Lenovo's Global Strategy: SWOT, PESTLE, and Marketing Mix Analysis

This report provides a comprehensive analysis of Lenovo's global expansion strategy. It begins with an examination of the alignment between Lenovo's SWOT and PEST analyses, assessing the intensity of the global PC, laptop, and smartphone industries. The report then evaluates Lenovo's market position using the BCG and Ansoff matrices, followed by an analysis of the extended marketing mix. The study also discusses the implications of political, economic, social, and technological factors on Lenovo's operations. Finally, the report concludes with recommendations to address any identified weaknesses and capitalize on opportunities within the competitive landscape. The analysis covers various aspects like political factors, economic influences, social trends, and technological advancements that impact Lenovo's global market performance, providing a holistic view of the company's strategic approach and market positioning.

Lenovo Goes Global

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK ..............................................................................................................................................1
1 Discuss how well Lenovo's SWOT/ PEST analyse match each other.....................................1
2 How intense is the Global PC, Laptop and Smartphone Industry............................................4
3 What is Lenovo's position from a BCG matrix perspective.....................................................6
4 What is Lenovo's position from an Ansoff matrix perspective................................................7
5 Analyse the extended marketing mix.......................................................................................9
6 Recommendations to overcome any areas of weaknesses.....................................................11
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13
.......................................................................................................................................................15

INTRODUCTION
Global marketing and brand management is crucial aspect for every business
organization to expand operational activities in new areas by adopting innovative approaches. As
global marketing can be define an effective field through that help in providing valuable products
and solution to local customers, nationally internationally and worldwide as well. Basically, it
has ability to increase as well as catapult a firm to the next level. It is considered as a
multinational process of planing, executing, pricing and distributing of goods and services in
another countries with the purpose of establishing positive brand image (Batey, 2015). On the
other side, brand management is an appropriate technique to determine how the brand is
perceived in the wider market context. Thus, it is important for company to develop good
relationship with target market for brand management. It includes the process of managing
tangible and intangible aspect of brand in order to improve positive brand image of the company
at market place. Along with this, it is a series of techniques which used by the company for
enhancing perceived value of goods and services. Furthermore, both global marketing and brand
management play important role in expanding business at global level with the aim of attaining
success. Current report is based on case study of Lenovo Goes Global. Lenovo is Chinese
multinational technological company as it designs, manufactures and sells personal computers,
smartphones, tablet, electronic storage devices. Along with, company also operate in more than
60 countries and sell its products in approx 160 countries. This report discussed about SWOT /
PEST analyse of Lenovo's. Porter's 5 Forces model for Lenovo is also mentioned in this
assignment. Along with this, BCG and Ansoff matrix are discussed which determine the actual
position at market place. Marketing mix is also going to discussed here which help in analyse the
extended marketing.
TASK
1 Discuss how well Lenovo's SWOT/ PEST analyses match each other
Lenovo is a Chinese multinational technology company as it offer various products such
as personal computers, mobile phones, tablet, computer, service, electronic storage devices and
many more. In addition of this, from 2013 to 2015 sales unit, Lenovo was the world's largest
personal computer vendor. In 2018, Lenovo become the world largest supercomputer provider
from the most top500. Mainly, company operate in more than 60 countries and also sell products
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in around 160 nations. It was founded in November 1984 in Beijing and incorporated in Hong
Kong in 1988. In 2014, Lenovo entered in the smartphone market (Desbordes and Richelieu,
2012). In this context, PEST analysis is conducted by the company to evaluate the actual
performance of the company at market place. It is considered as a strategic tool which is utilized
by the firm with the purpose of determining the negative impact of external factors on
organizations. The main purpose of PEST analysis is to measure market and its potential.
Basically PEST analysis helps in determining the SWOT factors of the company.
In addition of this, PEST analysis is a effective model which can help in describing the
framework of macro environment. If company wants to win the competitive marketing
advantage then they needs to use such kind of analysis for attaining success.
