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THESIS ON
A PERSPECTIVE ON THE MARKETING STRATEGIES OF HP (PRINTERS)
SUBMITTED TO: PROF. SUMANTA SHARMA ASSOCIATE DEAN IIPM, NEW DELHI
SUBMITTED BY: MAYANK DUREJA BATCH: PGP/SS, 2006-08 ALUMNI ID: DS68-M120 IIPM, NEW DELHI
ABSTRACT
Computer hardware market is highly competitive and dynamic today. With strong players operating, the key message is Survival of the fittest of the fittest. Within computer hardware market printer market has grown a lot in last 20 years. The name Hewlett-Packard Development Company strikes first to the mind when one talks of Computer hardware. Prints are considered as the most successful product under the umbrella Hewlett-Packard Development Company. It is surprising how this brand has continued to retain position of Market Leader for such a long period of time. The project undertaken is aimed at understanding the various variables affecting the marketing of HP Printers. This include competitors, customers, companys strategy etc. HP Prints are operating in a highly competitive environment with players like Epson, Xerox, Samsung, Lexmark, and Canon etc. the completive environment in which HP-Printers is operating vis-a-vis competitors has been taken up in detail. HP-Printers is the pioneer in the printer market and holds number one position in the printer market. Other brands, which emerged in the market, have created niche markets and targeted a specified type of customers. HP competes with these brands on quality, speed and service based attributes. The only way HP is combating this competition is by continues innovation and creativity in terms of differentiation in its products and other promotional patterns like advertisement, sales promotion scheme, publicity etc. with its various variants, HP is targeting both individual and industry consumers. If one talks about consumer, behavior, people consider HP as the best. Quality and services are the most critical factors determining the buying decisions. As far as income pattern is concerned, all those in upper middle and upper class could afford to but. Thus, higher income group can be potential segment for the company.
Initially HP-Printers started with dot matrix and inkjet printers, but later extended to laser, color laser and multifunctional printers with scanner-fax-printer facilities. Even though HP-Printers is the market leader now, but with increasing competition from Indian as well as foreign brands, it should realize that customer is the king and should make continuous efforts to identify and fulfill consumer needs.
ACKNOWLEDGEMENT
This thesis is aimed at developing an understanding of the concepts in Marketing Management, through HP Printers. The attempt has been to tie the various factors like Environment, Competitors and Consumers to understand the effectiveness of the present target market of the product. On the basis of the same, the Strengths, Weakness, Opportunities and Threats of HP Printers have been identified. Several people have played a significant role towards the successful completion of this project work and researchers extend their gratitude to them.
A deep sense of gratitude is owned to Mrs Nalini Anand who extended support and assistance throughout the project duration. Needless to say, her knowledge and experience have served as a continuous source of encouragement and motivation.
Finally a note of thanks is due to all those too many to single out by names, which have helped in no small measure by cooperating during the thesis and by providing constructive criticisms.
TABLE OF CONTENTS
CHAPTER 1 INTRODUCTION
Marketing mix-4 ps Product
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CHAPTER 2
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CHAPTER 3
LITERATURE REVIEW
Company Profile Founding Technology And Products Home Printers: Laserjet Printers Promotion You And HP Distribution Channel HP'S Bold New Printer Marketing Stefani As Saleswoman SWOT Analysis Competitive Scenario In The Printer Market Threat Of Substitute Products Threat From New Entrants Samsung Canon Xerox HP As Market Leader Strategies Followed By HP Printer The Future Ahead
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CHAPTER 1 INTRODUCTION
INTRODUCTION
