HOW CANON WHENT FROM ZERO TO HERO THANK'S TO HP
HOW CANON WHENT FROM ZERO TO HERO THANK'S TO HP
2009-11-10 at 11:06:02 am #22905
HOW CANON WHENT FROM ZERO TO HERO THANK’S TO HP
The Canon Brand Goes From Zero to Hero all with the Help of Some Clever Advertising and HP
The Canon brand has been growing stronger year by year. Liew Sip Chon, President & CEO of Canon Marketing (Malaysia) shares how Canon built its brand from a mere trading arm to a world renowned name. The year 2009, the recession year. This very same year, Canon ranks number one in Reader’s Digest Trusted Brands (Malaysia) in the camera and multi-function printer/copier category. They ranked number three in Asia’a Top 1000 Brands. Ranked number 3 in BrandZ Top 100 Most Valuable Global Brands 2009, which according to their findings say the value of the top 100 brands increased by 2 percent to $2 trillion.
That’s the Canon brand in a nut shell. More precisely, that’s the Canon brand in a year of an economic turmoil.Before Canon Marketing (M) Sdn Bhd was formed, Canon was under the trading arm of Mulpha Trading. “As a part of Mulpha, we were not the brand owner. And if you are not the brand owner, your objective is just to make profit. So you do optimum sales for maximum profit.”It was only until Canon Marketing Malaysia was set up, that the whole direction of Canon changed. “Our objective is no longer just profit as that sort of formula is shortsighted. As the marketing arm, one of our objectives is to drive high market share and, according to economies of scale, ultimately profit will follow.”Liew, who was then Area Sales Executive, knew that if the business was to grow, it had to be developed into more than just trading. He knew Canon needed to be turned into a brand. “When Canon Marketing started in January 1987, we started to invest heavily in Advertising and Promotion (A&P), and till today we continue to do so. In good times or bad we continue to invest annually, on average 5% to 7% of our turnover.”
The decision that catapulted Canon from zero to hero
Canon’s road to brand-fame was paved with one word, ‘Printers’. When Canon introduced their Ink Jet printers back in the year 1991, there was no market for the Ink Jet printers. The printer market only consisted of laser and dot matrix printers. The Laser Printer market was dominated by Hewlett Packard (HP) with a 70% market share, while Dot Matrix was dominated by NEC, the market leader, followed by Epson and Panasonic.“When we introduced Ink Jet printers, it was completely new to the industry. Consumers had never heard of Ink Jet printers, so we had the task of promoting a new product from scratch. In addition we had to compete with two giant players in the printing industry, HP and NEC.”
Canon began to market their printers through print advertisements. However the public was not convinced as Ink Jet had higher running costs than Laser, while Laser produced better quality output than Ink Jet. In comparison to Dot Matrix, Ink Jet gave better results but Dot Matrix was able to print carbon copies. Due to these facts, consumers felt there was no real use of an Ink Jet printer. Ink Jet printers also sat on the premium price scale. Canon received no support from dealers either. As many dealers had never heard of Ink Jet printers, they did not want to bear the risk of promoting a product that had no demand.
Canon then decided it was time to educate consumers about their new Ink Jet printers. “So we created an education program which we sold through posters. The posters read, ‘The 10 most commonly asked questions about Canon Bubble Jet Printers’.”Even with the education program, dealers were still not keen on stocking up Canon’s printers. This was when Canon introduced their retail programme. They designed a display stand that could fit all four printer models which valued at a total of RM10,000. “So we told the dealer, all you need to do is display this product and we will give you a 20% discount every quarterly. Over a period of one year, you would have gotten an 80% discount, which means your total investment is only 20%. Dealers bought this idea and they began to position the display stands stocked with Canon’s printers side by side with Canon’s education poster.”The next step Canon took was what killed their competition and brought them tremendous amount of publicity. Canon ran seven consecutive advertisement pages in, what was then, the leading computer industry publication, Computimes. “During the 1990s, Computimes was popularised because we spent so much money with them. We knew industry players and consumer will always read Computimes, so we put all our money on that paper.”The print ads featured all printers in Canon’s range, from the lowest priced to premium printers. “Till today I think it is a record. No other company has run that many ads at one time. Seven consecutive colour pages starting from page three.”He added, “After those ads, dealers such as SIS and INGRAM who, previously, were not interested in dealing with us, suddenly were approaching us for our products.”
