The Company Responds to the Xiaomi Challenge
In the early 20th century, General Motors (GM) became an umbrella company for many brand names of automobiles. Its goal was to cut across all demographics, with each nameplate addressing a specific target market. Sports, style, youth and budget: GM had it covered. The company acquired its way up and down the market and across the country and the globe.
Lenovo’s strategy of brand expansion is a reminder of those early days of the auto industry as the manufacturer builds an empire of brands and sub-brands to address different audiences.
The company plans to establish a new brand of smartphones for online-only sale, an acknowledgement of Xiaomi’s successful model which has enabled it to become the best-selling smartphone brand in China. However, Lenovo is responding to more than just Xiaomi as OnePlus, Oppo and others are gaining a loyal following in and outside of China. The name of Lenovo’s new Internet-centric brand hasn’t been announced, but sales will begin sometime next year, likely to start in China.
Lenovo will soon be able to use the Motorola brand as its planned acquisition of Motorola Mobility from Google moves forward. Motorola’s star has faded from its peak, but it’s arguably the most venerable name in the mobile industry and would provide Lenovo with some historic handset respect.
In PC and enterprise, Lenovo has been assertively expanding its Think brand in several directions, a nameplate it received in its acquisition of IBM’s personal computer in 2005. In addition to laptops, Lenovo makes ThinkPad tablets, ThinkCentre PCs, ThinkServers, ThinkStation high-end workspaces and ThinkVision displays. Lenovo has also established a consumer-oriented Idea brand for laptops and all-in-one PCs.
Last year, Lenovo expressed interest in acquiring BlackBerry, a brand that would give it a boost among its business customers. Rumours of Lenovo’s planned bid continue to surface (as they did again yesterday), but such an acquisition has already raised security concerns among Canadian and other government officials. It would be a complex purchase, but not impossible if the brand could be separated from the company.
As Lenovo takes on rivals while being challenged by Chinese competitors, the company is using a wide branding strategy, pulling many names under its umbrella. The company is driving its global presence forward, looking to make a name for itself. Or several.
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