It is beyond any doubt that the technological development is influencing our everyday life considerably. Nowadays, people cannot even imagine their lives without fashionable gadgets and modern equipment. Due to such technological development and high-technology equipment popularity, many companies are trying to conquer the market and trying to capture as much market share as possible. On the other hand, considering a high variety of offered products, the customers have become rather exacting and fastidious. Thus, the companies of high-technology industry need to work very hard in order to provide on a constant basis the inventions of new products, the improvement of existing ones, development of loyal relationships with the clients and company promotion. One of the companies that are managing to become successful in many of these functions is Sony. Thus, the research paper aims at conducting the analysis of Sony Company marketing strategy.
Sony Company Background
The company was incorporated in 1946 in Tokyo (Sony Global, n.d. b). A year after the company showed a considerable result in a successful commercialization and high level of sales of its development “power megaphone.” In 1950 a “Soni-Tape” was introduced to the market, which has made a considerable impact to the global technology development (Sony Global, n.d. b). In ten year the company expanded to the USA with the Sony Corporation of America and launched the World’s first direct-view portable TV. In 1979, the first stereo cassette player “Walkman was represented to the global market (Sony Global, n.d. b). In 1982 the company represented one innovation that became extremely useful and popular, and it was the world first CD player (Sony Global, n.d. b). Sony has also done an essential impact to the television and computer industry, namely in 2001, it developed the world’s largest full color display (Sony Global, n.d. b). In addition, Sony Corporation has introduced to the world such important innovation as bio-battery, e-book reader, and Internet TV. Thus, the company has become an inventor of many high-technologies that random people cannot live without nowadays. There is no doubt that Sony Corporation has managed to become an ample part of the world history.
Another important fact is that during the years of its development, Sony Corporation has expanded all over the world not only with its products, but with manufacturing facilities, and headquarters. Moreover, the company has transformed into a powerful empire with own marketing company, namely Sony Marketing Co., Ltd., Sony Communication Network Corporation and Sony Computer Entertainment Inc (Sony Global, n.d. b). Besides, there are Sony Bank and Financial Holding that ensure company’s financial stability. All of these organizations make the company strong, stable and independent from other companies and services. Basically, such structure gives an opportunity to avoid any type of crisis in the company.
Company’s Performance on the Market
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Sony Corporation is a successful company that operates on the global market of high technologies products. Due to the fact that Sony operates in many business fields, the company divides its occupations and businesses into two parts: mobile communications, game & network services, imaging products & solutions, home entertainment & sound, semiconductors, components, pictures, music, financial services, and all other businesses (Sony Global, n.d. a). Such activity division makes the company stable and independent from the conditions of the external environment. If one industry that the company participates in is in crises, another one may bring more profitability and save Sony Corporation form going bankrupt.
The company has sales and operating revenue at the level of 8,105,712 million yen (Sony Global, n.d. a). Moreover, it is rather successful on the stock market. Taking into account the continuous financial stability and rapid company development, there is a great demand on company stocks on the market. The amount of Sony stocks is about 858,867million yen (Sony Global, n.d. a). Thus, from the economic point of view Sony Corporation is a healthy and strong company that can solve the problems with any market conditions, fluctuations, and crisis.
There is another important part of company’s performance which is market success. One of the components that makes the company popular during so many years is a constant update in innovations and developments. The customers of Sony always stay interested in new invention and technologies that the company offers to the market. In addition, the key criterion to market capture is the delivery of qualitative products. Only with a high quality of equipment and technologies provided by Sony, loyal relationships with the customers can be developed. Thus, Sony Corporation performance on the market is also very successful as well as its economic development.
One of the key components of the market strategy that the company is presenting is its own positioning and attitude to the target audience and loyal customers. Sony Corporation states its mission as “to be a company that inspires and fulfills the curiosity of people” (Sony Global, n.d. c). Furthermore, the company is laying the stress on the passion for technology, content, and services. They are willing to deliver the new cultures and experiences to their users. The slogan of Sony Corporation is “Everything we do is to move you emotionally”. In other words, the company is positioning itself as a means to create mood and emotions to the customers with the help of their technologies.
One more important factor to be analyzed is company’s positioning. Sony Corporation underlines the high quality of the products offered to the customers and their wide range. The organization also emphasizes the personal impact to the world important inventions. In other words, Sony is trying to create the image of the great inventor that presents many important devices of high quality.
