Executive summary

The report aims to identify and analyze Sony Australia's micro and macro environment and
competitive market, constructing the SWOT analysis and marketing objectives.

Sony Australia Limited is the industry of consumer electronics and headphones. The Covid-
19 outbreak has made most people spend a lot of time at home, and to ease the boredom,
they spend their income on consumer electronics, one of them is headphones. TWS earbuds
have the most significant growth compared to wireless headbands and wireless earphones
due to the convenience.
The microenvironment analysis shows how supplier problems such as supply chain issues,
the increasing costs of the products, and major competitors such as Apple and Samsung
could affect the company's performance.
Throughout the macro environment, findings of Sony's renewable resources, innovative AI
use, and understanding of the target market's demographic were understood. Analyzing
these aspects of the company assisted with how the external environment affects the
business.
One of the strengths of Sony Ltd Australia is that it provides a wide variety of TWS
headphones. Low capital requirements and low customer class concentration should
become opportunities for Sony. As for the weakness, it had a below-average net margin
profit in 2021. Major competitors (Apple and Samsung) have become threats to Sony.

Conclusion
Many factors affect the company's performance, including the internal and external
environments. A deeper understanding of what influences the market, industry, brands, and
segments was gained. From this, the marketing objectives were constructed.

1. Company overview

In this marketing plan many relevant points will be made in order to identify the efficiency of
the company Sony Australia Limited, particularly discussing the industry of consumer
electronics and headphones. Sony is a multinational company, the current CEO, Yuzo
Otsuki is also the managing director of Sony Australia Limited (IBISworld, 2021:2). Under the
category of headphones there are many different types of brands that Sony Australia Ltd
have come out with. In 2021 the Sony Australia Limited had shares of 4.7% within the
headphones category (Euromonitor, 2021:5). Amongst the headphone’s category there are
eight different subcategories such as truly wireless (TWS) headphones, headband, in-ear,
gaming, noise cancelling, wireless, water resistant and in-home wireless (Appendix 1).
Below are some visual representations of some of the headphones Sony has released. The
company shares for Sony Australia Ltd in 2021 was 4.7% in retail volume. Whereas the
value of Sony Aus Ltd within the category of headphones was approximately $26.611 3 AUD
million (Passport, 2021).

Figure 1: Sony’s different types of headphones

1.1 Brand overview

This report will specifically analyse and evaluate the brand of LinkBuds created by Sony.
Sony LinkBuds belongs to the category of TWS headphones, and is on the premium side of
the range. These earbuds are categorised into two sub brands, the first being “LinkBuds”
and the other being “LinkBuds S”. What is the market share (%) and value ($) of the brand
under evaluation within the category?

Situation Analysis

2.0 Industry
Despite the strong value growth seen in 2020, the industry’s current value sales in 2021 are expected
to continue increasing. It is mostly because Australians have additional income to spend on consumer
electronics due to border closures and fewer opportunities to spend money on travelling. The
industry’s performance has been gradually increasing over the past five years. WIth the impact of
Covid-19 in 2020, portable consumer electronics top the chart in the categories because consumers
ease boredom with products like gaming home audio headphones and wireless speakers at home.
Electronics and appliance specialist retailers hold the largest percentage of consumer electronics
sales in 2021. This is mostly due to the rise of e-commerce, which has seen strong growth throughout
the years and especially in 2020 due to the pandemic outbreak. Industry's projected growth is
projected to slow down following the strong sales experienced in 2020 and 2021. Innovation is likely
to be driving the trend as manufacturers continue to invest in research and development to bring
competitive products to the category.

2.1 Category
Within the industry of consumer electronics there are a variety of categories that these items
are all separated into. There are three main categories for headphones: wireless headbands,
wireless earphones and TWS earbuds, within all there are the brands for each. For wireless
headbands the shares in 2021 were 21.71%, for wireless earphones it was 13.13% and for
TWS earbuds was 65.15% (Passport, 2021: 41). Therefore, TWS has the highest shares out
of all categories. Also, TWS earbuds have the most significant growth with retail volume of
2,206,800 units in 2021 (Passport, 2021: 43). Within the last year TWS earbuds have had
the most increase in value, with an increase of 75.5 million AUD (Passport, 2021). Whereas
the wireless earphones have the most significant decline with retail volume of only 444,700
units in 2021 (Passport, 2021). Over the past five years there has been a decline within the
wireless earphones due to the increase in demand for TWS earbuds. TWS earbuds have
been experiencing growth in performance over the past five years. Apple has played a
significant role in TWS earbuds, earning consumer recognition with their products, Airpods

(Passport, 2021: 40). Each category's performance has been projected to decline over the
next five years. with many manufacturers expected to create new innovations and
technologies for the upcoming type of headphones.

