Are you missing out on your share?

In an age where information is king, what is printed on a page, however increasingly commoditised, is still an essential part of our everyday lives, with more being produced every day.

While on most accounts the market for printers is growing, it is being driven on the whole by falling prices – a trend seen as a double-edged sword.

Pundits say on one hand, the lower end of the market is experiencing impressive year-over-year growth driven by the decline in prices; and on the other, the challenge of securing value growth is under intense pressure.

Small vendors that are fast losing their low-price propositions are gradually adding yet another market dynamic by increasingly looking to expand their offerings to the mid- and high-end markets.

Simultaneously, the relatively established vendors with a broader range spanning the low, mid, and high ends of the market are looking more seriously at managed print services.

Most commentators also suggest market players face a bumpy ride ahead, with business buying decisions impacted by cost constraints, environmental initiatives and technological developments.

Pricing is a key factor when it comes to market strategy, according to Rishi Ghai, program manager hardcopy peripheral research, Australia and New Zealand at IT researcher, IDC.

“The stereotypical price zones once associated with different types of hardcopy peripheral devices have been dissolved by a sharp drop in prices,” Ghai said.

“Average selling prices (ASPs) across all hardcopy technologies are increasingly getting concentrated in narrower bands, and will not only severely constrain vendors’ ability to differentiate their offerings in the long term, but will also add to perplexity for customers,” he said.

“Channels will continue to assume greater importance, as the battles for share of the entry-level and mid-range markets intensify.”

Competition for channel share would likely be seen in the mid-range space where some small players are struggling to establish their presence.

Vendors’ experimentation with solution-oriented selling will begin to gain more visibility, as the ASPs of hardware continue to erode, putting increasing pressure on the industry to look for alternative revenue sources.

“Vendors are trying to beef up production lines so as to compete in higher end lines, while those that were market leaders in the top end are now looking to join the entry-level market where demand is especially high,” Ghai said.

“I believe 2006 marked the turning point for printing and imaging. From that point on there has been an influx and growth in the entry-level market, with laser printers selling for less than $80 and colour lasers for less than $100.

“These lower prices have forced vendors to focus on other products and need to offer a complete balance and diversify into mid and high ranges as well.

“More than ever, vendors are having to look to set up an adequate channel base to provide a good market for their products.

“The channel is already better placed to take initial share in managed services where we have an increasing emphasis on providing a broader base for more customers by widening commoditising services.”

Jackie Yeung, research analyst, Printing Markets at Gartner, said the trend is towards declining serial inkjet printer shipments from the total printer shipments in Australia from 2003 to Q1 2008.

“Differentiation across printing and imaging sub-technologies is also set to become even more complex, as the entry-level market becomes more crowded for both laser and inkjet devices,” said Yeung.

The percentage of inkjet printer shipments from total printer shipment declined from 81 percent in 2003 to 50 percent in 2007.

Page printer shipments increased from 2003 to 2008 Q1. The percentage of page printer shipments out of total printer shipments increased from 18 percent in 2003 to 47 percent in 2007.

In Q1 2008, page and inkjet printer shipments accounted for 53 percent and 42 percent of total printer shipments in Australia. So, the most common printing technologies today are page (laser) and serial inkjet.

The longevity of inkjet and page (laser) printers will continue in the Australian printer market because the two print technologies will target different target users and market segments.

For example, inkjet technology will be useful for home photo printing, SOHO, home office users, personal printers in offices and students. However, page (laser) technology will target SOHO, entry-level personal printer, workgroup, departmental and corporate users in general office environments.