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An important part of the marketing strategy is the target audience that is aimed by the company. The corporation, however, is targeting both men and women. There is no age criterion, although the majority of the target audience of Sony Corporation is people in their 20’s -50’s. Due to the fact that corporation is a multinational one, as there are no geographic restrictions of the target market. Customers from all over the world are encouraged to buy Sony products. As for the economic point of classification, considering the high price on new technologies, the customers with middle and upper middle level of income are targeted. Thus, Sony Corporation objective is to cover very large group of customers that include men and women from all over the world with middle and upper middle level of income.
Regarding the fact that the company has a large expansion all over the world, it is important to mention about Sony Corporation internalization strategy. The management of the organization is using different approaches to different markers. The products and services that are provided by the company are adapted according to the requirement of the new or existing market. Thus, Sony Corporation has a multinational strategy of expanding its products and brand globally.
Conforming to the Ansoff’s Matrix, Sony Corporation uses all of the strategies, namely market development, market penetration, product development, and diversification. It is caused by the fact that the structure of the company is very complicated with different products and services provided and the variety of markets offered. Thus, different strategies are applied on different markets.
One more important part of the whole marketing strategy is a choice of lost leadership and diversification strategy. Of course, the company is willing to use the combination of these strategies. However, Sony Company is offering a great amount of products to the customers that have an opportunity to do a wide choice. For this reason, Sony Corporation prefers the diversification strategy.
The last but not the least peculiarity of Sony Corporation market conditions is the competition that the company is facing. With regard to the global rapid technology development, there are many companies that run the business in high-technology industry. The main Sony competitors are Panasonic, Phillip, Samsung, Apple, Lenovo, HP and many other companies that produce high-technology products and gadgets. Thus, it is important to admit that Sony Corporation manages to show great sale results and capture considerable market share.
Sony Corporation has rather effective products strategy. There is an extremely wide range of products presented by the company to the customers. Basically, they have different functions, purpose, size, and target audience. However, the fact of company multifunctionality makes it so successful and stable on the market. The products are divided into several groups, namely electronics, play stations, and devices for entertainment. The first group is the most considerable and explicit. There are many divisions and subdivisions, namely television and home theatre, cameras, audio, mobile, tablets and smart devices, video cameras, car and marine, energy storage and cables. Moreover, each of the sections has at least three or more subsections that give more detailed description of the products within the group. In addition, it should be noted that each device has different modifications and designs offered, so that the customer has an opportunity to choose the technology according not only to the technical characteristics but to the personal tastes as well. Besides, each of the products has additional spare parts and accessories offered by the company.
Thus, the core products of Sony Corporations are the high-technologies, inventions and devices with their main function to make people’s lives easier or more joyful. As for the actual product, the producer packs its goods into the comfortable and stylish packaging that protects them from possible damages and attracts the attention of the target audience. Regarding the augmented products, the corporation also offers the presales and aftersales service for the customers. The guarantee is provided in order to ensure the customers of goods’ high quality.
Moreover, Sony Corporation product range is very large and wide. There are plenty of high-technology products that can satisfy the needs of any customers. Besides, all product levels are accomplished rather successfully by Sony Corporation, so the products strategy of the company is quite effective.
The price is a very important component of the marketing mix that plays a considerable role in demand regulation and level of sales. It is critically significant for the company to settle the effective price level in order to capture as much market share as possible and earn maximum profits. Due to the fact that Sony Corporation is placing the stress on the high quality of the devices, equipment and gadgets offered to the clients, so the prices cannot be too low. Moreover, the company is targeting the audience with middle and upper middle level of income. Thus, Sony is charging rather high prices on its products.
The price strategy that is applied by the corporation is a value based pricing strategy. The strategy is based on the main criteria of customers’ attitude to the products. Sony is more orienting on the cost level or expenditures used for the product creation. The prices are based on the customers’ opinion and their will to pay a certain amount of money for the brand. Such pricing strategy assumes the prices to be higher than their actual cost. However, it is very effective, because it can add some additional goodwill to the brand, increase its profitability and popularity. Thus, the pricing strategy is very efficient for the Sony Corporation.
Considering the fact that the customers have become rather demanding and exacting nowadays, the delivery process of the products has to be fast, cheap, and effective. That is why the distribution strategy plays a considerable role in the whole marketing strategy of the company. Additionally, Sony Corporation has a very differentiated distribution strategy. The corporation is selling its products and services by itself as well as with the help of intermediaries. The distribution strategy of the company is presented with zero-level, one-level and two-level distribution strategy.