Political factors: This factor directly influence the company market because it include
various laws, regulations, policies, legislations, tariff controls and trade as well. As per current
scenario, computers, smartphone are highly related with people life. Along with this new and
advance technologies are take place and it create issues like increase pollution, health and energy
consumption. For this, EU, China and another countries are also encourage the Green IT for
reducing the noise pollution of the computers. In context of this, Lenovo is famous company and
they not only operate their business in China but all over the world. Thus, it is important to
follow all the global political laws while conducting their activities. Political forces play major
role behind strong Chinese market. Due to this, Lenovo can easily enhance their market share.
Economic factors: Through 2008 economic crisis, economy of the country tends to go
down. In this, government of China develop as well as make new economy policy like positive
financial policy, comfortable monetary policy. In addition of this, it is best opportunity for
China's IT industry to effectively develop their market. Furthermore, the GDP of China's attain
satisfactory level which may increase the demand of the products. In this, Lenovo increase their
market share because company not only produce computers but also provide Smartphones. This
will help in increasing their profitability and market share as well. Along with this, financial
condition of Lenovo is also strong as they can easily expand their business in another developing
country like India.In addition of this, Lenovo has emerged like China's first biggest multinational
company. Along with the sales grown to $39 billion according to the fiscal year in march 2014.
In China, companies are cash rich as recently they engaged in the way of mergers and
acquisitions in over the world. China is still become the world;s largest economy.
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Social factors: It includes population growth, lifestyle, attitude, choice of the customers
which directly influence the demand of the products of Lenovo. As the literacy rate of China is
prior to government. Thus, the satisfactory level get increased in term of household income so
that the purchasing power of customers is automatically increased. It is one of the company
strength as they easily increase their profitability level by delivering products as per customers
choice. Along with this, hot trends of mobile is also a major opportunity for Lenovo through
which they enhance their profitability level and brand image as well.
Technological factors: Lenovo was set by 11 scientists who are working in Chinese
Academy. It is a government organization. Thus it is consider as an effective technology support
through which company produce quality products (Dinnie, 2015). Due to technology
development, Lenovo increase their competitive ability in upcoming ten years and at the same
time also enhance their market share. Along with, Lenovo also working with Google and
Amazon to increase their contribution of smart phones to raise total sales. Along with this,
Lenovo is not competing solely on the market as per low manufacturing costs. In this products of
company like Thinkpad laptop, Yoga four position ultrabook all are having premium positioning
in market place.
Apart from this, SWOT analyse is also help in determining the current position of the
company at market place. SWOT analysis of Lenovo:
Strength: Lenovo is famous company is China market as they having good knowledge
about the China market. With the help of this they easily improve their performance level by
establishing positive brand image. Along with this, the production cost is also less due to this
firm can enhance their positive brand image at market place. By this company enhance their
market share and at the same time also create strong customers base. All these are the main
reason that company can grow continuously.
Weakness: Under the main weakness of Lenovo is its weak presence in smartphones
through company fail in inviting customers towards its smartphones. Less differentiation is also a
reason that reduce the company image in market place. Along with this, its PC marketing is in
declining stage. Due to this, firm can reduce their market share as compare to its rivals. The main
reason behind this is rapid change in technologies thus company fail in adopting the change
within their PC products.
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Opportunities: India is developing countries so that it is big opportunity for Lenovo to
expand their business in this country. With the help of this they can easily invite number of
customers towards its products. In addition of this, by adopting cloud technology company can
enhance their growth by sharing data and information from one place to another.
Threats: One the main threat for Lenovo is high competition in market place. This is the
reason company can reduce their productivity level at market place. Rapid change in
technologies is become major threat for company in which company may reduce their market
share and customer base as well.
In addition of this, Lenovo is famous company is China market as they offer various
products like smartphone, computers and many more. As a biggest firm company wants to
expand at global level. In this company is financially strong in which they easily operate their
business in another countries (Godey and et. al., 2016). One of the main strength of this
company is that it has good knowledge about China market. Through this, company can easily
enhance their market share form its rivals. In addition of this, GDP rate of China is satisfactory
as demand of the customers is getting increased. It is an opportunity for Lenovo to enhance their
growth level by capturing market share. As the political condition of China country is very
strong so Lenovo can easily survive in market for longer period of time. Along with Lenovo
make their strong brand image at market place by delivering quality services as per customers
requirements. On the other side, rapid change in technology may increase overall cost of the
company at market place. As it is considered as a treat for the firm so that company needs to
make effective plan to manage as well as implement the changes for attaining success.. All these
are contribute in making brand image popular at market place and also create the chances of
attaining success in another countries.
