Dell now accepting the alternative currency on its e-commerce site
Dell, which reported $56.9 billion in revenue for 2013 and employs more than 100,000 people, announced the decision to begin accepting bitcoin via a tweet by company founder, Michael Dell.
Dell Inc., has announced that it is now accepting Bitcoin as payment on its e-commerce site. Dell.com booked an estimated $3.55 billion in 2013 online sales.
Dell started accepting Bitcoin based on customer interest, a company spokesperson says, and worked with payment processor Coinbase to implement a Bitcoin payment gateway in just two weeks.
Dell customers can begin using bitcoin as payment immediately, and the company is offering a discount for Alienware-brand computer hardware if payments are made in bitcoin. The company is partnering with bitcoin payment processing company Coinbase, which works with tens of thousands of merchants in accepting and using bitcoin.
According to Adam White, the director of business development and strategy at the company, who worked with Dell on the partnership, Coinbase reached out to Dell several months ago. “We had some good conversations with them,” he said, but it wasn’t until recently that Dell got back in touch with Mr. White, and said they’d decided to adopt bitcoin, and wanted to get it done quickly so as to capture sales during the back-to-school season.
Coinbase also processes payments for Overstock.com Inc, which in January 2014 became the first large e-retailer to accept bitcoin. In the first 24 hours of accepting the digital currency, shoppers placed 840 orders using it, accounting for $130,000 in revenue, the retailer says. The company has since done more
In accepting the virtual currency, Dell joins a number of large companies and merchants including television provider Dish, payment processor Square and travel booking website Expedia.com.
That growing adoption rate isn’t an accident, Coinbase CEO Brian Armstrong said. The bitcoin payment processor set an internal goal for 2014 to partner with at least 10 retailers with at least $1 billion in revenue, and Dell marks the seventh such company to do so.
Although the vast majority of bitcoin trading comes from users treating it more like a speculative stock or investment, Armstrong said merchant-customer transactions have doubled since the start of 2014.
Although several early bitcoin adopters were more interested in gaining cheap publicity, Armstrong said that more merchants are realizing the cost savings potential of accepting bitcoin, which usually comes with fewer fees than credit cards.
“It’s increasingly becoming about just cost savings, and that’s becoming a more sustainable long-term advantage for bitcoin,” he said.
Coinbase has about 1.5 million customer accounts.
The goal for Dell was to tap into another method of reaching customers, according to David Frink. The decision involved a combination of people within the company, he said, including Mr. Dell himself, who was “very interested in moving this along quickly.”
Still, the company understands bitcoin is still in an early stage, and has conservative expectations for the program. “This is a pilot, and we’ll see how it goes,” Mr. Frink said.