HP Brand Identity


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HP Brand Identity

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  2. 2. Brand Tracker Phase I – Brand Image Measurement A report submitted to Prof. GovindrajanIn partial fulfillment of the requirement of the course Product and Brand Management th On 14 August 2011 By Rakesh Gakare (B10021) Sharath Ghosh (B10024) Shishir Ramkumar (B10025) Siddharth Goutam (B10030) 2
  3. 3. Executive SummaryHewlett Packard is a California based company established in the year 1939 as a partnership betweenWilliam Hewlett and David Packard. It is best known for its manufacture and sale of personal computersand computer accessories. It sells more than 48 million computers annually and 1 million printersweekly. It was ranked No. 9 in the list of Fortune 500 companies in the year 2009, with revenue of US$126.033 billion. HP enjoys global market leadership in the PC and computer peripherals segments.HP started as a manufacturer of instruments for analysis and measurement, it diversified itself intoproducing computer monitors, Digital cameras, digital press, PC’s, mobile phones, networking, laptops,PDA’s, printers, scanners, servers and storage devices. One of the main reasons for HP’s success hasbeen its innovativeness and its ability to acquire companies.In the first phase of the “Brand Tracker” project we have attempted to determine the current status ofthe brand and the brand identity in the minds of the consumers. A variant of the famous Brand AssetValuator (BAV) was used to identify the current status of the brand while the Zaltman MetaphorElicitation Technique (ZMET) was used to determine the brand identity.The BAV model measures the value of the brand along 4 dimensions namely Differentiation, Relevance,Esteem and Knowledge. Differentiation and Relevance together comprise the brand strength whileEsteem and Knowledge build up the Brand Stature. For BAV, a random sample of 50 was surveyed usinga questionnaire. HP has the highest percentile score (100) along 3 pillars namely differentiation, relevance andknowledge while it has 80 percentile in Esteem second only to Apple. On the BAV power grid HP lies onthe leadership category which shows that it has a high earnings and high growth potential. The onlycause for concern, if any is the comparatively low esteem score which shows that there is a problem inHP’s brand personalityThe ZMET technique was used as the qualitative research tool to gauge the brand identity of HP. Asample of 9 respondents was chosen to execute this process. The technique is based on the fact thatmost human communication is nonverbal, much of which is visual. The ZMET interview employs severalsteps to surface and further define consumers key thoughts and feelings. Each step in ZMET provides adifferent opportunity for identifying and understanding metaphors, thereby gaining a deeperunderstanding about the consumers. The ZMET technique identified HP as a global giant which is highlytrusted, innovative & professional and delivers superior performance. 3
  4. 4. Table of ContentsExecutive Summary…………………………………………………………………………….….. 3Brief history of the brand……………………………………………………………………….. 5-9Quantitative research model – BAV………………………………………………………… 10-18Qualitative research model – ZMET………………………………………………………… 19-24 4
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  6. 6. A Brief History of Hewlett-Packard:The Founders: William Redington Hewlett (Bill Hewlett) was born 20 May1913 in Ann Arbor, Michigan, where his father, a respected physician,served on the faculty of the universitys medical school. Occasioned byhis fathers acceptance of a faculty position at Stanford University;introduced young Bill to the cultural, scientific, and literary world of adynamic and growing San Francisco Bay Area. David Packard (September 7, 1912 – March 26, 1996) was bornin Pueblo, Colorado. He attended Centennial High School, where earlyon he showed an interest in science, engineering, sports, and Dave Packard Bill Hewlettleadership. He earned his B.A. from Stanford University in 1934.Stanford is where he met two people who were important to his life:Lucile Salter and William R. "Bill" Hewlett. In 1938, he returned toStanford from New York, where he earned a masters degree inElectrical Engineering in 1938.HP: US$ 538 to US$ 126.033 billion Hewlett-Packard had its beginnings with Stanford University graduates, William Hewlett andDavid Packard, who were encouraged by Professor Frederick Terman to start their own business. Withonly $538 and workspace in a garage behind Packards rented house in Palo Alto, California, the twomen began working on a resistance-capacity audio oscillator, a machine used for testing soundequipment. After