After Lenovo bought Motorola from Google in 2014 for $2.9 billion, there were speculations that brand ‘Moto’ maybe killed. In fact, strong possibilities arose this year when we reported that brand ‘Motorola’ may soon be renamed as ‘Moto By Lenovo’, which will make Lenovo as a stronger brand.
However, such speculations were false it seems.
Lenovo hasn’t been able to chalk out a formidable plan for their own brand, and has failed to create a plan for replacing Motorola, which is a much bigger and popular brand in smartphones, compared to Lenovo.
As per latest reports coming in, upper management of Lenovo has decided to kill their own brand name, and only market and sell Motorola brand for atleast in smartphones niche.
This is indeed a big, bold and selfless decision by Lenovo, which has clearly understood that it’s better to nurture an established, popular brand name rather than creating one of their own which is not so popular right now.
Why Lenovo May Kill Their Own Smartphone Brand?
Computers are still Lenovo’s largest and most important business vertical, as it accounts for 70% of their total revenues. (as per 2015 data).
On the other hand, smartphones (both Moto branded and Lenovo branded) was only $2 billion last year, which is 12% lower than previous year.
This proves that Brand Lenovo’s top-most priority should be desktops and laptop computers, rather than smartphones. Besides, as per another set of reports, Lenovo is slowly trying to shed their image of a hardware based company to that of a ‘’customer-oriented company focusing on devices with artificial intelligence and cloud services”.
And smartphones don’t appear to be an important business for Lenovo right now.
Advantage Brand Moto
On the other hand, Motorola and Moto brands are gaining in popularity as they have been around for years, and their new models are doing quite good business.
Yang Yuanqing, Lenovo chairman and CEO recently said that their mobile business has been growing 20% year on year, supported by Brand Moto, and their performance outside China has been better than inside China. This means that consumers are still trusting Brand Moto, compared to Brand Lenovo, which is stronger in China.
Motorola has a popular branding for their low cost, medium cost and high cost smartphones (Moto X, Moto G, Moto E, Moto X Pro etc), whereas Lenovo doesn’t have an established branding for their smartphones.
The theory that Lenovo may kill their own brand name for smartphones also gained momentum when the management decided to replace several leaders from their smartphones division, and appointed them into their laptop and cloud business.
For instance, Xudong Chen who was Co-president and SVP of the brand’s Mobile Business Group (MBG) in China would be replaced by Gina Qiao, who was the HR Head.
Although Lenovo hasn’t yet confirmed this development, but as per reports, they have already started moving in that direction.
So, ‘Hello Moto’ will still greet all new users, when they open up their Motorola smartphones.
Do you think Lenovo is right in killing their own brand name, and help grow brand Motorola? Do let us know by commenting right here!
