Earlier in the year, Lenovo acquired the Motorola Phone business Google for a reported three billion dollars. The acquisition also included the Motorola brand, over two thousand patents and the trademark portfolio. With a larger Lenovo in the running, changes are expected in the global tablets and Smartphone market. Although Apple operates on a higher niche compared to Lenovo, the possible impact that Lenovo could have, not only in the Chinese market, but also in the global market should get the hierarchy at Apple concerned. This case looks at how Apple can reduce the impact of Lenovo’s acquisition of Google’s Motorola mobile unit.
Problem:
How can Apple reduce the impact of Lenovo’s acquisition of Google’s Motorola mobile unit?
SWOT Analysis
TOWS MATRIX
Strategic Alternatives [those emerge from the SWOT]
Strategic Alternatives (pick 3 to 4 from the TOWS
- Exploiting the expertise of vendors to increase and strengthen its distribution channels in Indian and Chinese markets. (T3, W4)
- Use its brand awareness to acquire companies with desired patents. (S3, T1).
- Use of its strong marketing and advertising capabilities to capitalize on the growth in the Smartphone and tablet markets. ( S1, O4)
- Use its strong marketing and advertisement capabilities to popularize other products on the product line. (S1, W2)
Key Evaluation Criteria
- Fit with the company’s strategy, goals, vision and mission [20%]
- Timing: how long it will take to implement the alternative? [10%]
- Competitiveness: what can be consequences of implementing the alternative? [30%]
- Profitability: what can be the rate of return for implementing the alternative? [40%]
The scale used in analyzing the alternatives is as follows
1 = Low, 3 = Medium, 5 = High
Matrix for Analyzing Alternatives
Recommendation:
After an analysis of the alternatives, alternative number three can help Apple reduce the impact of Lenovo’s acquisition of Google’s Motorola mobile unit. This is because of the following reasons: -
- The company already has strength in its advertising and marketing capabilities. Apple can use this in new markets to optimize on the demand for Smartphones and tablets.
- Additionally, the reputation and brand awareness of the company will serve to augment the marketing and advertising drives.
- Apple needs to increase their presence in the Indian and Chinese market in order to curtail the progress of Lenovo. The advertising and marketing capabilities of the company coupled with its reputation and brand awareness can increase their presence in these markets.
Works cited
Dess, Gregory et al., Strategic Management: Text and Cases, 7th Edition. New York. McGraw-Hill Higher Education. 2014. Print.
