Individual Assignment

HOW MARKETING MYOPIA HIT SONY WALKMAN

MBA/19/**** B. S. D. Perera

Sub Group No.: D–4

Course : MBA 504: Marketing Management

Instructor : Mr. Asanga Ranasinghe

Term : July – September 2019

Postgraduate Institute of Management

University of Sri Jayewardenepura
Declaration

I am fully aware of the content under plagiarism stated in the PIM Student Handbook, and I
hereby declare and affirm that I have strictly observed the law relating to intellectual property,
copyright and plagiarism in this exercise (Student Handbook, 2018).

…………………………

B. S. D. Perera

MBA/19/****

Date: 23rd September 2019

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 HOW MARKETING MYOPIA HIT SONY WALKMAN
1. Introduction

This paper is carried out as a requirement of the Marketing Management Module of the MBA
and based on our learnings we are supposed to select a company that faced Marketing Myopia.

The main idea of this paper is to discuss how a well performing company fell into marketing
myopia and what are the reasons for that fall. In this study we are discussing how SONY
Walkman, that been once a very popular gadget among the younger generation, hit by the
marketing myopia and what myopic myths or features lead to that fall. Next we will investigate
on recommendations for the myopic issues that could have practiced avoiding those situations.

2. SONY and Sony Walkman

2.1 SONY Company Overview.

Sony Corporation (SONY), the electronic business unit of Sony Group that consists of
electronics, motion pictures, music and financial services.

SONY is well known electronic giant, a multinational Japanese conglomerate with

headquarters in Konan, Minato, Tokyo. It is diversified into several areas and the major of
them are entertainment-based electronics and professional electronic equipment. they were the
pioneers I many entertainment gadgets that attracted almost every youngster and during the
period of 1980 to 2005 almost every child on earth must have used a SONY gadget at least
once, to entertain themselves. When it comes to music industry the world’s largest music and
video game industries are owned by SONY, similarly one of the leading electronic device
manufacturers and a giant in the television and film entertainment industry. Being among the
leading semiconductor manufacturers SONY hit the fifth position in television manufacturing
in the world. In 2018 SONY ranked 97th in the Fortune 500 companies ("Sony", 2019).

The massive industry reins all over the market with its comprehensive range of products and
services. Following table illustrates the evolution of their company slogan from the beginning
to date.

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Figure 2.1: SONY Evolution of Slogan

Source: Sony. (2019).

2.2 SONY Walkman.

SONY introduced the Walkman brand with their first printed advertisement, named “Bridging
the difference” in 1979 as the pioneer to bring the world’s first ever portable music player by
introducing the “Japanese-ness” internationally. SONY distributed 100 unites to influential
characters around the world such as musicians to give it a better recognition.

Initially it consisted the traditional cassette format and in 1992 they introduced the MiniDisc
format as a competitive feature. Sony attempted to dominate the portable music industry by
not supporting the widely used MP3 format in their portable devices as in to enforce the
consumers to use their own audio compression technology.

They made this an essential part of life with utmost portability and enriched with
entertainment. This makes the device a cultural hip where it becomes an icon of recognition
and respect. With all these they were targeting the teenagers mainly where the youth power
and potential highlighted by linking it to the areas such as leisure, sports, fitness, outdoor
activities, health and networking.

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Following figure will illustrate the evolution of the SONY Walkman.

Figure 2.2: Evolution SONY Walkman

Source: Knight, (2019)

SONY managed to create a symbol that highlights the portability and freedom among the
younger generation and sustain in the market being the market leader of its kind using effective
advertising by leading to a culture that believed possessing a Walkman is the “way of life”
through making it an influential gadget.

3. How Marketing Myopia Hit SONY Walkman

In this modern world millions of products are introduced at a blink, but majority never succeed
and fails instantly due to various reasons and factors. Being narrow-minded in marketing is
one major pitfall for this instant drop-off as they only focus on short-term goals by only
considering their products and services rather focusing on the actual requirements of the
customers (Levitt, 2004).

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Due to above matter the companies always thrive to hook on to market trends as in they are
not adapting to the market. It is evident that a clear product definition is crucial for companies
to exhibit while meeting the exact needs and wants that demands by their customers. Demand
prioritization is the rule of thumb when it comes to a customer-oriented delivery process.