Canon brings their dreams to life
When Canon launched their first colour Ink Jet printer in the year 1993, they received encouraging response from dealers and the press. They have Liew’s favourite ad campaign to thank for that.“It just struck me one day. When we dream, are those imageries in colour or black and white?” It was this thought which led them to the tagline ‘Do You Dream in Colour?’ The tagline inspired a whole range of initiatives for the branding campaign including print ads and also a 10 minute musical.The ‘Do You Dream in Colour’ campaign created a phenomenal wave of publicity for Canon leading to exceptional business growth. After the launch of their first Ink Jet printer, in the year 1992, Canon produced only 5000 units of printers. By 1993, that figure more than doubled, and in 1994 they were manufacturing 40,000 units. By their fourth year the figure increased to 70,000 and by the fifth year, their printers exceeded 100,000 pieces. Today Canon sells, on average, close to about 40,000 printers a month.For almost one and a half decades, Canon has continuously out spent their competitors in terms of marketing. “Because of our high ad expenditure, it is very hard for the next brand to break into the market. It is the moment we stop advertising that we may have a problem because there are always new brands entering the market and we have to continue to attract consumers.”Their branding initiatives also brought another notable achievement, the synonymity of the name Ink Jet with Bubble Jet. “Malaysia is the only country where consumers refer to Ink Jet printers as Bubble Jet printers, when Bubble Jet is actually the brand name of Canon’s Ink Jet printers. It was our aim to build the name Ink Jet synonymous with Bubble and it took is approximately seven years to achieve that branding status.”
From Great Products to Exceptional Service
After years of branding and positioning themselves as the top brand for cameras and office equipment, today Canon’s key message is reflected in their tagline, ‘Delighting You Always’. They call it the CD project, Customer Delight that is, a project running for the last five years.“Customer service is our prime consideration now and that’s why our tagline is focused on the service level. We even set up a committee in our organisation, called the CD committee, to look into all aspect of improving Customer Service.”
Canon also conducts regular surveys to ensure the quality of its service is consistent and ahead of its competitors. “The surveyors act as mystery callers, calling the top 10 brands in our category. When we did the first survey to check if our helpdesk people were friendly, informative, knowledgeable, etc, we came out fourth out of the 10.”It was after this first survey that Canon started the CD programme. Nine months later, they conducted the second survey and immediately shot to number one. Since then, Canon has been conducting customer service surveys every nine months, with a total of six surveys to-date. And they have been number one ever since, staying ahead of their competition by a commendable margin, prides Liew.Canon also ensures that their hard work is being recognised by their customers. “We also conduct surveys on the end user. The last survey was about six months ago. We found that we have the highest customer loyalty and customer retention with more than 30% of customers who affirmatively say they will continue to purchase Canon products or recommend someone to use a Canon.”
Keeping with the times
With media 2.0, brand communication is no more a one way street. Realising this, Canon, since last year, moved into cyber space. “We [recently] engaged an IT consultant from India called the Havas group, to help us revamp our entire website and update it to the new Web 2.0. You can now find us at http://www.canon.com.my/interactive.To encourage customers to visit their site, Canon has started their online warranty which allows customers to activate their warranty card through their Web site. “Through the Web site, we give them an extended two year warranty. We believe you need to give customers a reason to go online.”
One of Canon’s most successful online projects is called ‘Canon Goes Green’, which began 2nd September 2008. Viewers are called to submit a picture through the Web site. For each picture they submit, Canon promised to plant a tree at Padang Kota Damansara, where a lot of illegal logging is taking place. “We actually started this project because we wanted to test the waters of our online tools. It was a low risk project and it doubled as our Corporate Social Responsibility project.”The team at Canon had their doubts about the response they would garner, as they conducted this project 100% online. However the response was overwhelming. To take the project to the next level of interactivity, Canon called all 1000 participants of the project to join them at Padang Kota Damansara, on October 19th 2008, to help them plant 2,500 seedlings. “We also invited YB Elizabeth Wong (Bukit Lanjan Exco), Faizal Parish (Director of Global Environment Centre), YB Dato Haji Mohamad Ruslan (on behalf of the mayor’s office), reps from Forestry Dept and Dr Nasir Hashim (ADUN Kota Damansara).”
