EDITOR's NOTE: Details added after the eigth paragraph
Azerbaijan, Baku, Apr.9 /Trend H.Veliyev /
Trend interviews HP Vice President and Personal Systems Group Central and Eastern Europe General Manager Achim Kuttler in Baku
Q: How would you describe the dynamics of international IT market development as a result of 2009?
A: We expected growth, but as all the processes and procedures sharpened due to the crisis, and it suddenly turned out that the market was not growing, we had to change our strategy and restructure the processes inside the company. In terms of the computer market, it was a little easier and we were able to reorganize and get into the retail market.
Q: How did the global crisis influence the IT market? How seriously has the high-tech equipment sector suffered? Have the IT needs of customers changed? How much has the demand reduced?
A: I can say that in Central and Eastern European, real demand decreased by 30-35 percent in 2009 compared to 2008. This decline was not observed in any other region.
Q: How has the HP's strategy changed in accordance with the crisis, and what anti-crisis strategy has the company implemented? What results has the company made? What directions is the company focusing on?
A: The main elements of our strategy were to reduce production costs, increasing efficiency and purchasing cheaper parts by increasing our presence in the market. HP has thus increased its market share and received profit in 2009. This is our main strategy - to reduce production costs and increase efficiency.
Q: What changes are you expecting this year? Are you forecasting a recession in 2010?
A: In terms of Eastern Europe in 2010 and beyond, we expect that growth will return to the market. The IDC (ed. International Data Corporation) suggests that the growth will amount to 10-15 percent in 2010 compared to 2009. We expect about the same level. We are also investing to succeed in this market. We plan to be presented in all three segments - in the corporative, small- and medium-sized enterprises, and retail segments.
Q: What kind of products and services you intend to focus on in the near future?
A: It's difficult to speak about specific products because our varieties are broad, and we have products in different categories, from entry-level to more high-tech and expensive models. So we cannot say that we focus on some specific products.
We have plans to develop all three segments in this region.
Q: Are "marketing wars" continuing? Are they traditional for this industry? Will vendors cut their advertising budgets and seek other ways of development?
A: It depends on the state of the economy and the market. Of course, during the crisis, we need to cut down our budget. But, at the moment, when we expect growth, I think the advertising and marketing budgets will increase.
As I said, we are focusing on the development of the consumer and retail segments. Here, the advertising possibilities are unlimited. We can use various types of advertising, including TV advertising. But the most important thing for the company is to know what kind of products we can offer customers.
Q: Will an HP store open in Azerbaijan?
A: Opening these stores is important for us. There was a store in Moscow controlled by our reseller. And this is the model we want. We want to open HP stores, but at the same time we want our local partner to be engaged in sales.
Regarding Baku, I think the idea should also be considered, but it would depend on business opportunities and profitability. Accordingly, if the parameters satisfy us, I think the issue of opening a brand store in Baku may be approved.
First, this is an opportunity to present the entire range of HP products, so the consumer has an idea about all our products. Second, it is important for us to provide consumers with the level of HP sales that we are aiming to achieve. We specially train people to answer all the questions and satisfy all the needs of our customers.
Q: What is the company's role in creating an industrial park in Azerbaijan?
A: It is important for us to take part in such projects and national initiatives, and we are participating in them in many countries. This is important for us from a technological point of view and in terms of cooperation with governments.
Q: HP is a world IT-industry leader. What distinguishes the Azerbaijani market from other markets in the CIS? What prospects for development do you see on the Azerbaijani IT market?
A: The situation in Azerbaijan is similar to the situation in other CIS countries. In many CIS countries, large IT projects are implemented by the government or with the support of the government. Also, some CIS countries have large multinational companies, which are our customers.
Unlike Western European countries, we see that in many CIS countries small- and medium-sized enterprises are not so developed. But the consumer and retail market segments are developed in almost all CIS countries. This is due to the fact that people have more income, which they can use freely, and buy more IT products. In general, the situation in the IT sector in Azerbaijan doesn't differ from other CIS countries.
An important project in Azerbaijan that I would like to see in other CIS countries is the People's Computer project. It is an important project supported by the government and involves major companies like Microsoft and HP. Many people now realize that access to IT is very important for the country's success, and realizing such projects in Azerbaijan is important. I think that Azerbaijan is an example for other CIS countries.
Q: Recently, it was reported that the company reduced its investments in the production of netbooks. Does it mean that this segment of the market is losing its urgency?
A: We try to provide customers with the entire varieties of products. There are two main parameters of devices - it is technical possibilities and mobility. I believe that such devices have future, and, of course, first of all we have to think about who are the consumers and what kind of market is here and how are they used.
Regarding consumers of the netbooks, I think that for students these devices may become the first personal computer in their life, as well as for those who want to buy a notebook in low price.
However, since 2009, we see that the price difference between netbooks and notebooks reduce. Also netbook customers may include people who go on vacation and rest and who want to take easy and affordable portable device. Therefore, I believe that netbooks have the future and have a base of consumers who will show demand for them.