3.1 Lack of Product Innovation.

Innovation is an area that many companies fear of as in it requires major investments and if
it’s a failure that will become a major fall in the entire organization resulting losing a major
half of their market share and allowing the competitors to enter the dominance that once
governed by them which makes it totally impossible to regain the lost kingdom.

But this is a myth that prevailing in the minds of the top management how makes decisions in
the organizations. As in innovation is basically opening a door to a new dimension to explore
the unknown and reap the hidden potentials that are out of reach in the current dimension.

Likewise, SONY taking a step backward, gave Apple the opportunity to lead the MP3 player
revolution knowing that there is a high potential for MP3 files its nature of accessibility and
the impact on the SONY music industry. Pleasing both the music divisions and electronics
SONY kept holding onto its dearly Walkman making the biggest mistake ever by not
considering the development of technology and the impact it can generate over its industry.

In 2001, Apple taking the maximum advantage of the given opportunity introduced the
revolutionary innovative product, I-pod, which is comparatively handy, flexible, more
portable, durable, high-tech, compatible and stylish product that killed SONY Walkman
forever.

3.2 Population Myth.

With a massive market share and being the pioneer in the industry SONY thought that their
market share will never go down as of the population growth and every person reaches their
teenage where the most potential customer base is thriving and since that there will be a
continuous demand and trend for their Walkman production.

It is crucial to be open-minded and think other facts that could affect this thinking. Though the
population grows, and the demands remain occurring doesn’t mean the demand will be there
to the same product or technology as in the needs and wants of the growing population varies

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and changes time to time. Different trends fashions and technologies create different wants in
the minds of the people for the same need. Hence holding on to the myth of population growth
will never result in succeeding in this rapidly changing world as the changing frequency also
doubles its speed in an unimaginable rate.

3.3 No Competitive Substitution Myth.

In the market it is a huge mistake to think that there is no competitive substitution. Market is
always competitive and being the pioneer and giant doesn’t mean there won’t be any
competitors or substitutes. In face it is far easier to substitute when there is a market leader
without a competition and then that substitute becomes the main competitor to chase out the
pioneer out of the market. This is what exactly experienced by SONY Walkman as they
believed them being the market leaders and pioneers of its kind, they let Apple to lead an
innovative approach thinking that Apple will never produce a competitive substitute as they
are an IT and computer manufacturing organization.

3.4 Faith in Mass Production.

Due to SONY’s huge demand and as they could convince the people that SONY Walkman is
an important part of their life, SONY went for mass production. To gain further advantage they
were able to customize the look and feel for different demographics. This resulted mass
production and during 2001 when Apple launched I-pod it became a huge overhead of
maintaining an unmoving finished goods and raw materials as their production is no longer
catering the demands of the people who’s needs and wants been changed overnight by Apple
I-pod.

3.5 Preoccupation with Scientific Research and Development Techniques.

Being an industry giant SONY has its scientific research and development done when entering
into the entertainment industry. But preoccupation of the same is a terrible myth as of science
and technology are areas that develops every second. It is necessary to evolve with changing
trends and adapting accordingly. Flexibility is the key characteristic SONY was lacking when
they were holding onto this myth with their once revolutionary Walkman.

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4. Recommendations to Avoid Myopic Effects for SONY Walkman

4.1 Recommendations for Lack of Product Innovation.

Holding to a large market share or being a pioneer in the industry doesn’t mean that the industry
will not be challenged by the developing technology and sciences.

Innovations is the key to success, and it opens doors into different dimensions to explore
unknown patterns of development. SONY should have taken the pioneer-ship of entering the
portable digital music and entertainment industry. As of they had the technology of that time
they should have invested in research and development to find out methods, means, and
possibilities to convert the old traditional cassette into a tiny compact device that is about 20
times smaller than the existing Walkman. If they didn’t reject the MP3 technology by making
it incompatible with their devices and got into innovation by exploring further how to integrate
MP3 into their devices and think out of box to reduce their Walkman box into a sleek tiny
device they should have still been the world leader in portable music device industry.

