Case Study: Acer
Case Study 1: Acer (Case 1-3)
MKT 505 International Marketing
July 20, 2013
Acer's strategy has been described as “divide and conquer.” Compare and contrast this to Lenovo's strategy.
Divide and conquer is a strategy that was initially applied in the military to weaken the enemy forces. It involves splitting the enemies force into two or more elements. This weakens the enemy increasing the vulnerability to attacks from more than one direction. The old adages 'unity is strength,' and ‘united we stand-divided we fall' are apt in explaining Acer’s strategy of divide and conquer. This strategy acknowledges that it is to easier to defeat a group of small companies than defeating one large one. In the light of the Acer case study, divide and conquer strategy could be interpreted to mean having distinct approaches for the local, regional and global market. In this sense, what is being divided is the market and competition. What Acer plans to conquer is the local, regional and global market by increasing her market share. This would be done at the expense of competitors such as Lenovo, who could possibly be conquered by being locked out of each segment of the market through Acer's superior offering.
Acer's management realized early enough that the company's position in the American market was weak. As a matter of fact, the company's market share had significantly dropped. According to Keegan and Green (2011), “Between 1995 and 1997, Acer's U.S. market share dropped from 15 to 5 percent”(p.36). In an attempt to conquer the pc world, in 2007, Acer acquired Gateway, which is a U.S.-based company. This acquisition provided the much needed opportunity for growth and global expansion. It is worth noting that initially Acer had a brand recognition problem springing from consumer's perception and concerns on quality and reliability.
By focusing on the Chinese market, Acer had recognized the importance of securing the local market before pursuing the global and
MKT 505 International Marketing
July 20, 2013
Acer's strategy has been described as “divide and conquer.” Compare and contrast this to Lenovo's strategy.
Divide and conquer is a strategy that was initially applied in the military to weaken the enemy forces. It involves splitting the enemies force into two or more elements. This weakens the enemy increasing the vulnerability to attacks from more than one direction. The old adages 'unity is strength,' and ‘united we stand-divided we fall' are apt in explaining Acer’s strategy of divide and conquer. This strategy acknowledges that it is to easier to defeat a group of small companies than defeating one large one. In the light of the Acer case study, divide and conquer strategy could be interpreted to mean having distinct approaches for the local, regional and global market. In this sense, what is being divided is the market and competition. What Acer plans to conquer is the local, regional and global market by increasing her market share. This would be done at the expense of competitors such as Lenovo, who could possibly be conquered by being locked out of each segment of the market through Acer's superior offering.
Acer's management realized early enough that the company's position in the American market was weak. As a matter of fact, the company's market share had significantly dropped. According to Keegan and Green (2011), “Between 1995 and 1997, Acer's U.S. market share dropped from 15 to 5 percent”(p.36). In an attempt to conquer the pc world, in 2007, Acer acquired Gateway, which is a U.S.-based company. This acquisition provided the much needed opportunity for growth and global expansion. It is worth noting that initially Acer had a brand recognition problem springing from consumer's perception and concerns on quality and reliability.
By focusing on the Chinese market, Acer had recognized the importance of securing the local market before pursuing the global and