Lenovo
Lenovo is a company in transition - and in two parts. In China, Lenovo enjoys strong consumer sales and offers many consumer-oriented products, including extremely low-cost ($200) PCs. It has recently begun to sell its China-market PCs in other countries (starting in India).
Outside China Lenovo has been selling almost exclusively to business and government, and it still has to build its consumer distribution channels.
Lenovo inherited an enterprise-oriented channel structure when it bought the IBM PC Company (generating what Lenovo calls its “relationship business”). |
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Outside China, Lenovo needs to establish new consumer marketing channels, and is part-way through rolling out a transactional business model, which in part uses new channel partners.
Lenovo has announced it will build on this transactional business and launch new consumer market initiatives (outside China) in early 2008, partly to coincide with the Beijing Olympics, of which Lenovo is a worldwide partner.
Lenovo had planned to acquire Packard Bell, which would have greatly boosted its retail presence in Europe, until a deal fell through and Packard Bell was sold to Acer. The extent to which this may have interrupted Lenovo’s plans to grow in European consumer markets is unclear.
Lenovo’s 2008 Olympics sponsorship allows the company to associate itself with the prestige of China hosting the 2008 Olympics. This reinforces Lenovo’s position in its domestic market, and helps to spread global awareness of the Lenovo brand. As part of its consumer branding initiative, Lenovo will drop the IBM logo off its products two years earlier than originally planned.
Given current antipathy to the ‘made in China’ label among consumers in many western countries, it remains to be seen if reinforcing Lenovo’s identity as a Chinese company will help or hinder global growth.
From January 2009, however, the Olympic sponsorship is owned by Acer. (It is unclear if Lenovo chose to drop the sponsorship, or if they were out-bid).
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