Lenovo Group Ltd. on Thursday announced that retailer Office Depot Inc. will stock two ThinkPad models on shelves inside its 1,000 stores, located across North America, beginning Nov. 6.
The move, which Lenovo says is designed to help it target small business customers, is the companys first step into retail in North America since it purchased IBMs PC business in May. However, Lenovo executives said the step does not reflect a change in its plans—its executives said earlier this year that the U.S. consumer market wasnt one of their first priorities—and instead bolsters its efforts to expand its sales to small and medium businesses. The space has long been a target of PC makers, due to it sheer size.
"Were not ready to jump into the consumer market and all the things that go with that," said Craig Arold, program director for strategy and business development for the Americas. Instead, "This is something were doing to further penetrate the very small businesses end of the [commercial] market."
Office Depot stores will stock ThinkPad T43 and Z60t models. The Z Series ThinkPad, for its part, was designed specifically with smaller businesses in mind. But Office Depot will offer a wider range of ThinkPad models, including the ThinkPad G Series, R Series and lightweight X Series via its Web site. Online prices on the machines will start at $699, Lenovo said.
Lenovo is also evaluating whether or not to offer its ThinkCentre desktops through Office Depot stores. The PC maker recently launched a new, low-price ThinkCentre E Series desktop specifically designed for small businesses.
However, the company believes that its ThinkPad notebooks offered the biggest initial opportunity. "Were focused on this partnership, getting it off the ground, making it successful," Arold said.
Small businesses tend to buy computer equipment at a broad range of retailers, ranging from wholesale club stores to brand-name electronics retailers like Best Buy, but that doesnt mean that Lenovo will pursue them at every store, Arold said.
"We dont want to get ahead of ourselves. We are going to evaluate things [such as expanding its retail presence] as they make sense for the time," he said.
Although its possible that the Office Depot deal could leave some other Lenovo channel partners a bit rankled, its an important exercise for the company, one analyst said.
"I think this is a good experiment for [Lenovo], just in general, to see how effective they can be by being out in front of the customers, versus being direct or using more traditional channels," said Steve Baker, analyst at the NPD Group.
Office Depot and others, such as Staples Inc., have been positioning themselves primarily as shops for small and midsize business, versus those that serve the broader consumer market, Baker said.
Thus, "Its a good opportunity for Lenovo to test how well the ThinkPad brand can do in that environment…to see if the brand stands the test without the support and salesmanship youd get at a place like CDW [Corp., a well known reseller] versus the kind of salesmanship and support youd get at a retail store."
The agreement extends a partnership that Office Depot and IBM had for several years.