary in no way constitutes investment advice. It should never be relied on in making an investment decision, ever. The content herein is intended solely for the entertainment of the reader, and the author.

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