Talking Reliance Jio, Moto, Online Sales, and More With Lenovo's APAC Head

Lenovo has been a significant player in the computing business since the company started in 1984, but it was only after its acquisition of IBM’s personal computer business in 2005 that the Chinese electronics giant took its place on the global stage. Since then, the company has entered the smartphone market (in 2012), and made the headlines once again when it purchased Motorola Mobility from Google in 2014. Today, it’s one of the biggest manufacturers of computers and smartphones in the world.

At the sidelines of IFA 2016, Gadgets 360 had a chance to talk to Ken Wong, President Asia Pacific for Lenovo, who shared the company’s plans for the future and offered insights into the market.

Still in the process of integrating Lenovo and Motorola
Although Lenovo completed the acquisition of Motorola nearly two years ago, the process of integrating the two brands is going to take some time to finish.

“We spent a lot of money buying Motorola, and we want to make sure that we properly integrate it into our existing smartphone business in such a way that the two brands work together going forward,” said Wong.

India also happens to be the only global market outside of China where Lenovo operates both brands, and Wong stated that the goal is to ensure that the position for both brands is different. Lenovo will control certain price bands and types of phones, while Moto will appeal to a different audience. There are no plans to do away with the Moto brand, but there is a definite effort to ensuring that Moto is recognised as a part of the Lenovo family, he added.

This form of brand positioning also exists for the computing business, where some of IBM’s old branding remains present to this day. Thinkpad (which most still associated with IBM) is Lenovo’s brand for commercial computing, while Idea and Yoga are the consumer-centric brands. The company also owns Medion, which while not yet available in India could well be launched soon. “We’re limiting our potential by sticking to just one brand name," he said. "We believe that having multiple brands and identities is the way forward.”

Success with online retailers in India
Lenovo’s retail strategy in China is changing, with the company choosing to move towards premium devices and function as a premium player in order to continue growing in the crowded Chinese market.

“However, the rest of world is huge for us, with quick growth wherever we’re established. Our business is strong in Brazil and Latin America, with over 20 percent market share for Moto there," said Wong. "In India, we’ve had great success with online retailers such as Amazon and Flipkart. We see India as similar to China in terms of retailer development, and we now hold a 7.7 percent share of the smartphone market in India. The Lenovo brand is the driving force behind this,” he added.

That isn’t to say that Motorola isn’t performing well either. “We’ve received good feedback for the new Moto G4 and G4 Plus smartphones, with the cameras receiving a lot of praise,” said Wong.

Although Motorola's success in India happened through online sales channels, Wong added that the company must embrace and develop retail as well, in order to succeed in the market.

“Online retail has hyper growth the world over, but it will slow down and stabilise at some point, and we already see this happening in India," he said. "Lenovo believes that an omni-channel approach is the best way forward, with online and brick-and-mortar stores working together.” Lenovo has 3,000 exclusive stores all over India, which are an important part of the company’s channel strategy, but some products are better suited to online and will stay that way, he added.

Reliance Jio’s impact on the smartphone segment
With mobile operators shifting to 4G networks, there has been a growing interest in 4G devices and Lenovo has been on the ball with that. “The Lenovo K3 Note and K4 Note sold in huge numbers because they were among the earliest devices to feature 4G connectivity. Naturally, now that Reliance Jio has launched, there’s going to be more demand for 4G phones and we’re aware of that.”

Wong added that Lenovo will be focused on bringing affordable 4G phones to the market to capitalise on the demand that will be created by network operators offering high-speed mobile internet at affordable prices.

PC market is boring
“The Lenovo Yoga brand was a revolutionary product in the laptop segment, and with it we created the convertible segment ourselves, which is something we’re very proud of," said Wong. "We remain the number one player for convertibles worldwide, in Asia Pacific and in India, so the Yoga line-up is something we’re very optimistic about.”

He went on to say that he finds the PC market boring, and that its year-on-year shrinking is because of a lack of innovation. Lenovo spends $1.5 billion on research annually, Wong added, with a focus on innovation and creating products that are out-of-the-box.

The Yoga Book, which was unveiled by Lenovo at IFA 2016, is one such example of the company’s innovation, according to Ken Wong. He believes that Android laptops such as the Yoga book have enormous potential, and its innovative style will help it stand out. However, the premium market is barely 5 percent of the total market, and it’ll be interesting to see if the company can bring the Yoga line to more affordable price points. When asked, he said: “Our goal is to innovate and create new products and categories. We want to be different, young and vibrant, and you’ll see a lot of that going forward with Lenovo.”