2012

Marketing Plan for Hewlett-Packard

Emilio Veneziano
Nicole Waldron
Corey Jarouse
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I. Executive Summary
The following is a full marketing plan for our new product/service that will be provided
by Hewlett-Packard in order to: increase sales, increase brand loyalty and equity, and increase
market share. The following report explains how HP will market our new product including
marketing strategies, advertisement techniques, etc. Our new HP product is a computer system
that HP will custom build to suit an individual companies needs and help do so in a cost effective
manner. This report will discuss this product in more detail along with how it will be
implemented into the current market and what HP plan to accomplish by adding this new product
to their companies line-up.

II. Situation Analysis

2.1 Company Overview

The current HP mission statement is broken up into categories such as customer loyalty
in which they look to “earn customer respect and loyalty by consistently providing the highest
quality and value and achieve sufficient profit to finance growth, create value for our
shareholders and achieve corporate objectives.” Through this they state that they will create
products that meet the standards of their customer’s wants and needs.
They also include their mission for Market leadership which is “to lead in the
marketplace by developing and delivering useful and innovative products, and services and
solutions.” However, while at one time a leader of the consumer electronic market, they have
recently fallen on hard times with the failure of several product lines. During December 2011
HP was trading stock at an average of twenty-five dollars versus today of an average of fourteen
dollars per stock. Even though HP is ranked 10th on Fortune 500s list and much higher than
many of its competitors (examples are Dell at 44 and Apple at 17). We as a group feel though
that with the start of our product line we can help them overcome these recent financial struggles
and put them back into an upright place in the market.
2.2 Market Overview
 2.2.1 Category Definition
Our Company, Hewlett-Packard, sits in the product form level of competition. While our
company will make a very unique product that hasn’t been done yet, we will still be using the
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Windows Operating System as our base. Product form can be looked at as a narrow view of
competition because it considers only those products that “look” the same as our product as our
competitors. Until our computers happen to a different operating system, we will stay in the
product form category of competition. We will be very unique on our customization solutions
and customer service, but since out competitors offer similar size and weight computers while
also running Windows, this is the category we sit in.
 2.2.2 Customer Need
If you are a business owner and you are looking for ways to save money, the first thing
you will do is research on way to do so. No matter how big a company may be, 100% of all
companies are always trying to figure out ways to cut cost in their technologies. One way is to
reduce the costs involved in software purchases. Also, time is money in every aspect of the
business world. There are plenty of customers out there that would be interested in custom
software and it can be seen by these two or many simple statistics: The global software-as-a-
service (SaaS) market is forecast to record an impressive 41% yearly growth between 2008 and
2015 to exceed $4.3 billion, up from $390 million in 2008; TechNavio estimates the world
enterprise social software industry will record 18% yearly growth between 2010 and 2014.
Market growth is being driven by rising productivity and collaboration through the use of
enterprise social software.
In order to accommodate the customization out customers would want; we would make
specific computer software packages for specific areas of business. For example, if you were in
the marketing industry you would receive a typical Windows based computer that would be
tailored to your area of business. For a marketer, you would have programs pre-installed such as
Aprimo’s Integrated Marketing Management which performs: pre-sales assessments of your
requirements, implementation and associated technical services, training and education for users
and system administrators, and ongoing remote support to increase user adoption and ROI.
Another example would be if you were in the engineering profession you would receive a
