“Lenovo has a ‘strong’ expansion potential in European market and we hope to become leader of the market in the next eighteen months, which is probably achieved in 2015.”
——Gianfranco Lanci, Lenovo Corporate President
A successful Chinese company
Lenovo, the company of successful Chinese entrepreneur Liu Chuanzhi, has grown not only into the world’s top seller of personal computers, but also has moved strongly into smartphones and such computer products as laptops and tablets. Here is an article from a Chinese consulting firm about how Lenovo started click here.
The Chinese company has now 54,000 employees in more than 60 countries and is ranked first in the global PC market share, exceeding Dell and HP since 2013.
Lenovo has been making great efforts on attaining a global reputation: In 2004, Lenovo became the International Olympic Committee (IOC) global partners, which is the first Chinese enterprise in cooperation with IOC. For the Turin Winter Olympics in 2006 and 2008 Beijing Olympic Games, Lenovo was the exclusive provider for desktop computers, notebooks, printers and other computing devices as well as financial and technical support.
Lenovo strategy is going global
According to 2014 Lenovo Report, China accounted for 38% of the group overall income. The rest 62% comes from America, Asia Pacific and EMEA (Europe, Middle East and Africa), which contributed 21%, 16% and 25% accordingly. The importance of global market for Lenovo is no need for verbosity. However, it is hard to imagine how this Chinese company has achieved such a brilliant record for its overseas market. Chen Xudong, Lenovo China President, sums up six driving factors for the success of Lenovo’s internationalization:
- Plan ahead: Lenovo group has clear long-term goals and we are determined to perform according to the planned steps
- Clear and effective strategy: Our overall strategy is “Protect and attack”, which represents fighting on new frontiers while keeping the obtained market. Also, we would like everyone to have a clear mind of the whole strategy and their department strategy
- Diversity of our team: Our employees come from the world and there is no ceiling for foreigners in this company
- Culture of Lenovo: We PLAN before we pledge. We PERFORM as we promise. We PRIORITIZE company first. We PRACTICE improving every day. We PIONEER new ideas
- Persistence and commitment to innovation: Three major R&D (research and development) in China, Japan and America focus respectively on different aspects of innovation
- Merger and integration: In 2005, Lenovo made a significant international move by acquiring IBM’s personal computer business in for $1.25 billion, plus shouldering $500 million of debt. On 1st June 2011, Lenovo announced plans to acquire Medion, one of the most famous computer digital brands in Germany. Since August 2011 they hold the majority stake in Medion. Last year, in a bid to continue diversifying its business beyond PCs, Lenovo said it had completed a $2.91 billion buyout of Motorola Mobility from Google Inc. The company hopes that Motorola Mobility will help its smartphones unlock developed markets in Western Europe and North America, as well as allowing it to go after the high-end market in China
In Europe, after dominating PC market, Lenovo goes for smartphone
“Lenovo has a ‘strong’ expansion potential in European market and we hope to become leader of the market in the next eighteen months, which is probably achieved in 2015.”Gianfranco Lanci said.
Indeed, this strong ambition of one of the most recognized Chinese Tech Company in Europe is producing outstanding results. Its higher business growths are in UK, Germany and Spain. In Spain, Lenovo won 16.1% PC market share in the first year and in 2014 the sale volume of Lenovo product in El Corte Ingles, the biggest department store in Spain, reached 70 million euros with an increasing rate of 133% compared to last year.
With the good performance in PC, Lenovo planned to approach European smartphone market. In order to successfully develop the smartphone market, Lenovo has cooperated with local telecom operators and retailers to reach more consumers’ attention. Predictably, in the next six months, Lenovo’s market share in Europe can break through 5% and Lenovo expects that a year later, the market share will double, which reaches 10% or more.
By Alexis, Consultant for China