Case Study 2: Gateway Computers

At a time when most computer manufacturers were switching to selling their products either online or through big computer stores, Gateway Computers made a disastrous marketing decision that cost them dearly.

Gateway decided to open up a nationwide chain of computer stores. However, at these new stores customers could not walk in and buy a Gateway computer ‘off the rack’. They had to choose their preferred model from those on display, place their order and then wait a number of weeks for the computer to be delivered.

Surprisingly, this decision was made at a time when other computer manufacturers were giving their customers the option of buying their PCs online from the comfort of their own home and having it delivered directly to their door.

One of the key rules of marketing is to make it as easy as possible for your customer to buy your product.

This move by Gateway, which made it more awkward for their customers to buy their products at a time when their competitors were making it easier, has become known as one of the major marketing mistakes in the computer industry. As a result Gateway’s sales fell significantly leading to price cuts and redundancies.

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