The Fall and Revival of Desktop Personal Computers - Assignment Example

? The Fall and Revival of Desktop Personal Computers The The The The The Fall and Revival of Desktop Personal Computers Introduction As technology advances from time to time, consumers also change their preferences over time. There are many reasons why certain product or service becomes obsolete. By obsolete, it means that customers are not anymore interested in buying the product/service. One possible reason would be because some features are so outdated that previous buyers do not want to get the same product again. Another explanation would be that competitors have been offering a slightly different product from the existing one with the same functions and latest features. This paper presents the current position and performance of desktop computers in the market and recommends possible ways to save the products from becoming more obsolete. Furthermore, this paper examines some market issues that greatly affect the desktop PC market. Desktop Computer and its Current Market Desktop personal computers came into existence before the latest computer tablets and netbooks were introduced to the market. Traditional personal computer has central processing units (CPU) unlike the current handy laptops and tablets. Basically, the target markets of desktop computers were businesses like internet cafes, hotels, and families with household internet access. Businesses often get desktop computers for their employees and executives for business related transactions because desktops run faster than laptops. Households also get at least one desktop computer at home despite the fact that family members may already have laptops and smartphones. According to the 2010 US Census, 63% of households with income of less than $50,000 have personal computers (desktop and/or laptops); 91% of the households having income of $50,000-$99,999; 96% of households with $100,000-$149,999; 97% of the households with income of $150,000 and more own personal computers; and, 68% of the households with income not reported have computers. Having children is also a factor to getting personal computers by households. In the same US Census, 84.1% of the households with children 6-17 years old have PCs; 79.3% of households with children not within the 6-17 range own home computers; and, 70.9% of the households with no children have personal computers. Another important demographic that also affects the decision of getting computers is the educational attainment of the households. The 2010 US Census showed that only 41.8% of those who did not graduate from high school have home computers; 64.8% owns PCs from households with high school graduates or General Education Attainment (GED); 81.6% of those who have some college or associate degrees; and, 90.9% of the households with bachelor’s degrees and higher have personal computers. Reasons for Declining in Popularity “The decline of desktop isn’t surprising,” says Arthur (2012). According to Wilcox (2012), US sales of personal computers had reached its lowest peak on the fourth quarter of 2011, which was said to be the worst since 2001. Apple’s iPad tablets have been hurting the PC industry and affecting the current sales (Randewich, 2012). In spite of the weak sales of personal computers, Apple products have continued to flourish. Although the declining sales was partly caused by the floods in Thailand, one cannot deny the fact that consumer behaviors have also changed. Consumers are more concern on buying something that is not bulky or huge and offers multiple applications. Nowadays, most tech savvy individuals prefer to get the latest gadget. They are not anymore into desktop computers since they find it hard to update some windows applications. Smartphones, computer tablets, and netbooks have up to date applications and features. Most students already own smartphones and laptops; there would be no use of getting a desktop computer. Majority of the smartphone and laptop features have grown to be impressive over the years of innovation. Moreover, laptops and tablets are definitely on their way to replace desktop computers in PC industry. Business executives may not need getting these bulky desktop since they might consider having a handy laptop which can be used anytime, anywhere. These stuffs are very convenient with longer battery life, very handy, and easy to use compared to the traditional personal computers which are not mobile. Recommendations Over time, products or services would eventually go out in the market. Possible reasons for their disappearance are the following: the manufacturing companies have pulled out the production, the market is beginning to look for something new, and the same product or service from competitors offers more advanced features. Before a product goes out, marketers should look for ways to save the dying product. Although some customers may tend not to buy the products, there are also those unidentified people who may be willing to get the product. The company may have targeted the wrong market; thus, the firm must reposition the product and look for the right target audience. The first thing marketers should do is to make new ideas to spice up the desktop computer features. Before going into the details of promotions, the company should first determine which areas in the production of desktop computers need further improvements, so that consumers would be attracted to buy the products. A great example would be adding new-fashioned features and applications to the computers which can compete with the latest existing tablets and laptops in the market. Giving the traditional desktop a new look would also be another great idea, like lighter and smaller