HP Consumer products Business Organization: Distributing printers via the internetExecutive SummaryThe existing HP product distribution comprises of 3 major and 4 minor channels, plus an online refurbished-product unit. Even though these channels cover a wide range of consumers in the U.S., HP has not fulfilled customers' needs efficiently and conveniently via the internet. The internet channel today is one of the most important commercial channels in the US as there are 46 million Internet users in 1997, and this number is expected to grow to 150 million by 2000. Therefore, buying behavior of the U.S. population has increasingly been shifted from traditional brick-and-mortar store shopping toward e-shopping. In meeting this new buying behavior, HP needs to add this new important channel effectively as soon as ...view middle of the document...
1) Why has HP set up such a complicated distribution system?HP's existing distribution system currently consists of multiple channels which are geared or designed to focus and concentrate on different market segments (Selective distribution). (See exhibit 1). The major distribution channels represent the bulk of the sales and is clearly defined and segmented by various variables. The main one being customer purchasing behaviors. Such a complicated system has allowed HP to capture a larger customer base through better market segmentation (based on demographics, psychographic, customer purchasing behavioral models), without the need to focus in detail on individual customers. To do this HP has carefullyProfessor Rajkumar's SuggestionPlease analyse the case based on the following questions1. WHY HP has set up and how it has managed a very complex distribution system?2. The benefits which a consumer might obtain via HP presence on Internet.3. The benefit to HP, in particular--is it cheaper to sell online?4. The Options that HP has overa. Scope of products over internetb. Demand Generation only or Demand Generation and Order Fulfillment also.5. How should HP go about implementing the change esp. with respect to current retailers.This is due on Sunday, 23rd of March from Groups 5, 6, 7 and 8 by 8.10 PM.Please write your group number on the sheet!5 Questions areWHY HP has set up and how it has managed a very complex distribution system?The benefits which a consumer might obtain via HP presence on Internet.The benefit to HP, in particular--is it cheaper to sell online?4. The Options that HP has overa. Scope of products over internetb. Demand Generation only or Demand Generation and Order Fulfillment also.5. How should HP go about implementing the change esp. with respect to current retailers.This is due on Sunday, 23rd of March from Groups 5, 6, 7 and 8 by 8.10 PM.Please write your group number on the sheet!
