16 | Lenovo India: Smooth Transition

Lenovo shot to fame when it acquired IBM's PC division last year. The $1.25
bn purchase has made Lenovo the world's third-largest PC maker, next to Dell
and HP. There were apprehensions about the merger. Worries about the synergy
between the two: Lenovo, the price warrior from China, and IBM, Big Blue from
the USA, a western-centric company in terms of culture.

Lenovo accepted the challenge, and its year round focus was on building a
strong brand. In India, the company adopted customized branding exercises such
as roping in celebrities like Saif and Soha Ali Khan as brand ambassadors. And
it was not just about brand building. Keeping up the IBM tradition, Lenovo was
voted 'No 1' in the DQ-IDC Customer Satisfaction Audit for the year 2005, in
both the notebook and desktop categories. It also won six of DQ Channels'
Choice Awards, a clear thumbs up in terms of popularity in channels. Fiscal
2005-06 shows that despite uncertainties, Lenovo did quite well in India.
Desktops sales grew 44% in number terms, and increased market share from 6 to
7.2%. While it lost notebook market share significantly, it still managed to
ship 116,000 notebooks, representing an 87% unit growth.

In March this year, Lenovo launched its own branded PCs aimed at the SMB
segment. It also ramped up its distribution model in India and signed with
regional distributors to gain more ground in up-country markets. As part of its
channel management, Lenovo launched new initiatives such as Think Warrior, which
offers reward points to the sales teams of the channels partners. Going forward,
bringing out affordable PCs and making a dent into the upcountry areas tops
Lenovo's agenda in India.