A US$ 46.296 billion (2015) company with 60,000 employees globally, Lenovo is probably one of the fastest growing company on earth. Whatever it touches it turns out to be gold. Probably its strategy of keeping the brand and growing it stands as a key to the success while others prefers assimilating and killing.
Lenovo as an IT company is actually scripting a very good story not only in India but also in global market. It is focusing on its bastion that is APAC. If any company is growing faster after Apple, it is Lenovo at least in the PC and smart phone segment.
What the company has done is that it has relaunched the brands with a lot of value addition. For example, in IT space, the company has launched IBM PCs and servers with its original names of Think and Idea along with keeping its own brand Lenovo intact. And each product is positioned to address a particular requirement therefore very strategically avoided overlapping. In the laptop and PC segment, there are three sub brands within Lenovo portfolio, i.e. Lenovo, ThinkPad or ThinkCenter and IdeaPad or IdeaCentre. Similarly, in servers the company has kept the original name of IBM that are either System x or Flex Systems.
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“Lenovo is developing products for customers in tier 3-5 cities and is addressing some of the major barriers to PC penetration, such as affordability, after sales service, poor financing options and inadequate communication from PC vendors.”
Ashok Nair
Director
Home and Small Business
Lenovo India
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Similarly, in the tablet space the company has also distinguished its offerings under Lenovo and ThinkPad brands. When Lenovo branded tablets are positioned for entertainment and consumers, ThinkPad is more for the business usage.
Although in smartphones’ segment the company has only Lenovo branded products but it is for sure that after the acquisition of Motorola from Google, its stature is growing day by day.
If that is not all Lenovo has also a range of storage (NAS), networking and hyper converged products – courtesy its tie-up with Nutanix to complete the offering.
The company is trying to grow in both the directions in India – in consumer and business or enterprise. Ashok Nair, Director, Home and Small Business, Lenovo India admits, “Even though Lenovo is transforming from a PC to a consumer technology player, it sees great scope in the PC industry and will continue to focus on it.”
Although, Lenovo journey in India is quite smooth in some fronts but in other it is quite bumpy. For example, in the PC market, Lenovo is doing extremely well while in the server and storage, it has a lot of catching up, similar is in the case of tablets, although in the smart phones it is doing fairly well.
Although it is a mix bag for the company, but so is the journey for others in the competition! What Lenovo is doing right is consistently trying to nurture relationship with its partners. It is looking at the entire geography in two ways. When top eight cities are covered under a particular strategy, rest of the cities and hinterland are covered with a different strategy.
The top eight cities it is targeting including New Delhi, Mumbai, Kolkata, Chennai, Bengaluru, Hyderabad, Ahmedabad and Pune are addressed with premium PCs from Lenovo; whereas the rest of the markets including tier 3 to 5 cities, are covered under the initiative called ‘Start up with Lenovo’.
Ashok adds, “Lenovo is developing products for customers in tier 3-5 cities and is addressing some of the major barriers to PC penetration, such as affordability, after sales service, poor financing options and inadequate communication from PC vendors.”
At the same time to address the growing smartphone market, Lenovo has been consistently introducing disruptive technology at an attractive price with all its devices, which has helped the company to capture an impressive 11.6 per cent market share of the smartphone market within 2.5 years of its commencement and taken it to the 3rd large player in the country.
Ashok says, “Our product line-up is particularly designed taking in consideration of the requirements of Indian consumers. We have specialised category segregation within that product line-up based on device USP’s which targets specific consumer groups.”
As per him Lenovo has a complete range of phones spanning from $75 to $400 premium phones.
Its YOGA devices have evolved over the years.
From the IT perspective, the company depends on the channel partners as far as its go to market is concerned. And for last three years, Lenovo has tried to nurture the relationship with them. And in order to do so, the company is careful about three things. One: constant engagement with them through a larger field force spread in all locations. Two: incentivizing the partners and their sales managers, and finally: enabling them with product training and demand generation programs.
Some of the highlighted programs rolled out from the company could easily be differentiator in the market. For example, ‘Lenovo ka Sikander’ is unique in the sense that it not only rewards partner sales reps for generating sales, but also for effective lead generation. Similarly, Lenovo Cares is a unique health insurance program for Lenovo sales representatives employed with partner organizations.
Finally…
It is no doubt that the company is facing tough times in the market but with its focus in getting the company into various government and commercial establishments have put them on a growth path. In the past Lenovo has bagged large orders from the state governments including Tamil Nadu and Uttar Pradesh. It is also contributing to the economy of the country by manufacturing in the country. But what will put the company absolutely on the front position is its focus on server and storage, which is growing rapidly owning to the infrastructure growth in the country. This is where also lies the better bottom-line for the company and its ecosystem partners.