The printers industry in India is showing a consistent growth, thanks to PC penetration and rise of IT industry in enormous proportions. Also the introduction of multi-purpose printer machines has pushed the buyers to go for printers. As off late, companies have shifted their focus from selling individual office utility machines like scanners, printers, copiers, fax etc to 4-in-one machines to show a better value proposition. The reduction in prices due to low manufacturing costs, decreased import duties and increasing competition has also fuelled this trend. HP makes its entry into the printer market with the launch of inkjet printers and laser printers that connect to personal computers. HP's high-quality, inexpensive inkjet printers spell the end of dot-matrix printers. The HP LaserJet printer line, which debuts in 1984, goes on to become the company's most successful single product line ever. The quality and reliability of HP's printers make HP a highly recognizable brand by both consumers and businesses. Near the end of the decade, HP is recognized for its rich past as well as for its technological advances and products. The garage where the company started is declared a California historical landmark, and HP celebrates its 50th anniversary. Imaging and Printing Group Imaging and Printing Group (IPG) revenue grew 6% year over year to $7.6 billion. On a year-over-year basis, supplies revenue grew 8%, Commercial hardware revenue grew 6% and Consumer hardware revenue declined 3%. Printer unit shipments increased 6% year over year, with Consumer printer hardware units up 4% and
Commercial printer hardware units up 9%. Momentum in key growth initiatives continued, with solid growth in both the Graphic Arts and the Enterprise businesses. Operating profit was $1.2 billion, or 16.2% of revenue, versus $1.2 billion, or 16.3% of revenue, in the prior-year period. HP is a leading technology company in some of worlds fastest growing IT markets including Russia, China, India, Brazil, Mexico, Eastern Europe and Middle East. Its portfolio contains desktops and workstations, notebooks and tablet PCs, Printers and multifunctional, handheld devices, monitors, and projectors, Fax, copier and scanners, digital photo cameras, PC Storage products, servers, wireless, solutions and other accessories. HP has range of printers Dot matrix, Inkjet, color inkjet, color laser jet, large format printers, photo printers mobile partners, multifunction and all-in-one printers. HP as sales of over 3.2 lack printers per annum in India -30% of which are home users and rest being commercial users. Hewlett Packard is the leading multinational in variety of high-end computer hardware and software products. To name few: Desktops & Workstation. Notebooks & Tablet PCs Printing & Multifunction Monitors & Projectors Fax, copiers & scanners Storage Servers
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Production & Financial Status: HP (NYSE:HPQ) announced financial results for its second fiscal quarter ended April 30, 2008, with net revenue of $28.3 billion, up 11% from a year earlier and up 5% when adjusted for the effects of currency. In the second quarter, GAAP operating profit was $2.6 billion and GAAP diluted earnings per share (EPS) was $0.80, up from $0.65 in the prior-year period. NonGAAP operating profit was $2.8 billion, with non-GAAP diluted EPS of $0.87 up from $0.70 in the prior-year period. Non-GAAP financial information excludes $172 million of adjustments on an after-tax basis, or $0.07 per diluted share, related primarily to amortization of purchased intangibles. "HP turned in another strong quarter, supported by improvement across our businesses. With 70 percent of revenue now coming from outside the U.S., we benefited from robust demand in emerging economies," said Mark Hurd, HP chairman and chief executive officer. "The company's financial outlook demonstrates its strength in the global marketplace." Revenue in the Americas grew 4% on a year-over-year basis to $11.1 billion. Revenue grew 16% in Europe, the Middle East and Africa to $11.9 billion. Revenue grew 16% in Asia Pacific to $5.2 billion. When adjusted for the effects of currency, revenue in the Americas grew 2%, revenue in Europe, the Middle East and Africa grew 6%, and
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revenue in Asia Pacific grew 7%. Revenue from outside of the United States in the second quarter was 70% of the total, with revenue in the BRIC countries (Brazil, Russia, India and China) growing 26% over the prior-year period and accounting for 10% of total revenue. MARKETING MIX-4 PS Whether its vibrant color photos or crisp black text, you can have it al with HPs latest technology printers. Stop any print job with a single click or print creative projects easily with bundled software. True to life color printing brings out the best in each photo while fast text printing reduces the waiting time. Whats more, these printers are easy to use and come with special HP software that help enhance your digital images. A printer for every need thats what HP believes in. PRODUCT HP has a wide range of printers on offer that cater to two segments of the market, the individual customers and the industry customers. The various printers on offer by HP can be broadly classified into:DeskJet/Inkjet Printers : This includes printers such as DeskJet 3550,
DeskJet3650, DeskJet 5652, DeskJet 3745, DeskJet 1180C, and DeskJet 5160. The basic target of this series is the individual user. These printers ensure vivid color and detailed printing. They come equipped with the following Easy to use and easy to setup features. Quick Setup : You can setup the printer in minutes with use friendly software and buttons.