assembling several models--baking paint for the instrument panel in Packards oven--they won their first big order, for eight oscillators, from Walt Disney Studios, which used them todevelop and test a new sound system for the animated film Fantasia. Now the same Hewlett-Packard isa global market leader in with revenue worth US$ 126.033 billion.How to make a BRAND (name): On January 1, 1939, Hewlett and Packard formalized their venture as a partnership, but theywere unable to decide the company name. So they agreed on a coin toss, which will decide the order oftheir name. Hewlett won and the legendary Hewlett-Packard was born.A Snapshot of HP: The California-based Company Hewlett Packard is best known for its manufacture and sale ofpersonal computers and computer accessories. With a distribution of more than 48 million computersannually and 1 million printers weekly, this Fortune 500 Company ranked No. 9 in 2009. However, thiswas not always the case. Hewlett Packard started many years before the Internet and personalcomputers became household items. At the time, this risky venture started by two guys working out ofgarage had only one customer, Walt Disney, and then the rest is history. 6
  7. 7. Statistics: Type: Public company Traded as: NYSE: HPQ Industry: Computer hardware, Computer software, IT consulting, IT services Headquarters: Palo Alto, California, US Revenue: US$ 126.033 billion (2010) Products: Computer Monitors, Digital Cameras, Enterprise Software, Indigo Digital Press, Mobile Phones, Networking, Personal Computers and Laptops, Personal Digital Assistants, Calculators, Printer, Scanners, Servers, Storage, Televisions, Telecommunications hardware and software. Employees: 324,600 (2010)Important Phases:HP Began as Maker of Test and Measurement Products: In Palo Alto,California, Bill Hewlett and Dave Packard men began working on a resistance-capacity audio oscillator, a machine used for testing sound equipment. Afterseveral attempts, they got their first big order, for eight oscillators, from WaltDisney Studios, which used them to develop and test a new sound system forthe animated film Fantasia.HP Moves into Calculators and Computers in the Late 1960s and 1970s:Although primarily a manufacturer of instruments for analysis andmeasurement, Hewlett-Packard developed a computer in 1966, specifically forits own production control, the HP-2116A, and had no plans to enter thecomputer market. Two years later, however, HP introduced the HP-9100A, thefirst desktop calculator capable of performing scientific functions. Signaling achange in company strategy, in 1972, Hewlett-Packard made its first decisivemove into business computing, a field dominated by IBM and DigitalEquipment Corporation, with the HP3000 minicomputer.HP Introduces Personal Computers and Printers in the 1980s: Hewlett-Packard introduced its first personal computer, the HP-85, in 1980, to a coolreception. Its move into information processing, however, proved successfuland the company quickly established itself as a leading computer vendor. Italso introduced a number of other products, including the HP9000 technicalworkstation (1982), the HP150 touchscreen PC, the HP ThinkJet inkjet printer(1984), and the HP LaserJet printer--a phenomenally successful product thatcame to dominate the printer market soon after its 1984 debut.HP in the Late 1980s: New Products and Markets: In 1986, HP introducedits new family of Spectrum computer systems, developed at a cost of $250million. While market projections for Spectrum were good, and the systemitself was state of the art, HP initially failed to capitalize on its technologybecause of the companys strategy of focusing on markets rather than productlines. In April 1989, Hewlett-Packard paid $500 million for Apollo Computer, a pioneer in the design,manufacture, and sale of engineering workstations. Integrating the two companies and eliminatingunnecessary engineers and salespeople proved more time-consuming than anticipated, and as salesdropped, Hewlett-Packard slipped back to second position in late 1989. 7
