Case study 9/04/10

DUTTA Avik GALLO Nomie GATEL Sbastien SINGH Sunil

 HOW A SUCCESSFUL WORLDWIDE COMPANY COULD HAVE KNOWN SUCH A FAILURE ?

HOW COULD MARKETING DECISIONS
INFLUENCE THE RECOVERY OF THE BRAND IMAGE ?

SONY overview
The reasons of the failure The new strategy

Recommendations
Conclusion

158,500 employees

64 billion $ annual sales

SONY
Sony is one of the most important companies in the world of business

Wide product range

Strong brand image

Innovation
Visionary leadership Pioneer advantage

Sonys net profit for the July-September quarter for 2006 falling 94% to 1.7 billion Yen, compared to 28.5 billion Yen for the same period last year (Benson, 8th Nov 2006) Sony was the inefficient manufacturing structures which decrease Sonys quality that badly affects their reputation and caused a decline in product competitiveness. DeWit & Meyer (2004: p192)

Many reasons have contributed to Sonys decline ofTV & Audio profit. brand and Unrelated diversification
Equipment
Mobile Phones & Music

1.

2.
3.

Innovation dearth
Financial Services

Lack of brand evolution

4.
5.

Recalls of Vaio laptops

For Example- There is the recall of 9.6 million Sony Laptop batteries which were liable to overheat and potentially burst into flames where Sony even failed to fully study the Product problem (Forbes.com, 2nd October Range 2006)

Movie & Video Equipment

Consumer segmentation problem Computer

Game Consoles

Marketing plansWhat Sony is doing to deter the threat

(Conglomerate Diversification)

Sony
Games Music
Entertainment Electronics
Networking & Financial Services

Ongoing process/product innovation and Advanced R & D

Strengthening Profits (through lower materials cost and greater operational efficiency) Forming joint-ventures (e.g. Sony-Ericsson)

Sony-Ericson
Most attractive and innovative global brand

C 702 . Any angle. Any weather C 902 . Getting the picture W 760i . Fill it up with songs Z780a . The web is where you are

High

Semiconductor
LCD DVD player Digital Camera play station Music Player CRT-TV PC Sony-Ericson VAIO

Industry sales Growth Rate

CD player
Low High Market Share

Walk man
Low

Brands positioning as a product that performs on both video and audio front. Sony Vaio is also positioned ( and priced ) as a premium brand. Sony Vaio Notebooks with a price ranging from Rs 43,000 - Rs 1,25,000( in India). Sony has a market share of around 5.4 % of the Indian Laptop market which is estimated to touch a volume of 1.6 million units this year.

Vaio targets the hip hop Indian youth aged 18-26 with the variant CR and X series. Brand is now positioned as a fashion accessory rather than a learning/working tool like Lustrous coating, custom Keyboard, and a personalized illumination LCD, style. The brand is now running a high profile TV campaign now. Vaio now has the tagline " All Eyes on You" clearly spelling out its positioning based on the design or aesthetics.

Rethink communication :
Make.Believe , A new slogan to reinvent is

marketing Concentrate is nearly $5bn annual advertising budget on a smaller number of products

But it wont be enough product have to be consumer oriented and not only technology oriented

Regain focus
R&D and design have to be consumer oriented Enable marketing to take a lead of the business and the strategy

Brand oriented leadership

Design, features and the cool factor

SONYs followers began its competitors

An ironic solution for SONY: looking at SAMSUNG The starting point of SONYs resurgence : The PlayStation 3

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