Dell Technologies' new North America sales chief is stressing the importance of the PC, not just as a consumer device, but as a key element of the vendor's end-to-end commercial strategy, saying Dell must continue to grow in both markets as the pace of consolidation quickens.
David Schmoock, who took over as North America sales head at Dell EMC in early April after the departure of 18-year sales veteran Bill Rodriguez, made the case for continued aggression in the PC market during the Dell EMC World conference in Las Vegas.
"We laid out a strategy in February of 2013, and we have not modified the strategy since then," Schmoock said. "It's about making sure we're focused on delivering a wonderful customer experience and innovation, and playing in both consumer and commercial and winning in both the consumer and commercial. It's important you do both because a lot of the innovation starts in consumer and makes its way over to the commercial market."
Driving the PC business aggressively will help Dell maintain its recent success in that sector, Schmoock said, noting that it has outpaced the market while it rapidly consolidates. And there's no real end to that consolidation in sight, he said. Currently, the PC market is dominated by Dell, HP Inc. and Lenovo, which together control about 60 percent of the market.
"We really see that going to 75 percent by the year 2020," Schmoock said. "In a consolidating phase of the market it's really important for us to continue outgrowing the market."
Right now, Dell has some momentum, Schmoock said, noting that its PC business notched 11 percent revenue growth in the fourth quarter after seeing about 2 percent growth in the periods leading up to that. "That means we're gaining momentum, and we're winning on both ends of the market, which is really key for us."
The importance of the PC in Dell Technologies' overall strategy has been a key point for executives during the conference this week.
The PC, Schmoock said, "is still your No. 1 productivity device. People get work done on PCs. It's essential to our end-to-end strategy. We want to deliver a great experience from the client endpoint device all the way back to the data center. It's the No. 1 acquisition tool. Two-thirds of first-time purchasers become new customers with a client device. The client is an acquisition tool to get them into the Dell family. It gives us an opportunity to expand into other lines of business. The PC market is a $178 billion market and the adjacent markets that are around it are equally as big."
Partners at the conference said they're taking that message to heart and beginning to form strategies for making PCs a larger part of their portfolio.
Dan Serpico, CEO of FusionStorm, a San Francisco, Calif.-based solution provider, said PCs have never been part of FusionStorm's offering, and the company is formulating ways to generate value with a PC business.
"Up until now, it hadn't been important to us," Serpico said. "We're a data center focused company. The impression we had around PCs was that it was low-margin, low value-add, low opportunity. We've started to change our perspective on that because our key partner Dell has put a lot of emphasis on it. We're not going to sell one laptop at a time or two laptops at a time, but we are thinking of ways we can expand our integration center to stuff that can create value that's not too far removed from our data center practices."
Sonia St. Charles, CEO of the Davenport Group, a St. Paul, Minn., data center solution provider that works with Dell EMC, shared similar sentiments, but said Davenport has been asked specifically by customers to sell them PCs.
"We're data center focused, but last year our No. 1 product was client," St. Charles said. "We don't lead with client ever, but when a customer says, 'Hey, can we buy our laptops from you?' We want them to keep thinking of us for that purchasing cycle. It's good for us, it's good for them, and it's become a significant part of our business."