Zero-level distribution strategy of Sony Corporation is offering the customers the products and especially services directly from the company without the intermediaries. Such type of distribution is the cheapest one and has an opportunity of the whole process control. The copying and falsification of the goods is definitely avoided. However, this type of distribution strategy cannot reach numerous audiences. That is why Sony Company is mostly distributing its products through the intermediaries, which are namely the electronic equipment retailers and stores. The three and four level distribution strategy requires the participation of several intermediaries that are involved in the products delivery to the customer. In such a way a wide range of customers can be included in various geographic locations. However, such type of distribution strategy increases the final price considerably, because each intermediary has a profit margin about 15-20%. Another disadvantage of such distribution channel is an inability of the company to control the quality of products delivery process. Thus, the combination of different distribution channel strategies gives the effect of synergy and positive result.
Sony Corporation is dedicating a considerable attention to the promotion strategy. The company has even established a certain organization in 1997 that is developing, launching and controlling all promotion strategies of Sony brand. It is called Sony Marketing Co., Ltd. It is using all marketing communication tools in order to increase the popularity of Sony products and increase their market share. . First of all, the advertisement is done through all communication channels, namely TV, internet, media, outdoor advertisement, topic magazines, and newspapers. Moreover, the company runs official global website that unites all the website modifications operated in different countries. Besides, Sony Corporation is reaching its customers through the social median networks groups and advertisement.
Another communication tool used by Sony Company is sales promotion. The company has developed a strategy of encouraging people to buy their products with sales and discounts that are offered to loyal clients. In addition, direct marketing communication is developed with them. The customers are informed about the sales or company news through the e-mails or short text messages.
One of the most effective marketing tools that used by Sony is public relations development. The company participates in charity events and became a sponsor of some sport and cultural events. In such a way, it has a huge opportunity to develop business relationships with other companies from different industries and show a social corporate position to the customers.
There is no doubt that any company has both advantages and disadvantages. In order to transform the disadvantages into company’s positive sides, one should know them and analyze them properly. That is why the SWOT analysis of Sony Corporation needs to be developed. The company has very strong competitive advantages which help Sony to win the market competition with its competitors. The main strength of the company is its diversified product range. Having many different products presented to the customers that are the parts of various markets, the company is stable economically and flexible to the market fluctuations. In addition, the research and development process which presents brilliant technologies to the world is a considerable strength of the company. Sony Corporation captures customers’ attention with high technologies and interesting developments. One more important advantage of Sony is its diversified geographic location. As Sony products are presented all over the world, the company is stable and successful in global prospect.
The industry where the company is operating is very expensive to participate in. Thus, in order to stay successful on the market and gain profits, the company has to invest funds to research and development process. For this reason, one of the Sony weaknesses is its high level of expenses. Moreover, the manufacturing process also requires considerable expenditures that need to be taken from the money turnover.
As for the opportunities, the main positive condition of the companies that operate in the high technologies industry is an increasingly rapid popularity of the high technologies, equipment, and gadgets. Sony Corporation is following all of the social trends and creates the products that are in great demand. Another opportunity is Sony partnership with important world organizations. One of them is a sponsorship of FIFA that might be rather effective for the corporation. One more significant opportunity for the company is the products launch and manufacturing facilities location in the developing countries that have great prospect and market opportunities.
Needless to mention, that Sony Corporation faces many threats which need to be resolved successfully. First of all, due to the fact that the company operates all over the world, considerable threats are connected with market fluctuations, differences in exchange rate and economic instability of the countries. In addition, there is a noticeable threat of the world economic decline and possible crisis. From another point of view, Sony Corporation is facing some obstacles in competition with its rivals. They are all struggling for the market and target audience. Thus, Sony Corporation has both positive and negative sides, although it managed to overcome the disadvantages and make them competitive ones.
Thus, resuming the analysis of Sony Corporation, it is important to say that it has developed an effective and successful marketing and business strategy. In other words, Sony Corporation is a prosperous company of the high technology industry that was incorporated in Tokyo. It is inventing, developing and selling different products such as electronics, play stations and entertainment equipment. Moreover, the corporation has a diversified structure with the Sony Marketing Co., Ltd., Sony Communication Network Corporation and Sony Computer Entertainment Inc., Sony Brand and financial institutions. It is a global company which uses multinational strategy of expanding all over the world.
In addition, the products strategy includes a great range of products that are offered with effective pre-sales and after-sales services. The pricing strategy of Sony is a value-oriented one. As for the distribution strategy, the company is using zero-level, one-level and two-level distribution strategy which allows it to reach a great amount of target audience. The promotion strategy of Sony is full and effective. Thus, despite the disadvantages and threats that company is facing, Sony Corporation is a well-developed prosperous company with an effective business and marketing strategy that guarantees it a leading position on the market.