2.2 Brands

As the demand for headphones grow there has been a simultaneous increase in brands
producing products. Currently the brand with the most shares is Airpods by Apple Inc. In
2022 Airpods increased their shares by 129% from the previous year (Passport, 2022). For
the past five years Airpods have had the most shares amongst all the brands. Using the data
it can be assumed that Airpods were able to sell approximately $22.2 million AUD of
products in 2021. Additionally, since Apple Inc has come out with their Airpods brand the
company has the highest retail volume of headphones in Australia with 22.6% in 2021
(Passport, 2021). Bose Corp has been able to surpass Sony in 2022 with 7.3% in shares,
this is a significant improvement for their brand as they stood at 2.8% in 2021 (Passport,
2021). Additionally, a brand that has grown over the past few years is JBL by Samsung
Corp. In 2021 JBL had a retail volume of 4.2% which is approximately double the retail
volume of 2020, this implying that JBL are growing at a rapid rate (Passport, 2021). Beats by
Apple Inc comes after JBL however this brand has been slowly decreasing retail volume
since 2019 (Passport, 2021). Apple were able to pave the way for TWS headphones
throughout the years. As they listen to the consumer’s needs and innovate quickly thus
being able to maintain lead sales (Passport, 2021: 40). Overall, all types of headphones
have increased in demand due to several reasons. It is predicted that the popularity of this
product will decrease anytime soon. With many companies adapting and creating new
wireless headphones. In the report conducted by Passport it is forecasted that TWS earbuds
will increase in sales every year with a prediction of $900 million AUD of sales by 2026
(Passport, 2021).

The popularity and increase in demand of Linksbuds and over all TWS headphones is due to
their convenience and comfortability these headphones have been reported to dominate the
category (Passport, 2021).

Figure 2: Apple airpods pro, Bose Quiet Comfort Earbuds, JBL Tune 225TWS

Airpods offer a variety of sub brands, including Airpods pro, Airpods 2nd generation, AirPods
3rd generation and Airpods Max. In the image above displays the Airpods pro, which would
be considered as a premium TWS headphones, retailing for $399 AUD (Apple Inc, 2022).
For JBL they offer headphones in different subcategories such as true wireless, in-ear
headphones, and others. As for Bose their earbuds are categorised into brands Bose quiet
comfort earbuds and Bose sport earbuds (Bose Corporation, 2022). Figure 2 displays all
premium TWS headphones release by the competitors.
2.3 Product segments

The product segment shares of TWS headphones as of 2021 is AUD508645.43 million.The

fastest growing product segment is Apple, with a market share of 39.3% for TWS
headphones as of 2020. It also achieved 20% annual growth in 2020. That's because the
brand has shaped the landscape of his TWS earbuds more than his AirPods, especially via
his latest AirPods Pro, which feature improved audio quality with active noise cancellation
and adaptive EQ offers. One of Apple's main focuses is compatibility with other devices.
Apple announced his AirPods Max in December 2020, which could lead to his 2021 mass
sales. These wireless headphones combine a custom acoustic design, the H1 chip and the
latest software to enhance your listening experience, complete with adaptive EQ, active
noise cancellation, transparent mode and spatial audio (Passport, 2021).

In Graph 1, Apple’s net margin profit was the highest in 2019 with a net profit margin of
3.05%. According to (IBISworld, 2021:2), Apple Pty Limited had a revenue of $11.3bn and
an annual growth of 8.1% from 2017 till 2021. Apple Pty Limited even had a net profit margin
of 2.9% which is higher than peer average. There was a slight decrease in net profit margin
from 2019 to 2020 as it fell from 3.05% to 2.94%. The possible reasons for this could be due
to high capital requirements and a low & steady level of assistance.

