HP beefs up direct sales approach

HP joins a growing list of vendors who are going beyond traditional sales methods, expanding the HP Shopping Village site.

Tom Dunlap
2 min read
In a nod toward the direct sales approach, Hewlett-Packard has added new products to its HP Shopping Village site, which until yesterday focused on refurbished computers and peripherals.

HP has added two new Pavilion PCs, two new monitors, and the HP PhotoSmart camera to the site, said Susan Murdy, director of Strategic Communications for Consumer Products at HP, in San Diego. More products will be added in the near future, Murdy said.

The emphasis on the direct sales approach came after extensive research of U.S. consumer buying habits indicated that 20 percent of PC buyers like to buy directly from the manufacturer, Murdy said.

"This will enable us to reach this segment who buy only direct," she said.

Murdy said HP's preferred sales channel is still retail outlets such as Circuit City, CompUSA, and Office Depot. HP this week told the stores about the expanded scope of the HP Shopping Village.

"They were generally pretty understanding," she said. "They know that it's important for us to compete, and many expected HP to go direct in this way."

HP joins a growing list of vendors willing to tinker with proven ways of selling computers in an effort to wring out more profit and efficiency from the sales process.

In addition to selling more systems online, HP, Compaq, and IBM have been experimenting with selling customized computers through in-store kiosks. Systems ordered by kiosk will be shipped directly to customers.

"The direct model clearly demonstrates that it's a more effective way to do this sort of business," said Roger Kay, an analyst at International Data Corporation. "The indirect guys are having to adopt as much of a direct approach as they can without disrupting their channel partners?It's a fine line they have to dance.

"I would expect [HP is] doing more [direct sales] than they let you know," Kay said, because "they still need the full effort of their channel partners to make this work." Murdy said the Shopping Village site has been up since May and is growing at 20 percent per month.

"We expect our volume to grow as consumer acceptance of shopping online grows," Murdy said.