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Easy on screen control : The on-screen print-cancel function lets you can any print job instantly, helping you save both ink and paper. And with on screen ink level indicator you will know exactly when to replace you ink cartridges. Laser Jet Highly quality results without the high costs LaserJet printers comes in two broad categories for Business i.e. the industry customers and the Desktop i.e. the individual customers. These printers are reliable, compact, and affordable and touted as just what your business needs. HP LaserJet 1010 printer series has been launched as the personal monochrome laser printer which can serve your business and desktop needs. It come with Direct USB and parallel connectivity for easy connect to your PC or MAC. HP has also been awarded with an A+ for the 12th consecutive year by the PC World magazine for its products quality, services and support. HP LaserJet 1010 series comes with an affordable price tag of Rs. 10,999 and comes equipped with HP instant on fuser technology which ensures a 10 second first page printout. The series of low cost laser printers includes. HP LaserJet 1015, 1150, and 1300 available in the price of Rs. 14, 999 to Rs. 22, 999 HP 1300 printer series promises professional quality and reduced printing time, it is expandable implying that the printer can be updated to keep pace with the increasing demand. The latest entrant in the HP armory is the HP color LaserJEt 3700 series. The printer promises the user with more color and more value. This printer provides you with the freedom to create marketing collaterals in-house. You can easily make last minute changes to customize your marketing materials for clients. The ease-of-use,
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affordability and speed gives you the chose to create powerful, professional communications that can help you stand out fro your competitions. Office Jet : Communicate with all in one convenience This series provides the all in one feature that a modern day business enterprise is always looking for. It provides the Printer / Fax / Scanner / Copier facilities to the user. This product line has also been segmented to provide low cost solutions to households as well as high cost, high capability solutions for the industry users. HP PSC 1315 provides multifunction capabilities in a compact all in one design complete with foldable space saving tray to the home users. The capabilities provided and the features provided can be easily summed up as its home creativity made easy. HP PSC 2410 also provides similar features but has been enhanced to provide a 2.5 color LCD monitor and a multi slot memory card reader implying that the user no longer needs a computer to get the printouts of photographs clicked with a digital camera. The user can simply plug the memory card, view the picture in the LCD provided the take a printout. This line o PSC series was further innovated to provide the HP office jet 4255 all-in-one printer/fax/scanner/copier/phone, now you can even made phone calls with the integrated handset while the built-in 33.6 kbps modem provides fast color faxing capability. Now you can Communicate with all-in-one convenience.
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OBJECTIVE
The main aim behind working on this research project work is to study and understand the key issues related to the marketing strategies of hp printers What are the various BTL activities done by the hp for its brand promtion. I sincerely believe that working on this project will help me to gain huge confidence and experience in the marketing field. Hewlett Packard is the biggest giant which deals in computer and its peripherals, it had reached this point after carefully planning its each and every step. It had to formulate very clever marketing and financial strategies so that their sales are maximum and earn huge profits by maintaining their existing customers and also trying to bring the potential customers into their respective companies. To understand what hp offers to its customers and how it had maintained its customer relationship. How the customers issues are solved. The Objective of My Research Study is What different categories of printers are offered by HP Various strategies adopted by Hp . Future products & Competitors strategy. Customers issues and solving their problems. To study and analyze the brand position of HP Printer in the Market. To study product, price, quality, and customer satisfaction.
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RESEARCH METHODOLGY
A research design is purely and simple the framework or plan for a study that guides the collection and analysis of data. The survey research was used in this project, because consumers feedback was necessary for obtaining the data. Primary data was collected by the questionnaire based market survey. Secondary data was obtained from journals, magazines, newspapers and books and of course the internet.
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LITERATURE REVIEW
COMPANY PROFILE
The Hewlett-Packard Company , commonly referred to as HP, is an American information technology corporation, specializing in personal computers, notebook computers, servers, printers, digital cameras, and calculators, network management software, among other technology related products.It is Headquartered in Palo Alto, California, United States, it has a global presence in the fields of computing, printing, and digital imaging, and also provides software and services..
Founding
William (Bill) Hewlett and David (Dave) Packard both graduated in electrical engineering from Stanford University in 1934. The company originated in a garage in nearby Palo Alto during a fellowship they had with a past professor, Frederick Terman at Stanford during the Great Depression. Terman was considered a mentor to them in forming Hewlett-Packard.[5] The partnership was formalized on January 1, 1939 with an investment of US$538.[6] Hewlett and Packard tossed a coin to decide whether the company they founded would be called Hewlett-Packard or Packard-Hewlett. Packard won the coin toss but named their electronics manufacturing enterprise the "Hewlett-Packard Company". HP incorporated on August 8, 1947, and went public on November 6, 1957. Of the many projects they worked on, their very first financially successful product was a precision audio oscillator, the Model HP200A. Their innovation was the use of a small light bulb as a temperature dependent resistor in a critical portion of the circuit. This allowed them to sell the Model 200A for $54.40 when competitors were selling less stable oscillators for over $200. The Model 200 series of generators continued until at least 1972 as the 200AB, still tube-based but improved in design through the years. At 33 years, it was perhaps the longest-selling basic electronic design of all time.
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One of the company's earliest customers was The Walt Disney Company, who bought eight Model 200B oscillators (at $71.50 each) for use in certifying the Fantasound surround sound systems installed in theaters for the movie Fantasia.
