Imation channel drives its own destiny

Brian Plummer, VP EMEA, recently dropped into Dubai to meet with local distributors and explain how the vendor's new global positioning fits in the Middle East.

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By  Andrew Seymour Published  November 7, 2007

Following the acquisitions of Memorex, Memcorp and TDK's brand recording media business over the last 18 months, data storage devices specialist Imation has thrashed out a strategy to take advantage of its burgeoning portfolio. Brian Plummer, VP EMEA, recently dropped into Dubai to meet with local distributors and explain how the vendor's new global positioning fits in the Middle East.

Imation generates half its sales from retail and the rest from the commercial sector. What direction do you see yourselves moving in the future?

Our vision is to transform ourselves into a brand and product management company. What we see is a company that has both strong global and strong regional brands, because while we have strong brands today not all brands are strong in all regions. For instance, Memorex is by far the number one brand in the US, but outside it doesn't carry anywhere near the weight that it does in the US. So we want to have a strong global and regional brand. Our business will be one of storage products, consumer accessories activity and the company will primarily be consumer-based with a strong commercial component. And the reason we say that is because the commercial business is about a US$2 billion market, of which we have the number one position globally. But that US$2 billion segment isn't going to grow because there are not many new technologies that are going to be created to provide the growth.

So should Middle East partners take that as a sign to get out of the commercial sector?

No. That market is still a very strong market for us. Our strategy in the commercial business is one of ‘optimise' - and never to be confused with the word ‘harvest'. The commercial business is a wonderful business to be in and has an excellent customer base all around the world. The demand for storage is increasing all the time, but that market place is not going to go away. Everybody needs more storage capacity. So the storage segment in commercial is going to increase many fold, but the dollar value of the market will level off.

How do you intend to enhance your position in the consumer sector?

We want to accelerate our growth in flash drives and cards and also introduce new storage products including accessories and hard disk-type opportunities. On the heels of this is the strategy of extending the global brands into new categories. What we've been focusing on with our Middle East distribution partners - especially the new ones - is how they see their business today, what our strategy means for them and, most importantly, what they want to do with their organisations.

What are the main challenges you face in pursuing a unified strategy and getting partners to understand what areas of the Imation portfolio they want to sell?

I don't see major issues. Obviously there's got to be refinement. Perhaps the first challenge is to embrace and discuss the plan going forward individually for each partner. Everybody has a different structure, market that they serve, and portfolio. Some companies are just TDK, others are multifocused. The first challenge is to help them understand where we are moving to, which is what we have done.

Are existing Middle East partners likely to have a different role to play in the Imation channel in six months' time?

They could do, or it could be the same. Firstly, it comes from them understanding what the opportunities are and that's why we have tried to communicate where we see ourselves moving to and then asking them to think about what they want their companies to look like in the future as well. Then we can work out how that can come together. Some of them may decide that for whatever reason they don't want to embrace a larger growth opportunity, but others I know are champing at the bit to be part of a bigger opportunity because they feel the biggest issue they have faced is being starved of the opportunity to really expand their business using the TDK brand.

Isn't there a danger that if you give distributors too much choice over which product areas to focus on they could all end up chasing the same opportunity?

What we've seen so far is that they have different focuses today anyway. We have talked with partners from countries where there is one or two distributors and talked about the size of the country. I don't think we are over-distributed with two distributors in a country of that size when you compare the distribution patterns that exist in Western Europe or the US. I don't think that's a problem at the moment because the bigger issue for us is how to capture the growth opportunities in this region.

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