2 How intense is the Global PC, Laptop and Smartphone Industry
Lenovo was known as Beijing Legend computers and in 1988 it was officially renamed
as Lenovo. In a very short duration of time, company has various critical achievements which
highly relate with smarter strategy. Along with this, the most critical achievement was
acquisition of IBM's PC division. Now, company is a leading firm in PC world and also generate
larger market share from its rivals. Mainly, it not only produce computers and IT solution but
also provide electronic products like tablets, smartphones, smart TVs and many more to large
number of customers. In addition of this, technological innovation is also a main reason that the
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company may attain success in small period of time. In this context, five forces analysis of
Lenovo evaluate the impact of forces on company competitive position. It is important tool
which help business organization to enhance their brand image at market place and at the same
time also capture competitive place.
Along with this,Global PC, Laptop and smartphones industry are in market in which
Lenovo operate their business with the purpose of attaining competitive position at market place.
Global PC industry has has a global production network in the market place as number of
companies are offer PC with the purpose of attaining competitive position. On the other side,
Laptop computer is small as the overall growth is based on customers demand . As per growing
popularity and adoption of smartphones, tablets is contribute in increasing the market growth.
Porter's five forces model can be helpful in understanding the competitive behaviour of
both domestic and international environment. Lenovo; which was originally known as Beijing
Legend Computers and was found in the year of 1988 carrying a good name in all over world. It
can be said that company have made relations with various companies so as to bring in most
updated technological innovations (Fan, 2018). With the help of Porter's five forces model,
Lenovo can easily gain many competitive advancements and along with this they can develop
strategies as well through which brand can easily be improvised. These forces are mentioned
below:
Bargaining power of suppliers: Weak - Under this, the supplier's bargaining power of
Lenovo is very low because number of companies are operate in same sector. Apart from this,
most of the suppliers are small in nature which were supplying various items so that Lenovo can
easily produce their products (Hakala, Svensson and Vincze, 2012). On the other hand, forward
desegregation cannot be taken as an easy task for its suppliers because they deliver quality
products to company as per their requirements. It has been found that, suppliers needs to follow
different codes of conduct which is being made by Lenovo so that to keep on working with them.
Bargaining power of buyers: Moderate – It is being found that bargaining power of
Lenovo buyers stays moderate in nature. It can be said that, company's customers are individuals,
business firms that are both large and small in nature. Still, Lenovo is decline in previous years
just because the PC market faced decline in current years. Because of this, there was an incline
among power of buyers took place. Apart from this, Lenovo reason behind lacking in this mobile
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sector and impacted badly as well on them. Number of competitive advantage may help in
mitigate several threats.
Threat of new entrants: Low – Majorly, in PC industry threats from new companies
stays low due to good image of Lenovo in over the world new company may not get a good
position because of highly branded competition. Because of this, it can be said that new business
persons have to make many initiatives like large investment for promotions in order to grab a
good position in short period of time. On the other hand, manufacturing facilities along with
distributional web can be considered as something which will help out these business firms in
attaining good position right on time. So, these type of factors may reduce the chances of
entering new players in market place.
Threat of substitutes: Moderate – It has been found that threat of substitute products for
Lenovo stays high in nature. It has been analysed that both laptop and PC brands in present
market consists with ample number of products along with different capabilities as well. On the
other hand, it is being found that features that are being provided by laptop can be found in the
smartphones as well (Heding, Knudtzen and Bjerre, M., 2015). This can be taken as a good
example of threat from substitutes. Apart from this, it is much required for Lenove to keep on
developing their laptop with distinctive and innovative features so that proper benefits can easily
be gained right on time.
Rivalry among the existing brands – PC market contains ample number of companies.
