Is Dell using a shady sales technique?

[dan596]

I in the market for a small business server to use in the home. I figured I would start with Dell as a first place to look. Good benchmark to go off of. I get to their site and see some great prices. Combine that with their 'award winning service' and things are looking good. However, here's what I found:

I went to the front page for a particular system. It had a price of $1599. I selected the "Customize" button so I could see what was in the system and possibly change a few things. When the customize page came up the price was now $2068. Okay annoying, and I was thinking they just changed the configuration or something. But no. It turns out all the nominal choices (no extra cost) were selected. So there was NO WAY to get the price down to the $1599. Fishy..yes. Frustrated...definitely.

I checked further by going to product pages for several products. Each of them was the same way. The price on the "Customize" page was not the same as on the front page for the product and there no way to customize it to the lower price. One for example was off by $1599!!!! (PowerEdge4600)

I even figured: "Maybe they add a bunch of sale discounts and incentives in the final 'sales cart.' Nope. I will say that the featured desktop ad laptop had no price variance. I did however try configuring several desktops and laptops in their line up and could not get the advertised price from the front page.

What is going on here. In the average online buyer that naive?? Do people really buy systems this way?

 

[MadRat]

They include their "value added" rebates into the price. Buy a server get a PDA worth $200... so then you pay $1799 and get a FREE $200 PDA!

 

[rudder]

Do people really buy systems this way?

Apparently a lot of people do! BUt I am getting to the point where I absolutely hate Dells. I mean how can a company put a machine together that consists of a 1ghz pentium III and 256 megs of RAM and it runs slower than my daughters 500mhz AMD system.

I've got to bring in my laptop to work because my Dell 1ghz PC is freaking slow. As soon as I get a free afternoon I am going to format it an reinstall with without all the crap.

But what also gets me about these configurators is that wow... you can upgrade to a Geforce 3 ti200 for $150 more. So the idiots configuring a computer order the upgrade even when you can order your own vid card for that amount. The least dell could do is give some $$$ credit for the existing card being replaced.

 

[MichaelD]

YES, they are. His name is Steven.

 

[dullard]

I looked at what I thought was the same system that you mentioned. The PowerEdge 2500 was shown with an advertisement that read "Now from $1599".

Click on that computer and it comes up with a price of $2068. Now I changed the warranty from 3 years 4 hour response to just plain 3 years. The price drops to $1599. But Dell will sell it even cheaper - change the warranty to 1 year labor 3 years parts and the price drops to $1450. This is even lower than their advertised price. That doesn't seem illegal to me. Tricky yes, illegal no.

Dell screws its customers in 3 major places: (a) the memory is roughly 3 times the price that you can find elsewhere, (b) the video cards are about double the price that you can find elsewhere, and (c) the warranty is extremely expensive. Just keep these in mind when you make your purchase: buy your memory elsewhere and throw the Dell memory in the trash, buy your video card elsewhere and throw the Dell video in the trash, and get the minimum warranty that you need.

 

[MichaelD]

<< I looked at what I thought was the same system that you mentioned. The PowerEdge 2500 was shown with an advertizement that read "Now from $1599".

Click on that computer and it comes up with a price of $2068. Now I changed the warranty from 3 years 4 hour responce to just plain 3 years. The price drops to $1599. But Dell will sell it even cheaper - change the warranty to 1 year labor 3 years parts and the price drops to $1450. This is even lower than their advertized price. That doesn't seem illegal to me. Tricky yes, illegal no.

Dell screws its customers in 3 major placesa) the memory is roughly 3 times the price that you can find elsewhere, (b) the video cards are about double the price that you can find elsewhere, and (c) the warranty is extremely expensive. Just keep these in mind when you make your purchase: buy your memory elsewhere and throw the Dell memory in the trash, buy your video card elsewhere and throw the Dell video in the trash, and get the minimum warranty that you need. >>




I agree w/Dullard...I got ripped off by Dell about a year and a half ago. I didn't know any better at the time. I do now. BTW, wasn't trying to crap on your thread...i thought it was funny.

 

[LordOfAll]

The difference is in the support options. I assume you are looking at a poweredge 2500. If you select 2 year bronze support, next business day it takes the price down to the 1599 price. Still, it is kinda cheesy they do that.

 

[dullard]

Dan596, 3 posts in four months. Are you just a reader, or did you come back from a break? Either way, we welcome you to AnandTech and hope you stay around.

