HP & THE DEATH OF BRAND EQUITY
HP & THE DEATH OF BRAND EQUITY
2005-09-01 at 11:26:00 am #12547
HP and the death of brand equity
My daughter’s HP inkjet printer died last month.
It wasn’t a big deal – it was a low-end HP 3535 printer that came “free” with the PC I bought.
If you understand the economics of cheap inkjet printers, you’ll know
that manufacturers like HP, Epson or Canon don’t make money off the
hardware, but make a killing on the ink. In fact, ink cartridges that
go with a new printer account for more than half the sticker price.
This modern-day version of the Kodak model (cheap cameras but
constantly replenished film) has worked for years, but from a
consumer’s standpoint, it just beats the crap out of a brand name.
When I was a kid, a commercial for Zenith TVs showed one being thrown
off a plane. With the help of a parachute, the TV landed roughly on a
field but survived.
None of this pride in product durability survives today.
The HP 3535 conked out just a few months after the warranty ran out. I
took it to the HP service center in Makati because the company had
closed its branch in Quezon City, which was much closer to where I work
The people in the service center were helpful, professional and
courteous, but one look at the place convinced me that they were in an
environment that wasn’t designed to keep the customer happy.
Looking bored, some 18 customers sat around waiting in a room no more
than 25 square feet. A few lackadaisically watched “Blackhawk Down” on
a TV while five HP personnel manned the counter.
I took a number and found I was in for a long wait.
An HP person helpfully suggested I have lunch first and come back,
which I did. When I returned, my number had already been called, so I
had to wait until they could squeeze me in.
I used the time to listen to what some technicians were saying.
One explained apologetically to a woman who had driven all the way from
Alabang that the printer she lugged in was no longer supported. Another
explained to a customer that repairing his printer would be more
expensive than buying a new one because diagnostic services alone would
cost P1,600. There would be a long wait, too, as the part had to be
shipped in from Singapore.
When my turn came up, I found that my problem wasn’t as serious: the power adapter was just dead.
Replacing it would cost P1,086 and I wouldn’t have to wait too long for
the part. I did have to wait 15 minutes more while the technician
filled up forms on his notebook PC.
Did any of this make me glad I was an HP customer, even by accident?
I remember a time when the brand HP stood for product quality and
durability. A time when their scientific calculators were prized
possessions. Even my first inkjet printer lasted years.
It’s easy to blame low-cost production and fierce competition, but
these do not excuse a lack of pride in product quality and concern for
What signal does a company like HP send when it tells a customer he
might as well buy a new printer than fix the old one? Or when it closes
all its service centers except the ones in Makati and Cebu? And when
customers must wait, not just hours in a service center, but maybe
weeks for parts to arrive from Singapore?