This can be taken as a strong competition among them because organisations majorly tries to
make products as per needs and requirements of customers with keeping an eye on updated
technology (Holtbrügge and Kreppel, 2012). Thus, it can be taken as a competition from
organisations that are dealing in the field which can give good competition to Lenovo. Apart
from technology, features, design also play vital role in attracting customers which increase
product demand and requirement as well. In this context, Lenovo is expanding its PC market at
global level by having 17.7% market share in initial quarter of 2014 . Along with, it also gain the
market share in mobile device. As the result is in 2013 is that company get ranked third position
in global level in market of smartphone and tablets.
All these forces are important for determining the competition of market in order to
improve the process of company. As Lenovo operate their business at global level in which they
capture all most half of the world by offering their products and services. This will contribute in
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making brand image more popular and at the same time also enhance customers base. In
addition of this, porter's five forces model can help in evaluating competitive advantage in
market which may contribute in attaining set goals and objectives in appropriate time frame.
3 What is Lenovo's position from a BCG matrix perspective
BCG matrix is portfolio planning model which help in attaining long term strategic
planning. By implementing this strategy, company can determine growth opportunities by
considering its portfolio of products and services. It also defines the areas where company needs
to invest and develop products. As it focus on optimum return on investment. It also suggest
growth strategies through which company can attain set goals and targets. Along with this, it is
based on industry attractiveness and competitive position as well (Hudson and et. al., 2016). As
per this technique, company and its products are divided as low or high performance which
directly based on their market share and growth rate. Mainly, it includes 4 stages such as:
Stars: Under this, products of Lenovo products are high growth with high market share.
As laptops of Lenovo is highly demand by the customers in market place which help in
increasing profitability level of the company. Along with this, for attaining success in PC market,
Lenovo needs to keep or increase the investment. Lenovo is biggest computer manufacturer
company is China. It is leader of PC producer in Chinese market. In this context, the laptop PC is
the start products in products line. Under this, it define high market growth and market share.
Cash cows: It include the desktop PC of Lenovo. Under this stage, Lenovo still having
strong market share but growth of market is slowdown year by year (Ko, Hwang and Kim,
2013). The main reason behind this is that number of people are preferring to buy Laptop PC as
compare to desktop. Thus, Lenovo does not needs to invest more money.
Problem Children: Under this, the mobile phone is the problem child because it still
weak and can not compete multinational companies. In 2010, Lenovo having approx 7% market
share. It comes in fourth rank in total market and in local market; it is No. 1 brand. Along with
this, PLC of smartphones is very short because number of peoples are already having cellphones.
On the other side, more rural people show their interest to buy mobile phone. As all these are
target customers of Lenovo. This is the main reason that market share of Lenovo is weak. If
company increase their investment and implement new techniques than it can be star in
upcoming time.
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Dogs: Under this, Lenovo make hard disk, USB flash driver but it is not give any kind of
advantage to the company. Thus, company needs to stop investment on these products and focus
on valuable products to attain success at market. With the help of this company can expand their
business and also attain success in their start products. Along with, the product which comes in
problem Children is also beneficial if company invest money for this. This will contribute in
increasing the chances of attaining success at market place.
Currently, Lenovo entered in fastest growing mobile phone market in which they are not
able to attain opportunities because of less experience about this business. Along with this,
Smartphone market already having number of strong players who are established their market
and attain higher market share. Thus, Lenovo have to focus on starts products to established their
competitive image at market place.
4 What is Lenovo's position from an Ansoff matrix perspective
Ansoff matrix is an effective strategic planning tool which help in providing a framework
for attaining future growth at market place. Mainly, it is long term business strategies which
highly depend on planning activities of the company. It represents various options to company at
the time of undertaking new opportunities for sales growth. By using this, Lenovo can easily
identify their position and also evaluate the opportunities to attain better growth at market. As
Lenovo is a well-known brand as they also engage in intelligent marketing to invite as well as
attract larger number of customers for making their positive brand image (Morgan and Pritchard,
2012). In addition of this, company also offer smartphones, computers and many more products
to number of customers with the purpose of attaining their satisfaction level. For evaluating
position of the company, Lenovo opt Ansoff matrix which includes four main categories are as
follows:
Market Penetration: It refer to existing market and existing products. In this, Lenovo sell
more in existing market with the purpose of attaining higher success. Along with this, the main
objective of this stage is to attain higher market share in existing market (Peng, 2012). For this
Lenovo needs to promote their PC, mobile phones, reposition their brand which increase the
revenue of the company. This will increase the market share of current products. It can be
attained by using effective combination of competitive pricing strategies. If Lenovo use
competitive strategies, advertising, sales promotion then they easily increase their profitability
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level as compared to its rivals. By introducing loyalty scheme, company can easily increase
customers base.
