Office dealers are to reap the rewards as manufacturers slug it out in a battle for market share.
Hewlett-Packard (HP) is the latest company to announce a strategy to aggressively target the imaging and printing sector and pour huge resources into the value-added reseller channel.
The move follows similar strategy announcements from the likes of Xerox and Oki Data, who have launched their own bold initiatives with new products and technology, financial incentives for channel partners and service support schemes.
HP claims it will divert more investment to traditional office copier dealers to create sustainable partnerships and will provide more tools and marketing support. The Palo Alto-based company said it is adding three specialisations to its Preferred Partner Programme. These are office printing, office printing solutions and sales service. The specialisation in sales service is meant to be aimed at Preferred-level partners with a certain level of expertise in HP service sales.
The company aims for its big push to increase the engagement between its solution providers. The leading vendor said it had spent the past 18 months developing the strategy, including extensive market analysis and pin pointing 15,000 accounts where HP was either not present or only present as part of the overall printing strategy.
According to Mark Quiroz, director of sales strategy for HP’s global enterprise business, the research enabled the company to initially target 2,300 of its named accounts. "We have created vertical and horizontal offerings, and added more sales resources to talk directly to these end users," he said. He added that although the company was talking directly to users, any resulting deals would be fulfilled through partners.
"We then wanted to look at the next layer down, after the top 2,300 accounts. We recognised around 11,000 accounts in our territories that we could target," Quiroz said. "There was no point in adding more direct sales resources here; we need to focus on the channel and help them to have the end-user dialogue and do the fulfillment."
HP’s Office Printing Channel Programme (OPCH) will replace the existing regional programmes and place all sectors under one umbrella scheme, Quiroz added: "Previously partners would have had to go to multiple channel programmes – one for hardware, one for software, one for services – in order to get all the benefits available to them. It was very fragmented. With OPCH it brings everything together and will help drive a more consultative approach for VARs."
Bruce Dahlgren, HP’s senior vice president, Imaging and Printing Group, said the strategy is being driven by recent and significant technological advances as well as the industry’s swift uptake of managed print services.
Dahlgren said in an interview: "We want to help enterprise customers manage and deal with these trends and then, ultimately, apply this capability with our channel partners. We know, flat out, we can’t cover this market ourselves and we won’t be successful without our channel. We need to sit down and work with these enterprise partners, work with them to determine how you build a plan around this.
"That is not a direct fulfillment model," Dahlgren added. "We want to create demand by getting to know the customer. We still envision that the fulfillment is best and most likely will go through the channel."
HP’s Imaging and Printing unit is a critical cog in the company’s overall performance, with $28 billion annually in sales including hardware, software and consumables. The company has long been the worldwide market share leader in printers.
The company has been delivering services, including workflow consulting, with solution providers for at least two years in an organised fashion. HP has also been ramping up integration of its advanced print head technology throughout its lineup of printers and multifunction products (MFPs).
"Have we been doing this in past years? We have," Dahlgren said. "But I can tell you it’s intensified over the past 18 months or so with all of our focus here."
Specifically, over the past year HP has engaged 2,300 named customer accounts with account representatives, a team whose mission is to work with those customers, understand their businesses and workflow better, and build a demand for HP products and services. Dahlgren said HP has assigned enough of those representatives to create an approximate ratio of seven customers for each HP representative – with the goal to still fulfill a large chunk of the resulting sales through the channel.