computer system with programs such as Pro-Engineer, AutoCAD, or Visual Studios. A huge cost
benefit is achieved her because companies wouldn’t have to purchase extra software for their
areas of business since they will already come pre-installed.
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 2.2.3 Collaborators
Our company will attempt to have many different collaborators. Our main collaborators
will be the many different software developers that make the custom software we will offer our
customers. For example an engineering program such as Visual Studios is manufactured by
Microsoft, so we would collaborate with them to make sure we can receive the best wholesale
prices possible so both parties can make money of the deal.
 2.2.4 Competitors
“HP is the world's leading provider of PCs consumer and commercial printer hardware; also it
holds the number one position in the US enterprise market.” (IBIS). HP has multiple
competitors in multiple markets. The competitors are Dell, Apple, IBM, Oracle, etc. These
competitors are what drive HP to be so successful in the many different fields they compete in.
The first market they compete in is, computer and packaged software wholesaling in the United
States. HP’s competition in this market is Dell, here Dell has nine percent market share
compared to HP’s seven point two percent market share. While the other companies share in the
rest of the market. The next market is, computer peripheral manufacturing in the United State.
This is when industries manufacture computer displays (monitors) and peripherals (keyboards,
mice, etc.). HP dominates by having thirty-one percent of the market shares compared to the
other major players like Dell, Western Digital, and Seagate Technology. HP operates in this
field through its imaging and printing group (IPG) which generates up to twenty percent of the
revenue. HP is the largest computer peripheral manufacturer in the United States, because no
other competitor was close to HP in this field. The next field is data processing and hosting
services in the United States. This field’s definition is “This industry provides specialized data
processing or hosting activities. Data processing services provide specialized reports from
information supplied by the clients. Hosting services can include web and application hosting.
Services range from automated data entry to processing that data. The industry does not include
websites themselves or the revenue earned by their owners.” (IBIS). Unlike IBM who has
fourteen point one percent market shares, HP has the leading percent of market shares with
fifteen point six. The next market is computer manufacturing in the United States, here HP also
leads its competitors in market shares with twenty seven point three percent. HP leads this
market even though you may think companies like Apple or Dell would be leading. HP could
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also have the market share in the Electronic and Computer Repair Service market if they decide
to dive into it because no one is competing in this market.
 2.2.5 Political/Legal
For our product to have a successful affect in this day and age we as a company must take steps
in protecting our idea. First, we would have to get patents and copy rights for the software. By
doing this we are making sure no competitor can take our idea. Next, the users of our product
will have to accept the terms of agreement before beginning to use our product. The users will
also have to abide by demographic laws put in place to insure it is appropriate to the user.
Lastly, by making sure we are a reliable company, we must make sure that the software being
used is secure and none of the user’s information is subjected to being hacked. Also we have to
promise that none of our uses information used without their permission.
 2.3 Target Market
With our product of personalization, we are looking at a target market of professional
business men and women as well as major companies. People nowadays lead busy lifestyles
trying to balance both a work life and a family life. When it comes to something such as their
computer, these people want something that will make access to software that they use on a daily
basis at their jobs whether they are engineers or marketers much easier. With our product line,
customers will no longer need to purchase a computer and then purchase the software separately.
When they buy the computer we will collaborate with the companies so that all of the software
programs they need for their careers is already installed right for use off of the assembly line.

