The last time tea made the news was when the American Patriots dumped it into Boston harbor to protest increased taxes. That was 231 years ago. Stewart Krentzman thought about it when he left his position as president of Lipton Tea to run Oki Data Corp.
But Krentzman isn’t leaving the food industry
behind: He is taking some of same marketing models he used running Lipton and incorporating them at the printer manufacturer. For example, brand loyalty is a factor in selling tea. He says consumers loved and trusted Lipton, and does not see any reason why that type of loyalty cannot be transferred to the printer business.
In fact, he believes that colour will create a new market dynamic in laser printing and imaging, which could give perennial market leader Hewlett-Packard a run for its money.
Computer Dealer News recently interviewed Krentzman about the colour printing market.
CDN: You have said the printer market is up for grabs because of colour. I have spoken to a few analysts about this statement and they believe only marketshare is up for grabs: not overall leadership. That still remains HP’s. Why do you think colour can be such as market shifter?
Stewart Krentzman: Look at the consumer market for black-and-white TVs. Once colour TV came down to a price close to or the same as black-and-white TVs it was difficult to sell black-and-white TVs. People see the world in colour and they want colour. If the price is right they will move to colour. I really believe if you look at what happened in that business. The TV business back in the 50s and 60s went through a dramatic shift and RCA and Sylvania (leading black-and-white manufacturers) were up against those in the colour TV business such as Sony and Toshiba. The whole dynamic changed and brand did not matter as much as the quality of the colour picture you delivered. The people voted for the best quality picture. As the market went up for grabs, those with technology that was not as strong as other players did not make the grade. We can talk all we want of our views of the market place, and certainly it will be a lively debate, but what is up for grabs is who is going to take the quality colour position in the market place. HP has done a phenomenal job in mono laser business and their market share reflects that. I am not so sure that is an indicator that end users will except anyone’s colour technology unless it makes the grade.
CDN: Why do you think HP has this aura about them in printing?
S.K. They did a phenomenal job for a couple of reasons. First is their relationship with Canon. It is not their engine and I think everyone knows that. It’s such that Canon basically decided in 1984 to give the technology to HP in the U.S. They did a great job introducing it and then I think they cemented their printing image business by leading with their own technology in ink jets. They moved from mono to colour in ink jets and I think their brand stands for a lot of things now beyond imaging. The aura of the HP brand is that they are a technology leader in laser and ink jets and the laser aura belongs to their mono laser business. I am not sure it’s transferable to colour. I am not suggesting we will replace HP as the market leader. I do think that if we turn our ear to customers and understand what they want we have a great shot at attaining a strong position in the market. Not necessarily the market leader but a strong and respected position can be ours.
CDN: Why are you banking on loyalty as the key element in the company’s go to market strategy?
S.K. I believe that IT customers in the printer segment are looking for smart choices. If you have relationships with those customers then you will have in fact made that smart choice easier for them to execution against. I do not think from a technological standpoint that CIO or VPs of technology want to be concerned about printer fleets. They want to make sure they have a reliable partner that they can go to so they can focus on bigger IT issues such as security as an example. We hear today that the number one call to help desk is about a printer issue. If they can move that away and have a trusted partner we are going to help that customer.
CDN: Will the doubling of the OKI sales force change the company’s view of its channel strategy going forward?
S.K. No sir!
CDN: How come?
S.K. I don’t want an infrastructure here that duplicates a more cost effective model in the channel. It is silly for us to go out and do what someone else does best. I can’t talk out of both sides of my mouth if I talk about loyalty.
CDN: Do you think impact printing or dot matrix printer will die off anytime soon?
S.K. No. There are too many government regulations here and in Canada that require multi part forms. So long as there are multi-part forms dot matrix printers will survive.
