With its historic strength in B2B markets, in the last two years Sharp Corporation found itself on slippery financial ground in large part due to its consumer electronics division’s challenges in the TV marketplace. Mike Marusic, senior vice president of marketing, operations and service for Sharp Imaging and Information Company of America, recently sat down with BLI to candidly discuss Sharp’s clouded financial past, and how the company’s licensing of its TV division has reinvigorated its focus on its core market—business users.
Mike Marusic, Senior Vice President of Marketing, Operations and Service for Sharp Imaging and Information Company of America
Renewed Focus on the B2B Market
Marusic candidly acknowledged Sharp Corporation’s struggle in the consumer electronics arena and how that has affected the perception of Sharp among the people whose opinions count most—Sharp dealers. He told BLI, “In the last year or two, Sharp has been a tale of two cities.”
He explained that the challenges Sharp faced with its TV division in the consumer electronics market took a toll on the entire company. That had been a distraction from Sharp’s B2B business model, and Marusic is confident that recent events will allow Sharp to concentrate on the market where it has traditionally excelled.
We recently announced the licensing of our TV brand to a Chinese company called Hisense,” he said. “They will manage the Sharp-branded TVs in the marketplace. What that allows Sharp Corporation to do is to focus on their B2B businesses, which have been very strong for them.” he said.The best part of that licensing agreement, he said, is that it “helped confirm to dealers what we’ve been saying for the last two years now—they saw that Sharp took the step of licensing our TV business. Consumer electronics is a very challenging and difficult market for anyone to make money in, so a lot of our investment dollars had gone in that direction to try to break through in that area. Now we’re seeing more investment in our top tier division. So that’s been encouraging for all of us.”
He said that the US document imaging business, SIICA, has been doing very well over the last two years, with double-digit growth two years ago and growth in the “high single digits” last year. Overall, it was “our third year in a row of improved profitability.” He said it’s also very encouraging that Sharp’s dual-line dealer business is up significantly year over year, which indicates a mind shift among dealers who were single-line dealers for other manufacturers.
Marusic noted that Sharp’s commitment to growing its B2B business is apparent, because while the consumer TV brand was licensed to another company, “professional displays were specifically excluded in that deal. We continue, at Sharp, to procure, sell and market professional displays. This indicates that Sharp is ready to build out its B2B unit, or Sharp would have included professional displays in the Hisense deal. We’re trying to promote and strengthen that strong B2B business.”
To that end, he says, SIICA has “stayed focused on research and development, and bringing out new products, which we’ve done a ton of. The quality of the different technologies we’ve brought out recently shows in the six different Pick awards BLI has given us recognizing the quality of what we’ve been developing (among the winners were the MX-7500 (tested with a Fiery Controller) and MX-C301W, which also won an Outstanding Achievement in Energy Efficiency award). You can see that the investment in R&D is strengthening our core brand.” He added that dealers will get a look at a “whole barrage” of products—13 new devices in all—at the upcoming Sharp dealer meeting in December in San Antonio.
Communication is Key
In an effort to do more than just touch base with Sharp dealers at its annual dealer conference, Marusic and the SIICA team have spent the last year and a half out getting to know them personally, visiting key business markets throughout the United States, with road shows going to key cities including New York, Boston, New Orleans, St. Louis, Seattle, Chicago and Los Angeles.
He told BLI, “While every company has its big dealer meeting, in the last couple of years we were the only manufacturer doing road shows, where we were touring the country between dealer meetings, hitting six markets each of the last two springs. We trained over 1,000 people on our products during the road shows, as well as giving them insights into Sharp’s strategies going forward. We find this exceptionally effective at sharing what we’re trying to accomplish, not only for the dealer/owner who attends our dealer meeting, but throughout their organization. We’re getting out to our dealers and explaining everything a dealer/sales rep has, and what they need to know in order to sell our products effectively.”
For Marusic and the team at Sharp, the most important part of the road shows has been the Q&A session with dealers and reps. “It can take a half hour or it can take three hours,” he chuckled. “We’ll stay there as long as they need us to, to listen and to talk. We want to make sure we have unfiltered information about what we can be doing better, and it’s really been working for us. What we ask people to do is, tell us what we’re doing that you don’t like, not just what you like.”
What this has done, Marusic said, is enable Sharp executives to spend time with the people closest to the customer, to hear their needs and opinions and direct feedback on what they can do to improve the product and the selling process. “Those are the people most focused on the end user,” he said. “We get great product input, including how people are using the products and what they would like to see done differently, and we can take that right to development and make the products better. We are one of the few companies out there pushing and supporting the dealers as our primary go-to-market strategy, versus competitors who focus on their direct sales branches as their primary go to market, with dealers secondary to that.”
Marusic said that Sharp’s efforts to reach out to its dealers has been rewarding. “This year was the first time ever that Sharp was rated as the best overall manufacturer, by dealers, in the annual BTA magazine dealer survey,” he said. “We’re really proud of that. (In this survey,) you don’t vote by saying who you like the best, but you vote based on very specific category ratings. That means dealers are directly rating us on how they like the product and how easy it is to service.”
“But,” says Marusic, “that’s not good enough for us. Knowing that we won the dealers’ choice award, we immediately commissioned our own dealer survey to ask where they thought we could do better. We want to know what they don’t like about us and how we can improve.”
Helping Dealers Close the Door on Competition
As a result of dealer feedback and conversations started on the road show tours, Sharp will be focusing it year ahead on helping dealers retain their hard-won business. “All of our competitors are offering dealers managed service options,” Marusic said. “But in every scenario the competition has left the door open for an IT dealer or IT VAR to steal that business back. Through its expanded relationship with Tech Data, which Marusic says is one of the largest IT distributors in the world, Sharp will be the first company that closes that door to VARs selling, say, laptops into the network. This brings complete integration and creates relationships even for small dealers who haven’t had access to the full range of business products that might be required to close a sale—or to keep an account.”
In the coming year, Sharp will be expanding its logistics outsourcing to Tech Data Corporation. The advantage has been that it “gets us out of running warehouses and packaging units for shipment, and has sped up our ability to deliver our product.”
The second phase of that deal will be to begin putting dealer commerce through Tech Data as well. According to Marusic, “This gives dealers access to the entire IT distribution product line. It allows our dealers, for the first time, the unique ability to go into any school district or other large customer and be able to provide all the products necessary for that order. None of the other manufacturers have any similar ordering system. All the products necessary, from our MFPs, other company’s printers, a scanner, a router from Cisco—it can be bundled together and will all work together. The new ordering system will let dealers fill a full order—hardware, software, peripherals and even other manufacturers’ printers—in one order form. This gives every dealer access to full range of solutions, even mobile devices and tablets from other manufacturers, for any type of customer and closes the door to IT or software companies who have sometimes been able to leverage business away through the back door. This closes that door.”
By keeping an open line of communication with dealers and helping them close out competition, Sharp is working to strengthen its dealer sales throughout the country. With its emphasis on R&D which will add 13 new products to its portfolio in December, Sharp is doubling down on its bet that its B2B business will thrive.
