Epson makes an impact on inkjet market

Seiko Epson Corporation picked India as a key country last year, and the results are there for all to see with Epson India’s inkjet sales shooting up by a mammoth 184 percent to over one lakh units. In the process, the company doubled its unit share of the Indian inkjet market, says Prashant L Rao

Suresh Govindachari says Epson is aiming for 30 percent market share in the current year

When Seiko Epson Corporation, Japan shortlisted India as a key country it set an internal target of achieving a 20 percent market share in unit shipments. "That has happened," says Suresh Govindachari, business manager-Consumer Products, Epson India. "We doubled in absolute value. Our growth came at the expense of the other brands," adds Govindachari.

Epson’s inkjet sales for 2002-03 zoomed from 39,796 units to 1,12,991 units, pushing its share of the inkjet market from 8.72 percent to 19.1 percent (all figures are from IDC India). From a look at the numbers, the growth seemed to come at HP’s expense; the dominant player saw its market share drop from 73.66 percent to 60.44 percent. In a way, this was part of a larger trend—second runner-up Canon also saw its market share increase from 5.31 percent to 14 percent.

The five-fold path

Product innovation

Epson India got a bunch of things right. First and foremost was the product. Epson launched the C41SX in June 2002. This inkjet printer led the beginning of the revival for Epson inkjets in India. Epson was aiming high—"We wanted to do to the inkjet market what the Maruti 800 did to cars,"

says Govindachari. The product had some firsts to its credit. It almost doubled entry-level speed and resolution. Launched at a price of Rs 4,500, the C41SX’s specs of 12 ppm (pages per minute) and 1440 x 720 dpi (dots per inch) outclassed the rest of the entry-level pack which were offering 6 ppm and 600 dpi.

The C41SX was a smash hit but Epson didn’t rest on its laurels. Toward end-2002, the company launched DURABrite ink. This is waterproof ink that gives you photo-quality prints on plain paper. Epson claims that these prints last 70 years. That was a breakthrough of sorts as till then, printer vendors said you had to buy expensive photo paper (Rs 600 for 20 A4 sheets). By offering ink that could generate almost the same quality on plain paper, Epson put photo printing within reach of the home user.

The company also launched a 5760 dpi inkjet, the C82. That was the highest resolution on an inkjet till then. Today, all its mid-range inkjets have 5760 dpi capability. The C82’s one-inch printhead makes fewer passes over the paper, letting it print 22 ppm as a result. Another innovation here was the introduction of separate ink cartridges for each colour.

Outdoor promotions

Building awareness was a challenge. Epson rose to it with a 20-city roadshow and a series of end-user promos with a gift that caught the consumer’s fancy—a VIP footloose bag. "VIP was strongly advertising this brand on TV at that time. Recall for the gift was fairly high. We ordered 20,000 bags," says Govindachari.

A new area that the company ventured into for the first time was outdoor hoardings. The theme of these hoardings was "I chose Epson". It was segmented toward college kids, housewives, and office-goers. Each hoarding explained why a particular demographic would choose Epson. "There was a different value proposition for each segment and we gave tangible reasons," says Govindachari.

"A lot of work that’s not visible is the backbone of success," says Govindachari. He’s referring to the roadshows and demos that helped push Epson up the ladder. The company used to keep printers at locations such as Foodworld (a supermarket), where it conducted demos where you clicked a photo with a digicam and printed it on the spot. Epson did that consistently; it had a van with billboards and folks handing out leaflets at public locations.

Getting cosy with the channel

The channel was the next piece of the puzzle. Epson took care of some straightforward issues such as paying partners on time, which helped build confidence. Consistent schemes helped ensure profitability. Epson has a three-tier channel model. At the top there are the biggies—Tech Pacific and Redington. At the second level come the dealers—a hundred of them across the country. Finally, you have the resellers. Epson had something for everybody—for the distributors it was executive incentives, for dealers there were monthly schemes and for resellers, well, hit that target and off they flew to Bangkok.

PC bundling

Another big push was PC bundling. For this market, Epson had a special model, the C41UX, which was created purely for OEM bundling. It was a brown box with USB support. The retail model had a parallel port and was more colourful. The UX wasn’t available through the channel. Epson India tied up with Zenith, PCS and Acer for bundling. The company claims that it was the numero uno vendor in terms of PC bundling last year.

Innovative outdoor promotions played a significant role in Epson’s success

Niche targeting

Epson’s brand equity has traditionally been strong in the advertising, photo labs and pre-press segments. In the past, Epson had been unable to cater to demand in this segment. It addressed supply chain issues and fulfilled latent demand in 2002-03.

The company came out with some rather unique products here. The SP925 is the only printer capable of printing passport snaps without a PC. Normally, when you click a photograph using a digicam, it’s horizontal and you need a PC to flip the picture. The SP925 takes care of all that and it also takes care of resizing the image. Epson India tied up with Olympus to bundle the 925 with Olympus’ cameras.

Epson also launched its MFD (Multi Function Device) in February 2003. It went after market niches here. The jewellery sector was one such target segment where Epson offered jewellers the ability to put a jewel on the scanner, scan and print. The big thing here was that jewellers could copy the jewel by doing a 3D scan. Another plus for this segment lay in the fact that as gold jewellery is the norm, a lot of yellow gets used. Having a separate ink cartridge for that colour helped bring the cost of consumables down.

Keeping consumable costs low

Epson also tried the tack of pricing its cartridges low. For instance, the black ink cartridge for the C41SX was priced at Rs 500 as against Rs 800 for that of competing products. Similarly, the colour cartridge was priced at Rs 800 as against Rs 1,200 for the competition.

The revised target

Epson India has ambitious plans—it wants to get 30 percent (by units) of the Indian inkjet market this year. "We have the base. The products support us. We just launched a product that is the first of its kind with no competing brand—it lets you print on CDs. It’s flying off the shelves." For videographers shooting wedding videos or companies putting presentations on CD-Rs, the Epson Stylus Photo 900 is a perfect solution.

"The technology edge will continue. Marketing-wise we are stronger than we were 18 months back. We are expanding into B and C class cities. In terms of service we have 133 authorised service partners at 64 locations," says Govindachari.

At present Epson’s sales break up 73:27, favouring the channel. "We need to balance the mix. PC bundling is like jam, it’s nice when you have it but retail is still our bread and butter," says Govindachari.

End-July 2003 found Epson launching the C43SX, the successor to the C41SX, offering double the resolution (2880 dpi) and priced at Rs. 3,950. "The C43SX printers will build on the success of our top-selling C41 printers, the most successful value inkjet printer of 2002," says Govindachari.