Strategic Marketing Sony Inc.

Introduction:
Sony is the brain child of Masaru Ibuka who in 1945 had been working for Japanese army on
military technology. Ibuka and seven other engineers in October 1945 Tokyo Tsushin Kogyo
(Tosuken) and the next year he was joined my colleague Akio Mrita. When Mrita went to usa
and found out that people are having trouble with the company’s name he changed it to
SONY. The company name "Sony" was created by combining two words. One is "sonus" in
Latin, which is the root of such words as "sound" and "sonic." The other is "sonny" meaning
little son [5]. According to the Sony Corporation, its founder Akio Morita "firmly believed
that brand image could be built from the ground up, and that a company had to work hard to
develop it.”[4]

Sony is the one of the biggest electrical giants in the world. Sony is one for the leading
manufacturer of Electronics, Videos, Communications, Video Game Consoles and
information technology products for the consumer and professional markets. Its products
range from small MP3 player to loud high tech stereo speakers, from small Digital Picture
Frames to big high definition LCD TVs, from Music to Movies Sony organisation covers all.

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What is Marketing?
Marketing deals with customers. Marketing is managing profitable customer relationships.
The twofold goal of marketing is to attract new customers by promising superior value and to
keep and growing current customers by delivering satisfaction.

Market Environment:
Market environment is the study of all the factors that affect the marketing of a business.
The marketing environment offers both opportunities and threats. These factors can be any of
the fallowing in some cases more than one.

• cultural influences
• governmental and political influences
• demographic and lifestyle trends
• local, national, and world economic trends
• the strengths of multi-national competitors
• the influence of technology on physical distribution

Types of Market Environment:

Market environment is divided into two parts depending on the factors affecting the
organisation. They are

1. Micro-environment
2. Macro-environment

1. Micro-environment:
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“It’s the set of forces close to an organization that have direct impact on its ability to serve
its customers. The microenvironment includes channel member organizations, competitors,
customer markets, publics, and the capabilities of the organization itself.”[7]

Micro-environment is the careful consideration of a company’s marketing strategies

towards different internal factors or factors which are very close to the company’s strengths
and weakness. These factors include

i. The Company:

This combines all the company internally groups like financial, research, management,
development and etc. Sony as a company has a very highly trained research team of
technicians, financial advisors and manager which keep Sony as a multimedia giant strong
from inside.

ii. Suppliers:

A company is as good as its supplier. Sony has a good relationship with its suppliers. This
gives Sony an advantage on its competitors in getting good quality and reliable material.
Otherwise shortage of material or increase in price can affect Sony’s sales volume.

iii.Marketing Intermediaries:

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These are the firms that help an organisation to sell their products to consumers. Sony has
any retailers, distribution centres and marketing agencies to help them reach to the masses
(customers).

iv.Customers:

Customers markets are of five types:

Consumer Market: They consist of individuals and households that buy goods for personal
consumption. Sony is very strong in this market.

Business Market: Sony is increasing its sales in this market but still a bit shy from its
competitors.

Reseller Market: They buy goods and services to resell at a profit.

Government Market: Sony is introducing more products which are taking high interest by
Government to increase public services.
International Market: Sony has very big International market and its demand is growing
day by day.

v. Competitors:

According to the marketing concept, a company must provide customer value and satisfaction
more than its competitor do. Sony as a multinational organisation has many competitors in
different fields of expertise. Some of the competitors are new but some are as old as Sony
itself but all of them never been able to match Sony’s value for money and marketing skills.

vi.Public:

A public is any group that has an actual or potential interest or impact on an organization’s
ability to achieve its objectives. Sony has many public interests like; Financial, Government,
Media, Citizen, internal and local.

1. Macro-environment:

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“It’s the collection of uncontrollable forces and conditions facing a person or a company,
including demographic, economic, natural, technological, political, and cultural forces.”[7]

Macro-environment consists of six major factors that affect an organisation externally

depending on its marketing strategy. They are

i. Demographic Environment:

ii. Economic Environment:

iii. Natural Environment:

iv. Technological Environment:

v. Political Environment:

vi. Cultural Environment:

i. Demographic Environment:

Demography is the study of human populations in terms of size, density, location,

age, gender, race, occupation etc. For a company like Sony who has different products for
different ages need to keep a close eye on the demographic environment. So that when a new

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product is launched it is targeted to right age group, or occupation at a right time and
location.

ii. Economic Environment:

The economic environment consists of factors that affect consumer purchasing power
and spending patterns. Sony has to consider its products prices and quality before the launch
of its products. For example; the buying power in Europe and North America is considerably
more than the third world countries.

iii. Natural environment:

Natural environment are the natural resources that are needed as inputs by the
marketers or that which are affected by marketing activities. Especially the following trends:

➢ Shortages of raw materials.