CPU, high resolution display and wider screen, and faster performance. Lastly, marketers should look for the right target audiences. It was stated earlier that businesses and households are the primary markets of personal computers. However, some of the households think that laptops and notebooks/netbooks are more practical since it is portable and can be used anytime of the day, anywhere. Although portability is still the best feature of laptops, desktops are still in use by some because they run faster compared to laptops. Desktop companies should note those individuals who are fond of computer and online games as their new target market. They are more interesting into getting desktop computers since PC games require units that can process very huge amount of data. Aside from desktop’s processing speed, it also has larger monitors, high-end central processing units, and video cards. These PC gamers should be considered a potential target market. The Best Foreign Country to Market the Product According to China Times (2012), China still remains to be the largest gaming market in the world. It was forecasted that the said market will grow every year. China has 120 million PC gamers, followed by United States with 52 million (“China Remains,” 2012). Knowing this fact, China would be a potential market of desktop computers. The average age of PC gamers is from 37 to 42 years old, and there are 73.6% of China’s population with ages 15-64 years old (CIA, 2012). Moreover, CIA (2012) also revealed that the working population in 2011 was estimated to be 1.0024 billion with ages 15-64 years old. It is safe to assume that these PC gamers will be willing to buy the desktop computers and can afford to have at least one. Product Segmentation and Positioning Market segmentation is the process of dividing the market into smaller and distinct groups with similar needs and preferences (Baines, Fill, & Page, 2008). It is related to product differentiation, wherein aiming at different market segments might mean adapting variations of product offering for customer satisfaction (Baines, Fill, & Page, 2008). We already have identified the PC gamers as the potential market. They are further categorized into enthusiast, performance, and mainstream users. According to Jon Peddie Research (2012), enthusiast and performance PC gamers spent $1000 for the gaming equipments. Internet cafes in China have increasing demands for performance and mainstream gaming equipments (Jon Peddie Research, 2012). To be able to target this market, modifications and innovations are needed for the traditional desktop computers to attract them. The following should be considered: sound and video cards/chips; a faster processor that can process huge amount of data without lagging; larger memory and storage capacity; anti-glare, high resolution LED display; and other peripherals such as convenient and customizable keyboard, mouse, pad, and headset. The price may be within the average price which is from $15000-$2400, depending on the product specifications. To introduce this product to the Chinese PC gamers, internet advertisements will be needed to educate them on the offered product. As to distribution channels, a Chinese retailer is needed to let the customers or buyers try for themselves. The customers will tend to be interested in a product if they will be able to try the actual features. Conclusion Desktop computers are definitely on its way to obsolescence. However, with the aid of innovation coupled with proper knowledge in marketing principles, desktop PCs may be able to survive this crisis. Since most tech savvy individuals are only interested to freshly released gadgets like tablets and smartphones, marketers should look for another prospective target market. We have identified the increasing numbers of PC gamers as our new target market. Consequently, China remains to be the largest PC gaming market in the world with 120 million gamers. This would be a profitable market because gamers are known to be spending an average of $1000 per person for gaming equipments. They also prefer to use desktops compared to laptops since desktops are more convenient to use. As long as proper innovations are done, the desktop industry will be regaining itself in the market notwithstanding the continuous blooming of smartphones, tablets, and laptops. References Arthur, C. (2012, April 25). How tablets are eating the PC’s future-- but might save the desktop computer. The Guardian. Retrieved from http://www.guardian.co.uk/ technology/2012/apr/25/tablet-pc-market-analysis Baines, P., Fill, C., & Page, K. (2008). Marketing. Oxford: Oxford University Press. Central Intelligence Agency (2012). The world factbook: China. Retrieved from https://www.cia.gov/library/publications/the-world-factbook/geos/ch.html China remains world's largest gaming market: analyst. (2012, July 17). Want China Times. Retrieved from http://www.wantchinatimes.com/ news-subclass-cnt.aspx?id=20120717000086&cid=1102 John Peddie Research (2012). PC gaming hardware market to hit $23.6 billion in 2012. Retrieved from http://jonpeddie.com/press-releases/details/ pc-gaming-hardware-market-to-hit-23.6-billion-in-2012/ Randewich, N. (2012, July 17). Intel forecast portends weak PC sales. Reuters. Retrieved from http://www.reuters.com/article/2012/07/18/us-intel-earnings-id USBRE86G15520120718 U.S. Census Bureau. (2010). Presence and type of computer for households, by selected householder characteristics: 2010. Retrieved from http://www.census.gov/ hhes/computer/publications/2010.html Wilcox, J. (2012, Jan 12). Only Windows 8 can save the PC market now. Reuters. Retrieved from http://betanews.com/2012/01/12/only-windows-8-can-save-the-pc-market-now/ Read More