Case Study - Acer's Growth Strategies

875 Words Oct 13th, 2012 4 Pages
Case Study - Acer's Growth Strategies
In 2007, Acer Inc. (Acer) was the third largest computer company in terms of world-wide personal computer (PC) shipments. With 2.43 million units shipped, the company enjoyed a market share of 7.6%. Its growth rate stood at 31% against the 30% of Hewlett-Packard Company (HP) and 21% of Lenovo Group Ltd.

In the first quarter of 2008, the company sustained its performance and its market share grew to 9.5%. Its growth rate of 25.2% was higher than that of Dell Inc. (Dell) and Lenovo.
Analysts felt that the company had come a long way since 1994 when it was the number eight player in the global PC market.

According to analysts, Acer's rapid growth could be attributed to the restructuring efforts
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The business was divided into the Enterprise Systems Group and the Consumer Systems Group. However, these groups were disbanded and replaced by a unified marketing and sales organization. Acer was a strong player in the government and institutional sales in India.
According to the company, it had strong relationships with 15 large system integrators and this had provided it with a presence in 40 customer verticals including the banking and financial services industry, education, telecom, and government.

Acer had been aggressive in building its brand image in India. It signed up Hrithik Roshan, a popular Hindi film star, as its brand ambassador to promote its products. The advantage of having a brand ambassador like Hrithik Roshan was that he helped in brand recall and in associating Acer with high quality.

To have greater brand visibility, Acer began focusing on the retail outlets. As of May 2006, Acer had 225 retail outlets and 179 retail partners. It intended to establish 350 retail outlets by the year 2008. Analysts felt that the retail network was a prime channel for the movement of premium products like notebooks, consumer desktops, and home theater solutions.

Acer's retail strategy was such that each retail outlet was allocated a geographical area in the city so that the individual retailers could grow their business without infringing on another Acer