III. Goals and Objectives

 Utimate Goal: To increase and possibly even double our market share in the software
computer package wholesale market from its current 7.2%
 Customer Objective: To create awareness among major companies so that they know that
we are the most efficient investment for their company.
 Collaborator Objective: To set an agreeable price so that both our software collaborators
and ourselves (HP) will profit from our sales.
 Competitive Objective: To create entry barriers for our competitors and ensure protection
through patents and non-disclosure agreements.
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VI. Strategy
4.1 Target Market
With our product of personalization, we are looking at a target market of professional
business men and women as well as major companies and corporations. The overall market
of selling personal computers is easily segmented by benefits sought by the user. While we
are looking at two different markets, individuals and companies, they are all in the same
segmented market. All of the users we are aiming our product toward want the availability
of a computer that has the software they use in their everyday jobs pre-installed and ready for
use when their new computers come off of the assembly line; therefore making our target
market business professionals.
 4.1.1 Customers
The customer base is determined through the quantity being purchased and the
basic needs market and segment. Since our target market is professional businesses, we are
considered in the Business to business market segment. The potential customers are large
corporations and small entrepreneurs. However, we have to be careful to target not the
individuals that are working for the corporations but rather the decision maker within that
business. In order to make a sale of our product our customer base becomes the person who
will influence the higher up’s in the company that purchasing our product is a smart business
move.
These companies will need software readily available; however, they may not
need our product to be mass produced. Software segments within the consumer segments
will include computers with occupation specific software preinstalled for occupations such as
engineering, accounting, marketing, human resources, office assistants, or business
professionals. These will be made available based on individuals/company’s needs. We will
also be selling the computers and software as complete corporate packages; say Lord
Corporation would like to purchase computers for their whole Engineering Company.
The current trend of increased corporate spending on IT and software technology
creates huge market in the potentials for long-term sales and service of customizable personal
computers. One large advantage of being the first mover in this market for us will be the
immense loyalty of our customers. With continued improvement to our product the cost and
convenience of switching away from Hewlett and Packard would be high to a customer.
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 4.1.2 Collaborators
The largest collaborators for us will be the software manufacturers. The main
companies will be Microsoft, Parametric Technology Company, and Teradata Corporation.
Microsoft Corporation (the maker of many software packages including Visual Studios) is an
American multinational corporation headquartered in Redmond, Washington that develops,
manufactures, licenses and supports a wide range of products and services related
to computing. Parametric Technology Corporation (known for making Pro-Engineer) is a
U.S.-based company that develops, markets, and supports software for product development.
Its main products are for CAD/CAM, engineering calculations, and product lifecycle
management. Teradata Corporation (the maker of Aprimo) is another American computer
company that sells database software for data warehouses and analytic applications. Its
products are meant to consolidate data from different sources and make the data available for
analysis. Besides just simply supplying us with the licensing and right to sell their software
without computer systems pre-installed, the collaboration effort would include staff training
for better troubleshooting assistance, cooperative marketing initiatives, and cooperative
engineering for seamless integration between current and future HP hardware with partners
software development. Both sides will experience benefits from collaboration. HP will gain
the right to use and license the software, along with an experienced and trained staff capable
of performing updates and troubleshooting problems for customers of customized computers.
Our partners will gain the added economies of scale in the production and implementation of
new software, as well as possible exclusivity contracts to only offer their specific software on
HP customized computers. As partners a cooperative marketing plan could be developed to
maximize the scope and reach of advertising, thus better informing the market segment of
potential benefits resulting from the purchase of HP computers.
 4.1.3 Competitors
The market entry strategy we plan to function in is Product Development.
Product Development is when you take a new product and place it in a present market. We
know we can have a lot of success in this because we know are product is different than the
already customizable functions you can get in PC’s. With HP being the world’s leading
provider of PC’s consumer and commercial printer hardware and the number one position in
the US enterprise market, this means that many other companies are looking to design
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products to help compete. But while HP is at the top of the competition, this opportunity
allows HP to be in a product development market, with an essentially new product in an
existing market for HP. With HP collaborating with the software producers, the current
competitors in hardware sales and data processing and hosting services are the most relevant
competitors. The main competitor in the computer and packaged software market is Dell.
Dell controls nine percent of the given market compared to HPs’ seven percent. In the data
processing market HP leads with fifteen percent market share compared to IBMs’ fourteen
percent second highest in the industry. Due to the uniqueness of HPs’ product a competitive
advantage in product differentiation will be developed and exploited. Our contracts with
software providers along with current corporate customer relationships will provide a large
head-start and competitive advantage over any competition that attempts to offer similar
customized computers. Our ability to completely customize computers to customer
specifications in hardware speed and performance, included software, assistance, and support
will be unrivaled in the market. With these advantages, HP will be able to get the leading
market shares in more markets that they are either second or if no one is in the market they
can have to overall market share.
 4.1.4 Legal Context
Protecting our ideas is crucial to having a successful business plan. Also
protecting our customer’s personal information is the most important thing. By protecting
their information and being reliable, ensure or customers that we are a safe company and
because of this we will build long term relationships based on this trust. There are ways of
ensuring all of this, the first way is through patents and copyrights. With patents and
copyrights we will be able to protect our ideas and our property from being copied by our
competitors. Another step in protecting our project is using term and condition agreements.
To use our project the user must accept it. By accepting it, it guarantees that our projects will
not be stolen, copyright laws, modifications to the product, etc. Lastly, to be a reliable and
trusted company we have to make sure that our customer’s information is protected. With
the Privacy Act of 1974, we cannot give out any of the costumer’s information like; social
security numbers, emails, and addresses without the consent of the customer.
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4.2 Value Proposition

