Sony case study

1. 2010




A Case Study On
Electronic Products Of Sony Pvt. Ltd.

2. Acknowledgement

We take the opportunity of submitting this report to express
our deep regards to those who offered invaluable assistance and
guidance in this hour of need.

First & foremost. We would like to express my gratitude to
my professor and guides, for their constant support, encouragement and
valuable guidance, without which the successful completion of this
report would have been impossible. They are responsible for making us
realize how important it is for us to concentrate and put focused efforts
on this project.

Last but not the least; we would like to thank our friends and
colleagues for their support and invaluable help.

Submitted by:
Surabhi Agarwal

Submitted to:
Prof Deepti Verma

3. Index

S.No. Particulars
1. Introduction
2. History
3. SWOT
4. Case-study

4. Sony India Pvt. Ltd.
Company: Sony India Pvt. Ltd.
Managing Director: Mr. Masaru Tamagawa
Date of Establishment: November 17, 1994
Location: A-31, Mohan Cooperative Industrial Estate, Mathura Road,
New Delhi - 110044, India.
Staff Strength: 636 (as at March 31, 2007)
Share Capital: Rs. 550 million
Share Holding: 100% subsidiary of Sony Corporation, Japan
Branch Offices: Delhi, Haryana, Ludhiana, Mumbai, Bangalore, Chennai,
Kolkata, Hyderabad, Vijayawada, Jaipur, Chandigarh,
Lucknow, Pune, Ahmadabad, Indore, Cochin, Coimbatore,
Ghaziabad, Guwahati, Hubli and Ranchi
Business Activities: Marketing, Sales and After-Sales Service of electronic
products & software exports
Products: Televisions, Hi-fi Audios, Home Theater systems
and DVD players, Personal Audio (CD/Cassette Radio Players
and Walkman®), Audio Video Accessories, Car Audio and
Visual Systems, Notebooks, Gaming Consoles, Camcorders
and Digital Still Cameras, Digital Imaging Accessory
(Batteries, Chargers, Microphone, Photo Printers), Mobile
Phones, Recording Media and Energy Devices, Broadcast and
Professional products.

5. Introduction
Sony Corporation (Sonī Kabushiki Gaisha) is a multinational conglomeratecorporation
headquartered in Minato, Tokyo, Japan, and one of the world's largest media conglomerates
with revenue exceeding US$99.1 billion (as of 2008). Sony is one of the leading manufacturers
of electronics, video, communications, video game consoles, and information technology
products for the consumer and professional markets. Its name is derived from sonus, the Latin
word for sound.
Sony Corporation is the electronics business unit and the parent company of the Sony
Group, which is engaged in business through its five operating segments—electronics, games,
entertainment (motion pictures and music), financial services and other. These make Sony one
of the most comprehensive entertainment companies in the world. Sony's principal business
operations include Sony Corporation (Sony Electronics in the U.S.), Sony Pictures
Entertainment, Sony Computer Entertainment, Sony Music Entertainment, Sony Ericsson, and
Sony Financial Holdings. As a semiconductor maker, Sony is among the Worldwide Top 20
Semiconductor Sales Leaders. The company's slogan is Sony. Like no other.
Sony India is one of the most recognized consumer electronics brand in the country, with
a reputation for new age technology, digital concepts and excellent service. In India, Sony has
its footprint across all major towns and cities in the country through a distribution network
comprising of over 7000 dealers and distributors, 210 Sony World & Sony Exclusive outlets and
22 direct branch locations. Sony India also has a strong service presence across the country
with 21 company owned and 160 authorized service centers.
The first thing that comes to people‘s minds of the company and products of Sony is its
high-technology-filled-with-gadgets electronic goods and innovation. It was also this innovation
that makes Sony the greatest company that started in post-war Japan. Sony has used its
innovation in building markets out of thin air, created a multibillion, multinational electronic
empire with products such as the transistor radio, the Trinitron, the Walk-in and the VTR. That
changed everyday household lives forever.
However, this consumer targeted quest for excellence and constant innovation instead
of targeting mainly at profit also has a lot to do with current crisis Sony is facing - sales and
profits are down or are slowing down, capital investment cost and R&D are climbing,
competitors are moving in with copycats, the battle between VHS and Beta and the search for a
smash hit product such as the Trinitron or the Walk-in.