  8. 8. Early 1990s Difficulties Led and Restructuring of HP: In spite of the new focus on workstationtechnology and cooperative trade agreements, HP began 1990 with sagging profits and a lacklusterconsumer response to its new product line. In 1990, earnings fell 11 percent to $739 million, down from$829 million in 1989. David Packard, the retired co-founder of the company, returned to his office totake a more active role in running the business. HPs 95LX palmtop personal computer, which wasintroduced in 1991, established an important new market in information devices. The resurgence of thecompany was not achieved without a price. HP cut 3,000 positions in 1990 and a further 2,000 positionsin 1991. While executives agreed that downsizing was a necessary evil, the staff reductions, togetherwith a more aggressive advertising stance, changed the companys image.HP Aggressively Expands in PCs in the Mid-1990s: HPs pursuit of personal computer prominencewas problematic given that sectors relatively low margins, but Platt (CEO at the time) felt the companyhad to be a major player in PCs in order to remain one of the top computer companies in the world.With the Internet and electronic commerce burgeoning, HP in mid-1997 paid nearly $1.2 billion toacquire VeriFone, Inc., a maker of in-store terminals used to verify credit card transactions. Also in 1997,HP was added to the companies that comprise the prestigious Dow Jones Industrial Average.1999 HP Plans to Spin off Non-computing Lines: In late 1998, HP launched a comprehensive reviewof its operations and announced in early 1999 its intention to spin off into a separate firm, AgilentTechnologies, its non-computing segments: test and measurement products and service, medicalelectronic products and service, electronic components, and chemical analysis and service. Thesesegments generated about $7.6 billion in revenues during 1998, or 16 percent of the total. Hewlett-Packard hoped this major divestment--which included the companys original lines of business--wouldsharpen the firms competitive instincts, energize its workforce, and enable it to become a moreaggressive player in the increasingly important sphere of the Internet.Acquisitions and a Merger of Worldwide Importance: In September 2001, HP acquiredStorageApps, manufacturer of storage virtualization appliances, and Indigo, a leading commercial andindustrial printing systems company. Perhaps the biggest news to the industry occurred on September3, 2001, when HP and Compaq Computer Corporation announced a definitive agreement to merge;creating a new $87 billion global technology leader. On May 3, 2002, Hewlett-Packard officially closed its$19 billion acquisition of Compaq Computer Corporation. Compaq investors received 0.6325 shares ofHewlett-Packard for every Compaq share they owned, and Compaq stock ceased being traded. HPQbecame the new stock ticker for the combined company.The Time Line: 1939: William Hewlett and David Packard enter into a partnership; Hewlett-Packard (HP) is born. 1940: HP operations begin in Palo Alto, California. 1947: HP is incorporated. 1951: HP introduces the HP524A high-speed counter. 1957: HP shares are offered to the public. 1958: HP acquires F.L. Moseley Company, manufacturer of graphic recorders. 1961: HP purchases the Sanborn Company; a medical instruments manufacturer and is listed on the New York Stock Exchange. 1966: HP develops its first computer. 8
  9. 9. 1972: HP introduces a handheld scientific calculator, the HP-35; HP introduces the HP3000microcomputer.1980: HP introduces its first personal computer, the HP-85.1984: HPs LaserJet printer makes its debut;1988: HPs stock begins trading on the Tokyo stock exchange.1989: HP purchases Apollo Computer;1991: HP introduces the 95LX palmtop personal computer1992: Lewis E. Platt replaces Young as head of HP;1993: Packard retires and Platt is named chairman, president and CEO of HP;1994: Compaq surpasses IBM as the number one seller of PCs worldwide;1995: HP launches the Pavilion line of home computers.1996: HP co-founder, David Packard dies on March 26, 19961997: HP acquires Verifone, Inc., maker of in-store terminals for verifying credit cardtransactions;1999: HP president Platt retires and Lucent-executive Carly Fiorina is appointed president andCEO.2001: HP co-founder Bill Hewlett dies on January 12, 2001 HP acquires application server specialist Bluestone Software Hewlett-Packard and Compaq announce their planned merger.2002: HP and Compaq merge on May 3, 2002; HPQ is unveiled as new stock ticker for combinedcompany.2004: HP announces plans to renovate and rehabilitate the garage, house and shed at 367Addison Ave.2005, December 6: With preservation efforts complete, the HP garage is re-dedicated as a statehistoric landmark and the “Birthplace of Silicon Valley.” 9
