Hewlett-Packard continues to innovate in printer space

Hewlett-Packard has been one of the globally dominant players in the peripherals segment for decades. In this country too HP has a clear lead, especially in the laser printer segment, controlling a whopping 85 percent share of the market. For the calendar year 2002, volumes in the laser printer market are expected to touch 1,00,000 units, according to IDC. Says Nitin Hiranandani, country business manager, imaging and printing systems, BCSO, Hewlett-Packard India, “We are working to ensure that we continue to dominate this market as clear leaders.”

According to Hiranandani, one of the key focus areas of HP is to deliver state-of-the-art products to the Indian consumer. Complementing this wide-ranging product portfolio would be a number of channel and end-user promotional schemes. “Currently we are giving a toner free with one series of printers, one UPS free with another product,” explains Hiranandani. “The other focus area is on high-end printing and solution sales. We have been able to get a major share of the high-end printer market, including colour. This has been possible because we have deployed dedicated sales people across the country to sell high-end printer solutions to customers.”

Like everyone else, Hewlett-Packard India too was impacted by the overall slowdown in the market last year, and had to find innovative ways to get around customer reluctance to purchase. “Especially for the laser printer category, the challenge has been to effectively communicate and educate end-customers on the lowest total cost of ownership possible by the usage of these printers,” says Hiranandani.

As we move ahead into the new financial year, HP India is looking for substantial growth in the multifunction product segment. A multifunction product combines the functionality of three or more products such as a printer, scanner, fax and copying machine all into a single device. Says Hiranandani, “The multifunction product segment is expected to grow. The customer now sees value in the cost-effective, space-saving solution offered in a multifunction product and this is ideal for small businesses. HP’s All-in-one products are seeing acceptance by the SOHO users and workgroups in organisations that require the functionality of all these products at their desktops.”

Looking at trends that can be expected to emerge in the printing segment in the year ahead, Hiranandani is placing his bets on the increased occurrence of “in-house printing.” This refers to corporates and other organisations increasingly looking to undertake small print jobs such as brochures, invites, mailers, etc, in-house, rather than outsourcing them to an offset printing shop. This not only adds up in terms of savings but also provides the user with greater control on the creative material.

Summing up HP India’s printer plans for the year ahead, Hiranandani says, “Our objective is to deliver state-of-the-art products to the Indian customer. We want our products to very clearly add value to customer applications. In our recent product launches we have been able to achieve this by providing features like duplexing, Print Web server, etc. HP on a continuous basis has pioneered breakthrough technologies in the laser printer market.”

Samsung aims to sustain market share amidst slowdown

Sustaining the healthy market share that the company has managed to capture in the last couple of years is the objective of Samsung Electronics India Information and Telecommunication (SEIIT), during 2002-03, with expansion in certain categories also on the cards.

“The challenge in the next financial year is to sustain market share and ride through the market slowdown. Major efforts will be put into market expansion and upgradation of product usage in specific categories,” says Vivek Prakash, general manager-sales and marketing, SEIIT.

Not surprisingly, the efforts poured into sustaining the market share are so designed as to automatically lead to grabbing a larger chunk from the total market. In fact this is what has happened consistently over the years. Take for instance the PC monitor market. Samsung had a 37 percent share here in 1999, which jumped to 44 percent in 2000 and further increased to 53 percent in 2001 and all the while the effort was to sustain market share. The company now hopes to rope in 58 percent of the monitor market in the calendar year 2002.

And this is not just true for monitors. Samsung has achieved a healthy growth rate year-on-year for most of its peripheral products. The TFT-LCD monitors that the company puts as a separate category and had launched only in 2000, secured 71 percent market share in the same year which is expected to rise to 73 percent by end-2002. The HDD products which stood at 18 percent in 1999 today occupy 36 percent market share, which is expected to increase to 45 percent by end-2002. In the DVD product category, Samsung hopes to reach 55 percent market share by end-2002, up from the current share of 46 percent.

“The key achievement in the last two years was the substantial market share build-up in the storage category. The same will continue to be a focus area of activity with special emphasis on CD-RW drives and the 7,200 rpm drives,” says Prakash.

