Analysis of Compaq Pressario Notebook - Case Study Example

Choice of Product/Service I wish to study the Compaq Pressario Notebook PC series. I wish to study the features and support services of this notebook series. My sources of information are the company’s Canadian web site, and acquaintances that use Notebooks of various brands including Compaq Pressario. The product category of Notebook PCs is engaging. I use the term engaging because it is useful to study this product-cum-service category to understand customer perceptions and how they interact with brand choices. I would like to study how the product-cum-service meets needs of customers. The very label indicates the transition from personal computers to Notebooks. Technological advance and consequent obsolescence are exceptional in this product/service category. I do not think that Notebooks will last for very long because cellular telephones of tomorrow may take over their roles and tasks. Already, top executives spend more time with cellular telephone devices than with Notebooks, and students as well as lay people will follow the commercial trend when prices come down. A Notebook PC is neither a tangible product nor a virtual service, but a combination of both these elements (Payne, 2002). Only software experts and electronic engineers can use these devices on their own. However, support services as related to Notebook/PCs for lay people are of no use if individuals do not invest in buying Notebook PCs. I use the term ‘support services’ to refer to after-sales service, help in beginning to use all the features of the Pressario, and trouble-shooting in case products break-down. Marketing combinations of products and services presents special challenges. Segmentation and Targeting White Caucasians dominate the demographics of Canada. No other ethnic group has any statistical significance (Ethnic Groups and Generations in Canada, 2008). Minorities are important in the country’s psyche, but there are no business dimensions of this as far as selling Notebook PCs are concerned. The median income in Canada is less than $25 thousand. The Compaq Pressario range starts at well over $500 (Canada, 2008). Thus, the product-cum-service category represents a major purchase decision for the average Canadian. Consumer behavior and related aspects of marketing have to be seen in this light (Silverstein, and 2003). The median age is 40 years (Canada, 2008). It is therefore important to note that the bulk of the population would not have been introduced to Notebook PCs in primary education. Computer literacy is likely to be low until a new generation emerges in the country. Young adults from the mainstream Canadian ethnicity, with relatively high and stable disposable incomes, form a cluster that is best for targeting. This segment of customers will yield the most productive responses to marketing investments for Compaq Pressario. The rest of this document addresses all consumer behavior and marketing questions with reference to the chosen target. I chose a Starbucks outlet to form a focus group. I did not make two ethnic groups because differences between recent immigrants from Europe and mainstream Canadians are not significant when it comes to Notebook PCs. This is an assumption I have made for simplicity, and based on my general knowledge of computer use habits in the country. Asians, other immigrant groups, and aboriginals are not significant in terms of business potentials, so I have ignored them. It is easy to spot potential customers for Compaq Pressario at Starbucks. Many of them carry Notebooks, and their attire and mannerisms give them away in any case. By this I mean that visual observation makes it relatively easy to distinguish professionals from lay people. I took permission from the store manager to approach possible respondents with requests for help with my primary data generation in return for some hospitality. The latter consisted of a beverage and snack from the menu. I trust that this gesture did not induce respondents to influence their answers and feedback. I was pleased to find that most of the people I approached were happy to help me. Here are my major findings about what young adults want from Notebook/PCs: 1. I could not find a single respondent who uses all the functionalities of his or her Notebook/PCs. They are vaguely aware that this valuable possession can probably do much more to make for productive living, but do not know how to learn to do this. 2. Cellular telephones are far more popular and used than Notebook/PCs. The best hand-sets are very expensive, but people will switch over to them if prices come down. It seems that large and heavy Notebook/PCs of today are on the road to obsolescence. 3. Music, movies, and games are major uses of Notebook/PCs. Entertainment matters to people, and this is one function that cellular telephones cannot totally substitute. 4. Security is a major concern. People use Notebook/PCs for secret data and communications that they do not wish to put in print. There are worries about government snooping, theft, and viruses. 