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HP LaserJet 1160 printer Professional performance at an affordable price HP LaserJet 1320 printer series Fast, expandable, network-capable
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The most affordable and compact LaserJet all-in-one designed to save office space. A versatile device and ideal for those looking to replace or upgrade their fax machines. HP LASERJET 3030 ALL-IN-ONE PRINTER LaserJet all-in-ones that delivers fast and reliable results for SOHO/SMB users in a space-saving design. The HP LaserJet 3020 provides businesses with integrated quality laser printing, fast flatbed copying and colour scanning, while the HP LaserJet 3030 all-in-one includes an additional fax function. Design for Environment (DfE) As a leading supplier of consumer IT products to small and medium enterprises HP has maintained a constant impact on its environment through its products. HP started with a Design for Environment (DfE) program in 1992. Design-for-Environment (DfE) is an engineering perspective which the environmentally related characteristics of a product, process or facility are optimized. Together, HPs product stewards and product designers identify, prioritize and recommend environmental improvements through a company-wide DfE program. HPs DfE guidelines derive from evolving customer expectations and regulatory requirements, but they are also influenced by the personal commitment of its employees.
PROMOTION
Promotion is one of the four Ps of marketing. Promotion means to create awareness although awareness is just the beginning. Good promotion compels the buyer to buy. The need for the product has to be addressed and how does it solve those customers needs of which even the customer has no idea. Promotion is unlimited. But it also not limited only to the amount of TV, radio, and newspaper advertising that one can do. But is limited by what works best for a company? The following chart helps us to understand the importance of the various tools or the elements of the promotion mix that can be used.
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Thus promotional Management can be defined as the process of coordinating the promotional mix elements to develop a controlled and integrated program of effective marketing communication. It involves various decisions areas such as : which promotional tools to use and how to combine them effectively. HP has been the precursor of growth in the printer market. HPs YOU and HP approach has yielded great dividends for the company. The company has been at the forefront of innovation, with newer and more up to date products hitting the market every three months to six months. HP does not use TV and Radio advertising to promote its printers; it makes use of print advertising to put forward its range of products. It also has time-to-time bundle offers where one product may be bundled with another product to push the sales of both the products. For example : HP recently had a offer where they bundled their newly launched HP Photo Smart digital cameras with HP Photo smart 7260 printer. They also use the coupons to provide the customer with special offers. The latest initiative in this direction was to provide the customers with a coupon that entitled the customer to three year extended warranty on a nominal payment of Rs. 250. After acquiring Compaq, HP has earmarked half of its advertising budget to promote that brand. In a concerted effort, HP will be spending at least half its advertising budget to create a cohesive, branded image that holds across all regions and products lines. One Voice is a project designed to unify the look of HP products, consolidate suppliers and agencies and renegotiate prices to create consistency. One voice is also aimed at HP employees themselves, who are increasing asked to look outside their individual divisions, and work to sell the company as a whole, looking for added revenue, and building new products like expensive printing system tied to HP data centers, that cross traditional lines of business. HP does not disclose how big that budget is other than less than 5% of total revenue.
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YOU AND HP
According to print report HP has put aside a sum of $400 million to push its image among the customers with the launch of you and HP campaign. It was ranked 12th among all global brands in terms of dollar value by Business Week;s third annual brand survey. We wanted to work with a reliable company that had a genuine interest in working with us and was as concerned about our problems as we were. -David Dikeler Manager, Customer Services & IT Bayers Choice Ltd. This kind of reputation has been a result of a constant effort of the Company to provide highest quality after sale service to its customers and clients. In order to provide services to its clients HP launched HP Care Pack Services which not only provides solution to common customer problems but also provide convenient and consistent solutions for many environments. HP has a 200 strong services network to meet the needs and requirements of the clients. HP service centers replace the faulty parts in your printer in case of a problem no repairing of faulty parts is undertaken. The company also has a policy where by which the client can even be given a new printer in case of a problem that cannot be fixed even with part replacement. This kind of service is not only provided for printers within the warranty period but also outside warranty for a price. HP DeskJet printers come with a one year replacement warranty which ensures the customer a complete replacement of the printer in case of a fault which cannot be corrected by replacing some parts. This warranty period extents three years in case of LaserJet and Office Jet Printers. PLACE Distribution Channel: HP has no manufacturing facilities in India and they import printer and their accessories from Hong Kong and Taiwan. HP has three national level distributors in
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Delhi, Mumbai and Chennai. These distributors then supply the requested units to the regional distributors who in turn provide the feeder service to Local Distributors who are in direct contact with dealers and resellers. Company has observed a policy where by which they intend to have a dealer / retailer or resellers with in a radius of ten kilometers in all the major cites of India. This network of dealers which is not fully in place as of now is still reaping rich dividends for the company. PRICE HP Produces wide range of printers varies from a minimum of Rs. 2999 to a maximum of Rs. 13,99,999. Pricing has been a major hindrance for the growth and prosperity of HP Printers in India. Company has no manufacturing facilities in India as a result of which they have to import fully manufactured units from Hong Kong, Taiwan, and China; this is adding to the cost greatly due to the import duly regulations. In spit of duty cuts the prices are still high and are out of reach for some sections of the market. Company provides a one year replacement warranty on its DeskJet printers and a three year replacement warranty on its LaserJet and Office Jet printers. This further adds to the cost of the company. Company has also launched its toll free help line in India to service queries to the customers. This is an added cost to the company. Products being highly specialized and complex require staff training which is another addition to the cost pie.
