HP puts new channel strategy in place

DQW Bureau
21 Dec 2001


Asim Raina & Shweta Sharma

With a two-tier channel structure, HP India Ltd is inventing newer ways to propel its products in India's channel dependent IT market. The latest initiatives have been proving favorable to HP, with increased pie in the market share, it is now bullish on gaining the government sector too.

The channel structure for HP in India comprises of registered resellers in the roots, Business partners (approximately 350 in #s) and Premier Business partners (approximately 150 in #s) at the top tier. These tiers are qualified on the basis of their amount of business and reach in the particular area.


Right now, HP's focus is to consolidate this structure and filter out the members who are not doing quantitative or qualitative addition to the HP's market shares. It is also trying to purge an inter-tier layer, sub-distributors, and induct more business partners.

The new strategy
  • Focus on Government sector
  • Training of business partners for specified number of days
  • Targets given to every sales rep for a specified period
  • Providing business partners with support linkages
  • Increased interface with its channel partners
  • Consolidating its Premier Business Partners
  • Providing sales incentives directly to sales representatives of dealers

It will also induct new business partners, which have not done any business with HP, to drive its recent strategy of capturing the government sector.

Training the HP sales representatives (sales reps) of various business partners and registered resellers are significant in the new strategy. The company is in the process of creating a consolidated database of its sales representatives across the country. HP will allocate individual sales targets to every sales personnel. It is also trying to personalize the incentive schemes for these sales representatives--e-points is a step forward in this objective.

E-points lets the scheme members (a sales rep) avail various gift on the points it has earned through selling various HP products. This gift can be a modest toaster or an exotic trip to Australia for nine days. "E-points is a program to boost the loyalty of sales force across the nation and express out confidence in them. Idea is to personalize incentives, so that the efforts of these sales representatives are recognized," said Vibhor Basal, SMB Programs Manager, HP India.


HP is enrolling new sales reps' aggressively for this scheme; right now it has approximately 1,400 sales reps in India, out of which, around 800 are active. To entice better channel partners, it will have various plans in place, such as storage plans, color plans, Final Tier Performance Plus (FTPP) or sales rep plans.

Interfacing with such a huge channel community is also a task in front of the HP's channel management team. It is trying to have maximum channel interaction. It already has an account management team in place and an external agency that is running the show for HP. The company is using Web extensively to manage the communication with its channel partners.

One major challenge for HP is making its schemes seamless and unbiased. For this purpose it has appointed Serve Gold as the audit agency to review the sales proofs for its e-points program and in the near future will appoint such auditing agencies to keep its schemes seamless.

Commenting on the present strategies, Rajkumar Rishi, Country Manager (Commercial Business), HP India, said, "HP has its root in the channel for a smooth sailing business in India. Making the channel relations impeccable will only help us. This strategy is aimed at making our communications better and to educate the channel partners for our benefit."