Canon eyes double digit growth in colour printers- Gautam Paul, Canon

The dynamics of printing market is changing rapidly with the focus on B2C as an emerging domain. In an exclusive chat with Gautam Paul, Assistant Director, CSP Group Canon India, Bhawna Satsangi finds out Canon’s strategy to penetrate in the emerging markets. The company is looking for double digit growth in colour printers’ category in 2014.

What are your roles and responsibilities as Assistant Director of CSP division?

I am responsible to take care of entire CSP business in Canon. My role is to carrying forward the entire marketing and sales of canon inkjet and laser printers to next level. Since we have a sizeable contribution to Canon India business therefore the responsibility to look into the division is important.

What are the trends you are witnessing in printing market?

If you look at the overall market the trend is moving to two broad categories:

1. Changing pattern of the printing usage in different verticals, like B2C is an emerging domain today. It will basically affect the consumer printing market. There is lots of home user evolving and our growth is likely to come from B2C now. From B2B perspective we will focus more on multifunction options among mid and high segment as the growing opportunity.
2. Gradually, modern trade channels are turning out to be a contributor to the industry. Printer as a category is still not very highly recognized among contemporary channels but we see that this trend is evolving. Be it Teleshopping, Online or Large format retail all the three have started getting acceptability now.

How do you see the colour printing market in India? Do you find colour printing a challenge?

The first challenge in printer market is that we are converting from single function to multifunction and within multifunction the mid and high segments are the growing opportunity. Within the mid and high, the colour segment is spreading. It is spreading primarily in the B2B segment because office environment in the eco system today demands that the same output when you do it in a colour has the far more appeal. So, the usage of colour is on the rise primarily for two reasons, one is better productivity and two that the cost of printing has gone down.

If you look at A3 as the category or A4 as the category, once the prices have become more affordable the B2B and B2g segments are slowly migrating to colour and I believe that amongst all product categories colour will definitely stand out.

Are you doing any educative programs to encourage color printing?

As part of the industry we have our responsibility which we continue to indulge. We have continuous programs with the corporate, SMEs. We have different programs where we engage with the customers directly and then we have channels who operate these customers. So we have a two-fold program, one is educating the channel so in turn the customer is educated and then also directly reaching the customers through various programs. There are lot of programs which we do collaboratively like the SME connect program, enterprise event or CIO meet, there we are largely focusing and trying to help the end customer understand that colour is affordable and is the necessity.

What is the revenue you generate from color printers?

Currently our contribution of colour will be around single digit and believe that if we achieve double digit then we will be doing the justice and that’s a step forward we are looking in 2014.

How will you be promoting the inkjet and laser printers?

In printers we have two categories inkjet and laser and for this we have different target audience. In inkjet as a category the home segment is our target so we have a traditional channel for this. We are really concentrating on home shopping like Star CJ, we have a sizeable presence in the large format retail which is the organized retail like Croma, Reliance and we are also directly and indirectly involved with the online because we believe that sale is something which will evolve. Today if we look at the consumers’ sale, the consumer today is still looking at this option.

In the laser printer category we are primarily focusing on B2B and B2G. So, in B2B our traditional distribution will still remain the main source and in B2G, we would concentrate through system integrators for e-governance project.

Which cities you will be penetrating in 2014?

The top 20 cities of the country will continue contributing 60% to our business. Our concentration will still remain in these cities. Moving forward our strategy will be going to tier 2 and tier 3 cities. In 2014 our aim is to move in these cities as we see lot of potential in these geographies.

What is your go to market strategy?

We have a distribution set up in tier 2 and tier 3 cities. If my existing channel partner has the width to cover tier 2 and tier 3 cities then we will continue to partner with them. If we find that there is some area where we need to pull up on, therefore if we see the possibility of exploring tier 2 or tier 3 then we will do it with fresh channel inputs.

How important are the channel partners for Canon?

It is extremely important for our set of business as our business has evolved with the partners. They constitute 60% of business therefore channel partner will remain an integral part of our business strategy. So whatever go to market strategy we develop we will do it for the benefits of our partners. It is a marriage we have done so there is equal amount of responsibility in fostering this relationship.

What is the contribution of channel to your business?

In laser category it could exceed to 90% and in inkjet category it could touch to 20%.

What are the programs you are doing for channels?

We have our annual programs like Leadership Summit. We continuously engage our channels through small programs. Some programs are linked to evolvement, some programs are part of the recognition and some as part of the encouragement. We do reward the channels while setting up the targets for our channel. We evaluate the partner with his strength and potential.

From which verticals the growth is likely to come for Canon?

In inkjet the growth is coming from home segment, in laser our focus would remain on two broad areas government space and enterprise space. These are the two strong areas where is a sizeable strength and growth. These are the significant drivers.

What are the challenges you face in tier 2 and tier 3 cities?

Smaller cities have smaller mindset. It takes time to believe that the potential is there. Our tier 2 partner in Surat has to believe that a city which generates so much tax and revenue, how big is the market. So tier 2 I don’t see it as a difficulty, I see it as an opportunity. If you are able to provide and help them then there is a sizeable business. One more thing which probably tier 2 cities slowly start adopting is that they still do the business in more traditional form like they want walk in customer and we suggest them to change the paradigm and start approaching customer also. With the change dynamics it is important for them now to understand the difference between sale and marketing.

What was the reason of expanding your business through online retail and LFRs?

We never looked at it. These channels are evolving automatically. Today the business ethics has changed. Today the consumer’s buying pattern has changed. For example If he has to buy the printer he will start surfing for the product on internet and decide that either he has to go to the market or buy online at a reasonable price. So, he buys through internet. Canon has nothing to do with it. What we realize is to ensure that between the buyer and seller we bridge the gap. As an organization I have a responsibility to help my consumer through this medium.

In LFRs for example Reliance digital must have 100 plus shops, the same consumer when walks into Reliance store in any mall he is likely to buy and if printer as a category is available there then I should have my presence. So the LFRs is evolving we engage with them and offer services.

Home shopping is a new domain for the customer where the buyer sees the demonstration and decides to buy. It is not that we want to go in these three mediums, it is out of market dynamics that these channels have evolved and we feel consciously that since my consumers are looking at them, then my reach should be there and delight my consumer.