➢ Increased pollution.
➢ Increased government intervention.

i. Technological Environment:

The technological environment is the most dramatic of all the environments. The
changes in the technology are so rapid that no one can predict it. Sony is a technology
dependent company. So keeping an eye on the technology and keep ahead of the competitors
is the vital role for Sony’s survival.

ii. Political Environment:

The political environment consists of Laws, Government agencies and pressure

groups that influence or limit various organizations and individuals in a given society. Sony
before mass producing a product for a country or a region has to take permission from
Government and other authorities.

iii. Cultural Environment:

The cultural environment is made up of institutions and other forces that affect a
society’s basic values, perceptions, preferences and behaviours. Technology has become a

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trend which changes from region to region. Keep ahead of this and taking advantage is a
successful company’s main agenda.

P.E.S.T analysis can also come in Macro-environment.

2.1 PEST ANALYSIS:

PEST identifies the political, economic, social, technological, environmental, and
legal factors that of which directly affect Sony.

Political:

• Trade, return, and warranty restrictions

• Employment law is crucial to maintain cost effective and legal in a specific
country.
• Introduction to Euro, the exchange may drop in the UK making Sony easier to
expand.

Economic:

• Production and distribution of a multitude of consumer electronic products.

• Interest rates play an important role in a company’s growth and price factor of
the products;
• The fall in unemployment rates may cause Sony some problems in the process
of recruiting new employee’s in the business.
• Specific region’s economic growth, inflation rates, and exchange rates, and
due to current economic crisis.

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Social:

• Social factors include health consciousness of customer

• Older population tend not to be interested in latest products rather they might
be interested in simple ones.
• Some Asian and African countries may not be able to buy Sony’s products.

Technological:

• Digital age is the future developing aspect of the consumer electronics.

• The production, storage and marketing of Sony products can be effected by
increased use of new technology.
• Technology and innovation has been Sony’s passion and they made a
breakthrough in 2002 by launching PS2, which included enhanced graphics.
This was followed by the PS3 in 2007 which had blu-ray

Marketing Planning:
Sony’s marketing strategy from day one was to be the best in its field. Their motto is “like no
other”. Sony’s co-founder Akio Morita was the key player in its success domestically and
abroad. Sony was a success in Japan. Morita’s strategy was to introduce Sony to bigger
market. So he decided to move to America with his family. In this journey he has faced many
challenges and failures but he never let go of its long term goal of Sony to be the brand every
one trust with their eyes closed. In these failures were the Chromatron and Betamax tapes.
The success are still coming from the introduction of mini TV (5”) to the introduction of
walkman, colour TVs, CDs to the modern day Multimedia power house PS3.

What Sony has learned by its betamax mistakes is that hardware is as good as the
software backing it so when CD format for music industry was introduced it was backed my

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marketing high quality sound format and making Sony/CBS music record company to back
it. Which was a success and Sony did the same marketing when it introduced the Blu-ray
format to the public and the movie industry. It has done it by Marketing PS3 and the large
amount of data storage and the ability to store high definition quality of video content to it
better than its competitive format HDDVD introduced by Panasonic.

So over all Sony has a marketing plan which changes time to time through technology
but the basic remains the same to introduce something that everyone will like by taking
considerable risks.

Suggestions:
Whenever Sony introduces some new technology its price tag is set so high that a normal
people think of it as unachievable. E.g. like in recent days when PS3 was introduced it price
tag was 500 pounds which as compared to its rival Xbox 360 from Microsoft which sold at
279.99 pounds was way too much. So Sony should think of its loyal customers before
introducing such products.

On the whole Sony as a multinational corporation has done a lot for its customers than
any other firm in the history and for a firm built from the ashes of the Second World War by
the countries who destroyed its homeland and making a name in those countries is a
marketing mile stone. Sony was the first Japanese firm to have an American Head office.
The future of this company is bright.

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References:

1. History of Sony, Available at: http://www.sony.co.uk/article/id/1060176719725

[last accessed on 08/04/09.]
2. History of Sony, Available at: http://www.sony.net/Fun/SH/1-1/h1.html [last
accessed on 08/04/09.]
3. Full comprehensive history of Sony, Available at: http://www.sony.net/Fun/SH/
[last accessed on 22/04/09.]
4. History of Sony, Available at:
http://www.brandchannel.com/features_webwatch.asp?ww_id=116 [last accessed on
23/04/09].
5. History of Sony, Available at:
http://news.sel.sony.com/en/corporate_information/sony_brand [last accessed on
24/04/09].

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6. Marketing Environment, Available at:

http://www.toolkit.com/small_business_guide/sbg.aspx?nid=P03_2046 [last accessed
on 22/04/09].
7. Marketing definitions, Available at:
http://www.marketingpower.com/_layouts/Dictionary.aspx?
dLetter=M#microenvironment [last accessed on 24/04/09].

Books:

Business Studies 4th Edition (Dave Hall – Rob Jones – Carlo Raffo – Alain
Anderton)

Business Studies 2nd Edition (Ian Marcouse – Andrew Gillespie – Barry Martin
– Malcolm Surridge – Nancy Wall)

A Company like no other Play Edition (Chris Reynolds – Sarah Slee) Image
Publishing

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