Found this on the web for Konica Minolta:
Having announced its intentions to build out the independent reseller channel, Konica Minolta recently held PrinterTour 2007 in New York City, at which it shed more light on its strategy and unveiled a slew of new magicolor and pagepro products that will lay the framework for the expansion.
According to Richard Miller, vice president of printer sales for Konica Minolta Business Solutions (KMBS), in the past, the purchasing department made the decision on copiers because they were not on the network. Now, because the machines are increasingly on the network, the IT department is beginning to own printers as well as MFP products, thus diminishing some of the influence of the purchasing department.
“Anything on the network typically falls under IT,” Miller added. “While a lot of people have always called on purchasing, purchasing could become less and less a player over time.”
Kevin Kern, president of product planning and marketing for KMBS, seconded the notion.
“IT is the customer now,” Kern said, adding that the merger of KMBS and KMPS enables the company to expand its IT channel.
Playing in the IT reseller channel is a key requirement for Konica Minolta to grow the business and protect the MFP world as it moves to IT. As Miller explained, this process can be facilitated by having a top-down approach with direct sales, and then having the value-added resellers come up underneath. Utilizing this strategy, Konica Minolta will be able to provide its customers with products from an IT/value-added reseller, dealer or direct sales standpoint.
OnDemand Channel Opened The Door
While Konica Minolta's printing division was already distributing products in the IT channel, the establishment of Konica Minolta's OnDemand channel last year was KMBS's initial foray into the reseller channel (see Konica Minolta Establishes New Brand, Distribution Channel in the September 2006 issue of Digital Imaging Review). The plan was for OnDemand dealers to come from several sources, including non-BTA dealers, such as VARs and companies in the document imaging and document management business.
As Kern explained, the OnDemand concept was launched prior to the integration of the printer business into KMBS. With the integration, and the color magicolor and monochrome pagepro printer lines associated with it, the company now has better branding than it had with the OnDemand concept. The product set remains, and the dealers who were recruited for OnDemand are now either part of the dealer channel or part of the reseller channel. OnDemand dealers who were BTA dealers have become bizhub dealers, while those who were more of a magicolor dealer became a VAR.
“OnDemand was a product subset,” Kern said. “Dealers now get access to either the full dealer line (the bizhub brand) or full reseller line (the pagepro and magicolor lines) depending on which side of the house they are on.”
Miller pointed out some key differences between the magicolor and pagepro products when compared to their bizhub sisters. Most notably, the bizhub models will feature a higher cost from a hardware standpoint with lower-cost consumables, while the magicolor and pagepro products will feature a lower cost up front with higher cost consumables.
Addressing Conflict Concerns
While generally the bizhub line is for dealers and the pagepro and magicolor lines are for resellers, many of the pagepro and magicolor products will have identical bizhub sisters. Notably, the magicolor 2590MF already has a bizhub sister, the bizhub C10, while the magicolor 4650DN, pagepro 5650EN and magicolor 8650 will each have a bizhub sister shortly. While noteworthy, this is not unusual. For example, all seven of Kyocera Mita's new EcoPro printers that are targeted for the IT channel are physically identical to existing models in KMA’s line.
Miller said he sees the dual branding of the same products as a short-term strategy as the company looks to build a solid reseller foundation.
“My channel as a whole is just starting to build. In the long term, I foresee the reseller channel having its own products that are separate from the offerings on the purchasing side,” said Miller.
In addition to the bizhub models featuring a higher cost from a hardware standpoint with lower-cost consumables and the magicolor and pagepro products featuring a lower cost up front with higher cost consumables, there are other key differences between the lines. According to Product Manager Dino Pagliarello, the bizhub versions will typically have duplexing standard, and have a three year on-site warranty versus a one year on-site warranty for the pagepro and magicolor models. Further, while bizhub toner can be used on a magicolor, magicolor toner cannot be used on a bizhub, as the toner is keyed differently. As Pagliarello explained, this is because the key exists on the bizhub toner, and therefore it will not fit in the magicolor version.
Still, according to Kern, if a brand is well distributed and properly distributed, there will always be some degree of conflict by nature.
“The turbulence in the market is from the convergence of the customer set and the convergence of the technology, and not from channel strategy,” Kern said.
As Kern explained, Konica Minolta is already competing with IT resellers, because IT resellers are selling printers to their customers. But in terms of out-and-out conflict, they don’t really have the exact same product line and they don’t have the range of experience in MFP service capabilities that a traditional dealer does.
However, the percent of margin the BTA dealers has been getting cannot be maintained as these markets come together, and all the parties must “meet somewhere in the middle,” Kern said.