5. Price sensitivity to demand is surprisingly low. Many people use financing options, and prefer to invest in top-of-the-line products. This may not apply to students and other demographic groups, but differences in sticker prices do not matter for working adult Canadians. The complete wish list I generated has some 15 points. I have listed the five most commonly expressed customer desires, in order to remain within the length restriction for this document. In addition to compiling this general marketing information, I also put together a wish list, which describes the general feedback I received. Customers do not want to buy Notebook/PCs. They want solutions. By solutions I mean that customers want turn-key answers for their business, information, and entertainment needs. They think in terms of entertainment on the move, staying in touch with loved ones, completing work in less time, and also in terms of ‘keeping up with the Joneses’. Differences between processors, storage capacities, additional devices, and other technical features do not matter as much as I thought they would. I could not locate reliable data on Notebook/PC sales in Canada. There are many conflicting claims. However, it appears that the product category may go the way of typewriters, with converged hand sets taking over computing functions, apart from telephony. It is possible that students may enter the market once prices drop, but my selected target segment seems to be inclined to exchange their Notebook/PCs for cellular telephones with wide screens and convenient keyboards. Internet Effects People will not buy Notebook/PCs from the Internet alone. The purpose of this section is to outline how e-commerce influences brand choices for Notebook/PCs. Customers may use the medium to buy upgrades, replacements, and even new models. However, a first purchase requires product trials, face-to-face persuasion, and service guarantees. The World Wide Web is not suitable to expand the market for Notebook/PCs (Holiday Gift Guide, 2008). The situation is very different when it comes to making best use of a Notebook/PC that already been purchased. People do not have the time or inclination to return to brick-and-mortar units from where they have made actual purchases. However, they do expect 24*7 online help and support once they have spent so much money on a brand. The World-Wide-Web is an appropriate tool for building lasting relationships with paying customers, but not for potential ones. Customer forums, support on-demand, access to new software, and e-commerce in spares, new models, and accessories, are the kinds of marketing phases that the Internet can do better and at lower costs than physical outlets. It is a wonderful means of customer engagement, but is not useful for generating new sales. Comparative Analysis It is integral to a marketing process to compare a brand against its main competition. This is the objective of this section. Dell and Lenovo have recall levels in customer minds that match Compaq. However, none of these names surface when customers are asked about their computing and communication needs. Nokia and Motorola reign supreme, with high awareness about Siemens and Korean brands. There is a gap between Notebook/PC marketing in the minds of marketers, and actual customer requirements. Comparative marketing of Notebook/PCs is now of only historical interest in the Canada, unless manufacturers can find ways to make small and light Notebooks function as cellular telephones. I chose to compare Compaq with Lenovo. I have compared all eight elements of the Marketing Mix, and list major findings within the space left for this document. a. Customers continue to associate Lenovo with IBM. Many are not aware of the new Chinese owners. The Lenovo brand is therefore more respected and admired. Compaq has a positioning more towards entertainment and gimmicks. b. Both brands are considered unreliable when it comes to pricing. Sellers offer models at very different prices. Customers expect bargains, and feel cheated at the same time. Lenovo is considered to be better for after-sales support (Welcome to Compaq, 2007). Works Cited Payne, A, 2002, Services Marketing, Prentice-Hall Silverstein, M, and Fiske, N, 2003, Luxury for the Masses, Harvard Business Review, Vol. 81, Issue 4 Canada, 2008, CIA World Fact Book, accessed December 2008 from: https://www.cia.gov/library/publications/the-world-factbook/geos/ca.html#People Ethnic Groups and Generations in Canada, 2008, web site of Statistics Canada, accessed December 2008 from: http://cansim2.statcan.gc.ca/cgi-win/cnsmcgi.pgm?Lang=E&SP_Action=Sub&SP_ID=30002&SP_Mode=2 Holiday Gift Guide, not dated, web site of Lenovo in Canada, accessed December 2008 from: http://www.lenovo.com/ca/en/ Welcome to Compaq, 2007, web site of the corporation in Canada, accessed December 2008 from: http://h10084.www1.hp.com/canada/compaq/ Read More