Lenovo will expand its presence in rural China to maintain its
competitive edge, according to one of the computer giant's top
managers.
"China's fourth- to sixth-tier cities will become our major
growth engine," said Chen Shaopeng, Lenovo's senior vice-president
and president of China operations. "We plan to intensify
cooperation with local partners to roll out new products that could
help our customers find their needs."
According to figures from the research firm IDC, the average
growth rate of the Chinese PC market in the next five years is
expected to reach 11.7 percent. Meanwhile, the growth rate in
China's fourth- to sixth-tier centers is expected to hit 23
percent.
In 2004, Lenovo released a low-end, 2,999 yuan PC, marking the
beginning of a battle to lure lower-income customers.
"As China's economy continues to boom, more and more people in
China's poor areas will join the PC age," Chen said.
PC giants Hewlett-Packard, Dell and Acer have followed Lenovo's
lead by releasing low-end products.
"Our competitors are putting more pressure on this market than
before, but that won't hurt our confidence," Chen said.
Since 2004, Lenovo has increased its presence in China's rural
areas, but the company didn't see much profit until last year.
"Currently we have over 5,000 sales and 2,500 maintenance stores
in China's fourth- to sixth-tier cities and we don't think any of
our competitors could have an equivalent network in the next two to
three years," Chen added.
In 2004, Lenovo signed a deal with the International Olympic
Committee (IOC) to join the sponsorship program, becoming the first
Chinese company in the high-profile club. The company also kicked
off an Olympic tour campaign last year to hundreds of small cities
where it donates and demonstrates its products.
Last year, Lenovo's PC shipments in China reached 38.7 percent.
Its Chinese market share in the fourth quarter of 2006 reached 30.2
percent, beating Founder Electronics' 9.6 percent,
Hewlett-Packard's 7.2 percent and Dell's 6.8 percent.
(China Daily June 5, 2007)