Market Development: It define new market and existing products. Under this strategy,
Lenovo selling their existing products such as mobile phones, computers in new market with the
aim of attaining higher profitability level (Using The Ansoff Matrix to Develop Marketing
Strategy, 2018). Lenovo will produce mobile phones, computers, software and many more to
enter in new market. It is considered as growth strategy in which Lenovo set their products as per
new customers needs. This will helps in enhancing the chances of attaining growth at market
place. For example, Lenovo export the products in new country then they have to make product
package more attractive. In this different pricing policies also help in inviting larger number of
customers towards its products.
Product Development: This category refer to existing markets and new products. In this
company introduce new products in front of existing customers. For attaining better response,
Lenovo needs to develop new and innovative features within their products to create customers
interest. In this Lenovo has been introduced new smartphones by considering market taste and
preferences. This will increase the chances of attaining higher profitability and at the same time
also increase customers base (Reiche and et. al., 2016). For attaining the same, Lenovo needs to
having good knowledge towards the market and customers preferences.
Diversification: It refer to new market and new products. Under this, company enter in
new market with new products. It is most risky stage of all the strategies because in this company
does not haver any kind of idea to attain success. For attaining higher success, Lenovo needs to
understand that how to move into new market with new products. In this they tries to carry out
an effective study before entering in new market to evaluate new market trends and customers
preferences. This will contribute in attaining success at market place.
All these categories are contribute in determining position of the company at market
place. Along with this, it also defines various strategic areas in front of company to expand their
business.
5 Analyse the extended marketing mix
Marketing mix is the combination of various elements which helps in attaining
predetermine objectives of marketing strategy (Reza Jalilvand and Samiei, 2012). It also help
business organization to meet customers needs and expectations. The main purpose of marketing
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mix is to enhance the productivity level of the company by offering quality products and services
as per customers needs and preferences as well. Traditionally the marketing mix includes four
elements such as products, price, place and promotion. On the other side, in recent time it also
ass three new elements are physical evidence, people and process.
Lenovo is one of the famous computer manufacturing company in over the world. It
provide various products like personal computers, tablets, Smartphones, workstation and many
more products in all over the world. They also operate their business at global level. In this
context, for enhancing strong brand image, company use marketing mix as a tool in order to
established their positive brand image (Zarantonello and Schmitt, 2013). With the help of this,
Lenovo can make their product quality high for attaining competitive advantage from its rivals.
In this marketing mix includes various elements through which firm can easily meet customers
needs and wants. All these can be understood by following points:
Product: Lenovo is an organization which produce Laptops, workstations, PC's, storage
devices, software and many more. Along with this, number of IT software also offered by
Lenovo which knows by the name of Think Vantage (ThinkPad). it is generating half of the
revenue in market of China. For enhancing their brand image, company adopt special product
strategy in Chinese market. This will contribute in establishing competitive place in market and
at the same time also enhance their profitability level as well. In addition of this, Lenovo also
offered products services to customers like product maintain services, rich category of products,
special package and many more to meet the customers expectations (Rohm, A. J. and et. al.,
2012). This will increase customers base and brand image as well. In market, accessories of
Lenovo is highly demanded by the customers. The products of Lenovo is known by reliable and
dependable through which firm may increase profitability level.
Price: Lenovo is leading computer and electronic brand which serve their products in
over the world. As, this company is known by its quality, design and performance of the
products. This is the reason, company is growing in fast speed. In this context, Lenovo adopt
comparatively flexible price strategy for increasing market share form its competitors (Solomon
and et. al., 2014). With the help of this, firm can make their competitive place in market place.
As company set their products price affordable as per customers groups. Along with this, Lenovo
has adopt smarter pricing strategy in which they can easily cater customers. In this, the range of
laptops from $400 to $1000 and they also offer high costing model which final costing is more
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