Building a Green Brand
Canon’s green initiatives have not merely been a test run of their online popularity. For years they have incorporated environmental saving initiatives into their brand building plans. Among the projects they have carried out includes recycling used ink cartridges. They have also done environmental clean-up projects. However, after all these years, Liew realises education is the sustainable path to restoring the environment.“That’s why we started ‘Canon Goes Green’. This programme educates the young on the importance of caring for the Earth. Civic mindedness has to start from an education level. For example we started planting trees at Padang Kota Damansara. We then applied to the government for permission to turn the park into a nice botanical park that can be used by the public for activities. We want to build basic amenities like toilets, water taps and tree houses.” Canon believes, by developing the park for public use, more people will come to appreciate nature and understand its importance.Canon has also implemented many environmental friendly initiatives within their organisation. “We have banned the use of plastic bags by our company. We only use recyclable paper bags and reusable woven bags.”Canon Inc Japan also started a green earth campaign two decades ago which has resulted in all Canon’s packaging material being plastic-free and environmentally friendly. In addition, all ink and toner cartridges are recyclable. “We also just launched our first calculator made from 100% recycled material and it is commercially viable.”
Sustaining brand excellence in a downturn
As stated in the beginning, Canon has managed to sustain its branding power even through the economic downturn. Liew says, for Canon, an economic downturn is no different than an economic upturn. “When the same economic situation occurred in the year 1997, [companies] were laying-off staff and cutting A&P. But we did not take the same approach. At Canon, we invest the same amount of money in good times and in bad.”Liew testifies, in 1997, after the recession, Canon’s business recovered in 18 months and hit record sales. Other companies, he says, took four to five years to recover.
Canon believes this principle is what has helped it outshine its competitors. Liew says, when the company spends the same amount in bad times, as they do in good times, they will receive higher ROI. This is because, as competitors cut back their expenditure, Canon, while maintaining their annual A&P expenditure, will receive larger share of voice. “This tactic makes it look like only Canon is advertising, hence drowning the other guys. [In actual fact] with the same money spent, we gain higher returns [during the recession].”
The faces of Canon
Brand ambassadors or spokespersons are a vital part of any branding campaign. The brand ambassador adds a human perspective to the brand, and builds the bridge between consumers and the product. Consumers also tend to be attracted to purchase products endorsed by their favourite celebrity or personality who claims to use the product.
Simon Yam has been the face of Canon’s EOS in Malaysia for nearly 15 years. The Hong Kong actor who holds a squeaky clean image is also known for his skillful photography. As an avid photographer, he understands the art of photography. He is also shifting his career path from acting to directing, and for his latest project, Simon shot the full documentary using Canon’s EOS 500. He not only elevates the value of the brand through association but his knowledge and active involvement in photography helps to market the product, in terms of application, and consumers see his word credible .
Canon’s brand ambassadors are also the Malaysian ten-pin bowling team. The Malaysian national team is one of the best national sports teams. As they have won many world titles, Canon is proud to sponsor them and have the team carry their logo, deriving publicity and value from the team’s continuous excellent performance.
When Canon first sponsored the bowling team in the year 2004, it was with the intention of carrying out their social responsibility. “When I met Dato Dr P.S. Nathan, the president of the Malaysian Ten-Pin Bowling Congress, he shared with me the difficulties faced by the national team, who are given low monthly allowance from the Malaysian Sports Council, forcing their parents to support them financially if they were to continue to represent the country.”
This year Canon brought back one of their former brand ambassadors. The Malaysian ‘Queen of Rock’, Ella, worked with Canon in the early 90s for seven years, and today has returned to promote Canon’s PowerShot and IXUS to the Malay market. Even though Ella is from the older generation, but the launching of her new album proved Ella an evergreen artist after her hit single shot to number one in just one month.
To Sum it All Up!
And that’s the story of Canon. From a run-off-the-mill trading company to one of the top players in its category, Canon has proved the power of advertising goes beyond just selling a product. Taking a lesson from Canon, we’d say, don’t just sell, brand it!