Acer ropes in Summit to push optical products, LCD monitors

NEW DELHI: Acer Peripherals has appointed Delhi-based distributor Summit

Infotech to push its optical products and LCD monitors particularly in the

northern belt. As both these are niche segments, the appointment assumes

significance since the job here will be to create the market rather than just

pushing boxes. Says Sandeep Nair, Managing Director, Acer Peripherals,

"Being niche products, the vendor has to be able to sell solutions to

customers and sometimes this entails creating a market. Summit has a good track

record as far as niche products are concerned since it is handling products like

Adobe and Quark."

In fact, it is a role that Summit enjoys and thrives in. One of its major

success stories have been Umax scanners which has maintained the number one slot

for scanners in the country for three consecutive years. The success here has

been attributed to the fact that Summit took on the dealership of Umax scanners

when the market for scanners was relatively nascent. According to Yashpal Bindra,

Director, Sales, Summit Infotech, "It is easier to create a market and gain

market share than following the leader. Making inroads is much more difficult.

In an existing market, the only way for the distributor to make inroads is

through price points and it hurts the bottomline when one resorts to cutting

margins." It is only now that HP has lashed back with its high-profile

campaign targeted at SMEs and upcountry markets that the market share of Umax

scanners has shrunk to about 30 per cent from the earlier 35 per cent. But

Bindra says that Umax scanners have not suffered any real setback as in terms of

numbers due to market expansion.

And it is due to this market expansion activity that existing players like

Samsung and LG have welcomed the entry of Acer Peripherals into the LCD monitor

and optical products market. The challenge before these vendors is two fold: to

educate the customers and the high price points. For both these issues, market

expansion is critical. Says, Ajay Kapila, Vice President, Sales and Marketing,

LG Electronics India, "Acer's entry is a positive development since it is a

restricted market we are addressing for these products. So, we shall all be

targeting the same customers and it will help in market development." In

other words, with more and more vendors raving about the virtues of new product

categories, it will be easier to convince customers. Concurs Vivek Prakash,

National Sales and Marketing Manager, Samsung Electronics India, "With more

players, market development will be faster bringing in volumes and thereby price

cuts."

Service is a critical aspect for the success of these products since both the

LCD monitors and the CD-RW cannot be repaired and should be replaced in case of

damage. Therefore, customer support will be a critical factor in determining the

winner in these products. For instance, Samsung, which claims to have the

largest market share in these segments, attributes it to the fact that it has a

large base of service support for its products. Recognizing the criticality of

service in these kind of products, Bindra says that Summit along with Acer

Peripherals will kick-start a training program for its service engineers from

the last week of January.

However, it is also to be noted that most of the Samsung sales in these

product categories take place in the direct selling model. Justifying the

reason, Prakash adds, "Since these are products that require customer

education, it is but logical that most of the marketing is done by Samsung

itself. The definition of channel is essentially to ensure reach for achieve

volume sales."

So, is the Acer strategy wrong? "No" says Nair. "We are 100

per cent channel driven and our partners play a significant role in the success

of our products. We are selective about our partners and are confident of

Summit. The message we would like to send is that despite our wide array of

products our approach to marketing is very focused. For instance, Tech-Pacific

handles only our optical products while we have recently appointed Godrej &

Boyce to distribute our DLP projectors."

Summit will target the corporate, SOHO and the government segments for the

two product categories. It is a challenge that the company is looking forward

to. "For one," enumerates, Bindra, "the Acer Peripherals brand

awareness is low. Second, the product range itself is niche and requires market

creation. Third, we have to ensure the reach of the products which are confident

with a dealer base of 250 across the country."