The UKs Desktop Printer Market - Essay Example

?Running head: The UK’s Desktop Printer Market The UK’s Desktop Printer Market Insert Insert Grade Insert 4 November The UK’s Desktop Printer Market Introduction The current globalization of trade has increased competition in the world market. In this case, firms have to continue improving their operations in order to remain relevant and competitive. Indeed, firms in every industry are bombarded with competition from all angles including labour market, production, and product market among other areas. It is for this reason that companies have to continue investing in research and development in order to produce more innovative products that competitors. The printers industry is experiencing the same challenges, especially in the desktop printer market; innovation is driving firms into developing new products with sophisticated level of technology and performance. In the UK, the desktop printer market is witnessing competition from the digital media market, thanks to advancement in technology. Indeed, statistics show that growth in the UK’s printer market has been in decline compared to other Western Europe countries like France and Germany. However, firms have continued to invest heavily in diversification of their product lines, with competition now shifting from all-purpose printers to 3D printers. Generally, there are two main buyers for desktop printers including consumers for home use and organizations for office use. Here, firms are concentrating on building positioning strategies that make them more attractive to the customers. Despite facing competition from digital media, firms have top compete among themselves, with major manufacturers such as HP, Samsung, Canon, and Epson among others investing heavily in advertising and other forms of promotion. This paper will examine and discuss the desktop printer market in the UK. Industry analysis and Trend For sometime now, the printer industry has been experiencing stiff competition from digital media, as people tend to shift from printed material to online trading. As a result, consumers and organizations are tending to slow down on investing in printers, opting to depend on online media. This explains why the UK’s desktop printers market has been on decline; indeed, the downward trend is expected to continue in the current year, despite the industry being one of the largest in the UK, employing over 77,000 people (Ibis World, 2013). For quite a long time, the inkjet printers have dominated the printer market; however, other types of printers have taken the market by storm and have claimed a sizeable market share, among them being the laser printers and the recently introduced 3D printers. As a result, consumers and organizations have a variety of options from which to choose. With the technology shifting from analogue to digital, it means that new products have also to be digital in order to be relevant. It is for this reason that most recent printers are digital, making them more efficient and convenient to use. Indeed, it is now easy to buy a digital inkjet printer or a laser printer from the market. Importantly, technology has allowed the printer market to diversify further by introducing the 3D printers, which have been received warmly by consumers, thanks to their affordable prices and high quality printing capability. Indeed, almost every company is going for the 3D desktop printers due to the rising demand, especially from architects and home users, as well as from education institutions. It is no wonder that the UK government has established a program to sponsor teaching of 3D technology in schools. The UK market of desktop printers is highly competitive, as almost every large manufacturer of printers is available in the UK. These firms include HP, Canon, Epson, Samsung, and Kodak among others, all of which tend to outdo each other in terms of product differentiation and marketing strategy. The presence of such a big array of operators in the market means that entry to the market is very easy – there are no barriers. As the competition intensifies, firms are taking differentiation seriously in order to attract more customers. It is for this reason that different manufacturers have been aggressively introducing innovative printers at relatively low prices. For instance, most of web pages will display advertisements of different digital printers, and this is also the case with the print and broadcast media. This aggressiveness in advertisements has left consumers spoilt for choice over what printer offers the best benefits. Indeed, consumers are not only making buying choices in relation to brands from different companies, but also on the basis of technology and type; for instance, one has to make a choice to buy either an inkjet or a laser printer, a stand-alone or an all-in-one printer and so on. However, the purpose for which the printer is bought will also have a factor in buying decision, for instance, one would prefer a laser printer for office use because it is faster than inkjet and it is quieter. Factors influencing purchase behaviour of printers by consumers and organizations Buying a printer may be a daunting task due to the various factors that one has to consider. Generally, factors influencing buying decisions include price, technology, performance, speed, running cost including usage of toner or ink, and capability. However, the significance of influence will differ depending on whether the printer is purchased for home use or office use. In the UK, firms have been trying to compete around the aforementioned factors, with technology and price taking the center stage. Price plays a very big role in purchase decision making, for instance, any buyer will purchase a printer that is within their budget constraint; however, it is also important to incorporate quality in price decision, as in most cases, the price of a printer (like in other products) is directly proportional to the quality of the printer. Moreover, printers require updating just like any other electronic in the market (Gabrys, Howlett and. Jain, 2006) Another factor that has been influencing buying decisions is the technology used to make the printer. Generally, there are two technologies (inkjet and laser), both of which perform differently in different situations. In most cases, consumers for home use prefer inkjet printers while organizations prefer laser jet printers for office use. The underlying factor here is that, inkjet printers are cheap, small, and easy to use; however, laser jet printers are faster and do not produce much noise, thus they are ideal for office environment. Maintenance cost and cost of toner or ink play a significant role in buying decision. Here, most buyers in the UK are going for printers that are affordable to maintain and run. Although inkjet printers have preferred for a long time due to the low cost of ink compared to laser toners, the trend is likely to change based on the recent complaints of cost of ink. For instance, consumers have been complaining that the cartridges in the market from different companies have reduced space for ink yet the price has either