In Graph 2, Samsung’s net margin profit was 1.44%. The net profit margin dropped to -
2.32% in 2017. This is because Samsung launched the Galaxy Note 7 in August 2017,
driving pre-orders and sales, but an optimistic start quickly soured. Samsung had to recall
the first version of the Note 7 in September due to a battery defect that overheated and
exploded. By October 2017, more than 2 million devices had to be recalled and
discontinued. The recall is estimated to cost Samsung $5.3 billion (Forbes, 2017).
Samsung’s net profit margin is 1.4% which is lower than the peer average (IBISworld,
2021:2).

In Graph 3, Sony Australia Limited net margin profit was 5.33% in 2019 which was the
highest over the past few years. However, it dropped to 0.06% in 2020 due to the spread of
COVID-19.Sony Ltd Australia had a net margin profit below average as of 2021. Sony’s net
profit margin continues to decrease over the years. This could be due to low & steady level
of assistance and low profit vs sector average (IBISworld, 2021:2).

In Graph 4,5,6 there is a trendline for each graph to indicate the forecasted growth for the
next 5 years. Sony’s net margin profit is predicted to decrease over the next five years. A
reason for this could be COVID-19 and the decrease in purchasing power for consumers.
However, Samsung and Apple are predicted to have an increasing trendline over the five
years.
Graph 1: Apple’s Net Margin Profit

Graph 2: Samsung’s Net Margin

Graph 3: Sony Net Profit Margin

Graph 4: Samsung’s Projected Growth Over The Next Five Years

Graph 5: Sony’s Projected Growth Over The Next Five Years

Graph 6: Apple’s Projected Growth Over The Next 5 Years

3.0 Environmental Analysis

3.1 Micro environment

This analysis will examine three main points of Sony Australia’s microenvironment and how
it impacts the company. The first finding of the company is that Sony has been affected by
the Covid-19 outbreak and experienced supply chain issues due to the closure of its
manufacturing plants in China and Malaysia. As a result, the sale of electronics products has
also been decreasing. The sales and financial results are also impacted and delayed in
account closing procedures and other operations. Next, the company has two significant
competitors: Samsung and Apple. Samsung’s Galaxy buds 2 and Apple’s AirPods have
stolen the industry’s spotlight and Sony has to keep advancing its products and technologies
to keep up with the trends. Last, the stakeholder is one of the essential things every
company needs to run smoothly. Sony’s corporate social responsibility strategy values
stakeholder groups the most. The company’s premium pricing strategy ensures high-profit
margins take the stakeholders’ interest. The company also aims to optimise operational
efficiency and corresponding financial performance. Hence, Sony’s strategy fulfils the
shareholders’ interests.

3.2 Macro environment

To summarise the macro environment there are three main points that will be discussed to
further analyse this environment and how it is affecting Sony Australia and the brand. The
first finding is the renewable resources the company has come out with named “SORPLAS”
this would be considered positive as it decreases the waste production as it uses products
that are no longer functional and thus minimising the company’s carbon footprint. This also
creates a better image for the company and displays their efforts to decrease harm to the
environment. Another analysis made within the macro environment is the force of
technology. Sony as a company has been able to innovate a type of headphones through
the use of AI machines. This was used to sample more than 500 million voices to develop an
algorithm that can reduce ambient noise and extract the speaker’s voice with great clarity. A
type of technology that has limited use within companies of the industry. The last point that
will be discussed is the demographic factor that affects the company. The target market for
consumer electronics were found to be the younger generation particularly generation Z, as
they also exert considerable influence on others when considering electronic devices as they
tend to be more tech savvy then the older generation. However, due to the fact that this
generation lives off of minimum wage jobs it can be implied that it is uncertain whether they
would want to indulge in such premium products. Overall, there are a number of positive and
negative forces on the macro level that need to be considered when deciding future
objectives.

Throughout the macroenvironment findings of Sony’s own renewable resources, innovative

AI use and the understanding of the demographic of the target market was understood. By
analysing these aspects of the company it assisted with how the external environment
affects the business.

