Introduction to Marketing

SONY VAIO

ACIM

Aishath Seena 000018283

Aishath Shaheedha 000017573

Shahuleeza Mohamed 000017497

Eanath Ibrahim 000017593

Mariyam Nixna 00009274

Introduction to marketing

Table of contentsIntroduction_______________________________________Error! Bookmark not defined.

Marketing Practice__________________________________________________________________3

Marketing Environment______________________________________________________________3

Macro Environment_______________________________________________________________4

Political________________________________________________________________________4

Economical_____________________________________________________________________4

Social__________________________________________________________________________4

Technological__________________________________________________________________5

Micro Environment_______________________________________________________________5

Customers______________________________________________________________________5

Suppliers_______________________________________________________________________5

Competitiors_____________________________________Error! Bookmark not defined.

Employees______________________________________________________________________6

Marketing research_________________________________________________________________6

Consumer Behaviour________________________________________________________________6

Need recognition_________________________________________________________________7

Information search________________________________________________________________7

Evaluation of alternatives__________________________________________________________7

Decision making_________________________________________________________________7

Post purchase behavior____________________________________________________________7

Branding alternatives________________________________________________________________7

New Product Development___________________________________________________________8

Idea Screening___________________________________________________________________8

Concept development and testing____________________________________________________9

Marketing strategy development_____________________________________________________9

Financial analysis_________________________________________________________________9

Product development______________________________________________________________9

Commercialization________________________________________________________________9

BCG matrix_______________________________________________________________________9

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Introduction to marketing

Star__________________________________________________________________________10

Question______________________________________________________________________10

Cash Cow_____________________________________________________________________10

Dog__________________________________________________________________________10

Ansoff Matrix____________________________________________________________________11

Market penetration______________________________________________________________11

Product development_____________________________________________________________11

Market development_____________________________________________________________11

Diversification__________________________________________________________________11

Conclusion_______________________________________________________________________12

Reference list_____________________________________________________________________12

Reference list____________________________________Error! Bookmark not defined.

SONY VAIO

IntroductionThis is a report based on a sub brand of Sony, Sony VAIO. Shortly in this report we will

portray the marketing practices of Sony Vaio to stand against their biggest competitors Dell,

HP and Apple Macintosh with its magnificent features.

Sony is one of the global electronics company with its headquarters in Tokyo, Japan with an

estimate of 163,000 employees (Sony Corporation, 2008). The sub brand of Sony, Sony

VAIO stands for “Visual Audio Intelligence Organizer”. Sony Vaio was first introduced by

Timothy Hanley in US in early 1996 as a major player in the laptop market across the world.

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Today, Sony is positioned among the top five global brands worldwide with $8.87 trillion a

year. “Sony’s sales performance for the next year is expected to see revenues rise by 1

percent to $9 trillion” (Sony Revenue and Profits Rise as Europe Becomes Biggest Games

Market, 2008).

Marketing PracticeSony started Vaio business in Asia in 2000 with a customer oriented business platform. It

uses the marketing concept as its marketing management philosophy which identifies,

anticipates and satisfies customer requirements profitably. Vaio’s target market is the youth

market that looks ahead of the speed and memory into design. Consequently it comes in

variety of colours like Blazing Red, Indigo Blue, Pure White, Beauty Pink and Aroma Black.

Marketing EnvironmentIn the evolving economy of 21st Century in an ever more linked world, companies must be

excellent in customer relationship management to keep up with the expectations of the

customers, clients and the external environment of the company. However to do this,

businesses should understand it’s inside and outside environment before beginning the

marketing process which will influence the business and its relation with the target buyers as,

“Marketing environment consists of the factors and forces outside marketing that affect

marketing management’s ability to build and maintain successful relationships with target

customers” (what does Marketing Environment mean,2009). The marketing environment

includes MACRO and MICRO factors, the external and internal analysis of the business.

Macro Environment

The vital roles of ecological issues result in businesses adapting to green practices and

extensive use of the PEST structure. PEST analysis thoroughly reflects the MACRO

environments influence on political, economical, social and technological factors.

