“It” extraction (killing a brand softly)

Last week, quietly and without fanfare, ThinkPad decided not to renew its flagship model, the X301. 

The X301 is a beautiful machine.  It has that wonderful ThinkPad keyboard, a huge screen, and it weighs only a little bit more than a ballet slipper.  It is a miraculous demonstration of what design and engineer can do.

And now it’s done for.  Lenovo is proposing the ThinkPad T410s as the x301s replacement.   When called upon to explain himself, Lenovo Marketing Director, Wang Lipin said that T400 series was more powerful than the x301, and cheaper by a thousand dollars.

The trouble: the T400 doesn’t have “it” quality.  It is a business machine in the most pedestrian sense of the term.  No trace of elegance.  No claim to being the pick of the technological litter.  No “wow” factor.  The T410 is just another business machine. 

This takes us into one of the thorniest issue in the branding world.  What is “it?”  And what’s “it” worth? 

It’s a difficult discussion because “it” is inscrutable.  We can point to “it.”  We know “it” when we see it.  But when it comes to anatomizing, measuring, and pricing “it,” well, this proves difficult and all the marketing and pricing models break down. 

This would be a mere irritation if “it” weren’t such a gusher in the tech world.  But it is.  All of us can buy a phone that is smarter, faster and cheaper than the iPhone.  But none of these has “it” status.  We may not be able to measure “it,” but we don’t hesitate to pay the premium it demands of us.  

Apple turns out to be pretty good at “it.”  In fact, Apple now pretty much owns “it” in the computer world at the moment. 

Except when it come to the lightest, full function lap top.  The Apple entry in this category, the MacBook Air, is a pretty good machine.  But that’s all it is.  A pretty good machine.  It doesn’t have “it.”  Until last week, that belonged to ThinkPad.

So why did Lenovo perform an “it” extraction?  That’s clear enough.  It was making a rational business decision.  It was applying a pricing model.  It may well have been working from Robert Dolan’s exemplary text book on the topic.  This was a perfectly sensible marketing decision.

But it was of course an absolutely disastrous business decision, one that may cost Lenovo dearly.  When Lenovo took the “it” out of ThinkPad, it gave up the only branding advantage it had over Apple.   Sadder still, it destroyed much of the brand value that prompted Lenovo to buy ThinkPad from IBM in the first place.  Having taken on a brand that would help it fight its way out of the commodity basement, it has now descended into that commodity basement, slamming the door behind it as it goes. 

Lenovo’s “it extraction” was a good, rational, pricing decision.  But if we are not protecting “it” when our designers and engineers gift us with it, if we are not building the brand that protects us from the commodity basement, our decision, rational by some narrow standard, is wildly irrational by any broader one. 

Commerce isn’t good at imponderables.  And “it” is nothing if not imponderable.  The fault lies largely on the side of the design house and the ad agency.  When asked to measure and account for “it,” and every cultural moments has it’s its (it girls, it brands, it activities, it restaurants, it industries), designers and agency people demurred.  “Oh, listen, don’t bother your pretty little heads about it,” they said to the client.  “This is what you pay us for.  We’ll keep track of it.  You just get product on the shelf.”  (If only they had a Chief Culture Officer.)

So it’s not entirely surprising that pricing models don’t have anything to say about “it."  And it’s not surprising that senior managers boot this sort of decision with some frequency.  But when you think about how much value “it” creates for us, how essential it is to the life of the corporation, and how much there is at stake in terms of careers and brands, isn’t it time we did better?   

Put these on the business conference agenda.  What is it?  What’s it worth?  How do we price it?  How do we manage it?  In the meantime, hire a CCO.  

References

Dolan, Robert J., and Hermann Simon. 1997. Power Pricing. Free Press.  

Lai, Richard. 2010. “Lenovo ThinkPad X300 series to be phased out, replaced by T400 this year.” Engadget. here. (Accessed July 21, 2010).

McCracken, Grant. 2009. Chief Culture Officer: How to Create a Living, Breathing Corporation. Basic Books.  

Hobbes, John. 2010. “BREAKING: Lenovo ThinkPad X301 to be discontinued, supplanted by T410s.” Logic ThinkPad. July 13. here. (Accessed July 21, 2010).

5 thoughts on ““It” extraction (killing a brand softly)”

  1. Sorry, but that’s crap.

    The X300/X301 was never the flagship of the Thinkpad line. It was an experiment that yielded a great result, but it never fittet in the Thinkpad line: the T-Series as the bussiness flagships, R-Series as low cost alternative, X-Series as ultraportables, W-Series as workstations.

    The 300/3001 sat uncomfortable between the 12″ X-Series and the 14″ T-series, and with the introduction of the T400s/T410s the line got even more blurry.

    Thinkpads are bussiness devices, and I assume that the numer of sold X300/X301 was insignificant compared to the X2x0s and the T-Series. Bussiness doesn’t buy looks, but price.

    The brand value is a lot more than just the nice lines of a model that was only availabe for a few years. The brand value was built over more than 15 years.
    I remember all the people foretelling the end of the Thinkpads when Lenovo took the brand over.

    And where are we now? The Thinkpads may have lost a little, but they’re still alive and kicking.

  2. I must say I agree completely and am sad to learn that Lenovo is ceasing to produce the X301. ThinkPad as a brand (whether as IBM or Lenovo) has always been the pinnacle of laptop computing. My father used ThinkPads, I use ThinkPad and I hope my children will be able to use ThinkPads too.
    That is unless they stop producing what they’re loved for. IdeaPads already have a silly keyboard with the Home and End keys being Fn keys. That’s absolutely appalling and anyone who does any amount of text input, let alone programming, is literally going to be handicapped by this change.
    I hope Lenovo will not continue making these anti-innovations to a product which used to be way ahead of the competition. Progress is great, but it better be smart.
    Lastly, while the iPhone doesn’t do “it” for me, the ThinkPad always has.
    Long live “it”.
    RIP, X301.

  3. Sad indeed. My first purchase of a notebook of my very own was the Thinkpad 240 I bought when I went on my own. Not much bigger than a current netbook, it was an awesome machine, and the envy of all who saw it. I still have it, nestled in it’s case on a shelf, just can’t bear to send it to notebook heaven.

    I was so sorry I went with a Compaq a few years ago. It was a heavy monster with a clear crisp screen, but nothing else about it was well thought out, as Thinkpads always had been.

    This year, I tired of dragging said Compaq around, and wanted another light-as-a-feather power monster to take with me. IBM just didn’t have it somehow, so now I have a Dell. Quite lovely really with its cherry red cover and jet black insides.

    It’s something when Dell can beat anyone in the design game, now isn’t it? But just as Lenovo is moving out of that space, I do think Dell is trying to move into it.

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