Taiwan PC Maker Eyes High-End Market Here
By Cho Jin-seo
Staff Reporter
The China discount can be overcome when a brand can prove its excellence in quality and service _ that is the philosophy of ASUStek and its South Korean chief Kevin Du.
The young and rapidly growing Taiwanese computer maker hopes that its emphasis on design and engineering will soon win the hearts of Korean consumers as well as those in other countries, with plans to extend its lineup to LCD monitors and other items.
``We do have a disadvantage because we are a Taiwanese brand. But we hope that there will be a shift in Korean consumers' attitude,'' Du said in an Interview with The Korea Times last week. ``It is a critical moment for ASUS to position its brand image. But we are always optimistic because our faith in superior technology will lead us to escape from the saturated market to a `blue ocean'.''
ASUStek is a Taiwan-headquartered computer and computer components maker with most of its goods produced at factories in Shanghai and Suzhou in mainland China. Though it does not spend much on advertising, the ASUS brand does enjoy huge popularity among computer fans here as one of the most credible producers of computer components.
But the firm is still more famous outside Korea. It is the solid No. 1 brand in the computer motherboard market _ of 138 million desktop PCs sold worldwide last year, 56 million units were built on ASUS brand motherboards.
Recently, it has emerged as a formidable laptop brand by selling fancy, cleverly-designed laptops, such as ones designed based on the Lamborghini sports car and ones wrapped in genuine animal leather. It was the world's eighth largest laptop maker last year, and the fourth largest in Asia.
Even firms like Sony, Samsung Electronics and LG Electronics did not match ASUS outside of Korea in laptop sales.
``We have a more flexible and horizontal organization culture than Samsung, which has a vertically stiff structure. Decision-making is very fast at ASUS. Maybe that is because we are a young company,'' said Du, who had also worked at Samsung Corp. for five years before moving to ASUS in 1999.
The firm's revenue has soared at a phenomenal and consistent rate. Every year since 1998, it grew by more than 17 percent. It achieved $17.4 billion of sales in 2006 and this year, it aims to achieve $23 billion, which will put it almost even with LG Electronics.
Du believes that sales in Korea can be boosted by introducing more uniquely designed laptops and LCD monitors. The first step is to be one of the five major laptop sellers in the near future, up from the current 10th place, by raising its brand recognition with a lineup of powerful and luxury-designed laptops.
The firm does not plan to depend too much on promotions and advertisements and instead will invest more on quality and service, Du said. He himself spent most of the time allocated to the interview in explaining the firm's technological and manufacturing prowess. For another example, ASUS is the only laptop seller in Korea that provides a two-year warrantee regardless of the place of purchase _ whether bought here or outside South Korea.
Such a pragmatic corporate philosophy is well reflected in the location of its Korean office. While most foreign electronics firms prefer the posh Gangnam (south of Seoul) or downtown Gwanghwamun area for its headquarters, ASUS Korea positioned itself in the bustling back street of Yongsan electronics market where the number of handcart-pushing blue-collar workers prevails over those in suits.
``It does not correspond with our policy to open the office in Gangnam just to show off to others. This is where we are closest to our customers,'' he said.
ASUS Korea was founded in 2006 with Du in charge. Son of a Chinese immigrant, he was born in Seoul and grew up here until he went to the National Taiwan University to study mechanical engineering.