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  11. 11. The Brand Asset Valuator (BAV) is the world’s largest database of consumer perception of brandscreated and managed by Brand Asset Consulting, a division of the advertising agency Young andRubicam(Y & R). The BAV is based on research data of almost 500000 consumers from 44 countries. It isused as an empirical model for managing brands worldwide. BAV also serves as a diagnostic tool forunderstanding how brands grow and decline over a period of time. Brands use BAV as a perspective toolfor developing brand strategies and tactics.BAV measures the value of a brand across four key pillars: Differentiation, Relevance, Esteem andKnowledge. Differentiation measures the degree to which a brand is seen as different from others Relevance measures the breadth of the brand’s appeal Esteem measures how well the brand is regarded and respected Knowledge measures how familiar and intimate the consumers are with the brandDifferentiation and Relevance together lead us to brand strength or brand vitality while Esteem andKnowledge calculate the brand stature. Brand strength is an indicator of the brand’s future value whilebrand stature is a report card on the past performance of the brand.Keeping in sync with the times another pillar has been added to the BAV model known as energy whichmeasures the momentum of the brand’s sense of momentum. In the power grid it forms a part of brandstrength. 11
  12. 12. Research MethodologyThe BAV model was used to measure the current status of the brand vis-à-vis its competitors. As theBAV is a proprietary tool an independent questionnaire was designed to gauge the consumer’sperception across the 4 pillars on which BAV is based. Each pillar was assigned 100% weightage and thiswas split amongst the questions pertaining to them. Weights were assigned on the basis of how directand how comprehensive was the information that could be derived from the question. The survey wasdone through the internet for a sample size of 50 and the sampling methodology followed was randomsampling.The calculation was done by totaling the number of responses and adding them after the weightage ofthe question was allocated to a particular attribute or a brand. This was done for every question toarrive at a score for each brand. All the scores from the questions pertaining to a specific pillar for aparticular brand was added to get the final score for that pillar for that brand. Once this was donepercentile was assigned on the basis of the final score received by each brand.In Q.9 a Z-test was done to find out whether the sample was representative of the entire population ornot. After that ANOVA was executed to figure out which brand was the leader across all attributes beingtested.In case of brand stature, there were few open ended questions which resulted in the category others.For the purpose of plotting the brands on the BAV power grid, this other category was ignored.Questionnaire: 1. What is the first brand that comes to your mind when you hear the words “Technological Corporation”? (Brand Knowledge-30%) 2. Identify the following taglines with their brands: (Brand Knowledge-50%) a. Solutions for a small planet b. The power to do more c. Think Different d. Invent-Everything is possible e. Your potential our passion 3. When it comes to computer hardware which amongst these brands would YOU recommend: (Brand Esteem- 30%) a. IBM b. Dell c. Apple d. HP e. Microsoft 4. Which brand(s) would you associate with the following devices: (Brand Differentiation-25%) a. Laptops b. Printers c. Desktops d. Servers e. Storage devices 12
  13. 13. 5. Which technological brand would you associate with the following: (Brand Relevance-50%) a. Stylish b. Prestigious c. Intelligent d. Professional e. Innovative6. When buying a computer devices or(&) peripheral devices which of the following is the critical to you: (Brand Relevance-50%) a. Price b. Quality c. Recommendation d. Variety e. After sales service7. For each of the following brands is there any brand that is similar in its offerings: (Brand differentiation- 50%) Brand Yes/No If yes, please name the brand IBM Apple HP Dell Microsoft8. Match the following usage with a technological brand of your choice: (Brand Differentiation-25%) a. Home usage b. Commercial usage c. Education d. Entertainment e. Data storage9. Rate the following brands on a scale of 1-5 for the following attributes (1 being the least rating and 5 being the highest): (Brand Esteem-70%) Trust Performance Customer care User friendly HP Dell Apple IBM Microsoft10. Identify the following logos: (Brand Knowledge-20%)11. Which brand of computer hardware do you use?( to be cross tabulated with Q.6) 13
  14. 14. Results and Analysis of BAV: (the details of the analysis and the calculations are in the excel sheet attached)  Individual brands: The percentile score of all the individual brands across differentiation, relevance, esteem and knowledge was calculated and then converted into graphs. Then the graphs were compared with the graphs given in the prescribed text- Marketing Management,13th edition to find out in which category( new, unrealized potential/niche, leadership, declining, eroded and unfocused) do these brands lie. The brands that were analyzed were IBM,Dell,Apple & Microsoft as they are competitors to HP. IBM100908070 60 60 6060 IBM50 4040302010 0 D R E K From the graph we can see that IBM is low on relevance while it is about average in differentiation, esteem and knowledge. By plotting it in the BAV power grid it comes that IBM is a Declining Brand. 14
