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H-P Strategy: A Tale of Two Consumers

H-P will announce its new corporate strategy in a couple of weeks. I have no role in setting that strategy. However, as this post explains, H-P’s strategy needs to include a renewed commitment to consumer satisfaction if the world’s largest computer company is going to regain some lost mojo.

The H-P Way
A friend called me over to his house a couple of weeks ago to help with his printers. He’s 84 years old, but is a real tech maven. He needed help with his new H-P printer install, which was complicated by the need to install software on the PC as well as WiFi set-up on the printer itself to support wireless clients such as Apple’s iPad ePrint. My pleasure to assist. And H-P did a good job of stepping the consumer through all the install options in its user guide. So, positive grade to H-P for making a very complex product relatively straight-forward. But that’s not the whole story.

Sitting on my friend’s couch was a nearly new H-P Photosmart printer. He offered it to me. Said it made messy photos with ink smears no matter what paper he used. Maybe I could do something with it. Friend said it was 100 days old but the warranty was only good for 90 days. H-P wouldn’t support it, so now it’s a hunk of e-trash.

I went over this whole sorry story with him, step by step, and it’s true. He’s an unhappy customer.

H-P has an industrial-product mentality exacerbated by cost-cutting bean-counters. This fails to excite consumers. It’s a real  turn-off.

In my decade of watching H-P and buying its products, the result for consumers is:

  • Phone support hell to a foreign country where American English is not spoken. Or the chat equivalent;
  • Short warrantees that barely cover infant mortality;
  • Poor to non-existent follow-on software support. For example, devices work under Windows Vista but not under Windows 7.
  • Planned obsolescence, where ongoing support for a model essentially stops when a new product comes out;
  • No follow-through on customer complaints or suggestions.

It does not surprise me that H-Ps consumer business was down in its latest quarter. H-P is also recovering slowly from an embarrassing consumer confidence problem in China, a key growth market.

At best, consumers tolerate H-P, but they sure don’t line up at the store overnight for new product intros or talk H-P up at cocktail parties.

In short, H-P’s approach to the consumer business is totally the opposite from intimacy.

The Apple Way
Another friend recently bent my ear about how pleased she was with Apple support. Her iMac hard drive died in month 38, two months after the warranty ran out. She took the PC to the local Apple store where they confirmed the sad truth of a dead disk. She asked how much a new drive would cost, installed. Apple guru said the failure was so close to the warranty expiration that he’d waive that $360 charges. Had it fixed in two business days even though it was Christmas.

By going beyond the letter of the warranty, Apple made a friend for life.

H-P needs to re-think its face to the consumer market. An ad program touting the “New H-P strategy” is not going to cut it. Although changing “Invent” to “Support” might be a step in the right direction and useful for internal communications.

H-P absolutely, positively needs all the consumer sales it can drive to succeed in its growth plans for the next decade. The global middle-class now emerging is a once a century opportunity. H-P cannot grow revenue and profits at double digit rates on sales to business alone.

H-P does not have to clone the Apple business model, although they could learn from Apple.

Consumers do not always want the lowest price. For PC-related products, many consumers are now sophisticated enough to be willing to buy the entire product-life experience. And there are profits there for delivering that experience.

H-P has a huge, top-tier computer services organization targeted at business. Where is the H-P home IT services business?


H-P Photosmart Premium Fax e-All-in-One


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