4.0 SWOT Analysis

Strengths Weaknesses
Internal ● Sony Ltd Australia provides many ● Sony Ltd Australia had a net margin
varieties of TWS headphones. profit below average as of 2021.
● Provides renewable resources ● Sony’s net margin profit is predicted
which decreases the waste to decrease over the next five years.
production as it uses products that ● Sony Australia Limited's pre-tax
are no longer functional which margin which is 2.3% is lower than
minimises the company’s carbon the peer average.
footprint.
● Sony as a company has been able
to innovate a type of headphones
through the use of AI machines.
● Sony’s corporate social
responsibility strategy values
stakeholder
● The company’s premium pricing
strategy ensures high-profit margins
take the stakeholders’ interest.

Opportunities Threats
External ● Both of Sony’s competitors, ● Sony has high competition.
Samsung and Apple have high Competitors like Apple and
capital requirements and low & Samsung have created similar
steady level of assistance. products. In this case, Airpods
● Low imports (Apple) and Linkbuds (Sony) even
● Sony Limited Australia has a low have similar features.
capital requirements ● Natural environmental factors cause
● Sony has a low customer class a downturn in the economy which
concentration may mean people could spend less
as income could decrease.

● Sony has a low profit vs sector

average.
● Sony has a low revenue per
employee.
● Since the majority of the target
market are generation Z, this
generation lives off of minimum
wage jobs it can be implied that it is
uncertain whether they would want
to indulge in such premium
products.
● Apple Inc has come out with their
Airpods brand the company has the
highest retail volume of headphones
in Australia with 22.6% in 2021
5.0 Marketing Objectives
1. Increase market share volume of Sony’s TWS earbuds – linkbuds. Increase in share
volume from 4.7% to 6.1% by December of 2023.

2. Increase sales volume of TWS headphones within the category of headphones from
68.1 AUD million to 100 AUD million by June of 2023.
Appendix

MICRO ENVIRONMENT

Company
Reference source Team
(Report, article, member’s
Actor (force) Findings (shifts and trends) URL etc) Name
Company While Sony’s most recent • Sony R&D chintya
annual research and expenses 2011-
Areas of focus within development expenditure was 2021 | Statista
this actor (force) are: the highest in years, it still
● Top management pales in comparison to those of
● Finance the world’s biggest R&D
● Research and spenders.
development flexibility is a key advantage of Sony Corporation’s chintya
● Purchasing Sony Corporation’s matrix Organizational
● Operations organizational structure. Structure Pros &
● Accounting
Cons - Panmore
● Other
Institute

Suppliers
Reference source Team
(Report, article, member’s
Actor (force) Findings (shifts and trends) URL etc) Name
Suppliers the company’s electronics Sony's electronics chintya
segment has experienced supply chain
Areas of focus within supply chain issues due to the impacted by
this actor (force) are: closure of its manufacturing COVID-19 instability
● Supply availability plants in China and Malaysia | ZDNET
and costs due to covid-19 outbreak.
● Supply shortages Sony began raising the costs https:// chintya
● Delays of a number of electronics www.t3.com/au/
● Labour strikes and across Japan in April this year, news/ps5-price-
other events increase-sony-
including a rise of between 3%
● Rising supply costs comment#:~:text=S
● Other to 31% in price for ony%20began
headphones, Blu-Ray players, %20raising%20the
cameras, speakers and more. %20costs,games
%20hardware
%20could%20be
%20next.
Marketing intermediaries
Reference source Team
(Report, article, member’s
Actor (force) Findings (shifts and trends) URL etc) Name
Marketing It was found in 2021 that for Passport: Hiiragi
intermediaries distribution of headphones that Headphones in
in store-based selling was Australia
Areas of focus within most prominent with an overall
this actor (force) are: percentage of 84.8%. Within
● Resellers this non-grocery specialists
● Physical distribution (75.6%) and electronics and
● Marketing Services appliance specialist (75.6%)
● Financial having the highest percentage.
intermediaries On the contrary non-store
● Other retailing was significantly lower
at 15.2%.

Sony Australia limited work https:// hiiragi

with the company adhesive PR mumbrella.com.au/
to maintain social media adhesive-retains-
accounts across several sony-electronics-pr-
platforms. Adhesive PR content-and-
representative described Sony influencer-account-
as a dream company to work 692143
with as they are a known,
trusted and desired brand.

