With its new range of consumer products ready to roll, Packard Bell is hoping to regain its market share this summer
Packard Bell, owned by the Acer group, announced its range of EasyNote laptops with a strong emotional sales appeal in mid May.
Using eco-friendly earthy colours and touch materials, the appeal of the products is described as “stylish and trendy” and is expected to do well across the affluent GCC consumer segment. The product range is segmented into entry level, mainstream and high end. The common factor across all the models is the focus on social media, entertainment, video chat, picture albums, data storage and backup and other related accessories and applications.
The new Packard Bell range is a “100% consumer brand”, comments Shashank Sharma, Country Manager, Packard Bell Middle East. The product range including netbooks, desktops and stand alone monitors is expected to be available across retail outlets by July 2011. The brand has been selling across GCC since 2009 and was previously distributed by Redington, which also distributes the Acer product range. However the new Packard Bell range will be exclusively marketed and distributed in UAE to the retail segment by FDC International.
Parallel to the development of the new range of products, the feeling within Packard Bell was to have an exclusive distributor to focus on the retail segment. With the volume market share falling from 4% in 2009 to the current level of 1% this has become more urgent. The aim is to bring this back to 4% using FDC as the distributor and the new “emotive” appeal of the products.
“If you are not managing your inventory very well in the retail channel, some of the things you work out on the desk don’t work out in the field”, explains Sharma. He intends to support FDC full time to get the volume sales to their previous levels. However as a group, “we continue to have excellent relationship with Redington”, he asserts.
Sharma’s list of marketing support activities for FDC include print flyers in leading newspapers; working with super retailers to include the Packard Bell brand in their own communications; availability of promoters and point of sale materials at super retail outlets. These marketing support activities were not available last year. The other side of activities include “collect, repair, return”, maintenance support through a toll free number during the first year of the warranty and option of additional two-year warranty.
FDC will be responsible for direct import of the products into their warehouse and outward movement to the super retail outlets. FDC also supplies Acer to the retail segment but Packard Bell and Acer products will be managed by two separate FDC teams. Other than Acer, FDC also supplies high visibility and fast moving brands Lenovo, Kaspersky, Sony, Western Digital and Seagate amongst others, to the retail segment. “We are very powerful in the super retail segment because we have a lot of products that we sell there”, comments Alan Pourmirza, Infrastructure Manager, FDC.
From a distributor point of view, which needs to equitably manage all its retail facing brands, “selling IT products is like selling ice”, an analogy referring to the extremely short-term pull of today’s consumer focused IT products. With continuous onslaught of new products almost every month, “time is also the biggest enemy”. Both inventory at the warehouse and inventory on the retail shelves have to be closely managed.
There is another concern on the super retail front. With limited space on the shop front and a huge number of ICT brands and products jostling for visibility, the most critical parameter for Packard Bell’s brand in the months of July onwards will be the “return per square foot “, for super retailers. No super retailer can afford to have a product that doesn’t move sitting on prime shelf space. “If a product comes and doesn’t move, we have to quickly decide what to do”, says Ashish Panjabi, CEO of Jacky’s group.
And that could mean going back to the drawing board and relooking at the customer experience, the type of messages in the communication, the amount of investment in the media campaigns and type of store-front promotion.
Will Packard Bell’s new product range move to the corporate segment? Sharma clarifies, “that is not the brand objective; as soon as you go to the office environment the equation changes”. The channel partners, service levels, infrastructure and communication, all need to change. For Packard Bell, investing in the summer consumer wave to take it forward, it would be like a new organizational setup in parallel.
Behind the scenes, inside the consolidated group, the Packard Bell and Acer teams remain integrated. For the product design, strategy and OEM procurement team which contracts with Intel, Microsoft, board, chipset and monitor manufacturers, the two brands are unified in terms of their combined volumes, product segmentation and market reach. The financial results of the two brands are also consolidated. But at the front end, the two brands face the market separately.
When Packard Bell merged with Acer in 2008, there were immediate synergies. Acer’s strength in laptops helped Packard Bell to surge ahead in the same segment. Now when Packard Bell is racing to hit the consumer market head-on, it remains to be the same whether the favour will be returned to Acer in the times ahead.