In the late 1980’s and early 1990’s, Hewlett-Packard started to experience a dramatic shift in its mix of product sales with a major swing from direct sales to indirect channels. This shift in sales mix, in turn, required a substantial change in HP’s service strategies. Although the company experienced excellent success in selling products through independent resellers, the sale of services was a completely different matter. Channel partners viewed services as complex, difficult to understand, difficult to sell and burdensome to contract. This Best Practice Case Study describes how HP responded to this challenge by developing a creative service packaging concept designed specifically for channel firms and their customers that purchase low-end products. In the process, HP found a means of generating more sales of services via indirect channels than it had it the past.
Note to members: This Best Practice Case Study contains significant original collateral from HP.