Xerox – Strategic Market Planning

Group 2
Aditya Jindal A027
Abha Ribawala A048
Pragya Singh A057
Jyoti Kasaudhan G030
Princee Shukla H051
Sowmya Suresh H056
 Xerox – Charting a new course
What is Xerox?
• 1906: Founded as ‘The haloid Company’
• Introduced the first plain paper photocopier using Xerography
• Technology pioneer: Laser printing, Object Oriented programming, Colab, etc
• Public sector and commercial customers
• Direct salesforce, independent agents, dealers, etc

Problem Statement…?
• 92% decline in share price from 1998-2000
• Anne Mulchay was appointed as CEO
• Little hard-core executive experience
• Not the kind of ‘Wallstreet Resume’
• How would the firm survive?
 Innovation:
Mulachy’s first steps: • $1 billion on R&D
• Focus on operational efficiency • Digital color printers, presses and copiers
• Color line expanded with 5 additional systems
• 50% reduction in capital expenditures • Customer-led innovation

• 1/3rd reduction in sales, general & admin expenses

What did Xerox do…? Customer experience:

• One to one marketing
• ‘Sentinel’ to boost customer satisfaction
• Restructuring of global accounts

Ad campaigns and positioning:

Results:
• Successful base campaign in 2002
• Giant, red logo • In 2006, profit margin was 7.75% and ROE was
• Short case studies built around prominent clients
17.2%
• Microsoft, Office Depot and Enterprise Rentals • Share value has more than doubled
• Advertising campaign centred around Consulting services • However, flat revenue and intense competition
• ‘Premiere consulting and outsourcing partner’
for Document management
• ‘We Find Millions’ Banner focussing on document assessment
services
 Sources of Marketing Myopia for Xerox
01 “Our technology is so new that we have no competitors.”
A technology pioneer with first plain photo copier in 1959. Its PARC was at a leading edge of development of laser
printing, OOP, personal computer. During 1998-2000 fall, realization that having a revered brand and well known
technology is no guarantee for survival in this brutal world of technology.

02 “The new technology being commercialized by new competitors will not pose a large threat”
In May 2006, they launched digital colour printers, presses and copiers. They did not let this Myopia affect them as the
breadth of Xerox’s colour portfolio surrounded competition in with options in every speed range and providing superior
value for customers.

03 “That competitor is in a different industry, and its strategies don’t/won’t affect my business.”
Xerox did not stay in just the copier business and in 2006 detailed two major consulting clients- University of Calgary and
Intercontinental Hotel groups. They announced a number of software offerings and business development tools that
helped customers boost performance and simplify work processes. Today they engage in development, manufacture,
marketing, servicing and financingof document equipment, software, solutions and services.
Three levels of marketing Decisions

Functional
Decisions
Product: Document equipment,
software, solutions and services
Price: Value based pricing
Place: Direct sales force,
network of independent agents,
dealers Tactical Decisions
Strategic Decisions Promotion: Print ads and
television commercials
Maintain innovative product line
Segmentation and targeting: Small Continue to spend heavily on
R&D
to medium sized and large
enterprises Offer wide range of products to
offer superior value
Positioning: Technology pioneer,
Launching extensive product line
customer-centric organization to cover range of customers

Common focus
Delivery of
superior customer
value
Type of Innovation at Xerox

Colab, a meeting
Personal Computer Alto room that provides
with first what you see is computational support
what you get for collaboration in
Leading edge (WYSIWYG) editor, face to face meetings
Laser printing mouse and GUI

1959 1972 1980 .............. 2006

1971 1973 1987

Introduced the first Object oriented System that allows Launched a line of
plain paper programming assembly of an integrated digital collar printers,
photocopier using the office network in which presses and copiers and
process of xerography users can electronically expanded colour line
create , process, file, with 5 additional
print and distribute systems
information

Breakthrough Innovation Incremental Innovation

6
High Tech Environment Common Characteristics

XEROX Innovation Background

Marketing
Uncertainty • Xerox was one of the first to come up with
• Whether the product will come up with laser printer in 1971
address customer needs
• Object oriented programming was introduced
by Xerox in 1972
• Xerox was first one to incorporate what-you-
see-is-what-you-get (WYSIWG) editor, a
Marketing Of mouse and a graphical user interface
High tech
Technology products • GUI system developed by Xerox allowed to
Uncertainty Competitive electronically create, process, file, print and
Volatility
distribution information.
• Uncertainty •
• What products Xerox personal computers were great tools
about the
they have to for collaboration in face to face meetings
suppliers
compete against
setting.
8-step approach to Strategic Market Planning at XEROX

Step 1World's leading technology and services in business

Define company’s goals and mission process and document management.

StepCommercial
2 customers, government, education and other
Choose the arena public sector customers.

Step 3 Spotlight on the brand Xerox, Growth focused on

Identify potentially attractive opportunities consulting services for document management

Step 4
Operational efficiency, Capex reductions by 50%,
Make tough strategic choices Overheads decreased by 1/3 rd, Marketing focused strategy
 Step 5
Stakeholder engagement so as to achieve maximum
Plan key relationships effectiveness. Customers, clients, employees and competitors.

Step Articulate
6 a clear value proposition, with development of a
Complete the winning strategy marketing strategy, and recruitment strategy.

Step 7
Each strategy should have a strong financial implication. Xerox’s investment in
Understand the profit dynamic R&D and marketing gave them a high profit margin and ROE in 2006.

Step 8
Appropriate structure, systems, personnel, and skills to complement the
Implement the chosen strategy strategy. Maximize the leverage from acquired competitive advantage.
Questions