Integrated Marketing Communication 1

AN INTEGRATED MARKETING COMMUNICATION MIX STRATEGY FOR HEWLETT

PACKARD (HP) IN CHINA

(by Name)

Course:

University:

Date:
 Integrated Marketing Communication 2

Introduction

China offers significant business opportunities for companies seeking to expand their

operations. Over the past 20 years, the country has attracted many technology companies,

particularly in the mobile telecommunication industry. Between 1989 and 2013, China`s annual

GDP growth rate averaged 9.2%. With a middle class of approximately 300 million people

earning between USD $10,000 and $60,000, China has room for companies such as HP seeking

to expand their operations in the country (Barton, Chen and Jin 2014, para. 1). A marketer can

begin with major cities such as Beijing to direct its marketing communications mix strategy.

Hewlett Packard (HP) is an U.S. based Multinational Corporation specializing in the

manufacture and sale of personal computers, software, technologies, solutions and services to

individual customers, small and medium sized businesses, and large ventures (Reuters 2014,

para. 1). This paper develops an integrated marketing communication mix strategy for HP

targeting Small and Medium Enterprises (SMEs) sector in China. HP entered the Chinese market

in 1985, and as a result, the company will benefit from its existing infrastructure such as

marketing, service units, sales, and research and development.

Integrated Marketing Communication (IMC)

IMC can be defined as a process through which a company accelerates its returns by

aligning its communication objectives with its corporate goals (Clow and Baack 2004, p. 12).

According to Madhavaram, Badrinarayanan and Mcdonald (2005, p. 70), for many years,

companies have used IMC in their brand strategy as a tool to attain a competitive edge in the

market. The rapid evolution of electronic media has further transformed IMC, and, as a result,

giving it an international perspective (Kitchen and Schultz 2003, p. 72). Technological progress

such as the use of mobile devices, database applications, and the internet has opened new
 Integrated Marketing Communication 3

avenues for marketing (Clow and Baack 2004, p. 53). As a result, marketers have to exploit these

avenues and make effective use of the new marketing channels. IMC is a component of the 4Ps

in marketing (price, promotion, place, and product). It also incorporates channels of

communication used by companies to communicate with both existing and potential customers.

Integrated Marketing Communication in the Chinese Market

For a successful entry into a new market, a company must have a complete understanding

of the economic and business dynamics in the target market. Significant changes have occurred

in China from 1978 when the country opened up its economy (Pan 2005, p. 5). From 2001 when

the country joined the World Trade Organization, China has attracted steady Foreign Direct

Investment (FDI) inflows, making it a spotlight for companies seeking to expand their operations

overseas. In 2013, FDI inflows increased by $117.6 billion. The country still has huge business

potential (Pan 2005, p. 7). With an average annual GDP growth rate of 9.2% (Barton, Chen and

Jin 2014, para. 1), there is no doubt that China offers a lucrative market. It is also important for

multinational corporations such as HP to be aware of the Chinese culture (Lee 2006, p. 69).

According to Pan (2005, p. 12), these companies should think globally, but act local. Small and

Medium Enterprises sector is one segment of the Chinese market that companies can enter

through integrated marketing communications using strategies such as database marketing

(Gurau 2008, p. 170).

Unique Characteristics of Customers in the New Market-SMEs

To develop an effective integrated marketing communication mix strategy for HP, it is

important to assess the peculiar characteristics of the target customers (SMEs). As already noted,

China has experienced rapid economic expansion in the past three decades. The country has not

only attracted investments from large companies, but has also promoted the growth of SMEs,
 Integrated Marketing Communication 4

making it a regional trading hub. Similarly, with technological progress in China, the country has

witnessed an increase in technology based SMEs (Siu and Liu 2005, p. 336). SMEs play a

significant role in China`s growth and development. The government encouraged SMEs

particularly during the 1997 Asian crisis. The main challenge is that SMEs lack sufficient capital

to invest in costly technologies. In most cases, SMEs rely on customer loyalty through multi-

channel marketing (NEBS 2011, para. 2).

HP is one of the leading technology firms in China. The company has a competitive

advantage over its rivals such as Dell because it offers diverse products and services coupled

with a strong balance sheet. Whereas HP has a well developed business in China that offers

numerous services to both corporate and individual customers; the company has not fully

exploited the opportunities in the SME, particularly in the area of software and consulting

solutions. The company should provide software and consulting solutions to the SME sector in

China and tailor its marketing campaign to suit the needs of the sector. As already noted, SMEs

do not have big budgets to spend on expensive software. HP should target technology SMEs and

avail affordable consulting and software solutions through its ‘Total Care’ centers (Cheng, 2014,

para. 1).

Strategies and Messages to Achieve Competitive Positioning

HP can leverage on its existing Integrated Marketing Communications for SMEs to

expand its portfolio to include software and consulting solutions to small and medium sized

enterprises. The company should properly coordinate its advertising by using online marketing,

direct marketing, print advertisements, industry specific journals and magazines, database

expertise through cloud marketing and event based marketing to sensitize and attract more Small

and Medium enterprises. The main marketing message for HP should be “Get HP consulting and
 Integrated Marketing Communication 5

software solutions for your small and medium enterprise without digging deep into your pocket!”

Furthermore, the company should organize conferences on products and services specifically

tailored toward the SME sector. With its Total Care program, HP can offer tailor-made software

and consulting solutions that address the specific needs of the SMEs at an affordable price. Using

this marketing strategy, HP can offer trade vouchers by placing ads in popular newspapers.

Given that SMEs mainly depend on customer loyalty, HP can also include database management

in its service offerings to the SME sector in China.

Conclusion

As a marketing manager for HP, taking into account China`s lucrative market and the

unique characteristics of the SMEs sector, the following recommendations will work best for

HPs integrated marketing communication mix strategy. Firstly, the company should make use of

its Total Care program to provide customized consulting and software solutions to the Chinese

SME sector. Secondly, HP should strategize its IMC mix by leveraging on the SME sector,

particularly through organizing conferences and trade fairs as well as using its existing IMC that

has made it a successful IT brand in the Chinese market. Software and consulting solutions offers

abundant opportunities in the Chinese SME sector, which HP can take advantage of by using its

existing IMC strategy in addition to organizing educational conferences.

Reference List
 Integrated Marketing Communication 6

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