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The advertising effort is part of a broader strategy within HP to keep the printer unit's revenue increasing at a rate of 4% to 6% a year amid rising competition from digital technologies and a slowdown in overall demand for printers in some markets. HP's printer division generated $26.7 billion in sales in the fiscal year that ended October, 2006. Within HP, the focus is not merely on "printer units sold" but on "share of pages printed," . Even the executive vice-president of the printer business says that it helps managers think broadly about many kinds of materials that customers print, from photos and party invitations to business stationery to marketing and advertising materials.
Stefani as Saleswoman
Its new advertising clearly emphasizes the act of printing over the printers themselves. Using the tagline, "What do you have to say?," TV and billboard ads play up the idea of creative expression and direct viewers to HP's Web site, where, HP says, the heart of the campaign lies. On pages devoted to Stefani (hired by HP's camera business as a celebrity endorser in 2005), customers can view and download photos that she has provided exclusively to HP. Consumers can use those free photos, some of which show Stefani performing, to create scrapbookssay, of a particular concert they attended. The site also offers some of Stefani's designs for birth announcements, greeting cards, CD covers, and paper dolls. At another page on the HP site aimed at small businesses, customers wanting to design stationery or business cards can download free fonts and templates provided by New York graphic designer Paula Scher. HP, which expects the printer campaign to last at least several years, had spent $300 million on the effort in the first year. The company as a whole spent about $472.1 million on advertising time and space in 2006, down 7% from the prior year . The printer effort follows the company's successful "The computer is personal again" campaign for PCs, which emphasizes how celebrities and other high-profile businesspeople, including wedding-gown designer Vera Wang, use HP equipment. That campaign began in mid-2006.
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Playing up the HP brand and the experience of printing is a smart move. For a printer company, "it's a tough proposition to be different, since all printers look the same HEWLETT-PACKARD India Pvt Ltd has also chalked out a new marketing strategy with special focus on the eastern region, and has unveiled a range of printing and imaging solutions. These are priced at between Rs 75,000 and Rs 4.5 lakh. A total of 16 variants of four product series were launched here. ``The new family of printers breaks price, performance and ease-of-use barriers by providing business customers with compelling reasons to print everyday business communications in colour. These new generation products are not just generic products but are designed to be applicationsspecific. International Data Corporation (IDC) has pegged the size of the Indian market for laserjet printers at 1.20 lakh units per annum. The market for inkjet printers has been pegged at 3.6 lakh units per annum. The market for imaging and printing products is stated to be growing at 18-20 per cent annually. In fact, an IDC study has revealed that 42 per cent of all personal and workgroup printers installed in businesses are colour devices. Several business houses are looking to supplement their office networks with colour with a view to breaking through the communications clutter. Hewlett-Packard India has a 79 per cent share of the domestic market for inkjet printers even as its marketshare in large format printers for graphic arts and large format printers for technical applications stand at 60 per cent and 90 per cent, respectively.
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SWOT ANALYSIS
SWOT Analysis is very effective way of identifying your Strengths and Weakness, and of examining the Opportunities and Threats you face. Carrying out an analysis using the SWOT framework helps you to focus your activities into areas where you are strong and where the greatest opportunities lie.
STRENGTH: The company is a market leader and has become all the more formidable as far as reputation is concerned after a merger with Compaq. Such a position has not been gained overnight but by perseverance and quality service being provided for a period of time after its inception in 1939. In the printers segment, HP has carved a big niche among the SMEs & Home segments. It has about 60% market share as far as inkjet are concerned and about 70% market share in the laser printer market. For customer relationship management, they have a process of taking regular customer feedback on the products they have purchased and the same goes as an input to relevant teams to improve upon. Moreover their service quality is the key to their customer retention. Also a major factor esp. in printers is that the printer cartridges / toners / refillable is readily available all over the country. In addition to international level quality being offered, the printers are designed to be robust and reliable esp. in testing conditions in India. Also there have been constant endeavor from R & D to bring printers with new technologies in the market before their competitors. Like the introduction of Multifunctional devices. Broadband
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networking enabled, Bluetooth Networking and printers with battery backup etc. They are being served by very efficient managers who have caught the nerves of the customers just right and provide them with the right kind of product that are intrudes at a rate of new product of every 6 months. At HP there has been a continuous thrust on Service quality, thats why they have a prompt replacement policy, i.e. the defected parts are replaced to reduce the downtime of the systems. They have a strong network of 200+ HP & HP authorized service centers. The distribution team has been broadly divided in three centers Mumbai, Delhi an Chennai. And further there are over 2000 resellers spanning over the country covering almost all the major centers in India. The majority of sales happen as a consequence of consultation from HP to its prospective customers. Their sales consultants with their customer centric approach, together with a wide range or printers, help HP sales effectiveness. They are being served by very efficient managers who have caught the nerves of the customers just right and provide them with the right kind of product that are intrudes at a rate of a new product every six months. WEAKNESS: The use of lower performance Transmeta chips in order to achieve high density and lower power feels like the re-visiting of past mistakes form the early days of blade serves. Users arent usually satisfied with slower desktop performance. With regards to positioning when HP started its operations in India, it kept its prices very high with a view to cater only to the upper users of computers. This resulted in
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putting the mindset of the general public that it was an expensive product although a quality product with high prices.