Competitors
Reference source Team
(Report, article, member’s
Actor (force) Findings (shifts and trends) URL etc) Name
Competitors Samsung happens to be Passport: Alissa
Sony's competitor. In 2016, Headphones in
Areas of focus within Samsung’s revenue was Australia
this actor (force) are: around 175 billion us dollars. In
● Direct competitors 2022, Samsung released
● Indirect competitors wireless headphones which
was named Samsung Galaxy
buds 2

Another competitor for Sony Passport: Alissa

would be Apple. Apple leads Headphones in
the headphone market in the Australia
United States with the release
of Airpods, airpods pro and
AirPods pro max
Publics
Reference source Team
(Report, article, member’s
Actor (force) Findings (shifts and trends) URL etc) Name
Publics Local publics are attended to https:// Hiiragi
through the use of panmore.com/sony-
Areas of focus within sustainability initiatives and corporate-social-
this actor (force) are: human justice programs. As responsibility-
● Financial publics the local community wields the strategy-
● Media publics values and beliefs of current stakeholders
● Government publics societies, thus the need for
● Citizen action accountability of such
publics initiatives is provided by the
● Local publics company.
● General publics
● Internal publics Financial publics for Sony are https:// hiiragi
● Other their shareholders. Sony value panmore.com/sony-
their shareholders significantly corporate-social-
as they are significant responsibility-
contributors to business strategy-
valuation and availability of stakeholders
capital to support business
operations. Relationships with
shareholders are maintained
by maximising profitability.

Customers
Reference source Team
(Report, article, member’s
Actor (force) Findings (shifts and trends) URL etc) Name
Customers Reseller markets for Sony https:// Alissa
include amazon. Amazon is an www.sony.com.au/
Areas of focus within American multinational microsite/
this actor (force) are: technology company which wheretobuy/
● Consumer markets focuses on e-commerce.
● Reseller markets
Sony’s principal market is the https:// Alissa
general population, providing www.cleverism.com/
Note: consumer focused electronic company/sony/
Business markets, products such as mobile #:~:text=Customer
government markets, and phones, gaming consoles and %20Segments,youn
international markets are networks, televisions, Blu-ray g%20professionals
outside the scope of this players and cameras. These %20and%20early
course. Do not include in products are aimed principally %20adopters.
your analysis. at affluent consumers, families,
young professionals and early
adopters.
MACRO ENVIRONMENT
Demographic
Reference source Team
(Report, article, member’s
Actor (force) Findings (shifts and trends) URL etc) Name
Demographic A generation of consumers https:// chintya
between the ages of 13 - 31 are salesfuel.com/
Areas of focus not only heavy consumers of millennials-heavily-
within this actor electronic products, but they also influence-consumer-
(force) are: exert considerable influence on electronics-
● Size, Density and others when it comes to buying purchases/
Location consumer electronic devices.
● Age
● Gender
Currently for consumer Ibisworld - Online hiiragi
● Race
electronics the target Consumer
● Occupation
demographic is seen to be Electronics Sales in
● Other
Australia
generation Z, as they are the
most tech savvy in comparison to https://my-ibisworld-
other age demographics. With com.ezproxy.lib.rmit
that being said many of the .edu.au/download/
people in this generation tend to au/en/industry-
have minimum wage jobs. specialized/
5243/1/0/pdf

Economic
Reference source Team
(Report, article, member’s
Actor (force) Findings (shifts and trends) URL etc) Name
Economic Interest rates play a big part in https:// Alissa
the sales of Sony LinkBuds. As tradingeconomics.c
Areas of focus within interest rates increase, a om/australia/
this actor (force) are: consumer's purchasing power interest-rate
● Interest rates will decrease. Australia's
● Inflation current interest rate is 1.85%
● Unemployment as of August 2022.
● Disposable income
● Other As of 31st of March 2021, https://my-ibisworld- Alissa
Sony Australia Limited had 205 com.ezproxy.lib.rmit
employees. The number of .edu.au/download/
employees affects the au/en/company-
production of the product, or in reports/5986/1/0/pdf
this case, Sony Linkbuds. In
2021, the unemployment rate
for Australia was 4.2% in
December. Which could have
possibly affected the
production of Sony Linkbuds.
Natural
Reference source Team
(Report, article, member’s
Actor (force) Findings (shifts and trends) URL etc) Name
Natural In order to decrease the https:// hiiragi
amount of non-renewable www.sony.com.au/
Areas of focus within resources used when electronics/sorplas-
this actor (force) are: manufacturing Sony products. recycled-plastic
● Weather and/or They have created a resource
natural disasters SORPLAS, enabling high
● Shortage of raw performance and sustainability.
materials This allows less waste
● Increasing pollution produced from products that
● Increased are no longer functional, thus
government better for the environment and
interventions minimising their carbon
● Other footprint.

