HP Inc (HP) held its Power of Print analyst event in Palo Alto on 1st and 2nd November 2018, marking its third anniversary as an independent company. HP has bold ambitions to reinforce its lead in the market, driven by an innovation-led strategy across all its business lines, which is already paying dividends. FY18 revenue was up by 12% on the previous year, boosted by key developments in operational excellence as well as an improved cost structure.
The road to reinvention
As a market leader in the print industry, HP is uniquely positioned to drive innovation. Its Instant Ink service for the home market has proved successful, with a 20% increase in adoption over the past year. Its plans to increase its market share in the A3 market, through the acquisition of Samsung’s print division, is coming to fruition, with market share standing at 9% today – its target is for 20% by 2020.
What particularly sets HP apart from its competitors is the breadth and scale of its product portfolio which encompasses home, office, graphics arts and 3D printing. The value of this broad portfolio is not only in its diversity, but more importantly the opportunity it provides HP to resonate with the new generation of users as consumer and work lives continue to blur.
As Millennial and Generation-Z digital natives move on in the workplace to take up influential technology decision-making roles, addressing their perceptions and expectations around print will be critical. Turning the new generation on to the power of print is by no means a lost cause.
In fact, Quocirca’s Print 2025 research revealed that Millennial decision makers are less sceptical about the future of print in the office than the older generation – so if print solutions are simple and accessible for the office environment it provides an opportunity for companies like HP to capitalise on print innovation.
Quocirca believes that HP’s industry lead will be reinforced in the following areas:
1. Building as-a-service momentum
HP’s Instant Ink, an ink cartridge replacement service was launched in 2013, delivering ink to customers before their devices run out. Based on the number of pages printed per month, HP allows users to upgrade or downgrade their plans at any time. HP reports that the service has delivered 30% YOY growth, and remains committed to developing Instant Ink as a core element of its business strategy. Instant Ink not only allows HP to develop monthly recurring revenue streams but, more importantly, analyse device usage to develop and sell new products and services.
Through managed print services (MPS), the “as-a-service” model is already well established, at least among larger businesses. HP continues to expand and deepen its MPS competencies and seek untapped opportunities in the SMB market, which is reached through HP’s channel network.
Quocirca’s research indicates that, while SMBs are increasingly receptive to the MPS model, channel maturity varies widely. HP is actively enhancing and simplifying its channel MPS programme options to accelerate the shift and Quocirca believes that the coming year will be critical for HP to drive increased engagement across both product and services through its diverse channel network.
2. Reinventing print for Millennials and Generation-Z
Of all the print industry players, HP is uniquely positioned to influence Millennials and Generation-Z by virtue of a strong consumer and office product portfolio. HP is looking to capitalise on the continued blurring of home and work lives, shaped by smart devices, mobility and the gig economy, where workers are not tied to a single workplace.
Consequently, HP is focused on the design, experience and simplicity of its products as it looks to bridge the physical and digital intersection. This is particularly the case for the HP Tango, its smart home printer, that is cloud based and entirely controlled by a smartphone or voice activation. The HP Smart App is seamless, supporting HP Instant Ink and easy scanning of files from a smartphone to the cloud, email or the HP Tango printer. With a stylish fabric cover, the HP Tango does not look like a conventional printer and is very much part of HP’s strategy to reinvent the traditional printer to fit in with the new smart home environment.
HP’s Sprocket printer which makes photo printing simple and accessible, is another device with appeal to the Millennial generation.
Influencing these younger, smartphone-native generations, which have typically yet to fully discover the value of print, with simple solutions, will be key to increasing awareness of how both digital and print can play a valuable, integrated, role in the future workplace.
3. Driving office transformation
The role of printing in the office is evolving rather than disappearing. While many businesses continue to rely on printing to some extent, they are also accelerating the digitisation of their paper-based processes. This creates a need for reliable and efficient printing along with better integration of paper and digital workflows.
HP’s core mission in the office is to grow a profitable hardware market share, accelerate profitable contractual growth and transform business printing with new categories and business models. Already an established market leader in the A4 market claiming a 47% market share, HP is looking to expand its share to 20% of the A3 market by 2020. It is already making strong inroads, increasing its share from 2% to 9% in 2018. Its recent acquisition of Apogee, a UK-based office equipment dealer, positions it further to expand its footprint in this market.
Of note is HP Roam for Business, which provides a more efficient and secure printing experience for mobile workers. HP Roam enables secure printing from any device – documents can be released at any Roam-enabled device at the office, guest printer or public print locations. HP discussed its HP Roam for Business partnership with WeWork, a flexible office space provider that provides shared workspaces and offices to start-ups, freelancers and also global businesses. WeWork now has 459 locations across 90 cities, with 268,000 users across the globe.
Along with improved uptime and reliability for its printers through HP’s Smart Device Services, which enables remote service delivery and optimised device operation, HP also announced JetAdvantage Apps. This software ecosystem aims to enhance paper productivity through the creation of integrated workflow apps – whether they are bespoke or are connected to enterprise content management (ECM) applications. Although it is early days for this initiative, HP is aiming to lower the barriers to develop and deliver such apps at scale through its developer and reseller programmes.
HP is clearly on the path to reinventing print across its broad and comprehensive product portfolio. unrelenting focus on innovation which permeates not only its technology developments but also its company culture. HP is well positioned to lead industry change in reconnecting today’s digital natives with print – as Enrique Lores, President of HP Imaging and Printing stated, “when you are number one you have to define where the industry is going”. HP undoubtedly has the technology, culture and marketing vision to achieve this.
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