OPPORTUNITIES:
HP has as yet catered only in big cities and the metropolitans, but with emerging markets it can look to venture into the smaller cities and towns, where the market is yet untapped. HP has recently started to push in sale of multifunction printer. Thus, it has an opportunity to expand its business operations, along with providing multi-services to the customers. HP has an opportunity to encourage laser printer sale over inkjet by advertising get into mass media for advertising its product its product so that it can reach out the larger number of copies of people.
THREAT:
Until the entry of Samsung / Epson like big companies in the printer market HP had a monopoly in the printer market, now a stiff competition from these players has resulted in Barista having to pull up their socks and work hard to sustain their position in the market. HP Printers are priced high as compared to other printers in the market. The companies entering in the market are introducing the product at a slightly low price creating a threat to existing HP Printer market. In addition, the spurious cartridges available in the market are earning bad name for the company.
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A printer has become a basic necessity for any IT industry in addition to other industries and individual customers. The Photostat, carbon copies and fax cannot substitute printouts. This product has got so deeply engraved into the minds of the consumer is difficult to be replaced or for that matter even substituted.
SAMSUNG
Samsung is a key player in printer market with strong brand awareness and act as a strong market challenger to HP. Samsung printers are technologically sound as HP printers with key features like no noise i.e. noise level below 48 dB as compared to other printers being 52 dB or 54dB. These printers have got lowest noise level among all the competitors. Only Samsung printers provide free auto duplex printing. For others, the duplex facility is either expensive or not available Samsungs quality, sales
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force, dealership and promotion schemes are as effective as HP. In the color laser printer class, Samsung is giving tough competition to HP.
CANON
Canon has an edge over HP in photo printers. It does not have as good sales force as HP has. Moreover, its distribution system also has a setback as compared to HP. But in photo pointers segment, Canon has proved its superiority by having more share of mind of the customers. Recently, Canon has employed integrated circuited manufacturing techniques to produce a print head capable of delivering a print quality that in many cases exceeds the results of more costly six ink systems of its competitors. The secret to the 1965s speed lies in the print head. Unlike other manufactures who must assemble their print heads from a multitude of components, Canon employs a proprietary etching process similar to that used in semi-conductor manufacture. The result is smaller nozzles, greater nozzle density and longer print heads. The extremely precise 10-micron diameter nozzles are almost half the diameter of Canons nearest rival and are placed seven times closer together. Minuscule 2pl droplets are ejected with high frequency and accuracy. Combined, these features produce a print head that puts more ink down on the page in less time for record breaking print speeds.
XEROX
Xerox Corporation is a $15.7 billion technology and services enterprises that helps businesses deploy smart document management strategies and find better ways to work. Its intent is to constantly lead with innovative technologies, products and solutions that customers can depend upon to improve business results.
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systems include color and black & white printing and publishing systems, digital presses and book factories, multifunction devices, laser and solid ink network printers, copiers and fax machines. Xerox gives competition to HP in multifunction printers. Xerox is No.130 among the Fortune 500 companies. The companys operations are guided by customer focused and employee- centered core values such as social responsibly, diversity, and quality augmented by a passion for innovation, speed and adaptability.
HP AS MARKET LEADER
HP has the largest share in the printer market. HP imaging and Printing posted record third quarter revenue of $5.6 billion, up 8% year-over-year. During the quarter HP shipped almost 10 million, printers, bringing total shipments to approximately 320millioin units worldwide. Business hardware grew 8% year-over-year driven by strong unit shipments in color and mono lasers, business inkjets and multifunctional printers. Home hardware decreased 5% with All-in-one unit sales growth offset by declining single-function printers and normal seasonality. Supply grew 9% fueled by strong growth in color and monochrome laser supplies. Digital imaging grew 11% as strong digital camera unit shipments helped offset an expected decline in scanner market. Operating profit of $837 million was also a third quarter record and represented 14.8% of revenue.