4.2 Recommendations for Population Myth.

World population growth is a continuous factor but the needs and wants of then are unique and
different. Hence catering with one product and being the giant and pioneer of that industry
doesn’t mean that there will be the same demand for that product. Hence SONY just the way
they did customizations for different demographics they should have focus on the different
needs and wants of the developing market. Walkman used to be the popular portable
entertainment device until the year 2000. But after that the population that grows in the same
and higher rate demands for different products than SONY Walkman.

Hence just in the way that they count on the population SONY should have focus on their
different needs and wats, rather focusing on their product and market share.

4.3 Recommendations for No Competitive Substitution Myth.

SONY being the market leader in the portable entertainment industry it doesn’t guarantee that
no other company can enter the same business. It is true according to Porter’s five forces
model, there is a huge barrier to enter as SONY Walkman holds the market share and that has
created an image and a brand loyalty among its customers. Also, SONY Walkman becomes
the main threat of substitute to a new entrant to the market. Due to the brand image and brand

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loyalty of SONY Walkman the buyer power is huge that any new entrant will have to find a
total revolution to change that power. Then SONY holding to its supplier power makes it way
difficult for any new entrant to the market to compete and the control of price is with SONY.
Degree of rivalry is at it’s best as any new entrant should compete with the industry giant in
order to take over a little portion of the market.

Having all above forces in hand SONY mad a serious mistake thinking there won’t be any
competitive substitute. SONY should have used its forces in hand to avoid any incoming
competitor while working on developing their product to an unmatchable stage. SONY should
have easily taken the lead over Apple in revolutionizing the MP3 player and come up with a
new digital, portable and comparatively small Walkman that would have been the revolution
of the millennium making Apple I-pod just a substitute without a major threat or not entering
into the portable entertainment market at all.

4.4 Recommendations for Faith in Mass Production.

SONY should have avoid going for mass production, instead it should have invested in
innovative approaches just like it produced customized its products for different demographics.
As we discussed above, they had the potential and power to invest more in innovative
developments rather invest on producing more and more. They should have maintained a
continuous controlled and monitored production to avoid any over production and wastage. If
they cutoff their mass production and invested that money in research and development they
would have not had a huge wastage of finished goods and raw material and also they would
have stopped Apple entering into the market with their revolutionary I-pod.

4.5 Recommendations for Preoccupation with Scientific Research and

Development Techniques.

Holding on to the old research and development techniques is not practical at all. Science and
technology develop every second and continuous research and upgrade is crucial in order to
sustain in this fast moving and competitive market. SONY should have moved on with latest
technologies and considered researching further on MP3 format and the possibilities of
embedding or integrating it into the Walkman by developing the device to cater fully digital
media formats they should have produced the technology before Apple. It is fraction of time
that Apple took over the industry completely. SONY did 2 mistakes, first by allowing Apple

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to lead the MP3 player revolution and second by not being proactive to beat Apple on the run
to the revolution.

Another successful approach should have been collaborating with Apple in revolutionizing of
the portable entertainment industry where SONY could have gain at least 50% of the market
share rather losing the entire and letting the Walkman to die off the market.

5. Conclusion

This study was done based on SONY Walkman with an introduction to Sony Group, Sony
Corporation, and how it fell into the marketing myopia. The four myths of the myopia and how
each affected SONY Walkman, why it fell into that myth and what resulted due to that myth
was discussed one by one. Afterwards the recommendations were discussed against each
respecting myth in order to avoid those myths what SONY should have done and what kind f
impact should have expected.

During the recommendations other marketing aspects such as Market Domain, Porter’s five
force model, Marketing Strategy and Marketing Mix Analysis been applied in order to provide
a better understanding and insights.

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 References

Knight, S. (2019). Sony's Walkman, the first truly affordable portable music player, turns 40.
Retrieved from https://www.techspot.com/news/80764-sony-walkman-first-truly-
affordable-portable-music-player.html

Levitt, T. (2004). Marketing Myopia. Harvard Business Review, 82(8), 138-149.

Sony. (2019). Retrieved from https://en.wikipedia.org/wiki/Sony

Sony Marketing. (2019). Retrieved from https://en.wikipedia.org/wiki/Sony_marketing

Sony USA - Electronics, PlayStation, Movies, Music, Product Support. (2019). Retrieved
from https://www.sony.com/