Sony Xperia Marketing Plan

The Executive Summary

Sony Corporation is a Japanese company engaged in production of home and professional electronics, video game consoles and other high-tech products. Sony Mobile Communications was founded in 2001 as a joint venture of Swedish telecom manufacturer Ericsson and Japanese electronics manufacturer Sony. Headquartered in London, but the company is registered in Sweden. In October 27, 2011 Sony bought 50% (part of Sony Ericsson), owned by Ericsson, for 1.05 billion euros, announcing that the new company's products will be sold under the brand Sony. In 2012 Sony Mobile consolidated successfully with Sony. (2012, SONY COMPLETES FULL ACQUISITION OF SONY ERICSSON)

This marketing plan is looking at Sony successful phone series – Xperia. At this moment Sony has 27 phones under the Android OS. Xperia phones combine great efficiency along with modern style. First SonyEricsson Xperia X1 was produced in 2008 and since that time company always expanded Xperia series phones.

 

 

 

 

 

 

 

 

 

 

 

 

 

1.0 Situation Analysis

1.1 The Market

- Market share (volume/value)

- Market trends using Porter-Five Competitive Forces, SLEPT Analysis, SWOT Analysis

- Company, Brand, Competitor, Customer, Company sales forecasts

1.2 Distirbution

- Available channels

- Sales by outlet

- Competitors’  distribution methods

2.0 Mission/Objectives

2.1 CORPORATE OBJECTIVES

- Profitability, growth

2.2 MARKETING OBJECTIVES

- Market share, growth, sales

3.0 Strategies

3.1 Segmentation

- Bases, Characteristics & measurement, Strategy

4.0 Marketing Mix

4.1 Product Decisions

4.2 Pricing Decisions

4.3 Distribution Decisions

4.4 Promotion Decisions

5.0 Budgets

- Sales Forecasts, Sales Budgets

- Periods 1-5 Years, Costs

6.0 Control - Feedback

 

Situation Analysis

Internal Environment

Key Executives:

• Kunimasa Suzuki (President and CEO)
• Bob Ishida (EVP and Deputy CEO)
• Dennis Van Schie (Corporate Vice President, Head of Sales and Marketing)

Employees:

Sony Group had 162700 workers around the world by May 2012 including 8900 people staff in Sony Mobile. The company has strong organization culture. All employees are divided into teams to produce more efficiency.

External Environment

Customers:

The range of customers for Xperia mobile phones varies from childhood age till grown up. Customer range is wide. The demand for high and low priced phones differs by the country. For example in the developing countries low cost phones have much more demand than high-end ones. These people are usually from ages of 13-50. Some customers buy it for its nice look, some of them for its camera, some of them for games and some for music. And there are numbers of such criteria, that’s why people from different ages purchase these products. Xperia phones fit almost every man in the world, it is easy to use, nice design and the price is competitive with other android phones. (CNET, 2013, CELL PHONE BUYING GUIDE)

Competitors:

Sony Mobile has a group of key competitors:

• iPhone – American brand phone from Apple based on iOS. Usually more expensive than Xperia but having same or lower technical characteristics. But iPhones are more durable than most of their competitors.
• Samsung – Korean phones based on Android OS. Sony’s straight opponent in Mobile business. Samsung phones have equal technical features and most of the time have similar or lower price. But the disadvantage of Samsung is the material of what the phones are made of. Most of customers say that it’s a low quality plastic that is easy to break.
• HTC – Taiwanese based Android phones. These phones have their unique design like Sony has. And the technical features are same as Xperia as well as the price. 2^nd straight Sony opponent.
• Nokia – Swedish phones based on Windows Mobile OS. These mobile phones were very popular during last decade, but after the rise of iOS and Android, Nokia’s Symbian OS lost its popularity as long as Nokia phones. Now the company started new phone campaign with high tech phones based on Microsoft Windows Mobile system. But these phones usually are more expensive than their Korean, Japanese and Taiwanese opponents.
• LG – another Korean brand smartphones based on Android. These phones are less popular and less productive as Samsung, but they are made of more durable materials and differ from Samsung by its style.
• Blackberry – Canadian smartphones based on Blackberry OS. These phones’ main advantage is encrypted mail client. Usually business people prefer such phones as the company guarantees confidentiality of mailing.
• Motorola – American android based phone company. The minor player on a nowadays phone business. This company used to have a success before, in first phones and pager times.