I've seen some Dell links that price a home computer at $13,000 when you first click on customize. That is because some Dell idiot decided to make every expensive component the default one. This could confuse some customers and isn't a smart business tactic (since those customers may just leave and shop elsewhere).

 

[LordOfAll]

<< Dell screws its customers in 3 major places: (a) the memory is roughly 3 times the price that you can find elsewhere, (b) the video cards are about double the price that you can find elsewhere, and (c) the warranty is extremely expensive. Just keep these in mind when you make your purchase: buy your memory elsewhere and throw the Dell memory in the trash, buy your video card elsewhere and throw the Dell video in the trash, and get the minimum warranty that you need. >>



You missed a few. On the power edge 2500 going from the base p3-1GHz to 2 p3-1.4GHz is a $1600 option. You can buy 1.4's for $340. So you could get the base, buy 2 1.4's elsewhere and save over $800 plus have a p3-1Ghz chip to use or sell. 73GB 10k rpm hard drives are $1000 from dell. You can get these for less than $500 elsewhere.

The kicker is, I bet dell won't give you support if you don't get all the parts from them.

 

[Ausm]

another one you can add is setting a world record on terminal hold while calling thier customer service number


Ausm

 

[dullard]

<< You missed a few. On the power edge 2500 going from the base p3-1GHz to 2 p3-1.4GHz is a $1600 option. You can buy 1.4's for $340. So you could get the base, buy 2 1.4's elsewhere and save over $800 plus have a p3-1Ghz chip to use or sell. 73GB 10k rpm hard drives are $1000 from dell. You can get these for less than $500 elsewhere.

The kicker is, I bet dell won't give you support if you don't get all the parts from them. >>


I didn't include those since they aren't important to the vast majority of the customers. I listed the 'major' ripoffs, and yes there are many minor ones that affect a few people. I could list many other minor ripoffs and I could list a few things that Dell sells cheaper than anyone else.

If you add these components to the computer and call Dell for support, they will first require you to remove the non-Dell stuff and retest. Only if the problem still occurs without the extra components will Dell provide support. Of course, there is no reason for you to tell Dell about these added parts...


<< another one you can add is setting a world record on terminal hold while calling thier customer service number >>


Right, their days of great customer service are far behind them. Expect lousy service from Dell.

 

[SteelCityFan]

I have owned 2 Dell systems and for whatever reasons I have had nothing but good experiences with them.

My first Dell was a P2 266 that I bought prior to me knowing anything about building my own. To that, I added a upgraded sound card, RAM, and a Voodoo2.. I was never asked to remove things in order to trouble shoot an issue... but I rarely had one to trouble shoot so my exposure to their staff was limited... however, each time I have called them, I have never been on hold longer than what I would consider normal, and most times my call was answered in under 10 mintues. This machine is still running as a backup/whatever PC on my home LAN. The monitor (Sony Trinitron with the Dell name) is still my main monitor... same with the speakers/Sub from Altec Lansing. The Altec Lansing speakers they sent me had a slight problem with the 2nd input in the back.. one phone call, and I had replacements shipped to me overnight no questions asked.

I recently (Nov 2001) purchased a Inspiron 8100 (P3 1 gig (133Mhz FSB), 32MB GeForce2Go, UXGA screen), and have been equally happy with that. What also pleases me about their laptops is the fact that I can swap out the GeForce card and put in a ATI 7500 if I wanted to.. and order the part for $170 from their Spare Parts Dept. Now of course, if I screw something up, it is not covered just as on the desktop side.. and rightfully so. People have even easily upgraded their CPU's in these laptops. Dell even provides info on how to do this... ( http://docs.us.dell.com/docs/systems/ins8100/remove.htm ). Does any other company do this?

I agree that they over charge for their RAM, and try to sell you on the higher price by saying it will be included in your system warrantee.. and the RAM they offer is CL3. This comes down to doing a little bit of homework so you don't get hosed... people who don't know what their trade in car is worth or the invoice price on the new car they want prior to going to the car dealership are the ones who get burnt.. same applies here. Personally, I took the cheapest option (2 - 64MB sticks) and replaced it with a 256MB stick from Crucial. I had no problem doing that.