 4.2.1 Customer Value
Value to the customer is an important subject. A customer will not purchase a
product unless they can see a value that they will receive from their purchase, for example
customers purchasing our product will be saving money and time. By creating a computer
that comes personalized, the customer saves the time of making multiple extensive
purchasing decisions; they instead make one decision to hire HP professionals (us) to do this
for them. Working with HP they lay out a set of guidelines, and trained we will custom build
computers to fit their wants and needs. The other value to the customer is the cost efficiency
of choosing us. By choosing to buy their computer through us, they will receive a discount
on the cost of software. Generally when you purchase a computer you have to pay for the
computer itself and install software which can be very expensive. However, if they choose to
purchase a computer through us, they will receive one price for everything that will be
overall cheaper and easier for them. Our positioning statement is: for companies that are in
need of computers that are pre-installed with software right off of the assembly line; our
product is the best choice because it is cost effective and efficient for buyers and businesses.
It will improve overall productivity within their company in the long run.
 4.2.2 Collaborator Value
HPs’ corporate collaborators will also experience multiple benefits from
partnership. A cooperative marketing plan will be established to maximize sales potentials.
With HP already being an industry leader in data processing, hosting, and improving in
hardware sales, a partnership that includes an outside software firm’s product as standard on
new HP hardware increases visibility, users, and ultimately profitability of the software firm.
A key benefit for the software developers would be in terms of advertisement and marketing
for their own company. If a consumer uses a software package that includes one from
Microsoft and enjoys using it, they most likely search for other products that the company is
responsible for making and in turn giving them increased market share and increasing sales.
The same concept can be said for HP. If a consumer is impressed in the hardware, etc. then
they will most likely look into HP for their future computer hardware needs. Our positioning
statement is: for those small or large businesses searching for the benefit of a highly
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customizable, cost effective way to improve their company’s technological situation by

implementing custom software on state-of-the-art hardware.

V. Tactics
5.1 Product/Service Description
 5.1.1 Core Product:
Basic Benefits of our personalization computer product include, the fact that time spent in the
workplace will be spent more efficiently. Also, since the software and computer are purchased as
one this is more cost beneficial to the consumer. Our product reduces overall time spent having
to set up your computer once it is purchased. Another benefit will be that the number of errors
that occur when you download the software yourself are generally high, therefore with our
professionals doing the installation for you it will decrease the number of errors that occur.
 5.1.2 Actual Product:
The personal computers are manufactured in house by our team of computer engineers
and manufacturers. They can either be purchased by the consumer as a laptop, or as a desktop
depending on those specific users wants/needs. Each computer when turned on appears with the
user’s name in which they must log on in order to get to their software. Once the user has logged
on the software that we are providing through our personalization process can be accessed and
opened. The product life of each computer is 4-5 years.
 5.1.3 Augmented Product:
 Limited warranty covers everything except physical damages that were caused by
carelessness of the customer( dropping the product, spilling liquid on it, etc.).
 Free hardware maintenance for one year after the product has been purchased, free 24/7
technical support, free initial assistance with software.
 If the customers order the product package they will receive free delivery.
 5.1.4 Additional Notes:
We are working on making the HP brand more innovative to meet consumer needs, our
product would be considered a line extension that goes more in depth since it is adding to a
current product that is on the market such as their existing laptops or desktops.
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5.2 Brand Management

a. Brand Equity
HP as a company is listed at number 11 on the list of top computer providers with a 78%
consumer rating on meeting innovative designs. Since our company has seen the results of this,
we have been constantly working hard to improve our company and better understand our
company’s needs. This being said, with the line extension of our HP custom computer systems,
we can reach a more specific customer base and tailoring our software to meet the needs of
specific customers. Because HP is listed as a public traded company, we care about our
customers and their feedback more than anything. The value of our company as of 2011 was
23980.83(in millions) being above Dell and just below IBM. With the implementation of our
company specific software will help us rise up and increase market value and improve our
customer loyalty.
From December 2011 to December of 2012 the stock market value of HP went from an
average of $25 to $14 per share. We are hoping that by offering this product to consumers it will
help in making the value of our stock increase.
b. Brand Loyalty:
Since we are the leading innovators in the personalized software industry, we would have
to spend most of our time targeting new consumers rather than targeting brand loyalty. By
offering considerable discounts for people who purchase our product (a computer software
package deal) they will realize that we are the cost beneficial way to purchase a computer and
therefore choose our company.
Once we have these consumers we will then need to focus on keeping them. We could
provide discounts for any software upgrades that they might need within the product life of their
computer. Also as part of our product we offer 24 hours a day 7 days a week technical support
with professional computer experts and engineers in case they encounter any problems opening
or running the software.

5.3 Place
Since our product is within an existing firm, we would be continuing with the sales tactics
that the Hewlett and Packard Company has already established. Currently the products made by
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the company are sold in chains such as Best Buy, Staples, CostCo, Sams Club,Office Max etc.
We will also be continuing with online sales of the products on the company website as well.
The reason we have chosen to sell in stores such as these is because it is the easiest and most
efficient way to reach the most consumers within our target market. With having our product
available in many different stores it is easy for us to maintain good customer relations as well as
keep up with our technical support that was one of our additional augmented products.

