Lenovo Uses Olympic Spotlight To Boost Global Image

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by Chua Siew Joo

SHANGHAI, Aug. 11 – It seems the news of Lenovo Group’s impressive profits arrived at an opportune moment, coinciding with the start of the Beijing Olympic Games 2008.

With its current focus on direct retail sales and emerging markets, Lenovo group is not affected by the slowdown in the United States. It achieved a profit of US$110 million in the last quarter, ended in June 2008. China sales alone accounted for 41 percent of sales while Greater China sales increased by 22 percent to US$1.2 billion.

The Lenovo brand is still struggling in terms of poor brand awareness in overseas markets despite its acquisition of I.B.M. It is leveraging on the opportunities offered by the Olympic Games by focusing marketing campaigns in 2007 and 2008 on the sporting event.

The company paid a hefty US$65 million to be a sponsor for the Torino 2006 Olympic Winter Games and the Beijing 2008 Olympic Games.

At Turin 2006, Lenovo already started phasing out the use of the I.B.M. name by marketing the Thinkpad as a Lenovo product with the same superior quality they would expect from the latter.

It is also the only Chinese company among the 12 major sponsors for the ongoing Beijing Games to put up the event’s first computer maintenance centers for troubleshooting computers.

It seems the brand’s Olympics related investments proved to be rewarding; its share in China’s PC market rose to 36.7 percent in December 2006 from 32.7 percent in late 2004.

Since February 2008, the company has been organizing back-to-back global online philanthropic auctions, featuring a different limited-edition notebook computer inspired by the Lenovo-designed 2008 Olympic torch each week.

All proceeds were distributed through the Lenovo Hope Fund to select philanthropies, including “Right To Play,” a program that takes on micro-finance, small-and-medium-enterprise development and brings sports to children communities.

To further their online marketing campaign, Lenovo even built a Facebook application for fans to follow their favorite games during the Olympics as well as a special Internet lounge for journalists.

Distinguishing itself as a truly global company, it has also made a statement on social responsibility issues. Lenovo is committed to maintaining product quality and safety; high ethical standards, environmental sustainability and employee welfare.

According to the New York Times, the company has also engaged NBC to publicize while globalizing its marketing. All company work happening outside the country is now done in a single office in Bangalore, India.

Come the London 2012 Olympics, Acer, the Taiwanese IT company will be replacing Lenovo as one of the International Olympic Committee’s top partners. Lenovo and Acer are currently competing for the third spot behind Hewlett-Packard and Dell to be third largest PC makers in the world.

Just like Lenovo, Acer has also been using sports sponsorship to grow its brand recognition in the United States and Europe. Acer will have a long lead to develop its marketing campaign starting September 2009 with estimated revenues of US$30 billion to US$40 billion in 2012.