Business01
September 2003 issue Taiwan Formula
GIGA-BYTE: From leading motherboard manufacturer to total IT solutions provider. This article was part of a series on Taiwan’s most promising industries. ……………………………………………………………………………………………………………..
GIGABYTE--From Leading Motherboard Manufacturer to Total IT Solutions Provider
By Cheryl Robbins
GIGABYTE Technology Co., Ltd. was established in Taiwan in 1986. Its product lines cover three main areas: motherboards and graphics cards, system products, PC peripherals and IA products, and communications/networking products. It is the world’s leading manufacturer of superior motherboards and add-on cards, marketed under the GIGABYTE brand name. But, the problem is that although Taiwan still holds 85% of the world’s motherboard market, last year there was only 1.53% growth in worldwide motherboard output. Although Taiwan’s motherboard manufacturers outperformed the rest of the world in terms of output, there was still only 7.4% growth, with product value decreasing by 0.2%. This means that the motherboard industry is mature and is feeling the effects of price competition.
To survive, motherboard manufacturers have to continuously develop unique products and diversify their product lines. GIGABYTE is taking on this challenge wholeheartedly, aiming to become the most valuable IT product provider in the world. Creating a reputable brand name and building extensive global sales, support and marketing networks were GIGABYTE’s earliest strategies in differentiating itself and taking a leadership role in the motherboard industry. The next step is to create a leading brand name in notebook computers, desktop computers, networking and storage solutions and wireless communication products. Along those lines, two years ago, GIGABYTE rolled out its G-MAX brand of system products and PC peripherals, vowing to provide chic and state of the art IT design, and to fulfill the demands of both individual and corporate customers.
The Year of Brand Promotion Richard Ma, GIGABYTE’s executive vice president, says that for the past two years, GIGABYTE has focused its efforts on R & D to produce new lines of products. This year the focus is on creating awareness of the company’s new products and strengthening sales and marketing efforts. Thus, GIGABYTE has decided to mark 2003 as its brand promotion year, highlighting the G-MAX brand for its new system products in addition to its GIGABYTE brand for motherboards and graphics cards. Ma notes that the G-MAX brand was created because system products are positioned closer to end-users than motherboards. Thus, a new brand name was needed to give consumers a clearer image. In the future, GIGABYTE’s system products, including notebooks, desktop PC and display products, will all adopt the G-MAX brand name. Like many of its industry counterparts, GIGABYTE started developing system products three years ago. However, the market has questioned GIGABYTE’s diversification progress, as the company continues to generate nearly 90% of its revenues from motherboards and graphics cards. Ma says that GIGABYTE’s non-motherboard sales have not increased significantly because the company has put its focus on own-brand products, which usually require more time to cultivate.
Innovation as the Highest Guiding Principle GIGABYTE insists on developing high value-added products. This insistence has made GIGABYTE one of the most innovative IT companies. High standard of quality control and advanced manufacturing capabilities mean that all of GIGABYTE’s products meet all commercial and consumer requirements for quality and reliability. Thus, it is no wonder that they have captured worldwide attention, and have won a number of prestigious awards. In
2002 alone, the company was bestowed with more than 300 awards for remarkable product performance. It is the only motherboard manufacturer to have been honored with the coveted Taiwan Symbol of Excellence for six consecutive years. For the second year in a row, GIGABYTE has been named the No.1 motherboard producer and one of Taiwan’s most influential manufacturers by PC Magazine. As of this year, it is also the only motherboard manufacturer to win the Gold National Award of Excellence, the highest award given for product development in Taiwan.
New Product Highlights Based on GIGABYTE’s core abilities, diversifying into PC systems and peripherals was the next logical stop from motherboards. This year in June, at GIGABYTE’s annual product launch, GIGABYTE introduced the Centrino notebook computer, a cooperative effort with Intel. Centrino is not GIGABYTE’s first release of a notebook computer. A few years ago, GIGABYTE tried unsuccessfully to enter the notebook computer market. Ma explains that, “The timing is different now. We never gave up on entering the notebook computer market. With Intel’s help and support, we believe that this is a good opportunity to try again.” GIGABYTE’s Mini PC TC2000, weighing only three kilograms, is an ultra compact PC belonging to the G-MAX series, and was also launched this year. Another new product, the Flex Pointer, was the one for which the company earned the 2003 Gold National Award of Excellence. Part of the G-MAX series, this is a wireless laser presentation pointer with built-in 64MB or 128MB flash memory and serves as a remote controller to give mobility to a presenter for up to 10 meters. supports Windows Media Player. Other products launched this year include the all-new P4 and K7 series motherboards, LCD displays, DVD-R/RW products, wireless broadband routers, switches, wireless LAN and Bluetooth, servers, and NAS (Network Attached Storage). Among its new products the most profitable are its networking solutions. The GIGABYTE brand is already a leader in networking technology products, and it is expected that GIGABYTE’s server sales volumes will double this year. It is also USB compatible and
Strengthening Sales Channels Plus Brand Awareness Through the years, GIGABYTE has outperformed all others in motherboard sales volume. It has also built a solid reputation in the worldwide PC industry along with strong sales and marketing channels, giving it a clear direction for product development and marketing and for combining its advantages in channels and brand awareness. When the yearly production volume of GIGABYTE motherboards reaches 13 million in 2003, it will mean that one out of eight PCs in the world is complied with GIGABYTE motherboard. This
is an outstanding achievement in the highly competitive IT industry, especially for a manufacturer like GIGABYTE that focuses on its channels instead of OEM production. The chairman of GIGABYTE, Dandy Yeh, says that strengthening of brand awareness and sales channels is essential to complement the diversification of the product line. Ma also says that in the past, GIGABYTE built its reputation among professional users. With the diversification of product lines, through brand integration, the company’s overall competitiveness can be strengthened and its products can provide value to all computer users. With sales revenues topping 870 million USD last year, GIGABYTE is showing the world that in these changing times, there is only once choice for survival in the global IT industry, and that is to bravely move forward and diversify.