Compaq no turkey, hungry for Asian markets
By: Mike Magee
Posted: 05/12/2000 at 10:02 GMT
An article in local New York rag The Wall Street Journal said yesterday that
Compaq's CEO, Mike Capellas, is giving thanks that US consumers don't
think its PCs are turkeys.
Although the piece doesn't quite say the following, the suggestion appears to
be that Americans, after they had stuffed themselves silly on silly dead birds,
and seen enough college football games on TV over Thanksgiving, then
levitated themselves from their collective couches and went out in droves to
buy its shining boxes.
Capellas was responding to warnings from other PC manufacturers [You
mean Gateway - Ed], that sales of the pesky devices are flagging in the US
market. At the same time, he denied that it had too many PCs sitting in its
warehouses.
Compaq, the firm which made its millions by almost single handedly taking on
IBM in the 80s, and which gave itself the handle Compatible Quality differs
from Dell in that it believes keeping PCs in stock pays dividends.
Compaq is not even that concerned about the US home market. Earlier this
year, a report from a US analyst suggested that the firm was set to make
waves in the PC market in South East Asia, mostly because Dell's build to
order model won't work in India and China.
It's certainly true that Compaq's latest ad campaign (Inspiration, Perspiration?
We can't quite remember) is being aired worldwide, and the brand name is
everywhere to be seen in India, for example.
How its latest New Age style ad campaign goes down with the man on the
Mumbai omnibus remains to be seen. Compared with other multinationals
keen to penetrate the Indian and Chinese markets, Compaq's ad is tame stuff
indeed.
The sexiest thing you're likely to find on Indian TV today is a controversial ad
from German combine Siemens which flies in the face, so to speak, of
Bollywood sensibilities.
That Haagen Dazs advert which showed a semi-naked young lady with a
dollop of what appeared to be ice cream adorning her navel has nothing on the
Siemens ad, believe you us.
These, and other multinationals (Coca Cola, Pizza Hut, Domino Pizzas, Pizza
Express, McDonalds - lamburgers, OK? and... err Haagen Dazs), are
engaged in a mighty charm offensive in South East Asia which shareholders in
the States might find charming but some locals might find offensive - that is, if
they can afford tellies.
With the average middle class salary bottoming out at around $5000 a year,
readers might wonder how a family could afford a Compaq PC, a Hot
American pizza, a Siemens mobile or even a dollop of ice cream.
The answer is that in order to sell their products in the Indian and Chinese
markets, Compaq, Coke and the rest have to charge far less than they do here
or in Poughkeepsie.
A medium-sized Coke costs ten rupees (two cents), a packet of Indian tabs
less than a buck, while two of you can dine out in the Jaipur Pizza Hut and still
have plenty of change from a five pound note (300 rupees).
So the shiny Compaq PCs are far cheaper too.
However, Compaq's strategy appears to be that it's in these markets for the
long term, and as the combined population of China and India hovers around
the two billion mark, it surely can't be that long before Dell realises that
build-to-order might not hack it in those markets.
Mind you, the fastest PC we saw in New Delhi was a Siemens 286. Our
lovely little Fujitsu Lifebook, even with its Celeron processor, seemed to be
the fastest PC in the whole of Rajasthan. ® |