5.4 Promotion
The most effective way to reach our target market of consumers, which is business
people, is through pulsing television advertisements, magazine ads and promotions and online
advertisements on the websites of our collaborators. Since there are so many different genres of
magazines and we want to reach only the sophisticated business elites, we plan on only
advertising in magazines such as Business Week, Bloomberg, and Wall Street Journal, Popular
Science, PC World and PC Magazine.
We are the first company to ever implement such an idea to the computer world;
therefore the advertising technique that we will be using will be Pioneering. We will have to
educate consumers on all that our product has to offer as well as making them aware of the
benefits that they will receive when purchasing our computers.

5.5 Price
The pricing strategy of our company for this product will be penetration pricing. We will
enter the market as a new product but under an existing company. We want to increase our
market share in order to discourage competitor companies from entering our market. In this
practice of pricing, we will offer the new product at a lower price in order to attract customers.
This will make current and new customers aware of our product to then increase out market
share and increase sales volume. In addition to increased sale and market value, this strategy can
lead to lower production costs and higher inventory turnover, both of which are a positive for our
company. We do however, need to make sure that our prices don’t become too low to the point
that we will increase our sales volume but not make a profit. Also while making sure we
maintain our profit levels, we must make sure our price is not set too low initially so that when
we raise the price, our customers won’t leave for another product.
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Refrences

-http://www3.cfo.com/article/2012/5/tech_small-business-reduce-technology-costs
-http://www.reportlinker.com/ci02074/Business-Software.html
-http://www8.hp.com/us/en/hp-information/index.html
-http://www.ibisworld.com/search/default.aspx?st=Hewlett+and+Packard
-http://clients.ibisworld.com/industryus/Majorcompanies.aspx?indid=928#MP8643
-http://clients.ibisworld.com/industryus/default.aspx?indid=741
-http://clients.ibisworld.com/industryus/default.aspx?indid=1281
-http://clients.ibisworld.com/industryus/default.aspx?indid=740
-http://www.slideshare.net/blogzilla/software-legal-issues-presentation
-http://btobmarketing.wordpress.com/2007/10/01/who-is-your-customer-or-b2b-market-
segmentation/
-http://www.growthperspective.com/2011/02/the-4-elements-of-effective-b2b-segmentation/
-http://www3.cfo.com/article/2012/5/tech_small-business-reduce-technology-costs
-http://www.reportlinker.com/ci02074/Business-Software.html
-http://www8.hp.com/us/en/hp-information/index.html
-http://www.ibisworld.com/search/default.aspx?st=Hewlett+and+Packard
-http://clients.ibisworld.com/industryus/Majorcompanies.aspx?indid=928#MP8643
-http://clients.ibisworld.com/industryus/default.aspx?indid=741
-http://clients.ibisworld.com/industryus/default.aspx?indid=1281
-http://clients.ibisworld.com/industryus/default.aspx?indid=740
-http://www.slideshare.net/blogzilla/software-legal-issues-presentation
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I. Executive summary …………………………………………………………… 1

II. Situation analysis …………………………………………………………………… 1-4

2.1. Company overview ………………………………………………………........ 1
2.2. Market overview ……………………………………………………………
2.2.1. Category and market definition …………………………………… 1
2.2.2. Customers …………………………………………………………… 2
2.2.3. Collaborators …………………………………………………… 3
2.2.4. Competitors …………………………………………………………… 3-4
2.2.5. Political/legal context …………………………………………………… 4
2.3. Target market …………………………………………………………………… 4

III. Goals and objectives …………………………………………………………… 4

IV. Strategy …………………………………………………………………………… 5-9

4.1. Target Market ……………………………………………………………………
4.1.1. Customers …………………………………………………………… 5
4.1.2. Collaborators …………………………………………………………… 6
4.1.3. Competitors …………………………………………………………… 6-7
4.1.4. Legal Context …………………………………………………………… 7
4.2. Value proposition …………………………………………………………… 8
4.2.1. Customer value …………………………………………………… 8
4.2.2. Collaborator value …………………………………………………… 8-9

V. Tactics …………………………………………………………………………… 9-11

5.1. Product/service description …………………………………………… 9
5.2. Brand management …………………………………………………… 10
5.3. Place …………………………………………………………………… 10-11
5.4. Promotion …………………………………………………………… 11
5.5. Pricing …………………………………………………………………… 11
References …………………………………………………………………………… 12