Lenovo is increasing its lineup of company-owned retail outlets in China to challenge Samsung's smartphone dominance. Are Lenovo stores -- right next to Apple stores and Microsoft stores -- in the U.S. next?

DH Kass, Senior Contributing Blogger

August 28, 2013

2 Min Read
Lenovo Smartphone Stores: Challenging Samsung in China, Coming to U.S.?

Global PC market leader Lenovo, which has relied on thousands of channel partners in its native China to sell its products in country, now is opening company-owned stores locally to challenge Samsung’s dominance in the smartphone market, according to a published report. Are Lenovo stores in the U.S. — right next to Apple and Microsoft stores — next?

Lenovo just opened its second company-owned retail outlet in Beijing with drawing-board plans to launch another five stores in the next three years, deployed primarily as showcases for its emerging mobile portfolio, according to Lenovo officials quoted in a Bloomberg report. By comparison, Apple (AAPL) operates 11 stores in China to sell its iPhones and iPads.

While Lenovo has no stated plans to open company-owned outlets outside of China, it’s not too far out there to think it could migrate the strategy to the U.S. and other markets when it believes the timing is right.

In other words, when Lenovo does bring its smartphones to the U.S. market, will it be enough for the vendor to sell the devices online and at major retailers or might the company want more control over the sales process as does Apple with its 400 retail stores worldwide?

One clue might be Lenovo’s apparent admiration for Apple’s retail strategy and execution.

Chen Xudong, Lenovo’s president of China operations, told Bloomberg that Lenovo’s company-owned store strategy mirrors Apple’s, albeit on a far smaller scale.

“We want customers to feel free to play with the products, and that basically is quite similar” to Apple, he said. Lenovo’s goal, he said, is to wrest smartphone leadership from Samsung within two years.

According to researcher Gartner, Lenovo has come out of nowhere in the smartphone market to position itself as a formidable competitor in the middle of the pack among Huawei, LG and ZTE, based almost exclusively on sales in China.

For Q2 2013, Gartner pegged the vendor in the No. 4 spot for worldwide smartphone sales for the first time, as the company grew its shipments 144 percent year-over-year to 11 million units.

With 95 percent of its smartphone sales in China, Lenovo has no presence in the U.S. market. To expand its geographic footprint, the vendor not only will have to broaden its relationships with carriers but also must find productive channels to sell the devices.

Lenovo’s two company-owned stores in China feature 10 different IdeaPhone handsets, tablets, desktops, notebooks and the vendor’s Internet-enabled televisions, according to the Bloomberg report. In addition to company-owned stores, Lenovo also is franchising stores in China–providing funding, signs, furniture and design to ensure franchises carry the look and feel of company-owned outlets–with plans to balloon the number of franchises to 300 in the next three years, the report said.

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About the Author(s)

DH Kass

Senior Contributing Blogger, The VAR Guy

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