Fuji Xerox fights price erosion with channel program

Helps partners combat dropping prices.

Printing giant Fuji Xerox has revealed its strategy for combating price erosion in the printer market, unveiling a new program designed to help partners stay on top of a difficult segment.

The company today officially launched its Premier Partner Program - an attempt to take some of the pressure off its resellers in the print category.

A/NZ channel and marketing boss Anthony Toope told CRN resellers had requested help in combating 15 percent price erosion in the print market.

He said surveying partners earlier in the year had provided a wake-up call about the company’s channel strategy.

“Partners are under a lot of pressure, and rather than complain about it we want to be proactive,” Toope said. “There are actually tremendous opportunities in key segments because the products are more affordable than ever before."

“For retail, the units are increasing but the price points are under a lot of pressure. We’ve done extremely well in segments like mono and colour where we are number one, excluding mono 21-30.”

Toope declined to provide specifics of the company’s recent financial performance, but said it had seen 20 percent revenue growth in the 2011 financial year, and over 40 percent growth in unit sales.

Toope said Fuji Xerox would not chase down price points, but as part of the new program will implement marketing and education strategies to allow resellers to flourish in both the traditional SMB midmarket hunting ground and retail segments.

“No-one wants to think they’ve been ripped off, we all want a deal and the best price,” he said. “Market surveys never show price as number one consideration. It’s definitely in the top five, but there’s generally a high proportion of service elements, as well as support.”

“We’re launching a live demonstration in store for retail," he said. "It’s a simple idea that isn’t revolutionary, but we all get so much into box moving that we forget people might want to look at a product or justify the price difference.

"We’re also increasing specifications, on the new range we’re going from 24 pages to 30 pages, and putting networking, wireless and duplex as standard.”

Alongside a revamped retail attitude, the company has responded to partner request for more access to whitepaper and technical information by creating specific value and vertical strategies under the new channel program. 

The program is divided into four core categories: sales and marketing, incentives, communications and tailored programs. It replaces Fuji Xerox's 'Channel First' program -- an all-encompassing rewards-based initiative Toope said needed to be fleshed out.

“We can’t have one program that does everything,” he said. “We’ve built a number of elements that are tailored towards the reseller. We want to help partners build not just hardware sales, but an ongoing annuity revenue stream.”

One of the more significant changes to the program involves lead generation. Toope said Fuji Xerox’s previous internal strategy had resulted in leads being lost due to time constraints.

The company has partnered with outsourcing specialist Outsource for a lead generation program that involves 400 outbound telemarketing calls, up to 2000 EDMs alongside dedicated white papers and daily performance updates, at a cost of $8500 per month - $2000 of that contributed by the partner. 

“It would be great for us to allocate leads to partners, but it wasn’t working,” Toope said. “This way they get real leads in real time, and a daily report as well as the rate of click throughs.”

So far, 30 partners have signed up to the Outsource program.

Fuji Xerox currently has about 100 top-tier partners, categorised by turnover of over $50,000 per annum; 450 authorised resellers; and 2000 to 3000 active product purchasers. In the past six months, Toope said almost 40 new partners have joined Fuji Xerox.

The Channel First program had 60 of those partners on board, while its new effort has already signed up almost 100.