HP Exec Says Quiet Part Out Loud When It Comes To Locking in Print Customers

HP is squeezing more margin out of print customers, the result of a multi-year strategy to convert unprofitable business into something more lucrative, and says its subscription model is "locking" in people. From a report: Tech vendors -- software, hardware, and cloud services -- generally avoid terms that suggest they're perhaps in some way pinning down customers in a strategic sales hold. But as Marie Myers, chief financial officer at HP, was this week talking to the UBS Global Technology conference, in front of investors, the thrust of the message was geared toward the audience. "We absolutely see when you move a customer from that pure transactional model ... whether it's Instant Ink, plus adding on that paper, we sort of see a 20 percent uplift on the value of that customer because you're locking that person, committing to a longer-term relationship." Instant Ink is a subscription in which ink or toner cartridges are dispatched when needed, with customers paying for plans that start at $0.99 and run to $25.99 per month. As of May last year, HP had more than 11 million subscribers to the service. Since then it has banked double-digit percentage figures on the revenues front. By pre-pandemic 2019, HP had grown weary of third-party cartridge makers stealing its supplies business. It pledged to charge more upfront for certain printer hardware ("rebalance the system profitability, capturing more profit upfront").

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