Thursday, September 13, 2007

Observations: HP's $300 Million Advertising Campaign and The Four P's of Marketing

HP's $300 Million Advertising Campaign
and The Four P's of Marketing

In my August column, I provided a history of printing from the Web and promised in this month's part two to "take a more detailed look at the new HP (NYSE HPQ) Web-printing solutions and work at seeking out my favorite quarry—the great marketing principles of winning value propositions aimed at satisfying customers." I have been true to that goal in the following column, although not without a little head scratching along the way.

As a part-time faculty member teaching graduate-level marketing courses for the last year, I have enjoyed re-visiting many of the old concepts that I learned years ago in college and graduate school business courses. Of course much is relatively new in today’s curricula, but some of the best concepts have not changed a whole lot.
The old faithful marketing mix, i.e. the Four P's, is one of those concepts. The Wikipedia entry for "Marketing Mix" discusses the Four P's — Place, Product, Price and Promotion—and pegs the origin of the concept back to 1948, which is actually long before I started college, believe it or not. Some experts have tried to add a fifth P, or change the P's to C's, and there are no doubt many other variations and aberrations of which I'm not aware. But I prefer the original incarnation, and recalling it helped me to understand the marketing situation currently facing the management team of HP’s Imaging and Printing Group (IPG).

First, let me submit that many of us started out as primarily "product" people and that mindset continues today. Whether from a technical background, or, like me, from product marketing, which some would say is the high tech world's only truly legitimate marketing function, the world of hard copy pretty much revolves around product. We should know better, and we tell ourselves to take a broader view of what product means—not just hardware but software, accessories, and even that boxy item at the other end of the cable (i.e. computer). Or we go further and talk about the solution, an almost mythical concept that is difficult to describe, although no one would admit as such.

However, the focus usually comes back to product, if not hardware, then at least (visible) software. So when faced with HP's August 28th announcement of Print 2.0, which followed an earlier announcement in May (see The Hard Copy of Observer, 7/07), we in the industry tend to sift through to see what is really meaningful…and preferably in the form of new boxes. (The October issue of The Hard Copy Observer will include complete coverage of HP's announcements.)

I am subject to that tendency and have gravitated to the Web-printing part of the Print 2.0 equation, where there are improvements and innovations that I can see. What I have seen are some very interesting and valuable contributions to an improved customer experience, which really started back a dozen years ago but have picked up substantial steam with HP's March 2007 acquisition of Tabblo.

Antonio Rodriguez, formerly CEO and founder of Tabblo and now director of research and development for Supplies in HP's IPG, tells of compelling evidence that motivated him to improve printing from the Web. HP studied home-printing users in the last year and discovered that approximately one half (48 percent) of all printed pages were initiated from a Web browser—and that is today. What of the future?

HP realized that in order to keep its users happy and buying more ink and toner, printing from the Web had to be streamlined, and that is what the HP "Print It!" button will do. Tabblo (and now HP) technology enables the "Print It!" button and allows Web-site owners to easily offer printing capabilities. So, as promised last month, there is a fairly simple value proposition offered to a very large customer base with unmet user needs. Marketing principle for the month—check!

This technology also takes care of the first P: the product or value proposition, which Rodriguez says is to "improve the Web-printing experience...creating new Web-based printing opportunities where none existed before." We are also in good shape on price, which is basically free, and place, as in on the Web or in the printer box at the clip of a million a week.

Perhaps most importantly, Web users need to be aware that this better and broader print experience is available to them. And that brings us to the last P: promotion. HP is putting up big dollars, as in $300 million, to get the word out. I opined in my August column, "The More Things Change, the More They Stay the Same," that good ideas often can or need to come around more than once, but bad ideas can come back around, too. Here we are again with what I think is a good idea, and maybe the difference this time is that HP is taking all of the four P's into account. Even with Web 2.0 and the requisite blogs, wikis, and other free outlets, good old paid advertising and other types of promotions can do wonders. We will no doubt revisit HP's Print 2.0 down the road to see what has transpired.

See graphic evidence above.

1 comment:

reciprocal said...

In 2006 and early 2007 the situation was the exact opposite.

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