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Customer Knowledge: HP is a customer centric industry and takes consultation from the customers and studies their needs. In other words through market research and intelligence gathering, HP studies its customers-both industry and individuals and utilize the data in improving its products. Product knowledge: HP is an active product innovator. Presently more than eight types of HP printers are in the market with further specifications and varieties. HP printers range from black & white inkjet printers to multifunctional all in one printer. HP launched more than 660 new products in 2003 and closed the year with 21000 patents in force worldwide, up from 17000 in the year 2002. HP spent 43.7 billion on R & D, focused in areas of innovations where it made unique contribution and lead HP invested more than $1 billion in software across its portfolio, $600 in building the HP brand, $400 million innovating its internal it systems. Quality Strategy : HP design products of superior quality and it is also the USP of the company. That is why HP is known for its brand image. Line Extension Strategy: HP produces its printers for all industry requirements and individual users. This strategy gives HP edge overall existing printer manufactures and prevent the competitors from sharing the mind and heart of consumers. Aggressive Sales force: HP has three national distributors in Delhi, Mumbai and Chennai and 2000 resellers all over the country, thus making the product available to the customers at their doors. This huge sales force serve the retail giant works closely to improve both the products that go the stores and the process by which they get there.
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Effective sales promotion : HPs sales promotion department trains its brand managers on the most effective promotions to achieve particular objectives. The department develops an expertise of these deals effectiveness under varying circumstances. At the same time, HP tries to minimize the use of sales promotion or low prices. Performance: HP printers are known for their reliability and durability. It is key buyer consideration in the choice of printers. Dealership System : HP has three distributors at the national level in Delhi, Mumbai and Chennai. It also has online retailing and reselling facility. Some of its online retailers are amazon.com, compusa.com, staples.com, computer4sure.com,
vikings.com Service: HP gives warrantee on its products and has a repayment policy in case of a faulty product delivered. Other advertisement done for HP is by following push methodology, range addition and other addition. HP also offers lease and financing option to the buyers with low or no rate of interest. HP believes that In this frenzied and competitive marketplace, you not only need to provide customers with solutions to their business problems, but to close a deal, you also have to give them more value for their dollar than the next provide. HP Financial Services delivers financial tools to help the customers to achieve superior business results by closing more transactions, closing larger transactions, closing more profitable transactions, adding values to the customer experience and thus keeping more customers.
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DATA ANALYSIS
QUESTIONNAIRE
This survey is being carried out to gather information about the printer usage and buying habits of the consumers. 1. Which brands of printers are you aware of?
35% 30% 25% 20% 15% 10% 5% 0% HP EPSON CANON SAMSUNG OTHERS (SPECIFY)
Almost most of the Respondents are aware of hp printers and they prefer hp printers in comparison to others competitors printers
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Yes
No
Marketing Strategies of HP Printers 3. If yes, then which one? HP Epson Canon Samsung Others
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Most of the respondents use printers and most of them have hp in their home as well offices.
4.
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Print media TV advertisement Friends and Family Showroom dealers Others Dont know
Hp Promotion activities are well known to each and every person, whether it is BTL or ATL Activities. Most of the respondents know hp as a brand .
5.
Rank in order of preference (1-5) the parameters considered by u while purchasing a printer (1 is most important).
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In this question I got different opinions from different categories of people well more people stressed on the after sales service and on the print quality.Price was the not the major factor in deciding the printer. Hp also gives the combination of all in one printers i.e print , scan , Xerox , fax in one machine .
6.
Quality
Price
After
Sale Printing
Brand
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10 2 4 10 7
5 8 3 7 5
Quality
Price
HP
SAMSUNG
Hp always remains consumer first choice for printers as it after sales service support is easily accessible.
7.
What is the primary reason for buying a printer? Convenience Cheaper printouts from outside People you know also have a printer
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It is for faster output and for easy accessibility and with all in one function people choose to buy a printer.
8.
Who/what will you consult before buying a printer? Spouse Children Friends
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It depends on for what purpose printer is being used for whether it is used in homes or it is used in offices.
9.
Who makes decision in you house as to which printer shall be brought? You Your elder siblings Your parents Souse Friends Children Others (please specify)
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OCCUPATION
STUDENTS EMPLOYED
AGE GROUP
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Brief description
INCOME GROUPS
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CHAPTER 5 CONCLUSION
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CONCLUSION
HP is the most successful and established company in Printer market. There are number of conclusions we can draw from this study.
ENVIRONMENT:
The environment of HP printers includes : Micro variables company, Consumers (most important), pubic, employees, intermediaries etc. Macro variables: Demographic factors (age, income, gender, social status), economic factors, etc. HP is the market leader in the printer segment with a market share of 62&. Quality, printing speed, after sales services and brand name are three major appeals in the product. The company should try and integrate all its micro and macro variables. Both micro and macro variables complement each other and go hand in hand. Company should ensure that it is able to extract maximum out of both these variables. An organization like HP is successful today because it has integrated all the elements of supply chain and other variables in its environments.
