DECLINING MARKET SHARE OF LENOVOEfforts: (GROUP A1) Amit Goyal Amit Singh Devendra Kashyap Harwant Singh Margaret Rajeshwari Murchana Borthakur Prateek Agarwal

EXECUTIVE SUMMARY

Lenovo group limited was incorporated in the year 1988 in Hong

Kong. it is a multinational personal technology company that deals in

development, manufacture and marketing of desktops and notebook

computers, workstations, servers, storage drivers, IT management

software and other related products and services. Lenovo’s main competitors in the Indian subcontinent are Apple,

Sony, HCL, HP, Asus, Toshiba amongst others. Over the last two

years, the market shares of Lenovo have fallen considerably in the

Indian market. The objective of this market research is to determine

the causes behind this fall. We discuss the qualitative research

required to ascertain the causes behind the low market share of

Lenovo. Data collection sources for primary and secondary data are

mentioned and discussed in detail. A detailed report will be presented at the end of the market research.

ABOUT LENOVO

LENOVO GROUP LIMITED is a Chinese multinational personal technology company founded in 1984 by Liu Chuanzhi.

Lenovo was incorporated in Hong Kong in 1988.

Yang Yuanqing is the current chief executive officer of Lenovo. Yang was a chairman of Lenovo's board from 2004 to 2008.

Lenovo’s principal operations are currently located in Morrisville, North Carolina, Beijing, China and Singapore and employees 26,341 people all over the world.

ABOUT LENOVO

Lenovo develops, manufactures and markets desktop and notebook computers, workstations, servers, storage drivers, IT management software, and other related products and services.

It is a global Fortune 500 company with a special focus on personal computers with annual sales of over $21 billion.

Lenovo became the world's second largest supplier of  personal computers in the world during the third quarter of 2011.

SWOT ANALYSISSRENGTH

•R&D Dept.

•manufacturing capacity

•International Presence

WEAKNESS

•Low customer acquisition rate

•Inadequate after sale service

OPPORTUNITIES

•Growing wireless PC market

•New and Better Means Of

Advertising

•Improvement in Features and

Technology

THREATS

•Intense competition

•External changes (government,

politics,taxes, etc)

•Product substitution

•Software piracy

PORTER’S FIVE FORCES MODEL

The five forces are:

1. Rivalry within the industry.

2. Bargaining power of supplier.

3. Bargaining power of customers.

4. Threats from new entrants.

5. Threats from substitutes.

PORTERS FIVE FORCE MODEL Rivalry among competitive firms

There is a huge competition in the laptop industry, nowadays

companies are offering not only good quality products at low

price but also one year on-site warranty. For example, to gain

market share Dell, for the first time in India, offered

customized laptops with accidental warranty, at a price which

the customer was willing to pay. So to make the difference

different companies are trying to give better product with

better service facilities to the customer at low price.

PORTERS FIVE FORCE MODEL Potential entry of new competitors

Potential entry of new competitors is also a factor which

intensifies the competition in the industry. Despite numerous

barriers to entry, new firms sometimes enter industries with

higher-quality products, lower prices and substantial marketing

resources.

PORTERS FIVE FORCE MODEL Potential Development of Substitute Products

The laptop industry is facing a significant threat from new

products and technologies like ultrabook, netbook, tablet

etc. which ultimately reduce the need for laptops by

providing almost the same functionality , better design, easy

to carry at low price.

PORTERS FIVE FORCE MODEL

Bargaining power of suppliers

Suppliers play an important role in production of good and services,

better the raw material better the final product. Manufacturer needs

to build relationships with the supplier to improve the quality and

reduce the prices of the products.

Example:

Dell computer known for best quality computer, laptop and server

manufacturer in the industry. The key behind dell success is

maintaining better relationship and collaboration with the supplier

of computer hardware and software.

PORTERS FIVE FORCE MODEL Bargaining power of consumers

Consumers are the final user of the products, performance of the

companies totally depend upon the consumers. Bargaining power

of consumers is more when there is number of players in the

market and providing better quality at low price.

OBJECTIVE OF RESEARCH

To identify the right type of audience for the laptops.

To identify the internal and external features consumers look into the laptops.

To explore the market psychology of the laptop consumer prior to purchasing the commodity/ Market features such as price will be considered.

APPROACH TO THE RESEARCH

The research will be conducted through qualitative research

technique in order to get the insights of the customers. Further a

quantitative research will be conducted in order to verify the

findings of the qualitative research. This research will be carried

out through various sampling techniques to explore and

understand the preferences of potential customers towards the

brand.

RESEARCH DESIGN

Secondary data:

The required secondary data will be collected through

business magazines, publications and web-sites and through

previous research reports.

Primary data:

The primary data will be collected through structured close

ended questionnaire and the sampling size for the

questionnaire will be 50 focussing on the NCR region.

REPORTING

After 1 week the progress report will be discussed with the

company and we will try to get the feedback in order to maintain

the authenticity of the final report. Once this has been approved,

there will be a formal presentation of all information collected

through research, along with conclusions drawn.Data collected

through primary research will be submitted to the company with

the final report.

RESEARCH SCHEDULE

Fieldwork ……………...8th March, 2012 Research analysis………13th March,

2012 Final report by…………22th March, 2012 Final presentation………30th March 2012

ESTIMATED COSTPhase Description Fee

Secondary Research Purchasing of Business magazine, journals,

Rs. 2000

Primary Research e-mails, telephone, FGD, Depth interview Charges

Rs.8000

Other expense Stationery charges Rs.2000

Total Fee Rs. 20,000