Remember when Domino’s started delivering pizza? How wonderful was that?!! Delivery was definitely a game changer in regards to the demand and popularity of pizza. Delivery allowed customers to stay in the comfort of their own home rather than spend time picking up dinner. It allowed the pizza to arrive warm in those heated bags until the moment it reaches your doorstep. Pizza delivery was fun and reliable and the concept added to the whole experience of eating the yummy food!
So while delivery changed the pizza industry, can it do the same for the ink supplies industry? This is a question that has yet to be answered. HP announced that it would offer an ink delivery program called HP Instant Ink. The program was first announced in January 2012 as a Beta Program. The concept was to mimic a “Netflix” type of service where original HP ink would be delivered to homes or offices upon the return of used cartridges. The program offers a significant savings to customers, incentivizing them to participate.
The program is offered in two package variations, one intended for office users and one targeting the home user:
Officejet & Officejet Pro Plan- $10.99 per month (3 month minimum commitment)- Receive up to $264 in ink per year
Photosmart Plan- $5.99 per month (3 month minimum commitment)- Receive up to $144 in ink per year
Under the Instant Ink program, participants should essentially never be without ink, a benefit to users and the OEM. HP offers a short video describing the program on its website. Further appeal of the program is its similarity to MPS services, which have become extremely popular as a result of the predicted annual cost of supplies and maintenance. HP’s Instant Ink program mimics some of these benefits by providing a baseline of how much participants are likely to spend on ink each year.
By reviewing preliminary numbers, HP’s Instant Ink program offers a significant value to customers, especially for office environments. For a $132 yearly investment, HP provides enough ink to support B&W printing only volumes up to 1,451 pages per month, a likely total for most SOHO / SMB environments. This total is the result of the free standard black ink tank included with the initial membership in addition to the 7.1 black tanks that could be purchased for $264, resulting in a total yield of 17,415 pages for the year, or a cost-per-page of less than a cent ($0.0075). In order to fully realize the financial benefit, users would have to print more than 684 pages per month.
Photosmart users would find a similar benefit to the Instant Ink program. For a yearly fee of $72, members are given four standard ink tanks ($44 value) and an ink allotment of $144. Through the program, customers can print as many as 3,695 black and white pages per year, or roughly 308 pages per month. Through the program, customers can realize a B&W cost-per-page of just $0.019, one of the lowest totals in the industry. The program may not be best for those users who print less than 1,720 black and white pages per year, or roughly 143 pages per month.
Along with the financial savings, the HP Instant Ink program offers convenience. To many, convenience is priceless. Considering the high cost of gas these days (over $5 in parts of California right now), each avoided trip to retail stores is a blessing for most consumers. In addition, the high perceived cost of ink often discourages shoppers from purchasing back up supplies, which often leads them to be out of ink when they might need it most. The added reassurance that they won’t run out of ink will be an appealing benefit from the program.
HP’s Instant Ink program does have its limitations. The program only includes a select number of devices at this time. This may deter some customers as the printer that they want to purchase might not be included. Additionally, customers may be weary of the number of cartridges that they could receive. While ink prices do not increase very often, we did see HP increase its pricing at the beginning of the year. HP ensures customers that their monthly payments are guaranteed for the first year, although if prices on the cartridges change, the number of received supplies may vary.
To sign up for the program, customers must visit a participating retail store to obtain a Subscription Key Code. Since the beta launch of the program in January of this year, only two retailers have officially signed on to participate including Office Depot and Best Buy.
However, the subscription keys are currently only available in select markets at this time, inhibiting the visibility and participation of the program.
The only other major OEM to offer a delivery service was Kodak. Unfortunately, there were no savings involved and the service was not pushed. With that, ink delivery services remain in their infancy and may not be catching on as much as OEMs such as HP would like. The potential benefits to the ink maker include ensuring that customers are locked into purchasing genuine ink rather than third party alternatives. The service essentially eliminates browsing in the ink aisle and identifying private label brands or ink refills as less costly alternatives. In addition to locking in supplies revenue, HP will also benefit from the return of empty supplies from customers. HP, like every other OEM, wants to avoid its empties from falling into the hands of remanufacturers. This service provides an easy and free (to the customer) way to get its cartridges back.
The roll out for the program seems rather slow considering the hype around it and the possible benefits that it could have on ink sales for the OEM. So, what does this mean? Is an ink delivery service a game changer for the ink industry? Probably not…at least not right now. The verdict will continue to unfold as HP’s Instant Ink moves from a beta program to an outright service, although timing on this is still unknown. What we can say is that companies like HP are looking for new ways to help its customers and adapt to the changing purchasing landscape. While a delivery service may not necessarily be the final answer, it shows the innovation and the drive to progress!
