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LG enters notebook market

Company strategy is to build brand through an authorized channel

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LG Canada this month entered the highly competitive laptop market with a series of slim and light models called the Xnote Ultimate Notebook.

Shawn Snobelen, the national sales manager, digital display and media division for LG Electronics Canada Inc., based in Mississauga, Ont., acknowledged

the notebook market would be tough to compete in.

Currently there is growth in the market, he said, but at only between five and 10 per cent. However, Snobelen believes the subsidiary’s channel strategy along with notebook’s looks and feature set will give LG a good starting point.

“”We are going to have some strong reselling points such as the best looking notebook on the market, the longest battery life on the market, the best wireless connectivity on the market. It will have a very strong three-year warranty program for our top end products,”” he said.

LG Canada’s channel strategy for the Xnote line will be limited distribution and an authorized reseller base. It has signed Ingram Micro Canada, EMJ Data Systems, Supercom and ALC Micro to distribute the products. The company is also building an authorized reseller network for the notebooks. As of launch, Snobelen said between 75 to 100 partners will carry the notebook line in Canada. The goal is to eventually have 300 partners in the network.

“”We want resellers who understand the brand and sell product for the benefit of the customer. We are going up against huge global brands that have been selling notebooks for years. If we get into a brand battle initially we will have a tough time. In a spec and feature benefit battle we are going to win. We need resellers who can sell that agenda.

“”We are going to focus on the VAR channel and corporate business and our current retail partners to bring the product to market,”” Snobelen said.

The authorized reseller program is an extension of the Premier Partner Program to be called Xnote Premier Partners, he added.

Also part of the plan will be slightly higher margins. Snobelen said that competitive notebooks average a margin of between six and eight per cent. He is trying to give resellers eight to ten per cent with the LG models.

LG manufactures premium notebooks under the LM Series line and high tech models in its LS Series line. Snobelen said the company also produces Tablet PCs and will be coming out with a 15.4 inch screen for its A/V or gaming notebook. Snobelen said that it would be unlikely that LG will enter the desktop replacement or luggable area of the notebook market.

Snobelen also outlined some aggressive goals for the product line. LG Canada aims to become a top five player in Intel Centrino-based notebooks by 2006. Eighteen months from there, LG wants to be a top five notebook player overall.

“”The market is ready for it,”” Snobelen said of the Xnote. “”We are seeing a bit of a recovery. It brings prestige to the line up. It now becomes our flagship product, while adding a new revenue stream. There are lots of positive reasons for bring in this product.””