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How Far Can China's IT Enterprises' Global Olympic Strategy Go?
added: 2008-05-13

At the end of December 2007, China's first International Olympic Committee's global cooperative TOP partner, Lenovo, announced it will exit the Olympic cooperative plan after 2008. Acer will take Lenovo's place. What's more, the competition between Acer and Lenovo is heating up in global PC market. Since Lenovo is quitting, China's sponsor enterprises are calmly examining the challenges and opportunities they face.

Taking a wide view of Olympic global cooperative partner list in the last twenty years, TOP sponsors were constantly changing. We consider four years as a cycle. From 1997 to 2000, the TOP 4 of Olympic cooperative partners are Xerox, IBM and Samsung; the TOP 5 are Panasonic and Samsung; the TOP 6 are Lenovo, Panasonic and Samsung; the Olympic cooperative partners in the IT field, such as Acer, Panasonic and Samsung after 2009 are adjusting. We could summarize that there are three important factors to decide the persistence of IT enterprises' global Olympic strategy.

Enterprises' important clients' positioning

Consumer demands of the IT market have grown fast in the past five years, which is driving the development of market. For example, according to CCID Consulting's research, the sales volume of Lenovo's notebook computer in China's market accounts for 27.1% of its total sales volume in 2007, up 146.8% over 2006. The industrial users account for 72.9% of the total market, but its growth rate in 2007 is 32.6%. Because the professional IT product market is transferring to a consumer IT product market, facing the huge consumer customer group, IT enterprises' traditional industrial channel advantage is dilution. Individual users' consumption demand decides whether companies can sustainably develop, such as Lenovo.

Olympic spirit emphasizes containment and understanding of cultural differences. This core value has powerful containment capability and participation. Therefore, this platform guarantees its propagation influence. With Xerox and IBM after 2000, the former mostly faces enterprises; the latter carries through business transformation according to users' demands. However, the Olympic strategy doesn't fit their customer positioning, so they give up the TOP cooperation. Therefore, according to their customer positioning, Lenovo and Acer choose to be or not to be global cooperative TOP partners.

Enterprises' global brand strategy

Enterprises' Olympic strategies have to fall in line with their brand strategies. First of all, clear brand strategy should have clear core brand value, clear brand identity and philosophy, and seek to spread them.

In 2003, after Lenovo changed its logo, its core brand value became honesty, innovation, energy, quality and professional service. Both of the functions in core value or emotional appeal accord with Lenovo's market positioning. With Lenovo's overseas acquisition in 2005, the relationship between brand and products is the harmonious cooperation of one brand for several products (Lenovo's notebook computer, desktop, mobile phone) and one product for several brands (Lenovo and Thinkpad notebook). On the international market, Lenovo brand bears enterprise's image and product line. However, core brand value has not caught up with expansion, which is difficult to adapt internationalized demand.

Clear brand strategy should insist on core brand value. Around core brand value, brand recognition and philosophy include a series of visible and invisible carriers to compose enterprise brand recognition system, such as product spokespeople.

The essence of IT enterprises' Olympic strategies is to enhance their enterprise brand recognition system by means of the Olympic platform's integrated spread, marketing strategy and united coordination. On this platform, IT enterprises can attain not only brand awareness, but also customer recognition and loyalty.

Enterprises' investment returns

As for TOP qualifications, the income from Olympic tickets is not very high, but the Olympic Games will bring great investment return in four years. The Olympic Games is a global gathering but not a regional gathering. Besides the huge funds bestowed on the Olympic hosting country so as to insure advantages to local markets, enterprises should pay attention to the global market, especially new emerging markets and competitors' weak areas. Through the global operational platform enterprises will need to share overall Olympic investment. It is then possible for enterprises to gain investment return.

In fact, it is difficult to quantitatively evaluate enterprises' investment returns in a cooperative period, because factors which decide enterprises' growth and profit are too numerous and changing. Thus, IT enterprises should revise their global strategic goal in the next four years, carefully calculate market shares, put forward a quantitative index aimed at important strategic markets and carry out resources dynamic configuration according to index implementation results, when they join in TOP. It is a prerequisite to ensure the realization of strategic goals. Enterprises should rationally arrange resources so as to ensure a relatively continuous Olympic strategy.

The Beijing Olympic Games is coming soon, TOP game will continue, China's economic rise will provide Chinese enterprises with more opportunities to join TOP. Lenovo and Acer have many things in common: both of them are Chinese enterprises in the PC industry; both changed their logo during their development; both are seeking international development in the process of acquiring overseas business; both competed to enter the global PC Top 3; both are the TOP cooperative partners of Olympic Games.


Source: PR Newswire

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