The Business

Partner Focus: Peter-Hortensius-Lenovo

The computer maker Lenovo has 9% of the worldwide PC market, and in 2009 it ranked as the world’s fast-est-growing PC company. In the three months to December 31st, Lenovo grew sales by 42%, against an industry av-erage of 17%. We asked Lenovo what that means for small business resellers.

Lenovo is already the number one PC maker in Asia, but most computer buyers in Europe know the company best as the manufacturer of the ThinkPad and ThinkCenter brands of computer, which Lenovo acquired when it bought IBM’s PC division in 2005.

The company is now extending the venerable ThinkPad range with ThinkPad Edge – a laptop computer line aimed more at the SME market – as well as netbooks, including some based around Android (and in China, mobile phones). The manufacturer is also boosting its support for the channel.

ITEXPERT asked Lenovo’s senior vice president for the Think product line, Peter Hortensius, how the company sees the market developing and how the channel can take advantage of a return to growth.

ITEXPERT: You have said you want to continue to grow faster than the market. Are there any particular areas in the PC business that you think are best placed to expand and where you think channel partners can add value?

Peter Hortensius, Lenovo: Clearly a big place for us to go after is small business. Small business have many needs that are like those of large enterprises, and our products map well to those needs. We think we have an excellent op-portunity to do that, and of course bring our resellers with us, as they are our path to those customers.

ITX: Clearly businesses of all shapes and sizes have been conservative with their cash over the last few years, and the PC market has been affected. Do you see any signs of renewed optimism there and do you think that companies will start to spend again on technology?

Lenovo: We are definitely starting to see companies start to look more – and you see this in the general marketplace as well, where market forecasters are telling us they are starting to see some turn. That said, it is still a very tough environment and you have to prove yourself for every dollar that you want a customer to spend with you. We however do see real opportunities, particularly taking our product line – our ThinkCenter and ThinkPad notebooks – to our small business customers and the kind of services they can enable represent a huge opportunity for us and our path to market, the resellers.

ITX: Do you think the industry has done enough to explain, or perhaps to explain again, the return on investment in terms of businesses becoming more productive that can result from spending more money on IT?

Lenovo: This is always a classic tough question. To me, again, we are starting to see this beginning to turn. The PC is a fundamental device for doing business today. Who can imagine doing business without their email, without the In-ternet? So it is a core element of what they do. You can defer a purchase, but you can’t stop. What we are seeing is customers starting to realise that they have missed something, by not participating in the market for the last year or two.

ITX: If customers are looking to refresh their PCs today, what are they looking for?

Lenovo: They are looking for good performance. More and more they are looking for a notebook, rather than a desk-top, because of the portability and the productivity you get by being able to work anywhere. We are seeing them look more at high portability form factors, so they truly can use this device anywhere – those are the general trends.

ITX: Can you give some examples of how you think resellers and VARs should help their customers to understand better the case for investing in IT, and for renewing their IT infrastructure, including their laptops or PCs?

Lenovo: Clearly when you look at the new current generation of products you see significantly better performance. If you are worried about security, that goes hand in hand with a high-performance experience. The next area is connec-tivity: wireless, and integrated cellphone connectivity, that allows you to have a system that is constantly communicating, not just when it is in a hotspot. Those kind of productivity improvements only come with the latest technologies.

Lenovo’s channel strategy

Lenovo’s new products, such as the ThinkPad Edge and the Android-based Skylight netbook, are attracting crowds at trade shows such as CES and winning positive reviews. But Lenovo’s managers appreciate that as they move away from focusing on the ex-IBM product range – with its focus on large, enterprise customers – the channel will be increasingly important.

Changes include stronger support for the Lenovo brand at global events, such as Formula 1 racing, as well as the appointment of a new chief marketing officer. At the channel level, this involves new demand generation and co-marketing programmes, especially for resellers targeting small and mid-sized businesses.

Other measures include faster rebates for resellers, a simplified and improved incentive programme, and a single, simplified inventory structure which allows channel partners to bid for its TopSeller models – especially useful for resellers putting together prices for large customers. Lenovo now also includes its Idea range of consumer PCs in its reseller incentive programme.

“We reviewed our strategy and programmes to simplify the way we work with our partners, and to drive additional benefits,” says Hortensius. “There is now a single interface for doing business with Lenovo.”

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