Lenovo to reinvent marketing strategies in server market

Lenovo, the world’s largest PC maker, will reinvent its marketing strategies in the highly competitive server market, said Lenovo China and Asia/Pacific, Eastern Europe and Middle East region (APEM) Senior Vice-President Xudong Chen on Tuesday.

Interacting with media on the recent acquisitions of IBM’s X86 server business and Motorola Mobility, Chen said that the server business is a highly competitive market with established players Hewlett-Packard Co and Dell Inc and marketing strategy will play a vital role in gaining further market share.

“With the new acquisition of the IBM X86 server business, we expect to achieve combined revenue of $5 billion from our server business within two years,” he said.

Lenovo announced its plans to buy the IBM low-end server business in January and completed the $2.1-billion acquisition this week. Lenovo is yet to close its deal to buy the Motorola Mobility handset business from Google Inc for $2.91 billion.

About expectations from the Indian market, he said the market is growing. “With the government’s new Digital India initiatives and smart cities, Lenovo hopes to increase its revenue share. But I can’t divulge details on numbers at this point of time,” Xudong said.

The company will be looking into the issue of pricing of IBM server products. “We will prune cost structure to make it more cost-competitive in the fast changing server market.”

Lenovo, which registered revenues of $38.7 billion in  2013, generates 80 per cent of this from desktop and laptop PC sales. The company’s effort to expand its business in servers and smartphones to take on the receding demand for PCs globally is slowing paying off.