Should Dell offer only Alienware and Precision/Latitude laptops? A Thought Experiment

I thought of this weeks ago and could not escape the idea, so I would like to know what people think of it. The Dell forum would be a better fit, but I think fewer people peruse that one than this one.

Assumptions;

1. Other vendors have better offerings than Dell's in the low-end, low-performance consumer sector. (e.g. Inspiron v. Acer Aspire, HP Pavilion and Lenovo Ideapads)
2. Consumers who buy those laptops buy based on cost, and Dell doesn't usually sell the cheapest laptops.
3. Other vendors have better or similar offerings in the premium, low-performance consumer sector. (e.g. Dell XPS vs. Apple, Asus and Samsung Ultrabooks)
4. Cutting loose XPS and Inspiron would decrease Dell's operating cost by a large amount. I think this is reasonable: fewer parts used, fewer service calls, fewer costs cut.
5. Demand for (only) enterprise and high-performance computers remains constant.
6. Dell's offerings in the enterprise and high-performance sectors are some of the best.

Because Dell has fewer competitors in the enterprise and high-performance sectors and its offerings are some of the best, why not focus on those? It would decrease Dell's profit, but it would also decrease operating cost, giving Dell more leeway to use higher-quality parts, innovate, and best its competitors. Buyers in those markets focus on quality rather than cost, and Dell can charge high prices if it offers the best products and the best customer service.

Thoughts?

Note: Since Dell will not need to subsidize losses taken in other sectors if they implement this, I imagine that Alienwares and Precisions will get a little cheaper.

 

I don't agree, for simple reason I am ready to pay a little bit more for better service even in low end spectrum of Laptops.

As for Dell, they need to be in lower end part of the market to get loyal clients that first will get a cheap laptop, then later another one, and another ect. Eventually some of them will get better and more expensive laptops. And this way Dell sells not one cheap laptop but many more.

PS. I am very sorry for my poor English

 

If there's a market, and they bring a profit, they'll keep selling them, regardless of whether your assumptions are valid or not

 

I am not into business, but it has to do with market share and brand recognition etc etc. By the way, iirc, dell focus had been business service and HPC for at least last few years.

 

A fair point. I don't know enough about Dell's sales and profits to rebut it. Dell's lower-end lineups have bad reputations though.

True, but I'm not posting this for Dell's benefit. Dell can do what it wants.

If I had posted this when the Alienware m15x, m17x r2 and Dell Precision m6500 were out, I would see little leeway to disagree. The fact that Dell has innovated in neither sector since then, which has allowed HP to surpass Dell in enterprise laptops and Clevo and MSI to come close to Alienware, suggests that Dell is not doing the best it can.

Note: These are my opinions.