  15. 15. Dell 100 80 80 60 60 40 40 Dell 40 20 0 D R E K In case of Dell the respondents perceive to be a highly differentiated brand. It has an average score in terms of relevance while score below average in esteem and knowledge. In the power grid Dell comes in the Unrealized Potential category. Apple 100 100 80 80 80 60 40 Apple 40 20 0 D R E KApple scores high on brand stature but scores comparatively lower on brand strength, ergo a DecliningBrand 15
  16. 16. Microsoft1008060 Microsoft40 20 20 20 2020 0 D R E K Microsoft scores low across the 4 dimensions as such it is an Unfocused Brand HP 100 100 100 100 80 80 60 HP 40 20 0 D R E KFrom the data collated we find that HP scores high across the 4 dimensions of BAV, ergo Hail to the chief. HP isconsidered a high earnings and high potential brand i.e. it falls in the Leadership category 16
  17. 17. Brand Asset Valuator Power GridHewlett Packard on BAVHP as per the BAV is a market leader what does that mean? In order to decipher this mysterywe need to analyze the 4 pillars of BAV individually with the percentile scores that have beenawarded.  Differentiation: HP has a percentile score of 100, this means HP has managed to differentiate itself properly from the other need satisfiers  Relevance: HP has a 100 percentile in relevance. This leads us to realisation that the need identification process of HP is excellent which leads to conclusion that the most important building block for a brand is in place HP.  Esteem: HP is only a 80 percentiler in case of esteem coming second only to Apple which has a 100 percentile in esteem. This shows that the brand HP is well respected and regarded by the consumer. 17
  18. 18.  Knowledge: HP again scores a 100 percentile, the highest score one can receive in Knowledege. This leads us to the conclude that the past brand building efforts of HP coupled with its age have made it one of the most well known brand around the globe. High Knowledge & Low Esteem: From the quantitative research we found that HP scores the highest in knowledge but has a comparatively low score when it comes to esteem. This leads to the conclusion that there is a slight problem with the brand personality of the Hewlet-Packard. 18
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  20. 20. Analysis Tool Used: ZMETZMET stands for the Zaltman Metaphor Elicitation Technique and was developed by Harvard BusinessSchool Professor Gerald Zaltman, the Joseph C. Wilson Professor of Business Administration and Co-director of the Mind of the Market Laboratory. To develop creative strategic solutions to marketingproblems managers need: Detailed knowledge of the consumer and the marketplace Clarity of thought guided by effective models and theories Creativity and imagination Reasoned judgment and experienceWhere these needs exist, it is appropriate to consider using ZMET. ZMET research provides fundamental understandings of consumers, by identifying a broad setof meanings, at several levels of experience. It helps understand how unconscious and consciousprocesses interact to: Create needs Influence the criteria for satisfying them Shape the experience of satisfying needs Spawn judgments about those experiences.These understandings are necessary foundations for building effective marketing strategies. ZMET uses visual and non-visual "images" gathered and/or generated by consumers to elicit andprobe the metaphors that represent consumer’s thoughts and feelings about a topic. Images are important units of analysis for marketing managers. When augmented by consumersexplanations during careful probing by an interviewer, the images provide a clear idea of whatconsumers really think and feel. Almost invariably, these insights are far deeper and clearer than theinsights to be gained from verbal discussions alone. Although images can be visual, many images can take other forms as well such Touch, smell andsound. Whatever the form it might be, an image represents a feeling much more distinctly than words.For this reason, usage of images is referred to as a Metaphor. During a ZMET interview, we collect verbal descriptions of the thoughts and feelingsrepresented by these images to help us understand their meaning. Strong evidence exists that theseverbal descriptions are far more complete and far more useful to managers because they werestimulated initially by these images or metaphors. By having, people select their own images, the ZMET process gives participants control of theresearch stimuli and a greater sense of involvement with the interview topic. Thus, participants are ableto represent their thoughts and feelings more completely and accurately than when responding tostimuli presented by the Researcher. The pictures participants bring to the interview are metaphors thatserve as entry points into their thinking process. Exploring the meaning of these metaphors allows us toelicit many important ideas 20
