As expected, Dell (s DELL) today releases the Adamo notebook PC, its entry into the high-end ultra-thin market dominated by Apple’s (s AAPL) Macbook Air.
On the surface, bringing out a $2,000 “fashion” laptop in the middle of a difficult economy may seem like a mistake. Dell’s taken a huge hit financially, and many industry watchers say Dell is especially vulnerable because it receives 80 percent of its revenue from business users. As businesses are moving toward cloud-based computing software, they’re likely to refresh their hardware less often.
Given that, Adamo might look like a product that’s dead on arrival. But that’s a wrong assumption. Two main things will keep it from being a dud: The trend toward design as a major factor in purchases and Dell’s long-term customer loyalty initiatives.
Design is now a key sales differentiator and is an area where old-school companies can catch up. Apple (s AAPL) benefits from the company’s obsession with aesthetic austerity, obviously, but even staid Lenovo’s gained attention from customers through beautiful designs (See: the IdeaPad U110) — and there’s no reason Dell can’t do the same.
Adamo’s aluminum unibody design copies Apple’s recent MacBook Pro update, has a super-thin .65-inch body, and its overall metal/glass construction screams futuristic. Having seen it up close in a meeting last week, I’ll say it beats any current ultra-thin in looks. Where older Dell laptops were highly customizable, but bland, the Adamo is only available in Onyx or Pearl and with two spec configurations.
Dell may also be able to parlay its recent high customer service ratings into sales. In the last two years, the company has pushed through an aggressive customer service campaign through forums, and it’s now using Twitter and other social networks to grow customer loyalty further. Dell’s customers are already generally loyal – many people in their 20s and 30s grew up with a cheap Dell laptop and were satisfied with the value; when they’re ready to upgrade to a nicer laptop, they’re more likely to turn to an offering from Dell.
So, how does the Adamo actually stack up? Its 1.2 GHz Core 2 Duo SU9300 loses out to the $2,000 MacBook Air’s 1.86GHz, but it has a 120GB solid state drive (SSD). The Air comes with a skip-prone 120GB SATA hard drive (though you can upgrade to an SSD for an extra $500). Like the Lenovo X300, the Adamo has all standard ports, and its better glass display comes in at about 13.4-inches wide. It is heavier, however, weighing in at 4 lbs. Finally, like the Air, it lacks a standard internal optical drive; adding one will cost you $120.
There’s one thing that could present problems for Dell, and that’s its own success with value-based pricing. The $2,000 Dell Studio XPS 13 may trade down on design, but it offers better features: a 2.66 GHz processor (Intel Core 2 Duo) and a 128 GB SSD.
But the rise of netbooks has taught us that people are realizing they don’t need the most powerful computer. Mix this with the rising popularity of Apple’s expensive offerings, and it’s becoming clear that at this point in time, those likely to pony up for the Adamo’s price are more likely to pay for the privilege of the design than they are to compare between minimal power differences.
As the middle class is being squeezed, services (or products) are moving toward two price extremes. In this case, it’s ‘best value’ and ‘best designed.’ For consumers in the market for a $1,500 laptop, an extra $500 is chump change, and they probably care about design. For those in the market for a sub-$1,000 laptop, opting for a netbook used with web-based services seems like a smart move.
Dell may still be the second largest PC maker in the world, but in order to keep up, it needs to fly its design-freak flag high. Because in the near future, design might be one of only two things that matters.