Thursday, September 27, 2007

Note to Xerox -- you got HP's attention!

On Monday I posted about Xerox (NYSE: XRX) announcing a couple of new solid inkjet printers and all-in-ones, along with a new pricing scheme and corresponding marketing slogan, "color printing at black and white prices". Like Eastman Kodak Company's early-2007 launch in the photo-printer market, Xerox is banking on boosting color print demand in the office through much lower supplies prices, with increased printer prices to go along with the rest of the equation. And of course, the benchmark in this category is market-leader HP (NYSE: HPQ) and their color laser printer product line. Their marketing materials and web site compares the direct cost of printing as well as the green/economics traits of both companies' products.

Defying conventional marketing wisdom of not commenting on lesser competitors' PR and advertising, HP has been lashing out in the days following. Vince Ferraro's LaserJet blog, usually home to more positive and even esoteric subjects, takes on a number of the Xerox arguments (see "Xerox Solid Ink -- Reality vs The Hype"). And another blog post from yesterday, on the ComputerWorld blog (see "Phaser or LaserJet -- HP and Xerox duke it out"), takes Vince's claim-by-claim analysis even further, with a little less bias, one might argue. I recommend reading both.

Again, traditional marketing practices call for little or no response when a lesser competitor threatens a market leader. So it's interesting to note when HP responds so strongly. It's mindful of their response to the Silverbrook / Memjet announcement six months ago (see "HP, Memjet: Words Heating Up"). HP's color laser business has been a shining star for the company, and has been a featured performer in their quarterly earnings briefs the last few years (see "HP Printer Metrics"), so this week's reaction shows HP feels the need to defend its turf.

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