What It Takes to Capture SMB Market ShareBy Lawrence Walsh | Posted 2010-01-21 Email Print
HP this week launched SMB Exchange, a sales strike team designed to expand the company’s share in the $55 billion SMB market segment by converting Dell and other competitors’ customers. The initiative will offer customers the choice of buying through reseller partners or direct from HP.
The SMB segment is historically difficult for large vendors to penetrate effectively. Small businesses—or the "S" in SMB with one to nine employees—often buy IT products through retail outlets such as Best Buy and Costco. Companies with 10 to 99 employees will often buy through authorized resellers or direct market resellers. And companies with 100 to 500 employees often buy through different channels depending on the need.
What makes SMB difficult to penetrate is cost. The sales sizes by dollar amount are often smaller because these businesses buy fewer products than enterprises. HP and its partners readily acknowledge that Dell’s direct sales engine is better able to undercut HP prices. SMB Exchange will enlighten non-HP customers to the full breadth of products in the HP portfolio and also provide competitive pricing—particularly in the 100- to 500-employee range.
Kelly insists SMB Exchange is different because it opens opportunities for partners while helping to keep HP financially healthy. "It’s all about getting net-new business for HP and the HP brand."