6. History
Masaru Ibuka, the co-founder of Sony.
In 1945, after World War II, Masaru Ibuka started a radio repair shop in a bombed-out
building in Tokyo. The next year, he was joined by his colleague Akio Morita and they founded a
company called Tokyo Tsushin Kogyo K.K., which translates in English to Tokyo
Telecommunications Engineering Corporation. The company built Japan's first tape recorder
called the Type-G.
In the early 1950s, Ibuka traveled in the United States and heard about Bell Labs'
invention of the transistor. He convinced Bell to license the transistor technology to his
Japanese company. While most American companies were researching the transistor for its
military applications, Ibuka looked to apply it to communications. Although the American
companies Regency and Texas Instruments built the first transistor radios, it was Ibuka's
company that made them commercially successful for the first time. In August 1955, Tokyo
Telecommunications Engineering released the Sony TR-55, Japan's first commercially
produced transistor radio. They followed up in December of the same year by releasing the
Sony TR-72, a product that won favor both within Japan and in export markets, including
Canada, Australia, the Netherlands and Germany. Featuring six transistors, push-pull output
and greatly improved sound quality, the TR-72 continued to be a popular seller into the early
sixties.
In May 1956, the company released the TR-6, which featured an innovative slim design
and sound quality capable of rivaling portable tube radios. It was for the TR-6 that Sony first
contracted "Atchan", a cartoon character created by Fuyuhiko Okabe, to become its advertising
character. Now known as "Sony Boy", the character first appeared in a cartoon ad holding a TR-
6 to his ear, but went on to represent the company in ads for a variety of products well into the
mid-sixties. The following year, 1957, Tokyo Telecommunications Engineering came out with
the TR-63 model, then the smallest (112 × 71 × 32 mm) transistor radio in commercial
production. It was a worldwide commercial success.

7. Product & Technology Milestones
(1955) Japan's first transistor radio, employing five transistors
developed in-house. The TR-55 became the forerunner of later portable
radios.


TR-610 Highly acclaimed for its novel design, it was a hit in
both Europe and the US. Approximately 500,000 units were sold
throughout the world.


(1965) TFM-110 This model featured a black and silver design
which was representative of the ―Solid State Eleven.‖ Its chic design and
unprecedented advanced sensitivity made the TFM-110 a top seller.

(1975) ICF-5900 Five-band radio known by the nickname ―Sky
Sensor.‖ Its crystal marker (based on a quartz crystal resonator) ensured
precise shortwave tuning.

1976 ICF-7500 Skillfully designed to separate the tuner
and speaker, resulting in a high-performance, compact FM/AM
receiver.

8. 1995 ICF-TR40 Model commemorating the 40th anniversary of
Sony radios. This handy portable radio featured a faux-leather exterior with
metallic trim.

1997 ICF-B200 Emergency radio with built-in manual power
generator. Just turn the handle to charge the internal batteries.


2000 SRF-G8V The use of magnesium alloy ensured a slim but
durable body. With a text-to-speech function and a stand charger, this radio
was designed specifically for commuter use.

9. INTERNATIONAL MARKETING
Sony Corporation - SWOT Analysis.
The Sony Corporation - SWOT Analysis company profile is the essential source for top-
level company data and information. The report examines the company‘s key business structure
and operations, history and products, and provides summary analysis of its key revenue lines
and strategy.
Sony Corporation (Sony) is one of the world‘s leading consumer electronics firm with
additional interests in the entertainment industry through subsidiaries dealing with recorded
music, motion pictures, TV programming, DVDs and videos. The group operates globally and is
headquartered in Tokyo, Japan. It employed 163,000 people as on March 31, 2007. The group
recorded revenues of JPY8,295,695 million (approximately $70,355.8 million) during the fiscal
year ended March 2007, an increase of 10.5% over 2006.
The increase was driven by strong sales within the electronics, game and the pictures
segment. The operating profit of the group was JPY71, 750 million (approximately $608.5
million) during fiscal year 2007, a decrease of 68.3% compared with 2006.The net profit
was JPY126, 328 million (approximately $1,071.4 million) in fiscal year 2007, an increase of
2.2% over 2006.

Strength

One of Sony‘s greatest strengths is their ability to produce innovative, quality products. Sony‘s
web page states ―Sony innovations have become part of mainstream culture, including: the first
magnetic tape and tape recorder in 1950; the transistor radio in 1955; the world‘s first all-
transistor TV set in 1960; the world‘s first color video cassette recorder in 1971; the Walkman
personal stereo in 1979; the Compact Disc (CD) in 1982; the first 8mm camcorder in 1985; the
Minidisk (MD) player in 1992; the PlayStation game system in 1995; Digital Mavica camera in
1997; Digital Versatile Disc (DVD) player in 1998; and the Network Walkman digital music
player in 1999‖ (Sony.com/en/corporate).

PC World published The 20 Most Innovative Products for the Year 2006. Sony‘s Reader was
listed as number six and Sony‘s PlayStation was listed as number sixteen. Sony Corporation
has managed to be competitive and stay a powerful organization by learning from past failures.
Sony states the following: ―Sony has learnt much from previous unsuccessful products. The

10. Sony MSX home computer, for example, did not attain a satisfactory level of success. But it did
teach Sony development engineers valuable know-how that would be applied in later years. In
effect, these engineers became living resources, representing latent power within Sony that did
not exist in other AV companies‖ (Sony.net).