  21. 21. Origin of ZMET: Zaltman began thinking about the power of using imagery in research while on vacation in Nepalin 1990. Zaltman initially planned to bring his camera but at the last minute opted to chronicle the tripby giving local residents disposable cameras and asking them to take pictures that would explain whatlife was like in their villages. After developing the pictures, Zaltman returned to the village to askresidents to explain, through an interpreter, the meaning of the photographs. The imagery tended toreveal ideas that would have been difficult or unacceptable to put into words. For example, thephotographers often cut off people’s feet in the photographs. This was intentional. In Nepal, bare feetare a sign of poverty. Zaltman believed that because of the stigma associated with poverty, the topiclikely would not have surfaced had the villages been asked to describe life in their villages using justwords.Steps followed in the Quantitative researchStep 1: Story telling about the pictures The respondents were asked to select 10 pictures, which they felt best described, their feelingstowards the brand HP. They were then asked to describe the pictures and how they associated themwith the brand in the form of a 5 to 6 line story. This is done as much of our experience and feelings takethe form of stories and are an important source of insight of the respondents. A bit of laddering wasdone to get a bit more insight into the respondent’s mindStep 2: Missing Picture The respondents where then asked if they wanted to include any other picture in the 10selected. If they answered yes then they were asked to explain why. This is done to explore the kind ofimage that might represent the thoughts and feelings.Step 3: The Triad Task This task tries to identify the concepts and thoughts at a higher level. The respondents are askedto represent 3 pictures selected at random by the interviewer and how 2 of them are similar, butdifferent from the 3rd picture. The reasons are probed using laddering technique.Step 4: Metaphor Probe The participants are then asked to elaborate their thoughts and feeling in a deeper and morecomplete way. This uncovers hidden meaning and gives validation to ideas, which have surfaced in theprevious steps. For this the respondents are asked to widen the frame of one or more picture by askingwhat should be added or deleted from the picture that might reinforce the original idea. This step isrepeated for 2 or 3 pictures. 21
  22. 22. Step 5: Digital Imaging The respondents are then asked to create a collage of the pictures they have selected. Theywere asked to give one word for the pictures they had selected. This brought out what they thought andtheir ideas. This is the summary of the entire exercise. While the summary brings out most of the ideasexpressed by the respondents earlier, some new ideas do surface during this step as the participantsmodify the pictures in size and colour to fully convey their feelings. When the picture is finished, therespondents are asked to give a verbal description, which serves as an interpretive tour of the entireexercise. 22
  23. 23. Similarities among the respondents 3 4 7 2 5  Leader  Faith Global  Professional  Future  Ahead  Basket of Giant  Trendy  Innovation  Out goods Invention  Host of  Trust performers  Team player Ideas services  Bonding  No.1  User Rich  Well Known  Poor  Global friendly Value for reach  24X7 customer  Bright Ideas money  Self-  Helpful service  Standing King evaluation  Basket of out  Quality goods  Professional  State of art  Innovative 23
  24. 24. Keeping in mind the Zaltman story telling approach, the brand identity of HP as per respondentfeedback can be interpreted as the following: is a global giant having a wide spread network. It is a highly trusted brand which promises value for money along with superior quality. This coupled with its innovations and professional attitude makes HP stand out among its competitors. 24
  25. 25. References:  Prof. Srinivas Govindrajan’s PPTs  Marketing Management, text book  http://fmcg-marketing.blogspot.com  http://wikipedia.org  http://www.people.hbs.edu/krandel/mml/negotiation/zmetint.html  http://www.acrwebsite.org/volumes/display.asp?id=7644  http://www.brandassetconsulting.com/  http://www.hp.com/  http://hpalumni.org  http://www.webhostingreport.com 25  http://www.fundinguniverse.com