Dell’s reputation tipping point

All sorts of opinions are flying around about Dell’s recall of over four million laptop computer batteries announced yesterday.

A quick scan of blog posts in Technorati show some people saying it’s the largest product recall in consumer electronics history. Others say Dell has issued a recall for the computers themselves (no, it’s just the batteries).

Many posts I see make reference to the recent cases where Dell laptops have burst into flames, events that clearly triggered the recall announcement.

It’s worth mentioning that the batteries are manufactured by Sony not by Dell. But will anyone make any differentiation in relation to that? It’s doubtful. As far as most people will care, it’s a Dell computer battery. So on the face of it, it’s Dell’s issue not Sony’s, although Bloomberg reports that Sony may share the costs of Dell’s recall.

If I had a Dell laptop, I’d think twice about leaving it running unattended whether or not that laptop is on the list of models affected by the battery recall. And if I were in the market for a new laptop, this battery issue would add a big negative for Dell when I compare different brands and models.

Anyway, they’ve announced the recall and have launched a special website with detailed information.

Some people are saying this is a crisis for Dell.

Yes, I think it is. A crisis to do with Dell’s overall reputation and a crisis of customer confidence in the products they’ve bought.

It’s not the battery recall itself that makes for the crisis, though. I think this latest high-visibility issue just adds icing to Dell’s cake of woes. That’s the crisis.

Last year’s saga of poor Dell customer service has become enshrined in the phrase Dell Hell – just Google that and see what you get. Most recently, there is Dell’s questionable behaviour in China over PCs people bought being different to what was advertised. Dell has started to address that one by apologizing and offering refunds.

Yet all these things leave a bad taste in your mouth. You start to wonder whether this really is a company you want to do business with. Or invest in.

What Dell does now, and how it communicates what it’s doing, could be a tipping point in salving the company’s reputation. It could easily go the other way, too. Direct2Dell, the corporate blog Dell launched last month, should play a prominent role in their overall communication, as no doubt it will. For instance, there are two good posts there
about the battery recall with the beginnings of conversations with customers.

But it’s what Dell do rather than what they say that will have a lasting impact on what people think of Dell. And that will impact Dell’s fortunes. The company will report its latest financial results in two days’ time. More interesting, perhaps, will be the future earnings guidance they offer and what they say about their marketplace.

What will be equally interesting about that earnings announcement will be the people who will write about it and blog it, either live or subsequently, whether they are bloggers or mainstream media journalists. What opinions will people form? What will they say in relation to the cake of reputation woes? And what will those opinions contribute to any reputation tipping point?

For the record, I own a Dell desktop PC which I bought last year and with which I am extremely happy. I have had my own exasperating experience with Dell recently, but that’s another story.

Neville Hobson

Social Strategist, Communicator, Writer, and Podcaster with a curiosity for tech and how people use it. Believer in an Internet for everyone. Early adopter (and leaver) and experimenter with social media. Occasional test pilot of shiny new objects. Avid tea drinker.

  1. Mark Rose

    I am furious at Dell. I bought a Dell laptop three months ago and the news about the potentially exploding battery shocked me. I tried to reach the company but the url was not active and the supposed phone line set up for the recall was not active. They totally blew this from a communications standpoint.

    What happened? They intended to release the news today but they were scooped by a web site called The Inquirer that broke the story Sunday. The the Wall Street Journal confirmed it with a posting yesterday and then The New York Times posted it.

    There was no mention of this recall on the Dell website, no way to reach the company until today. I have bought Dell desktops, laptops, servers and peripherals over the years and I have become increasingly disenchanted with the company – largely because of on-the-cheap, inferior customer service. This could be the tipping point.

  2. neville

    I can understand how you feel, Mark. I’d feel the same. In fact, I almost do as I recommended Dell to my sister in the UK, who has just bought a dual-core Inspiron. I think her model’s on the battery recall list.

    From what I’ve been reading online today, it certainly does look like a foul up somewhere in terms of how the news got out and when.

    I saw a good article in Business Week on what Dell’s doing to address customer service issues.