Political

Political factors include the government’s ideology towards the business, the legislations to

go through and the governments support for the business. The rules and regulations like

taxes, subsidies and minimum wage acts affect businesses in both optimistic and pessimistic 3

Introduction to marketing

ways. Subsidies or the financial grants may facilitate the business to expand whereas trade

restrictions might have a negative affect for a globally operating company like Sony.

Economical

Economic factors consist of the income level, pattern of consumption, exchange rates and

inflationary level of the economy. As now the world economy is in a bad shape, people will

have less buying power and the pattern of consumption of people or how often people buy

will be less. Furthermore, exchange rates have been falling persistently making Sony

importers and Sony suffers badly for the first time in history. “The company blames the

global economic downturn and the strength of the yen for a lesser demand for its products”

(Sony's first loss in 14 years, 2009).

Social

Social factors include the demographic and the behavioral aspects in an economy. In other

words social factors are all about people. It consists of population growth rate, age

distribution and cultural aspects. As Vaio laptop is also targeted for business people,

economy’s working age group and their income level also should be taken into consideration.

Social factors also include working for economy’s best interests like Sony has been

promoting science education for children as stated among the social contribution activities in

its official website.

“The Sony Corporation and its subsidiaries immediately donated 4 million dollars to disaster

relief funds. It donated 3 million to the American Red Cross Disaster Relief Fund (NY

chapter), as well as 1 million to the Twin Towers Fund, which benefits emergency personnel

affected by the tragedy” (Sony, 2001)

Technological

Finally the technological factors include the research and development activities. Laptop

industry is represented as ongoing developments in high quality and design resulting in

several introductions of new products. Like in 2006 Sony produced the World's first Blu-ray

equipped notebook just weeks after the launch of Toshiba’s Qosmio G30 notebook (Sony

VAIO VGN-AR18GP, 2006). Hi-tech technology is being used to improve working process

through new machinery, software’s etc... to keep up with the speeding and high turnover of

laptop products establishing cost effective ways of inventing high quality.

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Micro Environment

Businesses should not merely focus on building relations with their external environment but

also they should have good relations among the internal environment of the business, the

MICRO environment. Internal factors have direct impact on organizations strategy, counting

consumers, employees, suppliers, competitors and media.

Customers

Why no customers? No clients? There is no business when there are no customers and no

clients. Sony can only survive on the basis of meeting the expectations of Sony customers

worldwide. Failure to do so will result in disastrous business approach.

Suppliers

As boost in raw material prices have a knock on affect on the marketing mix strategy of any

company like Sony, keeping closer relationships among the suppliers guarantee that they

formulate competitive and quality products to the company.

Competitors

The competitor market should be evaluated to grant a better product and uphold the position

in the market. And in a market economy, it is only through competition that the true price of

anything can be determined. Among Sony’s competitors comprise the Dell Company with

Ultra-slim Adamo Notebook, HP with HP Pavilion G60-120US and Apple with its MacBook

Wheel, competing in the laptop market.

Employees

Employees are the back bone of any business. Keeping these staffs motivated is an essential

part of Sony, as training and development plays an essential role in consumer electronics

industry. Their staffs are well trained for it.

Marketing researchMarketing research can be defined as systematic gathering, recording, analyzing of data

about problems related to marketing of goods and services and its objective is to identify and

assess how changing elements of the marketing mix impacts customer behavior. Here we will

suggest ways for Sony if Sony had to do marketing research in Maldives. Marketing research

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Introduction to marketing

in Maldives will not have to be expensive because transportation costs inside Maldives is not

too expensive as this is a close- knit society. They can do it for least charges as we are only

three million as a whole occupying an area of just 300 sq km. They can conduct focus group

studies asking people about their attitude towards a product or the concept. Questions can be

asked in a place where participants are free to talk with other group members. They can also

do market perception studies by carrying out series of surveys assessing the markets opinion

of their performance, the degree to which they meet customer needs and of course people’s

perception on their brand name. Various factors like consumer behaviour and culture should

be taken into consideration as different cultures follow different practices and a product

might not suit the particular market. Most importantly they have to understand the

competitive environment that consists of other firms trying to win customers that take

account of all instant business rivals of the company.

