A bundled Compaq deal aimed at the small business market via the retail channel caught the attention of IDC Australia's senior PC consultant, Bernie Esner. And according to Esner, it illustrates both the opportunity afforded by the coming GST and the battle the vendor is fighting with the white box.
In the IDC Pulse article, Esner reported on Compaq's bid for the hearts and minds of the Small Business market, with the inclusion in the latest Coles/Myer OfficeWorks catalogue of Compaq GST specials, bundling desktops with small business accounting software like MYOB and Quicken.
According to Esner, `The promotion is aimed squarely at small businesses gearing up for the administration of GST. The focussed approach to this specific market and the simplicity of the bundles should be applauded. It's timely, relevant and the decision to distribute via Coles/Myers Officeworks is strategic one. It makes good sense to target small business via Officeworks stores, which are deliberately located in industrial hubs throughout the country.
`We strongly believe that the key to marketing small business is the simpli-city of the message and of the pro- duct set. Small business owners don't have the time or resources to analyse complex product offerings.'
Compaq has combined a `one box approach' with three accounting options. This saves managing excess inventory. The all-important price points ranging from $2027 to $2096 for a Pentium III are well positioned. Financing options through RentSmart sweeten the deal. Rentals are generally 100 per cent tax deductible when the equipment is used solely for business.
`Currently, Compaq's main competitors for the small business dollar aren't its fellow international vendors. It's the resilient and wily white box suppliers who dominate this sector of the Australian PC market. IDC estimates that the white box PC market accounts for more than 33.7 per cent of all Australian PC shipments, making it the biggest `brand' of PCs sold in Australia. Putting this in perspective, the Australian PC white box market is nearly two-and-a-half times the size of the entire local Mobile PC market.