More Strategy Details Come Forward
While fully transitioning to the IT channel is a key goal for the year ahead, Miller is careful to note that Konica Minolta is not specifically targeting HP, which controls approximately 51 percent of this space.
“I am after leveraging our existing infrastructure and market strengths to try to get our company to the next level,” he said.
According to Miller, from a strategy standpoint Konica Minolta will first measure itself against the second tier of competitors, looking to move up slowly and develop a framework and basis from which to go forward.
“We are going to compare ourselves to the top, but in terms of growth, we view ourselves as part of the second tier from a printer perspective,” he said.
The transition to the IT channel will also not be totally at the expense of the retail channel, Miller said. For example, more and more products will feature an array of solutions and services that build a requirement away from retail and more towards IT, enabling Konica Minolta's resellers to not only sell the printer, but also provide more “value.” However, this does not mean that retail products from Konica Minolta will be done away with entirely, Miller said. For instance, a product like the magicolor 2590 will still maintain a retail model.
And Then There Was One?
Miller does admit that Konica Minolta has some work to do in relation to establishing one point of contact for users. He explained that with Konica having a direct channel, a dealer channel and a reseller channel, there are instances in which multiple channels are calling the same people, and the company needs to have one interface to the customer. This, in and of itself, would give Konica Minolta a big advantage over the competition.
“No one else can do that, and the baseline strategy we are building will allow just that,” Miller said.
Konica Minolta said it will also be focusing on getting the right partners and building the skills of its partners in understanding both printers and MFPs.
“We want single ownership of accounts and for that single ownership to fulfill the product needs of the customer,” Miller said.
Monochrome Plays Key Role
Remaining a player in the monochrome market is also a key component of Konica Minolta's IT reseller channel. As Miller explained, offering monochrome products enables Konica to talk to partners about an entire product line.
“Very rarely in the corporate world do you see a company replace hundreds of color units in a bid,” he said, estimating that the IT channel currently stands at an 80 percent to 20 percent ratio in favor of monochrome.
The Products
New products introduced on the monochrome end included the pagepro 4650 and 5650, laser printers with rated speeds of 35 ppm and 45 ppm, respectively. Both models are equipped with Emperon technology and feature 1,200-x-1,200-dpi printing and 128 MB of standard memory, while a 40-GB hard drive is available for added functionality, such as secure printing and direct printing. An optional CompactFlash card also supports some of these capabilities. Both devices support postcard to legal print sizes, and the 5650 supports banner printing.
On the color spectrum, new products introduced included the magicolor 8650, with rated speeds of 35 ppm in both black and color. The magicolor 8650 features 1,024 MB of memory, along with an optional 60-GB hard drive for enhanced functionality, including setting up user boxes for individual document control. In addition to built-in auto duplex capability, a number of capabilities are offered to make the device more suitable for on-demand, short-run output. For example, paper capacity is expandable to up to 3,650 sheets, and staple, hole punch, folding and saddle-stitch finishing are available.
Offering a rated speed of 25 ppm for both black and color, the new magicolor 4650 series features 256 MB of memory, along with an optional 40-GB hard drive. Equipped with Emperon technology, the device also allows users to print XPS, PDF, JPEG and TIFF files directly from a USB flash drive. The magicolor 4650 also features a low noise level, according to Konica Minolta. The DN model has a built-in auto duplexer to handle booklets and multi-page files.
With rated speeds of 20 ppm in black and 5 ppm in color, the magicolor 2590MF features print, copy, scan and faxing capabilities. The device features many of the same printing, copying and scanning features found on higher-end bizhub MFPs that are geared toward larger organizations, according to Konica Minolta. The unit also features Simitri Color Polymerized Toner, and supports a wide variety of media types and sizes, including transparencies, labels and envelopes. In addition, the Camera Direct Photo Print function allows digital images to be printed directly from a PictBridge-enabled digital camera. Borderless 4" x 6" prints are also available.
Printer-Based MFPs On The Way?
Printer-based MFPs in higher speed ranges, such as 45- to 50-ppm, are also on Konica Minolta's radar. Indeed, the MFP and printer are converging with success from other vendors (see The Lowdown On Printer-Based MFPs from the April issue 2007 issue of Digital Imaging Review and BLI's recently published Special Report on the subject, Copier Vs. Printer Which Type Of 45-ppm MFP Makes More Sense?).
According to Kern, with the way the printer, IT and MFP markets are converging, the possibility is there for crossover products that may fit both the dealer channel and IT channel in different flavors.
“All-in-one products that look more like bizhub MFPs, but are built on printer engines, is a concept that makes a lot of sense for us,” Kern said, adding that this could be the type of product that plays in both the dealer channel and IT channel. “The market need will be there, and we will deliver some components for all three channels.”
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