Consumer BehaviourConsumer behavior is defined as an appropriate marketing stimulus based on customer

personality of how people buy what, when and why they buy.

The steps involved in consumer buying process are…

Need recognition

The buying process starts with need arousal. When you feel you need something and you

miss something that’s when a need is activated. A student may need a laptop to study and an

office worker to do his work. It might be the peer pressure of his co workers or he might be a

person doing his office work in the comfort zone of his house meaning telecommuters.

Information search

Here the consumer gathers the sources of information about the product. In this stage Sony

can influence the consumers with providing information on internet which consumers use

mostly when searching for information. He may ask his friends and family and also may go

to a laptop vendor. Here the company can make available leaflets about pricing and features

of the product to vendors.

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Evaluation of alternatives

Having collected the information, the consumers clarify and evaluate the alternatives.

Searching for a laptop the first thing comes to mind is hardware consideration. So Sony can

make its product features and product prices more attractive than the competitors.

Decision making

Here the consumer decides on which particular brand to buy. But sometimes people deviate

from the final decision also because o unanticipated situational factors as looks or manner of

the salesman or the way business is carried on.

Post purchase behavior

After buying and trying the product the consumer will feel some level of satisfaction or

dissatisfaction with the product. The dissatisfaction he feels about the product he bought is

what we call dissonance. To avoid this Sony can give out a call to its customers to ask them if

they have any problems or need any assistance regarding the product which will make the

customer feel valuable.

Branding alternativesFour Branding Alternatives is a strategic marketing communications technique. It is a fun

and creative approach that can add value to any class that likes to discuss brands and how

they could be innovatively developed (Four Branding Alternatives, 2009).

A new product is developed when new ideas and meanings are introduced to the customer.

Sony Ericssons Bravia TV phone can be an example. It’s an exotic looking super-flip factor

phone perfect for viewing movies, which they launched after mixing up their sub brand Sony

Ericsson and Bravia. With this Sony Ericsson BRAVIA you can experience high definition

cinema in your hands. Flanker brand is when a new brand is introduced into a category

where the organization already has established products. A possible example is the

introduction of Sony VAIO series into the PC market. When a current brand name is

introduced into a category where the organization already has established products, it is line

extension. Sony recently launched Sony Ericsson Xperia X1 into their existing brand Sony

Ericsson which is a good example of line extension. Franchise extension is when a familiar

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brand is taken to a product category where it is unknown. It may be Sony entering the market

for eco friendly motorbikes or cars.

New Product DevelopmentNew product development is the term used to illustrate the entire technique of launching a

new product or service to marketplace and promoting the product.

It is the systematic search of ideas. An idea can be generated either internally or externally

from R&D department or from the company employees or by just analyzing the competition.

Sony have this concept called, VAIO ZOOM CONCEPT which is not officially a Sony

concept. But we can say it is one of the most exciting and competitive product we will ever

see.

Idea Screening

This is where the ideas are taken into standard format and are verified for technical and

financial viability and marketability. This concept is a laptop which has a holographic glass

screen that goes translucent with a touch sensitive keyboard that turns opaque when turned

off. This might sure not be easy to produce with the existing technology we have now. So the

product should be technically tested to see whether they are financially in a good position to

invest and whether they have the required technology to support.

Concept development and testing

In this stage all the concepts and ideas are placed with other similar concepts and they try to

sell the idea. But the laptop concept we have here is something with features that doesn’t

really exist till now.

Marketing strategy development

Here the probable selling prices are estimated based upon competition and even customer

feedback is done. The sales volume based upon size of market and the profitability is

assessed to place the product in market.

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Financial analysis

The probable sales, profits and costs are reviewed as this is a product that surely will need

much more advanced technology, the probable costs will be higher compared to any other

product of the company.

Product development

Here the Research and Development department generates the product focusing on

production and quality of the product turning the idea into a product. These are products that

are prototypes of the product to test physically for test marketing.

Commercialization

This is where you go to the full length of the product. Here the decision to launch the product

is taken and the 7p’s of marketing is applied. When, where, to whom etc… like if Sony make

zoom concept a reality also the product will be targeted for first class prospects due to

estimated high cost of production.

