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Straddling all the price segments in the Indian PC mart, HP has a lot going for it

“With so many options available, it is really difficult for the customers to select a notebook that fits their bill, need and their style,” says a multi-brand PC retailer based in the NCR region. “While some are attracted by the amazing looks of a Sony Vaio, a few are pulled towards Lenovo and Acer for their attractive price point, and there are others who get hooked on to the business utilities offered by Toshiba and Dell. However, if there is one brand that encompasses all the attributes of aesthetics, multi-utility, business capability and an attractive price point, it has to be HP.”

Well, this testimonial of sorts from this multi-brand PC retailer clearly defines the edge that HP enjoys in the highly competitive Indian PC market. Right from Lenovo, Sony, Dell, Toshiba to HCL, all are trying their level best to woo Indian consumers with their attractive offerings but it is HP that has continued to master the Indian PC arena with an impressive 22% market share (According to IDC’s second quarter results). Even in the desktop segment, HP maintained an overall lead in the market with a remarkable market share of 16.7%, followed by HCL and Lenovo.

Interestingly, HP has an admirable portfolio with myriad offerings at variable price points. With the Compaq brand at the entry level (the new CQ brand), HP Pavilion at the hi-end multimedia level and HP Compaq brand for the business line products, there is hardly any weak point in the strong PC line up offered by HP in India.

The major reason for the success of the HP brand is that the company puts strong emphasis on getting the brand distinction for its broad portfolio segmentation, a strategy that help consumer choose the best available products in a particular category. Back in 2006, HP launched its new marketing initiative targeted towards the youth with an underline message of ‘computer is personal again’. The campaign was a great hit in the Indian market, creating the much required connect with the customers, especially with the youngsters. Later in 2007, HP realised the growing desire of style amongst the customers and launched the ‘oomph’ concept under which they launched high-end fashion driven PCs and notebook. In the mean time, HP launched the Tablet PCs in India which received immense success within few months of their launch. Remarking on the success of HP’s Tablet PC, Rajiev Grover, Head-Consumer Products, Personal Systems Group, HP India, stated that, “we thought that it would be handy for students and the business people but there seems to be a demand coming from everywhere for the Tablets and we are selling about 2000 Tablet PCs per month, which generates 5% of our revenues.”

Further commenting on HP’s success in the Indian market, Rajiev told 4Ps B&M, “One of the reasons for the leadership of HP in the personal systems space is the strong retail arm of HP.” HP commands a mammoth 40% of the market share in the laptop segment, which couldn’t have been possible without the support of 2,500 odd retailers which are retailing directly, and another 1,000-1,500 retailing through service centres. To further strengthen its retail presence, HP has also ventured into exclusive showrooms called HP World, showcasing the products offered by HP. Till date, HP has come out with 150 such touch points in the form of HP World where the idea is to showcase a whole gamut of HP Pavilion and Compaq Presario notebooks and desktops. A visit to one such outlet in the Bhikaji Cama Place in Delhi, gave us a broader picture of the whole HP portfolio including a variety of printers and computer peripherals. Taking a cue from its PC strategy, HP India has also rolled out more segment specific printers catering to the needs of diversified customers like home users, corporate customers and medium size businesses.


However a key struggle for HP India has been the easy availability of cheap- er fills of printer cartridges, a factor that has had a major blow on the overall margins. However, the year gone by has been a testimonial for HP’s efforts for making the original cartridges popular. The store managers too mentioned that price reduction was one of the major changes apart from giving out free-bees and provision for placing order for the cartridges over phone and internet.

For the uninitiated, apart from dominating the PC market in India, Hewlett-Packard is also a strong player in the server market. It has retained its leadership position in the x86 server market and currently holds an impressive market share of above 30% share in unit shipments. Taking ahead its lead in the server category, HP also boats of an outstanding 71% market share in the blade server category. Not only this, HP also registers a dominating presence in the 1P and 2P server category. Well, such dominance in the server category speaks volumes about a company like HP which is recognised for its personal computers.

“We are delighted that the market has confirmed HP as the server vendor of choice. We will continue to deliver innovation across our entire server portfolio and provide customers with a superior IT infrastructure that helps them drive business and lower costs,” said Rajesh Dhar, Country Manager, Industry Standard Servers, Hewlett-Packard India Sales Pvt. Ltd..

Well, whether it’s the Notebook segment, the desktop domain or the Enterprise vertical, HP has maintained its ascendancy over its competitors. Now, with the competition strengthening in the PC market with the Dell’s overhauled new indirect strategy, Lenovo’s price intrusions and Toshiba’s business vigour, HP will have a lot to strategise in order to maintain its primacy. But with HP’s understanding of the blueprint ‘one size doesn’t fit all’ and its experience of dominating the global PC market under the leadership of its global CEO Mark Hurd, it will be a long-winded endeavour before any other player dares to chip-in near this dominator.


Edit bureau: Surbhi Chawla

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Source : IIPM Editorial, 2008

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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