    One point in that article – Dell’s customer service will likely be tested as never before as, no matter what the website may say, many people are going to be calling Dell about this battery recall.

    Could be quite a tipping point.

  3. Richard

    Thanks for the thoughtful perspective and reference to the role Dell’s new corporate blog is playing in this important recall, but also generally as Dell moves forward with its truly unique and important role in the computer industry, our direct relationship with customers. You highlight several important issues and indicate that what Dell does will be as important as what Dell says. Its why Dell acted after 6 instances of battery problems. Dell is not just talk, but delivery. Dell said it would invest in this business for the long term. That includes $100 million to improve the custommer experience and our direct relationship with customers. We have opened additional customer technical support facilities, retrained and hired additional support staff. We have made over our website. We are embarked on programs that resolve customer issues. Today the University of Michigan Customer Satisfaction survey shows Dell turning the corner. Dell has more work to do, but you will see us investing in the business and our business leadership, like none of our competitors. What Dell says is being matched by what we do. You can count on our determination and customer focus to avoid that negative “tipping point”…but clearly it is a positive tipping point for us going forward.

  4. neville

    Richard, thanks for stopping by and for your comments.

    I can see from Direct2Dell that you are all pretty busy in talking about what’s happening on the battery recall. Some good dialog happening there, with little snarkiness from visitors (which is good to see).

    On that customer satisfaction survey you mention, that presents an interesrting PR challenge for Dell. On the one hand, it paints a pretty good picture of Dell’s customer service and customer satisfaction with that service.

    On the other hand, you have the negative experiences of many Dell users who are angrily and publicly recounting those experiences via the net (just Google for ‘Dell’ and you’ll see what I mean).

    If you tout those survey results, don’t expect warm and universally positive reaction. More likely is that people will point to what they see via Google and other searching – the experiences of people just like them.

    I think it’s a credibility gap. So that’s where Direct2Dell could really help with some candid and open commentary there about that survey in the context of the realities of many people’s real experiences with Dell.

    Not to suggest that’s all you focus on. You do have some good things to talk about (and, I bet, more good news than bad news). It’s that you need to recognize the negative experiences of many people who may not be typical of your customer base, their geogrpaphy of whatever other demographic.

    It’s not about the numbers, though. Time to ditch those demographics and talk like normal people!

    Just a $0.02 suggestion from a fellow communicator :)

  5. Mark Rose

    Richard, I appreciate your comments. I checked out the Direct2Dell blog and it is cool. I particularly appreciate comments from Lionel Menchaca, Digital Media Manager. He seems to be on top of what’s going on and he reaches out for answers across the organization. It’s nice to have a guide like that.

    One communicator to another, I ditto Neville’s comment about ditching the demographics and talking like “normal” people, especially during a crisis, which this is. Also, nothing is “truly unique” or I have yet to find it.

  6. Richard

    Thanks Mark and Neville….appreciate the feedback. Lionel is the best! Just a point of clarification that I mentioned the Michigan study not as cold corporate source, but as a possible indicator that we are starting to “turn the corner”. You might consider the sentence before that “We are embarked on programs that resolve customer issues.” Here I was referencing Laura’s comments on our blog and references on other blogs about our actively reaching out to address personal negative experiences, as you so accuratley refernced Neville. Its an example of our personal and direct outreach to solve the isses one by one, as well as figure out how we can make sure the problems do not get repeated…..clarification done and your points are well taken. Thanks so much

    Mark…on the website and battery recall, its a complicated story that involves working with regulatory agencies.
    On your laptop and service issues, I believe we are reaching out to you. if you want to follow up with me direct, let me know. Alternatively, you can also contact this email: and mention our chat here.

  7. Charolette

    Certainly Dell could have done more to have tested and prevented this from ever becoming a problem… But to me its surprising how everyone is putting this as a crisis for Dell. Didn’t Sony make the batteries? Why aren’t they seen as being in crisis?

    I came across this article about how Dell could have done more to predict the problem and take more drastic actions to fix it early on. It looks as though this has cost them a bit on the public opinion front. Its a good read.

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