Lenovo: Building a Global Brand
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Lenovo: Building a Global BrandManaging Brands over Geographic Boundaries and Market Segments
Presented by:Prasanth BoharaDinesh SharmaMudith HimwanShalini MishraHet Mavani
REGIONAL MARKET SEGMENTS
Regionalization is an important recent trend that, perhaps on the surface, seems to run counter to globalization.
Reasons for regional marketing◦Need for more focused targeting ◦The shift from national advertising to sales
promotionsDrawbacks
◦Production headaches◦Marketing efficiency may suffer and costs may
rise
OTHER DEMOGRAPHIC AND CULTURAL SEGMENTSFor example, the importance for
marketers to consider age segments and how younger consumers can be brought into the consumer franchise
As another example, the 2000 census revealed that Asians and Hispanics accounted for 79 million of 281 million people in the United States and an estimated $1 trillion in annual purchasing power.
RATIONALE FOR GOING INTERNATIONALPerception of slow growth and increased
competition in domestic marketsBelief in enhanced overseas growth and
profit opportunitiesDesire to reduce costs from economies
of scaleNeed to diversify riskRecognition of global mobility of
customers
Advantages of Global Marketing ProgramsEconomies of scale in production and
distributionLower marketing costsPower and scopeConsistency in brand imageAbility to leverage good ideas quickly
and efficientlyUniformity of marketing practices
DISADVANTAGES OF GLOBAL MARKETING PROGRAMSDifferences in consumer needs, wants, and
usage patterns for productsDifferences in brand and product
development and the competitive environment
Differences in the legal environmentDifferences in marketing institutionsDifferences in administrative procedures
STANDARDIZATION Vs. CUSTOMIZATION
Indian consumer American consumer
As brand consultant Robert khan said. “ global branding does not mean having the same brand everywhere”
Standardization: same product-same communication across the border or globally
- Followed by electronic instrument
customization: to change or adopt product-communication according to the market
- As coke’s marketing mantra “think global act local”
Standardization-customization process- product
communication
No change change
No change
change
Straight extension
Product adaptation
Communication adaptation
Dual adaptation
Why customization:
Meaning is different
reading habits
country 1 right left
right left
country 2
Detergent Ad
taste, need , demand is different from one country to other
Culture difference: individual Vs. collectivism , masculine Vs. famine.
Delivery adaptation by domino pizza in different
Countries because of culture because in Britain anybody knocking on the door is
rude
Domino pizza home delivery
to get positing difference or country
Of origin effect
“ Tokyo beer”
Global brand strategy: we need to get attention over few basic issues while making product brand in global market
- Identify differences in consumer behaviour. How he purchase and use product.
- Adjust the branding program accordingly through the choice of these customers
- Then have a leverage secondary association programme according to the market.
- After the application of these factors over the brand we need to focus on the implication, control and measurement of these factors
Making the brand by the use of CBBE model :
Salience- awareness about the product useful for product recall and recognition
Performance-its basically related to the
product features and its performance.
Tailor product according to the
globally market
Increase brand awareness
Favourable brand
association
Positive reaction
Increase brand
locality
Imagery: imagery means what is your product having mental map in the mind of costumer. Should be carefully because each word symbol and picture represent different meaning. So it hurt sentiment of people
Source of imagery-
Core brand association
Identifying points of parity and point of difference
By origin effect
Judgement and feeling: brand judgement can be negative or positive like good quality , credible and worthy. At this point judgement provide feeling to the consumer like excitement, happy etc. making product brand by the use of LSA in global market-
LEVERAGE SECONDARY ASSOCIATION
BRAND
Other brand
placespeople
things
alliance
ingredient
extension
company
employees
endorsers
eventsThird party
Channels
Country of origin
Celebrity endorser: all good character related to celebrity gets transfer to product and influence to the decision of the consumer.
trustworthy
intelligence
Likeability
Familiarity
attractivenessattractiven
esstrustwort
hy
Familiarity
Likeability
Resonance: it is a final stage in making any product globally brand here costumer is having locality towards your product
Resonance is depend on the success of other parameters in the CBBE model.
And you can have your product as a brand now.
Ten Commandments of Global Branding1. Understand similarities and differences in the
global branding landscape2. Don’t take shortcuts in brand building3. Establish marketing infrastructure4. Embrace integrated marketing
communications5. Cultivate brand partnerships6. Balance standardization and customization7. Balance global and local control8. Define operable guidelines9. Implement a global brand equity
measurement system10. Leverage brand elements
LENOVO:BUILDING A GLOBAL BRAND• In the year 2004 IBM’s personal
computer acquired by Lenovo.• By the year of 2004, 90% of
revenue comes from china market.
• Lenovo sponsor “Turin Winter Olympics” in order to gain strong market share in china and Asia.
The Global PC Industry1970s- IBM introduced its first PC
after microcomputer and home computer.
IBM relied on three key technical contributor-1. Intel for 8080 processor2. Microsoft for DOS operating system3. Software for VisiCalc Art
1990s Internet BoomedLaunching the set of basic
standard for PCs by Microsoft and Intel.
Increase in the number of outsourcing and off shoring.
Early 21st century major consolidation had taken place between HP-Compaq and Gateway-e machines.
Contd……….By 2004 half of the PCs sold
around the world came from Dell , HP and Lenovo including IBM’s market share.
RISE OF LEGEND:1984- china academics of science
invest $25000 to form the New Technology Developer.
1987- Introduced its original product Legend card.
Contd……..1990- Company launched their
own PC.1996- Launched their first laptop
and marketed its PCs carrying Intel Pentium chip.
DEAL:IBM was an opportunity to shed
“Unprofitable operation”.Lenovo gained the right to use
IBM think pad laptop and think centre desktop..
Think Pad LegacyThe research showed that in
customer mind IBM and Think pad are hard to separate.
OPPORTUNITY:The way IBM and Lenovo sold PCs
was very complementary.CHALLENGES:Lenovo focus on the SMEs while IBM
focus on corporate and enterprise customer.
Organizational ChangesSeptember 2005 –
Management restructuring that integrated the original Lenovo and former IBM◦New international composition and
scope◦Company’s working language
changed to English◦Working via conference calls posed
challenges◦12-hour time difference between
Beijing and U.S. east coast also caused some strain
Branding OpportunitiesOpportunity and Challenge to
build an international brand using IBM legacy.
Turin Olympics Sponsorship – a platform to showcase its capabilities to the world
Right to use IBM logo for five years
Best from East and WestFrom Lenovo
◦ Understanding of emerging markets
◦ Excellent efficiency
◦ Focus on long-term strategy
From IBM◦ Deep insights into
worldwide markets
◦ Best practices from western companies
Main concerns with customersInnovation would slow downQuality would sufferService and support would be
outsourced overseas
Branding Alternatives
1. Master Brand Strategy2. House of Brands Strategy3. Synergy Approach4. Lexus/Toyota Strategy
“One-Two Punch” StrategyTwo main elements:
1. Build up Lenovo as a strong master brand
2. Continue to strengthen the ThinkPad product brand, which was a special franchise that could be leveraged to support the Lenovo master brand.
Differentiation: Innovation and Efficiency
Advertising Plan“Maintain ThinkPad brand and use
that brand’s strength to build the Lenovo brand”
Three phase advertising plan:1. Worldwide Advertising campaign –
“ThinkPad” instead of Lenovo (maintain ThinkPad sales momentum)
2. “ThinkPad Unleashed” campaign – Lenovo making ThinkPad even better
3. Third campaign stress innovation for Lenovo master brand
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