Due to the covid-19 outbreak https:// hiiragi

many manufacturing and www.nytimes.com/
supply chain issues became wirecutter/blog/
prominent, globally. One of silicon-chip-
them being the silicon chip shortage-delays/
shortage, due to the decrease
in demand during the outbreak
many manufacturing
companies stopped their work.
However, now that situations
are becoming a new type of
normal, the demand has
increased and dysfunctional
transportation logistics

Political
Reference source Team
(Report, article, member’s
Actor (force) Findings (shifts and trends) URL etc) Name
Political The Federal Court has ordered https:// chintya
Sony Interactive Entertainment www.accc.gov.au/
Areas of focus within Network Europe Limited (Sony media-release/sony-
this actor (force) are: to-pay-35-million-
Europe) to pay $3.5 million in
● Legislations penalty-for-
regulating business penalties for making false and misrepresenting-
● Ethical and socially misleading representations on playstation-gamers
responsible actions its website and in dealings with %E2%80%99-rights
● Other Australian consumers about
their Australian Consumer Law
(ACL) rights.

Former senior Sony staff are https:// chintya

 now breaking ranks, detailing www.abc.net.au/
for the first time how the news/2021-10-11/
company's global head office sony-music-denis-
handlin-toxic-
knew about the alleged abuse
regime-australian-
but failed to protect its industry/100523030
Australian staff for almost 40
years.

Technological
Reference source Team
Findings (Report, article, member’s
Actor (force) (Shifts and trendings) URL etc) Name
Technological Precise voice pickup https:// chintya
technology performs advanced www.forbes.com/
Areas of focus within voice signal processing using sites/marksparrow/
this actor (force) are: 2022/02/18/
Sony’s noise-reduction
● Technological reviewed-sonys-
advances – algorithm that’s been new-linkbuds-are-a-
impacting the developed with AI machine stunning-
offering learning. Sony sampled more breakthrough-in-
● Technological than 500 million voices to earbud-technology/?
advances – create an algorithm that can sh=46ac5806341e
impacting the way suppress ambient noise and
the consumer
extract the speaker’s voice with
engages with the
category greater clarity.

Adaptive Volume Control is https:// chintya

another feature the LinkBuds www.forbes.com/
offer. When switched on, it sites/marksparrow/
2022/02/18/
automatically optimizes the
reviewed-sonys-
volume based on where the new-linkbuds-are-a-
listener is. It enables the user stunning-
to listen to favorite tracks at a breakthrough-in-
comfortable volume in a whole earbud-technology/?
range of situations, making sh=46ac5806341e
listening to music in the open
air a more enjoyable
experience without being
spoiled by unwanted sounds.

Cultural
Reference source Team
(Report, article, member’s
Actor (force) Findings (shifts and trends) URL etc) Name
Cultural Celebrities play a big part in https:// Alissa
the cultural environment as celebrityendorsers.c
Areas of focus within customers get influenced when om/endorsements/
this actor (force) are: their favorite celebrity uses a sony/
● Core beliefs and product and will eventually buy
values them too.For example, some
● Secondary cultural celebrities who have endorsed
shifts Sony include, Bella Thorne,
● View of Andrew Wiggins and Fleur De
Force.
 organisations
● View of Society Another factor is purchasing https:// Alissa
● View of Nature and habits by the consumers which www.comparably.co
the universe is buying from a brand over m/brands/sony
● Other and over again. Sony has 80%
of customer loyalty as of 2022.
References:
https://my-ibisworld-com.ezproxy.lib.rmit.edu.au/download/au/en/industry-specialized/
5243/1/0/pdf ibisworld - Online Consumer Electronics Sales in Australia