Asustek Computer Inc.

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Strong Research and Development (R&D). Innovative and product development capability of ASUS has helped mold the image of the brand as products that are lightweight and thus providing better user experience and driving higher sales.

Evaluations of the Firm

From my perspective, ASUS’s major pricing strategy – penetration strategy may not be in favor of the firm as the competition increases within the industry. As we all know, when profit margins start declining for all the players involved, there would be an intense competition in the technology market. This competition can be a real threat, resulting in price wars, and offering innovative products by the competitors. Although innovation is considered as one of the strengths of ASUS, as ASUS is not differentiating itself and coupled with its poor marketing strategy, the decline in profit margins is expected to be profound over the years. In order to survive, ASUS has to set lower price and which results in lower returns.

In addition to that, as the world is moving to a cloud first, mobile first platform, the PC market is gradually showing signs of decay. The demand of these products is expected to start falling dramatically. As a result, the sales of related products such as monitors, computer peripherals and batteries will be slowing down as well. Based on the current technology trends in the market, the demand of smartphones is increasing. Consumers are now becoming more interested in smartphones as those are being developed to be compatible with every aspect of technology. This phenomenon is certainly causing a reduction of sales of desktops or laptops. In conclusion, I would suggest that the management realize that the public demand is shifting to smartphones, they should start switching the manufacturing plants from computers and laptops to smartphones. It is time to transfer R&D resources in the development of smartphones, as the growth in laptop industries will only be more stagnant as time goes on.

Suggested Improvements

The Future of ASUS

With rapid technological changes observed so often in the industry, ASUS should constantly be aware that the company’s enterprise solutions and information technology products catch up with the trend and consumers’ preferences. Moreover, as mentioned above, ASUS invests heavily to develop new products at its R&D centers. It needs time to recover the cost associated with product development. Shorter product life cycles and continuously changing market trends do not even allow the product to get settled in the market. With that being said, to compete effectively with its competitors, the company should continually introduce new products are services that exceed customer requirements and expectations.

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