Another strength of Sony is their ability to be successful in several different markets. They have
made an impact in the video game market, the PC market, and especially the television market
and there are still numerous others.
The greatest asset of Sony is of its human capital, especially its engineers which make
up the R&D department. Their constant innovation is crucial for a consumer electronic firm
which specializes in audio-visual equipment and the higher profit margin, which comes from
being the leader of the pact. Subsidiaries are also well established, such as in the United States
and Europe which give Sony a distinct local hands-on knowledge of the local market. It also
makes Sony an international corporation, bringing together the talents and best of strategies of
both world to the organization. Besides the employees, the two founders, Ibuka and Morita also
legends in their fields which they create vision and sense of direction for the organization. They
also acts as bridges between the employees and the management.
The self promoting system and job rotating systems creates satisfaction for employees
and give them greater exposure to all aspects of the business. Ideally, this would produce better
products as engineers gain knowledge on consumer needs while marketing people engaged in
the production and can give their point of view.
The goodwill of the company among the consumers is one of the biggest asset of Sony
corporation. the general image of the company is – it a big company with huge experience in
every field they are in ,provide high quality products, very expensive and best product.
Distribution network of Sony and all it‘s subsidies id world class.
Showrooms made exclusively for the Sony products are very exclusively made. Which
makes a customer entering it get caught spirit of Sony and feels completely dragged by it.




Weakness

11. Sony‘s biggest and most recent weakness is their lack of innovation with PS3. Sony focused on
digital technology when building the PS3 and it has the ability to export video in high-definition.
But this technology can only be viewed on a high definition TV so a lot of people will not even be
able to see the full potential it has to offer. Another downfall to the PS3 is the price, which Sony
has recently lowered by $100. Yet the weakness of the PS3 is even deeper when considering
the range of video game selections. The majority of games available are all first-person shooter
games, which appeal to a particular market. There are few games that appeal to a different
section of video gamers. Sony executives made it clear that they know they need to do more
than lower prices to woo consumers back to its flagging video game brand.


Opportunities

Sony seeks a lot of opportunities that utilize their strengths of innovation. At Sony Ericsson,
design is about more than just a good looking product: it is integrated into every step of the
process – intelligent features, user-friendly applications, innovative materials and, of course,
attractive visual appearance. Design is the essential differentiator when comparing mobile
communications products.

Sony's Reader, a device the consumer-electronics giant hopes is an early draft of how the world
will read books in the future, is another innovation that Sony is using as an opportunity to enter
a new market. The downloaded books generally cost 20 to 30 percent less than their dead-tree
counterparts, which is also setting a standard on what is expected in regards to new products
that encourage environmentally friendly devices.

One of the other CSL projects most likely to succeed was a nifty little piece of graphics software
for cell phones by Ivan Poupyrev. It might not sound like much, but the ability to draw realistic
icons and avatars directly on a standard (non-touchscreen) phone is sure to add appeal to users
of mobile social -networking sites.

Although there was far too much on display today to cover in depth here, there was a clear
emphasis on what many predict will be the boom technology of the next few years – social
networking in all its forms.


Threats

A common threat facing any company in sales is competition. Sony‘s Vaio is its newest
innovation in notebook computers. The various models range in price from $845 - $2300.
However, Dell has a great reputation when it comes to laptops similar to the Vaio and has a
broader range of notebooks to choose from, not to mention that Dell has also been a top seller
when it comes to desktop computers. Additionally, the cost of a Dell notebook computer seems
to have a lower price tag than many of Sony‘s Vaio models.
Sony‘s top competitors in the gaming industry are Nintendo and Microsoft. The PlayStation 3

12. sales have fallen behind recently. In 2007, 82,000 PS3s have sold and 360,000 Nintendo Wiis.

In the LCD television market, Sony excels but still faces some strong competition, including
Samsung, Sharp, Panasonic and more. Many of these same brands appear in the DVD player
market that Sony has to compete with.

Competition isn't the only threat Sony is facing. Sony most recently had to make a public
apology concerning the use of a backdrop in a violent video game, "Resistance: Fall of Man."
Sony used the Manchester Cathedral in northwest England in this video game, which features a
bloody gun battle scene between American soldiers and aliens. Sony made a formal, public
apology on July 6, 2007. However, when asked to withdraw the game or make donations to
community groups, they have refused.

