Lexmark charts out retail plans

Lexmark International (India) has decided to adopt the retail strategy in a
bid to attract more customers, by way of a pull strategy. Initially this
activity will be limited to 10 outlets in Mumbai and based on the response to
the initiative, it will be rolled out in other metros and A-class cities as
well. The company is investing almost Rs 35,000 in the setting up of each of
these counters.

"2005 is a turning point in the strategic position of Lexmark. For the
past three years, we have been building business to a level of efficiency. We
want to do more direct activities, which bring us directly in touch with our
customers," said Pradeep Kamath, GM-Lexmark International India, while
explaining the rationale behind this new strategy.

Lexmark has identified 10 select locations where it will set up its counters.
While some of these are the traditional IT channel partner outlets, it is also
planning to set up its department and lifestyle stores or malls.

Though Pradeep feels that IT retailing has not come of age, the customer
mindset is changing. This is why Lexmark is exhibiting its offerings in consumer
electronics outlets as well. "Products like photo printers are gaining
acceptance, which is why we feel that our retailing endeavor will succeed,"
he stated.

Initially, Lexmark will work with those retail outlets, which will give its
free floor space. It is leveraging on its Lexmark Express Door-to-Door warranty
to entice more retailers to stock its products. "We are taking away the
headache of warranty support from our partners, while providing them with more
footfalls, which can translate into sales of other peripheral items as
well," Pradeep said.

The company has also signed up with a HR company that will provide people to
demonstrate these products to customers. It would rather not rely on the store's
in house staff, as they might not have the requisite skillsets to hard sell the
brand.

Recently, Lexmark rolled out a channel program called Don't Need Approval
(DNA) for its partners. It has around 140 Diamond partners and 700 Premium
partners with 300 active members in the latter. Under the program, Diamond
partners can design a promotional scheme for the Premium partners, without the
approval of the vendor. This is a slab-based scheme, wherein based on the
targets met by the partner, he can reclaim the expenses of the promotional
activity.

VINITA BHATIA