Good things about Dell:

At least in the laptop market, it is hard to beat their price.
Online Support forum that is NOT censored in anyway... (other than profanity, etc of course)
Always have the latest technology... how many other laptop makers even use the ATI 7500 yet?
They were also one of the very first to offer the sweet UXGA screen.
They offer a VERY wide variety of warantee options so you don't pay for something you don't want.
Price protection.. if the price drops within 30 days they refind the difference.. (saved me $250 on my P2).

 

[DcHoliday9]

Same over here I am the Administrator of 150 Dell desktops and 6 Dell 2550. I have nothing but good things to say about them. I have recommed and sold about 15 to emloyees of our company. They have also had no complaints about them. I don't know why people have such a problem with them.

 

[superbaby]

I have nothing but good things to say about Dell's support either. I know Dell systems have a price premium, but then again I don't like relatives calling me up asking me "how do I fix this blah blah blah", so I recommend Dell's to them for the customer service. I have found them courteous and much better than any other vendor, at least when shipping parts back and forth.

For my I8000 laptop, they actually had a guy come over to my house and replace the motherboard right there on the spot! Now that impressed me to no end.

 

[christoph83]

But what also gets me about these configurators is that wow... you can upgrade to a Geforce 3 ti200 for $150 more. So the idiots configuring a computer order the upgrade even when you can order your own vid card for that amount. The least dell could do is give some $$$ credit for the existing card being replaced.

Dell has to make some profits somewhere. Most big computer companies do this same thing with online configurations anyway.

 

[jcmkk]

Dell gets the graphics cards at OEM prices. Even if they put it in your system for the price it costs retail, they are still making money off of it.

 

[SteelCityFan]

<< Dell gets the graphics cards at OEM prices. Even if they put it in your system for the price it costs retail, they are still making money off of it. >>



Dell also has to handle all warrentee claims on the OEM models. Just because they get them at OEM prices does not mean they don't incure added costs. A retail version costs more because you generally get a better warrantee etc. When Dell sells an OEM part, they are responsible for the added cost of providing the warrantee.

They also need to pay all their tech support, customer service, pay the assemblers etc... which you don't pay for when you buy an OEM video card.

You pay more for a Dell than you would if you bought the pieces yourself for these simple reasons... If it takes you an hour or 2 to build your system and a few more to load all the software, how much is your time worth to you? $20 an hour? That is one of the reasons you pay more. Companies that build computers MUST charge more to cover costs such as these. How would you expect them to make money if they (in your eyes) were only permitted to charge OEM prices while still providing all the services expected of a computer maker?

 

[AA0]

DELL isn't any worse than 99% of other companies out there doing the same thing, their computers are not that fast, expensive and I've seen more stable cyrix computers running a unpatched win95.

 

[dan596]

Well Dullard
I have to admit I am more of a reader than a writer....mostly because I often don't know as much as the people that already respond. But I try to contribute when I can...sometimes directly. As for this Dell thread I was surprised at the responses and let me say I wasn't trying to imply anything about Dell's quality and service. Just found my time shopping their site very interesting.

Some of you made comments that you were able to reduce the price lower by switching the warranty/service agreement around. Kudos to those of you who looked into it. I can only submit that my tests must not have been thorough enough. It still isn't straight-forward enough for me to feel comfortable with the way Dell has it set up.

I will say this, I sent a similar letter to Dell using there support email. I received an email back from a "Server & Storage Consultant" about 3 hours after I sent my letter. Ofcourse all it said was "Please give me a call concerning your server request. Thanks." with 800 number and name for me to call. That's pretty good response time. I'll call tomorrow and let you all know what his angle is.

I've built my last two systems, but with prices as low as they are (even with the premium some like Dell are getting) I'm not sure the hassle of building is worth it anymore.

thanks for all the feedback.

 

[ibbilbo]

This probably deserves an explanation but, suffice to say, I am NOT a happy (former) Dell customer.
Here is a copy of the final e-mail I sent to them. (the last of about twenty)
As for Award winning service..........BAH!



Dear Cogs in the Wheel,
>
> So, you think I should contact your sales team and place another order,
huh?
>
> Why should I expect that you will ever send me what I order?
>
> Never in my life, have I had the displeasure of dealing with such a
> collection of clueless drones.
>
> Let me make myself perfectly clear. Never, not even if you were the ONLY
> supplier of computer hardware on the PLANET, not even if my life depended
on
> it, would I ever again consider buying so much as a case screw from your
> company.
>
> Michael Dell should be ashamed.
>
> Goodbye.....good riddance