13. Case
The company was also gathering a reputation as the ‗‗guinea
pig‘‘ of the Japanese electronic manufacturers. Sony continually
was first to market with new innovations, such as the transistor
radio and the first solid state TV set in 1959. Other, larger
manufacturers would sit back and see whether markets
emerged for those products. If they did, they would then jump in,
releasing competitive products. As Sony‘s successful track
record became better known, the larger manufacturers were
waiting shorter and shorter periods of time before entering new
markets.
To keep Sony at the leading edge, up to 10-percent of the
company‘s sales were committed to research and development.
To develop international sales operations, most Japanese
companies tend to work through Japanese trading companies.
By contrast, Morita decided Sony would set up its own sales
offices, with the first being established in New York. Morita also
resisted the urge to move the company into OEM deals -- making
a radio and putting someone else‘s brand name on it -- at this
time as he was keen for the Sony brand name to gain recognition
first.
Sony also continued to add more products to its range of
consumer electronics. Early videotape units were large,
expensive and used mainly by broadcast stations. Ibuka set out
to develop a small system that could be installed in homes. By
1969, the Sony U-Matic video recorder was released, featuring
three-quarter inch wide video tapes. The company then
perfected a home video unit, using a self contained half-inch
video tape cassette about the size of a book.
In color television technology, Ibuka had another team working
on the technology that would later come to be called Trinitron --
an innovation in which the electron beams generating the TV

14. picture were packaged in one compact, highly efficient unit. The
new technology debuted in 12-inch and 7-inch TV sets -- niche
markets everyone else had ignored while they turned out larger
and larger color TVs.
In many companies, sales companies actually discourage
innovation, because that means re-educating the sales force.
This is an expensive exercise, usually including R&D
expenditure, increased advertising and sometimes new facilities
for the manufacture of the new products. It also obsoletes
existing product lines. In profit conscious companies, particularly
those where compensation is tied directly to profitability, sales
managers will prefer not to innovate. The challenge, therefore,
is to get sales people to think long term and not to focus on
projects that will come to fruition in the immediate future.
One of the distinctive features of Japanese creativity is that it is
driven by changes in the consumer marketplace rather than by
defense industry expenditure. Many U.S. and European
technology breakthroughs are spin offs from defense work
funded by the government. In Japan, by contrast, technological
innovation goes hand in hand with commercial viability.

15. International Marketing of Sony Pvt.Ltd.
Sony's decision to shift focus from the domestic to the international market took seed
during Morita's 1953 visit to Philips. Holland resembles Japan in many ways. If a company like
Philips can succeed in the international market, there's no reason why Totsuko can't, he
thought. Boosted by this convicton, he directed Sony to begin concentrating its energies on
producing exports for the international market.

Their initial goal was to build up overseas markets which would yield 50&percent; of their
gross sales. Thanks to sales of transistor radios and the diligent marketing efforts of Morita and
his staff, this goal became possible within seven years.

Next came step two. Morita took an assertive stand. Until now we have merely exported
overseas. From now on, however, we must go to the heart of the matter. Overseas marketing is
an overseas business. I believe that Sony can become stronger by setting up overseas offices.
Offices had already been set up in New York, Hong Kong and Zurich for this purpose. A radio
factory had also been established in Shannon, Ireland.




The early days of Sony Corporation




Then in February 1960, Sony Corporation of America (SONAM) was established to
oversee Sony's marketing activities in the United States by doing business with Americans like
an American company. This was something that no other Japanese electronics corporation had

16. dared to attempt. Many doubted that a company specializing in transistor radios and other
electronics products, as opposed to a general trading company, could deal successfully without
an agent's assistance.
Morita was well aware of the risks. In light of Sony's current situation, we may be acting
a little prematurely. But a business that doesn't take advantage of its opportunities doesn't
deserve to be called an enterprise. We may be overextending ourselves, but the time to act is
now. We at Sony don't believe in shying away from the hardship that comes along with a good
opportunity, and we ask all our employees to uphold this spirit, explained Morita to his
employees.

Marketing Strategy
The marketing concept of building an organization around the profitable satisfaction of customer
needs has helped firms to achieve success in high-growth, moderately competitive markets.
However, to be successful in markets in which economic growth has leveled and in which there
exist many competitors who follow the marketing concept, a well-developed marketing strategy
is required. Such a strategy considers a portfolio of products and takes into account the
anticipated moves of competitors in the market.

17. PUBLIC RELATION MANAGEMENT

OBJECTIVES

1. PR efforts began by identifying three target audiences, defined as (1) jetsetters who require
an ultra-portable notebook, (2) early adopters and affluent consumers desiring high-end
electronics regardless of cost and (3) image-conscious consumers whose purchases are driven
by aesthetics and who appreciate stylish design.

2. Position Sony as a leader with an "industry first" technology that meets the needs of today's
mobile PC users.

3. Drive sales and garner significant media coverage of the T350 notebook.