BCG matrixBCG matrix is a chart created by Bruce Henderson for the Boston Consulting Group in 1970

to help corporations analyze their business units. This helps the company to allocate

resources and use analytical tools in branding and marketing (Growth-share matrix, 2009).

Star

A star is when huge quantities of profit is produced because of the powerful market share and

high growth rate. We can say Sony Cybershot camera is a star because they are the first who

came into market with face detection technology with 40% of market share with no close

competitors.

Question

A product becomes a question when they have a lower market share and they do not generate

much profit or cash. This is a good example of Sony BRAVIA. Because due to tough

competition from Samsung Panasonic and other competitors, they couldn’t make as much

sales as they expected and their market share was only 14.5% where as Samsung was leading

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the LCD market with 27% of market share (Samsung number one in the UAE with a 27%

market share, 2009)

Cash Cow

We can say Sony Ericsson w980 from their walkman series is a cash cow. We say a product

is a cash cow when the product show signs of that the come back on assets is better than the

market growth rate, and makes more cash than they use. In case of Sony Ericsson W980, it’s

a phone with touch sensitive music controls and an 8gb of internal memory which means you

can store up to 8000 songs. This product positioned Sony Ericsson as a market leader in the

music world.

Dog

A product becomes a dog due to low market share and a low growth rate and when the

product neither produces nor uses up bulky amounts of cash. Sony PlayStation 3 is placed in

the category of dog because Ps3 was beaten up badly by Xbox and the company suffered a

loss of 3billion. When the CEO of Sony was asked if it could make back the loss they made.

He responded saying “Not for as long I live”. This shows how disastrous the product was in

market (Sony CEO: Wii Business Model 'Superior,' Sony Won't Recoup PS3 Investment,

2009).

ANSOFF MatrixANSOFF matrix is defined as ways to grow the business via existing or new products, in

existing or new markets. This matrix helps companies to determine what path they have to

follow and what action they should take under certain circumstances. The matrix consists of

four market combinations or strategies including market penetration, product development,

market development and diversification. Here we will see how Sony’s practices resulted in

growing the business.

Market penetration

In market penetration company enters a market with current products. Here we have the Sony

BRAVIA LCD TV which became a question earlier. Then what they did was they re-

launched the product this time with a promotion which was when you purchase a BRAVIA

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TV you get their dog product, a PlayStation3 for free. Market penetration is said to be the

least risky way for a business to grow.

Product development

It is the approach of building up other products catering to the same market. In product

development what Sony did was after the launch of Sony VAIO in 2000 in New Delhi, India,

Just after 4 years they started a new business of IT peripherals targeting to the same Indian

market.

Market development

The third strategy is market development. Where an already existing product in the market is

targeted to a diverse customer sector like Sony targeted their PlayStation 3 to children and

after the maturity stage of the product it was targeted for adults.

Diversification

And the fourth strategy is diversification where the company enters new markets with new

products. Here we have taken the example of Sony Walkman because when Walkman was

introduced into the market, there were no existing markets for portable music.

ConclusionOn balance, as a globally operating company in consumer electronics, Sony is a successful

company with a good brand image with victorious products including its VAIO series which

we talked about in the beginning. It had ups and downs as any other company in its

marketing practices all over the world.

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Reference list

➢ http://en.wikipedia.org/wiki/Growth-share_matrix

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➢ http://in.answers.yahoo.com/question/index?qid=20090315070929AAiEMI2

➢ http://www.bbc.co.uk/worldservice/learningenglish/newsenglish/witn/2009/01/09012

3_sony.shtml

➢ http://www.cn-c114.net/578/a394265.html

➢ http://www.computerworld.com.au/index.php/taxid;567450213;st;3

➢ http://www.marketingteacher.com/Lessons/lesson_four_branding_alternatives.htm

➢ http://www.shacknews.com/onearticle.x/54453

➢ http://www.tomsguide.com/us/Sony-Financial-Results,news-1340.html

➢ https://www.courses.psu.edu/comm/comm497d_amh13/fall01/sony.html

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