HP betting on retail photo solution

Prasad Ramasubramanian

Mumbai

March 28th, 2008

With transitioning becoming the mantra for most mavericks in the industry,
companies such as Hewlett-Packard (HP) have taken it upon themselves to
transform the retail photography scenario. Whilst it made its retail photo
solution debut in 2007, HP has extended its product portfolio and now has HP
Photosmart Studio and HP Photosmart pm 1000 Microlab Printer.

HP Photosmart Studio is designed to manage high-volumes of photos and print
creative projects such as albums, posters, greeting cards and calendars in as
little as an hour and HP Photosmart pm 1000 Microlab Printer packs a punch by
providing high speed 4 x 6 inch printing capabilities to a host of photo lab
environments. Rich Duncombe, VP, Retail Photo Services, Web Services and
Software business, Hewlett Packard Company spoke to Prasad Ramasubramanian of
CyberMedia News on the initiatives taken by the company in the retail photo
solutions domain and the learning in the Indian market. Here are the excerpts.

You commenced on the retail photo solutions front in 2007. How has the
response been post the launch?

If you take the history of our photo solutions, we have been a world leader
in that area and in 2006 we entered into the retail photo solutions segment when
we launched it in the United States. Also, what we saw in our consumers is that
they were technically capturing more images than they ever had done and it just
keeps exploding. So, we told our consumers that they need a place to save those
images and that's why we acquired SnapFish, which allows you to view images,
save images from multiple sources such as camera and cell phones. Then we said
what they would do with these images and which is when HP Retail Photo Solutions
was born.

India has always been a core markets for us and HP has very strong position
here and in 2007, we launched the HP Photo Retail Solutions here.

How do you view the challenges the nearby mom and pop photo shop pose to
your offering?

HP likes to be in markets, which has a high rate of change and we don't want
to be in a market that is stagnant. India is perfect for us as consumers are
going through a change and Indians have often been visiting these mom and pop
outlets. So why go to a HP shop? The reason why we go to that mom and popshop
would only be to get your passport sized photos clicked.

Now, when you talk about the retail photo solutions from HP, we are certainly
not talking about the passport-sized photo.

The products that we bring to the market have not been by the Indian market
so far. Today, you might say that am a busy person and I don't have the time to
walk up to a shop, I want to do it from the confines of my home and so we have a
provision to do things online and the acquisition of SnapFish done by HP is
absolutely in a position to cater to such kind of consumer. Sitting at home, you
don't have to even walk to the shop; we would print it and get it back home.

Features like this gives us enormous confidence that this is where we are
different and the experience is going to be different from what it has been so
far.

What have been your findings since you launched these solutions?

If you look, key chains, which might appear small have enormous connectivity
with the consumer or sticker in a refrigerator having pictures of your son,
daughter or your spouse or parents is what the consumer is looking for. With our
experience in the country, we definitely feel that we have jumped the curve.

Again, coming back to the shops, which we have been frequenting, now those
shops also want to scale up their operations because the consumer is expecting a
better experience and a better ROI every time you visit a store like that. So,
even they are looking at upgrading their technology and that is where we have
been comfortable in mingling with the existing environment with our offerings,
add value to the shop which in turn would deliver value to the consumer like you
and me.

How many cities have you put the operations on?

Its still early days, and this concept have a longer cycle time. If you go
to a Hyper City, Reliance or any other retail shop, you don't expect photography
but globally it's all part of the same offering. Now this is a new concept for a
retailer in the country. We are talking to different types of retailers in the
country. There are some who are in IT arena to people who are serving coffee to
our consumer and all see a great value in a product like this.

Talk on the marketing and advertising aspects of HP retail photo solutions

What we would do is support them through our best practices that we have
been following for the last two years globally in the retail formats and get in
the best communication strategy forward. It's going to be a mix and match
between us and the retailer and what works best is put forward.

If you look at what is happening in the United States, the photo department is
targeting the bakery. So, if you purchase a birthday cake, you get a 20 per cent
off on a photo book. So, there is cross merchandising that is happening in a big
way.

We see a lot of players in the printing market. Your take on the same

Our range of products touches almost every segment and there are areas where
we have 80-85 per cent market share. Those are the areas where we have absolute
leadership but in the lower end of the market, you have guys coming in who want
to make a breakthrough in the Indian market and we welcome that. We are happy
that there are more people coming in.