Acer Sick of Being "Cheap" and "Unprofitable", Wants to be Like Apple
December 8, 2011 3:44 PM
comment(s) - last by
Company hopes that ultrabooks are the answer to its sales woes
Taiwan's Acer Inc. (
) is sick and tired of making "cheap" products. It lusts for the kind sleek designs that highly profitable American computermaker Apple, Inc. (
Acer CEO J.T. Wang was blunt when he remarked, "We will shift our strategy to improving profitability from pursuing market share blindly with cheap and unprofitable products."
The candid rhetoric is a sharp departure from that of company founder Stan Shih who in 2010 fielded such wild opinions as stating that Acer's products were so cheap they would put Dell, Inc. (
) and Hewlett-Packard Comp. (
out of business in 20 years
Apple was a "mutant virus"
that would go the way of "Betamax". At the time Acer had just
stolen the number two spot
in global sales from Dell.
However, since then it's been all downhill for the firm. It began to post losses, its
CEO was forced to resign
, and suddenly "cheap" was perceived in a whole new light. Suddenly Acer began to
aspire to be more like Apple
-- a premium vendor with large margins.
In 2011, the situation has progressively deteriorated for Acer, despite its change in attitude. Tablet sales
passed netbook sales
-- Acer's traditional sales driver. Acer had prepared for this
launching an Android tablet
, but this first crack at the tablet market proved a relative flop, forcing it to
cut sales estimates almost in half
Recent estimates on global PC sales show Acer shedding nearly 20 percent of its U.S. and 10 percent of its global market share,
falling to fifth place in the U.S.
and fourth place globally in PC sales (excluding tablets).
Acer feels that by focusing on good battery life, a thin design, and light weight it will be able to return to sales success. The culmination of all those characteristics is "ultrabook" a class of PCs first introduced by
Apple's MacBook Air
luxury designs back in 2008. Officially
the term "ultrabook" comes from
chipmaker Intel Corp. (
) and has a strict set of hardware quality requirements for use.
Mr. Wang comments, "Selling more ultrabooks will also help improve our profit margins as they command higher prices."
Acer's first ultrabook, the
, went on sale on Oct. 10, 2011. The 13-inch design is remarkably similar in look to the MacBook Air, complete with a thin metal shell case. It's currently retailing for as low as
from Amazon.com, Inc. (
for the cheapest 13-inch MacBook Air.
If all goes according to plan, Acer hopes to halt the losses and grow 10 percent in 2012. But to do that, it argues, it must stop selling "cheap" junk.
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Asian Business 101
12/8/2011 7:05:35 PM
Seems like the majority of asian-operated businesses all use the same model: undercut everyone no matter what. They fail to understand the nuances of the markets they're selling to. They don't realize that are plenty of people willing pay more for quality, aesthetics or a combination of the two...and even if they did, they'd probably lack the creativity to make something people really want (which is going to be Acer's main hurdle).
I guess that's why US colleges don't want asians flooding their ranks - they're more like robots than humans, incapable of independent thought and only effective when they're operating as part of the "yellow collective". They're great a copying, mimicking and performing repetitive tasks, but fail at creativity and invention. I will exclude Japan from this statement, at least in terms of creative potential and coming up with unique and interesting things. Maybe japanese should be reclassified as its own race so as not to lump them in with mere asians.
RE: Asian Business 101
12/8/2011 10:21:34 PM
Nice racist trolling.
RE: Asian Business 101
12/9/2011 3:47:44 PM
Oh, did I say something untrue?
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