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Lenovo turns to Olympics to boost profile
(China Daily)
Updated: 2006-02-17 08:43

TURIN, Italy: The Lenovo Internet cafe in the Olympic Village seems to be a marketer's dream. The Lenovo name is splashed on the wall, and each of the 34 work stations have athletes and trainers from Australia to Sweden tapping out e-mails to friends and family.

Yet the users have little idea about the sponsor.

"No, no clue. Maybe it's an Internet provider?" said Andy Huppi, a massage therapist for the Canadian men's ice hockey team. "They let us in, and we use the computers."

Athletes are not the only ones hoping the Olympics will bring them worldwide fame.

Lenovo Group Ltd is one of world's largest computer makers, which acquired IBM's personal computer business, but it's a household name mainly in China. However, it is banking on an expensive Olympic sponsorship to help it become a worldwide brand.

"We're using the Torino Games to establish ourselves as a global player," said Deepak Advani, Lenovo's chief marketing officer.

Lenovo is launching an ad campaign with three 30-second spots to air on NBC, the network showing the Winter Games in the United States. It has endorsement deals with 11 Olympic athletes from China, Europe and the United States. And NBC's Olympics crew is leasing 1,000 Lenovo notebook and desktop computers, giving Lenovo more chances to get its brand on TV.

As China's first and only global sponsor of the Olympics, Lenovo is joining such well-known multinationals as Coca-Cola and McDonalds and is trying to follow the Olympic marketing path blazed by other well-known Asian brands such as Panasonic and Samsung.

Lenovo and the International Olympic Committee refuse to disclose how much the company's sponsorship cost, but analysts estimate it paid US$80 million to US$100 million in cash and services for the three-year cycle that covers the Turin competition and the 2008 Summer Games in Beijing.

The deal gives Lenovo the right to affix the Olympic logo of five interlocking rings on products and advertising worldwide. In return, Lenovo provided thousands of servers, computers and monitors for the Turin venues and other facilities. It set up seven Internet cafes like the one in the Olympic Village and has had about 100 engineers on site, some of them living in Turin for nearly two years.

The blitz is Lenovo's biggest marketing foray since it made headlines 15 months ago with the US$1.75 billion purchase of IBM's PC operation. The acquisition is China's largest to date of a US business and a bold move for a company founded 22 years ago as a commercial offshoot of a government research institute.

In a sign of its global ambitions, Lenovo moved its headquarters from Beijing to the New York City suburb of Purchase last year.

The adjustment has not been wholly smooth. Cultural barriers between the Chinese employees and IBM holdovers, different work styles and a 12-hour time difference between Beijing and New York have complicated integration, employees said.

"In the past, we could leave the office at 6 o'clock. Now we have dinner, and by seven the conference calls start coming," said Alice Li, the Beijing-based head of marketing and communications. "More and more we're figuring out how to adapt and change to being an international company."

Lenovo has won positive reviews for updating the style and technology of IBM's well-regarded ThinkPad notebook computer. Moreover, new product launches are planned, including a data-backup system to guard against viruses, Advani said.

(China Daily 02/17/2006 page2)

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