HP Still Doesn’t Get It!

hp slate6

Some of the world’s smartest companies are sometimes guilty of the world’s dumbest marketing mistakes. Take the instant case of HP. They exited the smartphone market two years ago; but now the company is getting back into the market in an interesting way. Rather than re-enter the fray with the usual 4- or 5-inch models, it’s going big, selling 6- and 7-inch “phablets.”

Lest we forget HP’s last foray into smartphones was a disastrous one. The company bought Palm, which had just released a series of phones based on its new webOS operating system. But shortly after that, CEO Leo Apotheker shut down the Palm group in a move to focus more on enterprise computing. Apotheker was ousted by the HP board shortly afterward. Before the Palm phones, HP sold smartphones under the iPAQ brand, which it had acquired when it bought Houston-based Compaq.

For now the new HP phones will only sell in India, but of course will enter the US market sooner or later. Make it later for HP’s sake. Why? Because people think of HP in terms of laptop and tablet PCs, printers and imaging, desktops and work stations, servers and storage, monitors and calculators. Remember those? But an HP smartphone? Sure they have the capacity to make a great smartphone. But that’s not the HP brand footprint!

Let’s look at classical target market selection theory (Hooley et al p. 254). Even if the smartphone market is still attractive, HP’s current company position in serving that market is weak. Their best outcome is therefore likely to be “possibilities.” Not what HP wants.

What do we think? We predict HP’s re-entry to the smartphone market will not be a huge success. So what about Apple and the iPhone you ask? Aaaaaah! Apple. Apple is… wellllll… Apple. The world’s best at strategic brand management. For now.


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