Lenovo charts three-pronged strategy for PC growth

Lenovo, the world’s biggest maker of personal computers, is embarking on a three-pronged plan to boost its market share in personal computer (PC) segment in India over the next few years. It is sharpening the focus on three specific areas and they include small and medium businesses, government sector and first time buyers.

This strategy is to increase the market share of the company from the present 20-21 per cent to 30 per cent. “This is not only our India target, but also on a global level,” Rahul Agarwal, Managing Director & CEO, Lenovo India, told The Hindu.

“We believe that India will have far more small and medium businesses than what it has now as the entrepreneurship culture is taking off. Many of these new businesses are going to be in knowledge sectors and they will require IT as a backbone. Also, the traditional businesses houses will start deploying IT hardware in a big way. So, this will be one of our key growth areas,” he added. The company expects this segment’s contribution to grow from about 15 per cent now to 25 per cent two years.

The other area Lenovo intends to focus is the government sector. “Of course, money flow will have longer duration in this business. We will watch this space carefully. If the business is not at ridiculous level, we will continue to focus,” said Mr Agarwal.

Thirdly, Lenovo bets big on first time buyers’ segment. Of late, the company has come out with several initiatives to expand the personal computer market. “We have never done it before. Earlier, we were only fulfilling the demand. But over the past few months, we have been running a number of campaigns and programmes to attract first buyers and also trying to make PC purchase easier for them,” he said. In the immediate term, it plans to reach out to additional smaller cities to set up exclusive stores.

Though the growth of PCs is falling, Lenovo has held the view that present PC growth will be better in the future. India’s PC penetration has stagnated at about 10 per cent as against 40-50 per cent in other markets .

“For a country that has a history of giving more importance to education, the penetration is very low. We believe that PCs will grow at a much faster pace in the coming years as education level improves and smartphone penetration grows. Smartphone is the introduction of IT world to the families,” he said.