CONSUMERS:
Changing technology is the key factor which prompts consumers to choose a product in computer hardware. HP has been the market leader because it has continuously innovated in the printer segment and came out with new and useful features. HP should try to satisfy the customers quench for innovative features and usability by bringing variants in the existing product line HP needs to concentrate on consumers at two levels:
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Existing customers : Retaining a customer is much harder that getting a new customer. As a number of new companies have stepped in the market of printer, HP should take feedback from existing consumer and modify their offerings accordingly. Potential customers: These are the people who buy printers but not from HP. It is very critical for HP to identify reasons for their non-usage. The research done shows that the biggest reason for non-usage is price difference in the various printers available in the market. As the individual customer has to see his pocket before investing in this product, this could be a big threat to HP as the competitors are introducing their products in low price range with same features. There is a high level of involvement of the customers in buying the product. A large percentage of initiators in the buying of HP printers are students in the age group 1724. Major reference group includes friends and colleagues.
COMPETITION:
HP is facing competition on two fronts- based on pries and based on services attribute. Company needs to formulate strategies for both kinds of competitors. To face the competition based on price, HP should offer promotions like free gifts, price offs etc so as to induce customers who are more interested in maximizing physical satisfaction by getting more at lesser price. Whereas for competition serving service conscious customers, HP needs to advertise more to highlight their large number of outlets and dealers. The printer is a product found all the IT industries and almost all other industries and IT professionals. The buyers are not price sensitive but there very particular about the quality. As printers are available in a range of prices, different buyers target different price range according to their pocket. At the same time it depends what application does one wants from the printer. Some companies need is restricted to the A4 size printouts but the hoardings and large maps need printer above the range of even 5 lack rupees. Rather, theres no upper limit to the price of a printer.
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Thus, we can conclude by saying that HP has been successful in being a market leader for a number of decades and with its ability to change with consumers need and increasing competition, it can continue to retain its market position forever. It needs to keep a close check on competition and anticipate their strategies. Also a proper integration of all variables in the environment can help HP continue to be a market leader.
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CHAPTER 6 BIBLIOGRAPHY
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BIBLIOGRAPHY
Textbooks
Kotler Philip, (2004) Marketing Management (Pearson Education, New Delhi)
Websites
www.hp.com www.canon.com www.samsung.com www.xerox.com
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CHAPTER 7 ANNEXURE
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ANNEXURE
QUESTIONNAIRE
This survey is being carried out to gather information about the printer usage and buying habits of the consumers. 10. 11. 12. 13. Which brands of printers are you aware of? HP EPSON CANON SAMSUNG OTHERS (SPECIFY) Do you have a printer? Yes No If yes, then which one? HP Epson Canon Samsung Others How did you come to know about HP Printer? Print media TV advertisement Friends and Family Showroom dealers Others
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Rank in order of preference (1-5) the parameters considered by u while purchasing a printer (1 is most important). Print quality Brand After sales services Price Printing speed
15.
Price 5 8 3 7 5
After Service 2 7 1 7 8
Brand Image 3 2 7 5 0
What is the primary reason for buying a printer? Convenience Cheaper printouts from outside People you know also have a printer
17.
Marketing Strategies of HP Printers Children Friends Colleagues Internet Magazines / newspapers Brochures Showrooms
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18.
Who makes decision in you house as to which printer shall be brought? You Your elder siblings Your parents Souse Friends Children Others (please specify)
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Thesis Topic: A perspective on the marketing strategies of HP (Printers), Date: 24/05/2008 Details of the student Name - Mayank Dureja Batch - PGP SS 06-08 Alumni Id DS68-M120 Phone No - 9818574847 Email Id - dureja.mayank@gmail.com Date when the guide was consulted: 30/04/08 Progress of the work : 1) Computer Hardware Market in India. 2) Scope of Hardware Market , Problems . 3) Company Profile of HP (Hewlett Packard) 4) Marketing Mix 4Ps. Comments from internal/external guide: Its a good start but need to give more stress on statistical facts and figures to make this thesis attractive. Signature of the external guide: guide: Signature of the internal
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Comments from internal/external guide: Going at a good pace and is now focusing on actual problems faced by the customers. Signature of the external guide: guide: Signature of the internal
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Comments from internal/external guide: Good work done and done a good analysis of competitors BTL MarketingActivities. Signature of the external guide: guide: Signature of the internal
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Comments from internal/external guide: Well he is doing a good work and more important is that he is taking interest and doing a good analysis and research work by studying the previous records and focusing on the future strategies too. Signature of the external guide: guide: Signature of the internal
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Comments from internal/external guide: Its a good thesis with relevant facts and covering all the aspects of marketing strategies done by hp whether its BTL or ATL ctivities. Signature of the external guide: Signature of the internal
guide: