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2010 MARKETING AND PROMOTION PLAN
ALLA ABRAMYCHEVA MICHAEL GUZMAN FARAN MAQSUD KEITH McMURDY ANDREW YAKOVLEV
PREPARED FOR PROFESSOR DAVID DIAMOND MKT 9703 MARKETING MANAGEMENT CUNY BARUCH ZICKLIN SCHOOL OF BUSINESS 5/2010
TABLE OF CONTENTS
SONY ADVANTAGE p.3 COMPANY AND PRODUCT PROFILE p.4 SWOT AND COMPETITOR ANALYSIS p.7 MARKETING PLAN OBJECTIVES p.10 CUSTOMER TARGETS AND SEGMENTS p.12 MARKET POSITIONING p.14 IMPLEMENTATION GUIDELINES p.16 PROMOTIONAL PLAN p.17 CONCLUSION p.19
! Sonyʼs television business is uniquely positioned to thrive in today's consumer electronics marketplace. Other manufacturers have accepted the commodiﬁcation of their wares, focusing on price points and generic television advertising strategies. The introduction of 3D in their eyes is another gimmick for pitching technological superiority. We propose that Sony takes advantage of this miscalculation and grabs a signiﬁcant lead in consumer mental space by focusing on consumer enthusiasm generated by experiencing the immersive world of 3D. Sony is the only company in the space that can create a complete 3D environment using solely its own equipment and content. That is its largest competitive advantage and needs to be leveraged to the maximum when communicating the value proposition. This needs to be done on a mass scale, with publicity and public excitement.
! Sony Corporation (Sony), founded in 1946, is the world's second-largest consumer electronics maker after Samsung, with FY2009 revenues exceeding $82.57 billion. Its diversiﬁed operations are spread across electronics, games, entertainment, and ﬁnancial services categories. The group is headquartered in Tokyo, Japan and employed about 180,500 people as of March 2008. The company operates globally in over 200 counties across Japan, North America, Europe, and Asian countries. The company's current slogan is “Make Believe”. ! Over the years, the group has established a strong brand image in global markets, which increases its bargaining power and makes its entry into new product segments easier. Sonyʼs Brands include: BRAVIA®, Vaio®, Cyber-Shot®, and PlayStation®. ! In 2010 the forefront of the company's mission will be the shift to 3D. According to Sony chairman Howard Stringer, 3D is "the next great consumer experience." Stringer said, “We intend to take the lead in 3D. We are the only company fully immersed in every part of the 3D value chain." Sony will begin selling 3D TVs in Japan on June 10 and worldwide at about the same time. Sony said it expects 3D televisions to make up between 30% and 50% of all sets it sells in FY2012.
STANDARDIZED PRODUCTS Video Equipment Mfg LCD Screen Mfg Video Game Console Mfg Electronic Computer Mfg Movie Production Consumer Electronic Components
Latest Revenue in Millions USD
FY09 REVENUE 23159.40 12747.73 9840.55 9417.51 7169.30 6619.15
% REV 29.98% 16.50% 12.74% 12.19% 9.28% 8.57%
Source Bloomberg Finance L.P.
! BRAVIA® is the brand Sony uses to market its high-deﬁnition LCD televisions, projection TVs and front projectors, along with its home cinema range under the sub-brand BRAVIA® Theatre. The BRAVIA® name is an acronym of "Best Resolution Audio Visual Integrated Architecture". All Sony high-deﬁnition ﬂat-panel LCD televisions in North America have carried the BRAVIA® logo since 2005. The BRAVIA® brand uses the slogan "Color like no other." ! 3D TV is a generic term for a display technology that lets home viewers experience TV programs, movies, games, and other video content in a stereoscopic effect. It adds the illusion of a third dimension, depth, to current TV and HDTV display technology, which is typically limited to only height and width ("2D"). To get true 3D content, you will also need 3D glasses, access to 3D broadcast programming and/or a 3D Blu-ray disc player, and 3D movies. ! A wide selection of exciting 3D content will be vital for accelerating the growth of 3D entertainment in the home, and Sony plans to offer a comprehensive range of 3D home entertainment content to appeal to the widest possible audience. !
! Sony's 3D plans revolve around gaming, movies and sports. Sony is already working on gaming with the PlayStation 3 upgrade plans and its movies division, Sony Pictures, is already producing 3D movies. "Cloudy with a Chance of Meatballs" will be the ﬁrst in the catalog of 3D movies created by Sony Pictures Entertainment to be issued on Blu-ray disc, and is scheduled for release in the summer of 2010. Other movies announced this year in 3D include "Monsters vs. Aliens," and "Disney's A Christmas Carol." Sony Pictures Entertainment plans to continue the release of both its latest movie titles and previous masterpieces on "3D Blu-ray discs" going forward. ! The excitement of sports is also suited to the dynamic realism of 3D, and this is another area in which Sony is concentrating its 3D efforts. Through an alliance with ESPN, the largest sports broadcaster in the U.S., Sony will cooperate in the 3D ﬁlming of sports events including "X Games" and "College Football" to deliver the full impact and excitement of 3D sports broadcasts. Sony is also driving the growth of 3D in sports such as golf and football through its previously announced 3D agreements with FIFA and the PGA Tour. ! Discovery Communications, Sony Corporation and IMAX Corporation announced a joint venture to be established to develop the ﬁrst dedicated 3D television network in the U.S. The partnership brings together three leaders with an extraordinary collection of awardwinning 3D content, technology expertise, television distribution and operational strength to deliver a high-quality three-dimensional viewing experience to home television audiences. ! 3D programming from broadcasters will also be essential to ensuring the enjoyment of a wide variety of content on 3D compatible BRAVIA® LCD TVs. As such, Sony is working with leading broadcasters including ESPN, DirecTV, Discovery Channel in the U.S, and BSkyB in the U.K. to ensure that Sony BRAVIA® LCD TVs will be capable of receiving the 3D programming these broadcasters are currently developing. ! The company's existing relationship with broadcasters through its movie division and TV production house could serve well in promoting 3D, but even if it doesn't there will be a secondary route to 3D-capable sets. Sony is expanding its PlayStation® Network service to cover its televisions and will launch a new content delivery service next year that will pump movies, TV shows and other video content directly into BRAVIA® TVs and Blu-ray disc players from its own servers.
PRODUCT • CONTENT
‣ Only company fully emerged in the 3D value chain: content,
distribution and display
‣ High interest level for 3D after success of 3D motion pictures such as
Avatar and Alice in Wonderland
‣ Joint ventures with other companies for 3D content ‣ Strong present Eco System via PS3 and Sony Online Network ‣ Special 3D Research facility setup in California ‣ Partnership with ReelD, manufacturers of 3D glasses ‣ Sony Retail Stores
‣ Not enough market data available for 3D preferences ‣ New hardware is required for 3D ‣ Switching from present day 2D to 3D will be expensive ‣ Limited 3D content ‣ Viewing experience may not be comfortable ‣ Last major company to launch 3D TV
‣ 3D Gaming ‣ Academic and Professional applications ‣ Medical Applications ‣ 3D TV sport content ‣ 3D Advertising content ‣ 3D PCs - Vaio ‣ Other 3D consumer electronics- cameras, camcorders, etc
‣ PC graphic chip makers can offer the same 3D technology at a lower
‣ Long term exposure to 3D may involve health risks ‣ Too few cost/beneﬁt proofs may impact adoption ‣ Competitors such as Panasonic, LG and Samsung have already
introduced their 3D TVs in the market
‣ Newer, better technology could emerge.
Sonyʼs (6758) main competitors in the 3DTV space are Samsung (005930), LG (066570/034220), and Panasonic (6752).!
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Chart shows global revenue for the last 3 years (LY1 is 2009). Note LG is listed under two codes, Sony is in fourth place. Source Bloomberg Finance L.P.
COMPETITOR ANALYSIS • CONTINUED ! • Samsung has been very aggressive with its 3D campaign as it has positioned itself as the worldʼs ﬁrst LED 3DTV. They have launched a major media campaign that depicts the hardware as if it were a work of art, providing an immersive 3D experience that brings people together and enriches their lives. A second follow up campaign focused on showing a family bringing home the “wonder” of 3D entertainment. They also signed up Avatar director James Cameron for a special launch event at Times Square where they displayed their new 3D lineup. Pop group Black Eyed Peas also did a special performance that was shot in 3D. The concert footage would be distributed to new Samsung 3D customers. ! • LGʼs 3DTV plans include use of Passive 3D technology, which requires signiﬁcantly cheaper 3D glasses than Active 3D technology that is being utilized by everyone else. This may attract many budget consumers to LG 3D, even though they might compromise on quality. LGʼs media campaign is targeted towards the beginning of a new era in TV viewing as it highlights the end of traditional TV. The campaign focuses on the transition of moving from traditional TV to 3DTV. ! • Panasonic is using Plasma technology for its choice for delivering 3D. They claim that Plasma TVs delivers a better 3D experience. Panasonic has signed an agreement with Best Buy to display their 3D technology at Best Buy retail stores. They are also offering an exclusive bundle deal at Best Buy stores that features a 50 inch TV and a 3D capable Blu ray player. Panasonic is not offering Internet connected 3DTVs whereas all other companies have models that support the internet.
! Global demand for 3D TVs is projected to reach 15.6 million units in 2013 from an estimated 1.2 million this year. That ﬁgure could reach 64 million in 2018, when total revenues are expected to hit $17 billion. The planʼs main objective is to ensure that 3D BRAVIA® models will make up at least 10% of more than 25 million LCD TVs that Sony will sell next year and account for an even larger percentage of revenue. Secondary objective is to restore Sonyʼs leadership in the television manufacturing marketplace.
FY09 LCD TELEVISIONS US SALES
2009 PERCENTAGE GROWTH 18.72% 92.08% 17.74% 11.64% 7.57% 7.58% 5.03% 31.72% 100.00% 22.58% -0.97% 81.64% 8.91% -29.06% 36.11% 29.04%
2009 RANK 1 2 3
BRAND Vizio Samsung Sony Toshiba LG Sharp Others TOTAL
2008 UNIT SHIPMENTS 3082 4575 3717 1318 2200 2244 7369 24505
2008 MARKET SHARE 12.58% 18.67% 15.17% 5.38% 8.98% 9.16% 30.07% 100.00%
2009 UNIT SHIPMENTS 5920 5608 3681 2394 2396 1592 10030 31621
2009 MARKET SHARE
Sony 12% Toshiba 8%
US Unit Shipments in Thousands
MARKETING PLAN OBJECTIVES • CONTINUED ! In order to achieve the outlined objectives a number of targets need to be hit. The consumer public must come to associate unparalleled quality in 3D entertainment as exclusive to the Sony BRAVIA® brand, thus regaining the sense of prestige that came with owning a Sony television. While the “Made In Japan” tag doesnʼt carry the same cache as it did a few decadeʼs back, the ground can be regained by effectively communicating to the consumer Sonyʼs market position as the only start-to-ﬁnish 3D Company. The consumer needs to aspire to have a Sony 3D television, Sony Blu-ray disc player, PlayStation 3, and a Sony surround sound system while they consume the 3D content produced and distributed by Sony and made with Sony equipment. That is to say, the consumer must want a total Sony 3D experience. While that is very hard to achieve, the consumer can start getting close to the feeling by purchasing a Sony 3D television and proudly saying, “Itʼs a Sony!” ! The role of retailers is not to be underestimated. Their cooperation with the companyʼs efforts to position the brand is essential, since a signiﬁcant portion of consumersʼ ﬁrst direct encounters with the product happen within their stores. Best Buy, among others, should feel naturally inclined to showcase the Sony home theater experience in the best light possible to be in line with consumers expectations created by the planʼs campaign. ! The planʼs metrics will involve a before evaluation of the consumer mental space as it relates generally to the brand of Sony 3D and especially to the Sony BRAVIA® 3D HDTV product. After the implementation, regular updates will be made. Retail order response and qualitative feedback will be another important measure of the planʼs success. !
! Our qualitative research supports an initial target, for an ideal customer, as a 25-35 year old innovator male who regularly uses his television to watch ﬁlms and network programming, possibly gaming. He is technologically savvy, has disposable income and considers himself an innovator when it comes to acquiring the latest devices. He most likely owns a video gaming system and has an above-average home entertainment system. He will likely be unmarried or recently married and may have young children. ! A secondary market will be gender non-speciﬁc, targeting the age ranges of 35-45. These will be young married couples with children varying in ages but who have a home gaming or home entertainment system in place. These individuals will also be innovators, but with a target adjusted toward family entertainment and educational concerns. !
We target two segments: new television purchasers and current Sony product users.
1. Purchasers of 3D Television ! In this segment, we assume that the consumer already owns a high deﬁnition television. The challenge is to convince the consumer of the beneﬁts to upgrade to a 3D television to maximize the viewing experience. Emphasis will be placed on enhanced viewing capabilities as a “total viewing experience,” focusing on the increased offerings of 3D channels and viewing options that are forthcoming from networks and cable service providers. Sonyʼs product would be position as a “total 3D solution” for experiencing enhanced programming, such as sporting events, movies and major entertainment events (such as concerts). ! In conjunction with this segment, thought must also be given to presenting the 3D viewing experience as signiﬁcant to home education or compatibility with educational programming to reach those consumers with children. Emphasis will be placed on the enhancement of home computing gaming and educational software that expands the consumer base to include families with children seeking to expand the use of the product beyond simple home entertainment. 2. Existing Users of Sony Products ! This segment of individuals is already familiar with Sony branded items and, in most instances, will already be owners of gaming equipment (Playstation) or Sony home theater components, such as Sony Blu-ray disc players. In conjunction with presenting the beneﬁts of 3D television generally, this segment would be targeted speciﬁcally to recognize the ease of integration with the Sony product into their existing Sony devices.
PRODUCT ! BRAVIA® 3D HDTVs are to be positioned as luxury electronics. Their high quality is communicated by an elegant design and ﬂawless attention to detail. The current line up has 3 series (the LX900, HX900, and HX800) that come in 6 sizes (40”, 42”, 46”, 50”, 52”, and 60”), for a total of 8 different SKUs. Our belief is that there should be one model in small, medium and large sizes, sandwiching the most popular size of 46”. ! Furthermore, when considering product life cycle, Sony BRAVIA® 3D HDTVʼs can be broken down into three curves: Sony company brand, BRAVIA® brand, and 3D televisions as product. Sony is unquestionably the market leader in terms of verticals. Unfortunately, it is yet to produce synergism, innovate the market place, and jump start revenue growth (Sony has considerably lost out in the last decade to the likes of Apple and Nintendo). Managing to stay slightly ahead of that curve is BRAVIA®, the brand maintains its quality and appeal, though again sales are lackluster. 3D TVs as a whole, in the early stages of the market are doing well. Panasonic sold out within a week after offering its 50” bundle (includes glasses and Blu-ray player) at BestBuy. We see the coming popularity of 3D as a catalyst to bring new energy to the organization, company-wide positioning should communicate that belief. PRICE ! Current pricing strategy has Sony 3D HDTVs wedged somewhere between that of Samsung and Panasonic. Panasonic was successful at selling its 50” bundle for $2900, Sonyʼs pricing is considerably higher and rightfully so. When the 3 model approach is implemented, it will become easier to communicate the value through the price, price in itself becoming an uncompromising sign of the productʼs quality.
LX900 Series: 40” - $3,200, 42” - $3,900, 50” - $4,800, 60” - $6,500 HX900 Series: 46” - $4,350, 52” - $5,250 HX800 Series: 40” - $2,450, 46” - $3,100
POSITIONING • CONTINUED PLACE ! Consumers may purchase the product at their nearest high-end electronics store or consumer chain, through an online retailer, or directly from Sony Style, Sonyʼs online store. It is important to draw retailers to the prestige of carrying Sony BRAVIA® televisions and in no way subsidize the in-store product demonstration. One of the planʼs goals is to make the Sony 3D Experience valued by the consumer, hence stores that include a new Sony 3D Experience home theater room can expect to see increased foot trafﬁc. ! While not so noticeable in US, globally, Sony is in the process of rolling out ﬂagship stores to sell its electronics. This trend is particularly noticeable in China. Considering the difﬁculty of ensuring retailer cooperation in promotional efforts, the development is not a surprise. We expect Sony to eventually further build on its US store portfolio and have better control of in-store pricing and display of its products. PROMOTION and ADVERTISING " The promotional plan outlined in the following pages is at the heart of the proposed marketing mix. We have concluded that the real consumer value proposition is in the wonder and an awe that is produced by experiencing 3D content on 3D Sony equipment. The consumer is less and less concerned with the technological speciﬁcations, because they expect them to be the best quality possible. ! Our plan brings the Sony 3D Experience to the consumer directly, regardless of their demographics. We will use a shotgun approach to build enthusiasm about the experience in the mass public, thus leveraging it as inﬂuencer on our targets. Once the general public perceives a Sony 3D television as a genuine luxury (“Itʼs a Sony!”), our targets will be motivated to adopt the product due to its buzz and public appeal. ! With these considerations, we propose a nationwide, promotion centered strategy structured around a mobile campaign to showcase the 3D Sony Experience in a home theater environment. It is a logistical challenge, and at the plan's core lies the ability to successfully coordinate and manage several promotional companies. The working name for the initiative is “Sony 3DWORLD.” 15
! The Sony 3DWORLD environment is created by partitioning a recycled metal shipping container into two soundproofed rooms. The smaller partition contains a a fully furnished Sony 3D gaming setup for two with a 46" HX900 BRAVIA® HDTV, a PlayStation 3, and a DAV-HDX BRAVIA® Theater System. The larger partition is a complete Sony 3D home theater for six with a 60" LX900 BRAVIA® HDTV, a BDP-S570 3D Blu-ray Disc Player, and an HT-SF470 3D Blu-ray Disc Surround Sound. The containers are then decorated with Sony branding, loaded up onto semi-trailer trucks and then sent out across the country. ! A nationwide advertising campaign, coupled with local promotions, will alert the public to when and where they will be able to go to the Sony 3DWORLD. Present members of Sony Club, and individuals already in the CRM database will be given advanced notice and VIP tickets to special screenings and events. The general public might have to wait online, as seats are limited, though a VIP pass can be obtained by registering with Sony online or through a mobile device. ! The trucks will stop anyplace where there are large gatherings of people: sporting events, city centers, fairs, concerts, campuses, and malls. The events will be promoted with great fanfare, and will include sharply dressed staff, as well as have clean and orderly execution. The audiences must truly feel like they have entered a new world once they go through the 3DWORLD experience. It is also useful to utilize Sonyʼs Universal Pictures talent to promote the tour stops and cross brand 3D ﬁlms with the home theater experience. In particular, we recommend coordination with Sonyʼs franchise Men In Black. MIB3 is currently in pre-production and should be 3D. ! A PR campaign will accompany the truck tour where local and national television and radio personalities will be invited to the 3DWORLD stops. These events will be designed for maximum wow effect. We propose the incorporation of Sony 3D production equipment into these events. For example, letting personalities see themselves in 3D. ! Lastly, the 3DWORLD will need special content produced for the showcase. Whether on the road, or for in store demonstration, this content has to be up to high Sony standards. 16
! The diagram on the right demonstrates the complexity of the task at hand. It is imperative that all elements work in concert. While the tour is the most elaborate and expensive part of the campaign, it must be supported by coherent national advertising and local promotion to ensure large audience draw. A smart internet (including social networks) and mobile strategy must be deployed as well. In addition, PR ﬁrms should be recruited to make sure that the tour stays in the news and is a trending topic. A retailer coordination effort must take place as well, part of the campaign should be telling customers to visit their retailers and “Ask about Sony 3DWORLD.” All this must be done in concert with latest IT and consumer behavior tracking technologies to ensure high data volume for Sonyʼs CRM system. Lastly, the fanfare of Hollywood must be brought to the experience. ! Using PromoAid we designed a portfolio of promotional companies to employ in this campaign. Coordination, quality control, and effectiveness monitoring will stay in the hands of our team. After RFP and selection process, choice came down to two companies to spearhead the tour - EventNetUSA and OnBoard Entertainment (OBE). In the end, OBE won out with a signiﬁcant lead. We were impressed by their grasp of latest marketing approaches and their portfolio. OBEʼs work for AMC Theatersʼ 35MM ﬁlm tour, their successful work on various Nike tours and marathons, as well as the coordination of MTVʼs Sports and Music Fests impressed us fully.
PROMOTIONAL PLAN MINDMAP
PRINT TV RADIO
NATIONAL CONSOLIDATED MEDIA ADVERTISING CAMPAIGN
LOCAL ADVERTISING FOR TOUR
SONY 3DWORLD NATIONAL TOUR
MOTION PICTURE PROMOTION
INTERNET CAMPAIGN CRM SONY 3DWORLD INSTORE PROMOTIONS SONY REWARDS
3D PROMO CONTENT PRODUCTION
PROMOTIONAL PLAN • CONTINUED PROMOAID PORTFOLIO " TOUR - OnBoard Entertainment (Sausalito, CA) “At OBE, the goal of Mobile Marketing is simple: we bring the message to the consumer. In mobile events, we let the brand message come to life organically and take root through questions, one-on-one interaction and true branded experience. We take brand whisperers and put them on the road, letting them roll from town to town to nurture the growth of your brand's message. Whether a part of a larger event or a spectacle all their own, our mobile campaigns take a message and plant it everywhere.” Vehicle design. Tour management. Product launch tours. Pop-up events. Guerilla events. ! INTERNET/SOCIAL NETWORKS - Brandmovers (Atlanta, GA) “Brandmovers specializes in Online Games, Contests, Sweepstakes, Reward Solutions, Facebook Apps and mobile promotions that deliver measurable results. Major brands turn to Brandmovers to develop promotional campaigns requiring dedicated support, heavy consumer interaction and advanced technical knowledge. Once your promotion is live, Brandmovers Customer Intelligence™ tracks the performance of your campaign to gain critical insight into consumer behavior.” ! IN-STORE/RETAIL ADVERTISING - Valassis Insignia (Costa Mesa, CA) “Weʼre one of the largest media buyers in the U.S. deliver over 10 billion media impressions annually. Valassis is the nationʼs leading marketing services company, offering unparalleled reach and scale to more than 15,000 advertisers.” ! MARKET RESEARCH - BG Key Analytics (Dobbs Ferry, NY) “Bg Key Analytics' small team members are experienced researchers with different areas of expertise, including Project design, execution and reporting, Data analytics and processing, Coding of verbatims for pen ended questions” " MOBILE - 5th Finger (San Francisco, CA) “A creative mobile agency that formulates strategies and designs engaging interactions for consumers living on the go.” " NATIONAL/LOCAL ADVERTISING and PR - Ogilvy & Mather (New York, NY) Following Oglivyʼs commendable performance in Vietnam we propose to continue working with the ﬁrm for this project. 18
! Our team has designed a robust marketing strategy with an innovative promotion plan. We believe that the excitement and national buzz generated by the Sony 3DWORLD tour will inﬂuence our consumer targets to purchase the Sony BRAVIA® 3D HDTV. Furthermore, the promotion has great positive collateral potential to energize sales of other Sony products in addition to elevating the status of the Sony brand itself. ! The promotional plan, designed with PromoAid, will help Sony acquire key territory in the consumer mental space, regaining the associated prestige with owning the brand, “Itʼs a Sony!” Furthermore, in a bold stroke Sony will introduce 3D to the population by bringing it to their doorsteps and will effectively communicate not only the beneﬁt of 3D, but most importantly the beneﬁt of owning a Sony BRAVIA® 3D HDTV.
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