remained the same or increased, thus becoming costly to maintain an inkjet printer (Robinson, 2013). Speed and performance are also taken into consideration in making buying decision. Here, organizations will go for printers that can print at high speed (that is, more copies per minute), and those whose quality is high due to the importance of documents printed. Lastly, buyers will need to consider the functions a printer can perform vis-a-vis their needs. For instance, printers come as printing-only type or all in one; the latter includes a printer, scanner and a copier, all built as a single unit. Therefore, if scanning and copying will be needed at sometime or frequently, then go for the all-in-one type of printer. Manufacturers Marketing and Positioning Strategies The factors discussed in the preceding section play a great role in manufacturers’ decision-making process about the most appropriate marketing and positioning strategies to adopt in order to attain competitive advantage. Although the printer market is experiencing competition from digital media, the intra-industry competition is more challenging for most firms. Indeed, some firms have failed to withstand the competition and abandoned operations, for example, Lexmark Company was forced to exit from manufacturing of inkjet printers in 2013 due to competition from the main players HP and Canon (Bayon, 2012). Generally, companies use different marketing approaches to beat competition, with the most commonly used being differentiation and cost leadership. Here, most manufacturers are investing in innovation and creativity to produce high-tech printers that are more endearing to customers due to their high quality. For instance, HP is taking advantage of the 3D technology to produce desktop 3D printers with performance and quality that will make it very competitive (Athow, 2013); this is after its initial shot in the market in 2010 did not succeed (Mero 2013). On the other hand, Canon has introduced an intelligent printer that beats them all, Canon Pixma MG6350, with feature such as app for USB, smartphones, WI-FI and cloud, as well as the capability of printing paper and discs (Jary 2012). Moreover, most firms are differentiating their products through delivery channels; here, firms are setting retail shops in different locations in order to be close to their target market and through these shops, they can also offer other support services to customers. Lastly, manufacturers are differentiating their printers through promotion, with advertising being the most preferred. Here, different manufacturers are advertising their printers in their websites, other online media, as well as in print and broadcast media. In terms of cost-leadership approach, manufacturers are competing to introduce printers at low prices. However, it should be noted that, low cost price of a printer does not mean it is cheap in the long run. For instance, some firms are adopting the captive pricing strategy where initial cost of printer is low; however, subsequent costs related to cartridges and inks are high. In this case, the firm is able to recover its profit margin from sale of cartridges and ink. However, firms are building on quality and durability in order to ensure that customers do not feel shortchanged when using the printers. This also in consideration that, unlike other electronics, printers need to be used for long time without replacing; therefore, it would be very unfortunate to have a broken printer after a short time that needs replacement. In addition, printers are very sensitive and tend to breakdown easily, so it is important to include a warranty to cover for repair costs or replacement in case of non-repairable defects. This is an aspect that firms are placing in their pricing in order to entice customers, who will be interested in products that have a warranty or guarantee; customers need a situation where they have a cushion in case things do not go as expected. Positioning is a marketing tool used by organizations to create an image with which customers will identify them (Kazmi, 2007). For instance, a firm may position itself as a low-price product company. Generally, positioning strategy is drawn in line with the needs of the target market, for instance, if the target market is high-end market, then the product must reflect what the high-end clients prefer, such as high quality with premium price product. In the UK’s printer market, firms have been trying to position themselves as low-price in order to attract home users, and as fast and high quality printing to attract office users. For instance, canon has positioned itself as an intelligent printer manufacturer through its intelligent camera technology, which it uses in its all-in-one color printers; these printers also use the wireless technology, and this is an area where Canon beats other manufacturers (Ferrell, 2013). Conclusion The desktop printer market in the UK is a very competitive market, with almost every printer manufacturer setting shop in the market. Despite the increased demand in technology, and with firms investing heavily in innovation, the desktop printer market in UK has been declining due to competition from the digital media. This is because people and firms are mow embracing the capability of online technology. However, competition among manufacturers in the industry has made every firm to try different marketing approaches in order to gain competitive advantage. Basically, firms are embracing differentiation in terms of product, place, price and promotion in order to attract the largest market share possible. Indeed, with the continuous technological advancement, it is true that the battle is going to be even tougher, especially now that the 3D technology printers are taking their stake in the printer market. Reference List Athow, D 2013, HP plans to enter 3D printer market within 12 months, Retrieved from http://www.techradar.com/news/computing-components/printers-and-scanners/hp-plans-to-enter-3d-printer-market-within-12-months-1193347 Bayon, D 2012, Lexmark to exit inkjet printer market Retrieved from http://www.pcpro.co.uk/news/376615/lexmark-to-exit-inkjet-printer-market Ferrell, O C 2013, Marketing Strategy, Cengage Learning. Gabrys, B, Howlett, R & Jain, L 2006, Knowledge-Based Intelligent Information and Engineering Systems: 10th International Conference, KES 2006, Bournemouth, UK, October 9-11, 2006 Proceedings, Springer, London. Ibis World 2013, Printing in the UK: Market Research Report, Retrieved from http://www.ibisworld.co.uk/market-research/printing.html Jary, S 2012, Canon Pixma MG6350 review, Retrieved from http://www.pcadvisor.co.uk/reviews/printing/3417830/canon-pixma-mg6350-review-multifunction-disc-printer/ Kazmi, S 2007, Marketing Management, Excel Books India, Delhi. Mero, D 2013, How Will HP's Return Affect 3-D Printing?, Retrieved from http://seekingalpha.com/article/1789662-how-will-hps-return-affect-3-d-printing. Robinson, D 2013, Printer ink cartridges: why you are paying more but getting a lot less, Retrieved from http://www.theguardian.com/money/2013/feb/23/printer-ink-cartridges-paying-more-getting-less Read More