The company has outlined two big initiatives for the next fiscal. The first is to weave all its manufacturing marketing and promotion strategies around 17” monitors from the current 15” size. Secondly, to upgrade to 40 GB as an entry capacity from the current 20 GB in hard disk drives.

On the PC monitor front, the company foresees two distinct categories emerging in the next fiscal consumer and commercial. The consumer category will be a price-sensitive market aspiring for a brighter display, optimisation of screen for Internet surfing and video displays. “Samsung is the world’s dominant technology provider in this category and is also the biggest brand and manufacturer two out of five units worldwide are made by Samsung. We are also working on the latest technology in this area: Highlight Zone, for greater clarity and image contrast; and Dynaflat X, the latest flat tube technology,” says Prakash.

Though the company has formulated innovative strategies for the next fiscal, Prakash on the other hand candidly confirms that 2002-03 may not turn out to be the best year for the peripherals industry in India.

“The entire IT business of the company is linked to PC industry fortunes. Most products are either used to make a PC or are required and bought only after the actual PC purchase has happened. Immediate growth prospects of the industry are not very bright. The overall Indian PC market is expected to rebound only by the end of 2002-03,” he says.

LG all set for a quantum leap

In keeping with its international philosophy, LG Electronics India has set itself a tough target for the coming fiscal it hopes to achieve a quantum jump from its current 18 percent market share to 44 percent by the end of 2002-03. From the monitor business itself, the expected turnover is expected to be in excess of Rs 425 crore by 2002-03.

The company is moving to meet the target in three ways. One, by formulating aggressive marketing and promotional campaigns. Two, launching new products to cater to all customer segments. And finally, fine-tuning its service in order to far exceed industry standards.

Today, the company faces three critical challenges: Price deterioration, quality issues and the economic slowdown. Though nothing can be done about price deterioration, on the quality front the company has strengthened its R&D team to offer more value for money to customers. LG Monitors support higher frequencies and also meet MPR II norms for electric and magnetic field emissions. Constant efforts are being made to further improve the service and warranty offerings.

“The slowdown in the PC industry has also brought about a sluggish trend in the high-end monitor segment,” says Pradeep Tognatta, vice president - sales & marketing, LG Electronics India. “The market does have a chance of recovery this year with the first signs emerging in the second quarter of FY 2002-03 starting July. However, the market is expected to recover completely only by the JFM quarter of 2003. Nevertheless, the post-PC sale market of monitors has balanced the slowdown to some extent.”

With a shift in the mindset of end-customers, the company is upgrading its channel dynamics. “2002-03 will see the channel re-aligning itself to changing trends, with box movers becoming VARs, systems assemblers taking up solution provision, resellers adding support to their portfolio and topline-conscious resellers now focusing on the bottomline. Single brand counters are changing to multi-brand counters, which are branching out into retailing. The continuing trend toward thinning bottomlines, coupled with increased demand for value addition, compels the channel to re-align itself to complement the two,” says Tognatta.

Powerware wants to electrify growth pace

Just a little over a year old in India, Powerware International, the Indian subsidiary of the UK-based $12 billion Invensys’ power solutions division has plans to end the coming financial year 2002-03 with a turnover of Rs 80 crore. This translates into a 10 percent market share certainly ambitious figures taking into consideration that the company stated its operations in December 2000 and has to compete with well-entrenched players like APC, Emerson and Elnova, among others. The company clocked a turnover of Rs 30 crore in the year 2001-2002.

The company is moving ahead with a single aim, which is to grow at a quicker pace than the overall UPS market in 2002-03. “The IT UPS market is expected to grow by 10 percent in the next financial year and we plan to grow faster than this. We plan to more than double our revenue sales in FY 2002-03,” says Deepak Sharma, managing director, Powerware International.

Powerware has established a manufacturing facility for its upper range of Uninterrupted Power Supply (UPS) products in Gurgaon. “The current size of the Indian market is around Rs 800 crore split into three parts, namely, entry-level products, mid UPS segment and high-end UPS market. We have carefully devised strategies to tap each segment, especially the mid UPS segment of 1-6KVA with an estimated market size of Rs 200 crore,” says Sharma.