Lenovo free essay sample

After the success of the Legend card, the company launched its own-brand PC into the Chinese market in 1990. The desktops were designed to be easy to use for Chinese consumers. In 1999, the company introduced a PC that overcame China’s complicated Internet access procedures with a preloaded oneyear Internet connection. This also included Chinese voice-recognition software and a graphic pad for writing Chinese characters by hand. Thus, the company became China’s PC market leader with 21. 5% share in 1999 and well known throughout the Asia-Pacific region. 3. What challenges did Lenovo face after the acquisition? After the merger with IBM, Lenovo faced many challenges as following: †¢ Integrating Thinkpad into Lenovo brand. Lenovo wanted to create awareness of the new brand, on the other hand, it had become tough to maintain the credibility of ThainkPad as an innovative and creative product when Lenovo brand itself was positioned as a low-cost brand. Lenovo had to determine a strategy which would help to increase its brand awareness without hurting the ThinkPad credibility. Building Lenovo brand outside Asia-Pacific region. In order to introduce its brand to the global market, Lenovo had joined the Olympic Partner Program. This opportunity helped Lenovo to access the international market. Because the Lenovo name was not well known outside Asia, the company viewed the Turin Olympics sponsorship as an opportunity to show its capabilities to the world. Olympics served to showcase Lenovo from a local brand to a global brand. The media and press perception of Lenovo’s association with China and the Chinese government is another particular challenge. As firms from China and some other Asian countries tend to get very low marks for trustworthiness, Lenovo had to build its own image as a new world type of company by bringing the best from East (Lenovo) and West (IBM). †¢ 4. How should Lenovo handle the brand management challenges associated with the acquisition? In order to build Lenovo global brand, the company should leverage both its efficiency and the ThinkPad reputation of quality. After the acquisition, the company settled on a â€Å"one-two punch† strategy with two elements: †¢ à ¢â‚¬ ¢ Build up Lenovo as a strong master brand Continue to strengthen the ThinkPad product brand, which was a special franchise that could be leveraged to support the Lenovo master brand In 2006, Lenovo planned to launch its own-branded PC series 3000 worldwide. This new product was tended to serve different customer’s needs. The 3000 Series is built with industry-standard, value price, contemporary design, and secure security. On the other hand, the Think-branded are to be industry-leading PCs with custom models, classic design, complete business solutions, and the most secure PCs on the market. Lenovo has chosen to effectively use the ThinkPad name from IBM in order to maintain existing IBM customer while at the same time extending the quality perception of the ThinkPad into other Lenovo’s product lines. I personally agree with Lenovo’s strategy to keep the ThinkPad brand separately from the other product lines. This will not damage the ThinkPad brand quality. Moreover, building the ThinkPad + Lenovo connection through advertising and marketing campaigns such as ThinkPad Unleashed, the ThinkPad reputation can eventually be seen in the rest of Lenovo products. In my opinion, launching its first Lenovo brand PC worldwide by using a product number (3000 series) was not the best idea. The fact that numbers are pretty generic and the same number may be used on many products across many industries could be confusing. I would recommend Lenovo to create a new name as what Sony and Compaq did with the Vaio and Presario. The name of the new product that could imply an image of a good choice, easy on the budget, and a good home companion. At the present, Lenovo named their other product lines differently. The â€Å"ThinkPad† are seen as business laptops with premium quality while the â€Å"IdeaPad† and the â€Å"Essential† are built for home and small business users. Lastly, Lenovo should differentiate itself as being the â€Å"new world type† of company. The combination of East and West, innovation and efficiency can become the company’s competitive advantage. 5. In trying to become a global brand, does Lenovo have a problem coming from China? According to Advani’s explanation that firms from China and some other Asian countries tend to get very low marks for trustworthiness, therefore, Lenovo would have a problem coming from China. Since Lenovo is a company from China, the perception of providing cheap products might devalue the Lenovo master brand. In my opinion, the consolidation between Lenovo and IBM would result in a degradation of the â€Å"ThinkPad† brand around the world. IBM brand is perceived as the high-end premium brand, while Lenovo is perceived as the low-cost brand. IBM ThinkPad stood for quality and â€Å"made in America† (even though most production took place offshore). Lenovo was known as a PC market from China and lack of brand recognition through the international market. Products from China are often viewed as clones with low quality and sold at low price. Thus, the main concern from customer was that the innovation and quality of ThinkPad would slow down. This will become a big challenge for Lenovo to think about how to remain their brand image after the 5-year transaction when Lenovo will have no right to use the IBM brand. To overcome this problem, Lenovo has to ensure that their products have a unique, distinctive and attractive design while remaining same IBM quality.