Porter-Five Competitive Forces:

• The threat of new entrants to the industry. New companies are entering the mobile segment every year. These new players can harm Sony if their devices would be cheaper, more durable and more efficient. But on the other side new players cannot seriously harm Sony as they don’t have such a powerful brand. But if a new player comes from a well-known company, for example Amazon Kindle plans to start producing smartphones. In such cases Sony Mobile has to keep in mind all of new invents in IT sphere, refresh their mobile phone lineup periodically, adding new features or upgrading existing. (2013, RUMOR: AMAZON SMARTPHONE TO SPORT 4.7-INCH DISPLAY, LAUNCH THIS YEAR)
• The threat of substitute products or services. There are not so much threads of substitute products for mobile phone market. Landline phones are used rarely nowadays, most often they are used at homes and in offices. These days almost every person has a mobile phone. Laptops and Pads are not a straight substitute to the phones as they are much bigger, even if they are using more cheaper way of communication.
• The bargaining power of customers. These days there are a lot of smartphones using same technologies or similar to the Xperia smartphones. But they are produced under the less popular brands like Huawei or ZTE. Some part of customers can select these cheaper less known brands with similar specifications instead of branded Xperia.
• The bargaining power of suppliers. Sony doesn’t produce parts for mobile phones. They buy it from their suppliers like Intel or Nvidia. If the suppliers increase the price for their parts, then Sony will have to decide whether to keep business with this manufacturer or try to find similar and cheaper producer of parts.
• The rivalry amongst current competitorsin the industry. Sony Mobile’s biggest rivals are Samsung, Apple, Nokia and HTC. These competitors produce phones that have similar or in some cases better technical specifications. Especially Samsung’s Galaxy S4 will be announced soon – the most efficient mobile phone these days. Sony’s latest Xperia Z is the top phone of Xperia lineup. But it has a little bit worse specifications than Samsung. And this rivalry happens all the time between mobile giants. Every company tries to surprise the customers with their new features, so Sony has to take the next step in competition by producing better phone than Samsung S4. This is the endless battle between phone producers. Every year of half-year one producer goes ahead of others after publishing the most efficient phone. Then it is a signal for the rest of producers to create something better. And this tradition goes on and on, year by year.

 

 

Media

The media keeps following Sony long time before they began to produce smartphones. The media is able to promote Xperia phones as well as it can be the cause of sales decrease. It all depends on how media will observe new product. The media is one of the biggest things why people around the world know Sony.

The Market

Market Share.

Below is described the market share for all mobile phones sold from 2010 till 2012:

Competitors	Market Share
	2012	2011	2010
Sony	4,80%	2,60%	2,60%
Apple	7,50%	5,00%	2,90%
Samsung	22,00%	17,70%	17,60%
Nokia	19,10%	23,80%	28,90%
HTC	1,80%	2,40%	1,50%
Blackberry	2,10%	2,90%	3,10%
LG	3,30%	4,90%	7,10%

(Table 1)

As you can see on the table 1 Samsung is the leader in this segment for past 3 years with their 22% share in 2012. Nokia has a straight decrease from year to year as this brand loses its popularity from year to year; but it still remains at 2^nd place after Samsung. Apple’s share is increasing since 2010 as well as Sony. (2012, GARTNER SAYS WORLDWIDE MOBILE PHONE SALES DECLINED 1.7 PERCENT IN 2012)

Competitive Analysis

Competitors	Customer Awareness	Product Quality	Product Availability	Technical Assistance	Sales Force	E = Excellent
Samsung	E	G	E	E	E	G = Good
Nokia	G	G	E	G	E	F = Fair
Apple	E	E	G	G	E	P = Poor
Sony	G	G	G	G	G
LG	F	G	F	F	F
Blackberry	G	E	G	F	F
HTC	F	G	G	G	F

(Table 2)

Table 2 describes the competitive analysis between the biggest mobile phone producers. As we can see Samsung has excellent statistics except their product quality. In fact their phones are the less durable comparing to other brands. Nokia also has good marks because of their past experience basis: they opened a lot of spots and representative offices in different countries with their own service centers many years ago when Nokia used to be the leader in this segment. Apple has excellent product quality and popular brand name but it is not so available as Samsung for example. Apple has less vendors around the world and less authorized service centers. Sony remains good mark as their brand Xperia is a new player on the market; so their business has just started.

SLEPT Analysis:

• Social. Sony Xperia brings all the best for their customers. Sony tries to make the control of their devices easiest as possible. The company already gained a well known reputation in audio/video/computing devices. Their brand is the one that people can rely on knowing that it is high-tech, modern and has branded Japanese good quality. The company always follows the new trends in information technology. Any new invention published in this sphere may be useful for the company. They still continue to produce unique electronic products as well as Xperia phone model line.
• Legal. The company needs to continue registering their all new products with the authorities to avoid any governmental scandals or risks to be involved into it, as it will cause badly the company’s reputation.
• Economical. As long as Sony is an international company, it has different exchange rates in various countries. If the exchange rate in a particular country changes, Sony needs to react fast and change its pricing policy in this country.
• Political. Sony has to be prepared for any political changes in any country, where it operates. The government can change minimum wage, tax, VAT etc. So the company has to be able to react on these changes.
• Technological. This company follows the IT progress every day. The company successfully implement new technologies into their new Xperia mobile phones. Such things like 13Mpix camera, Bluetooth, HDMI, high-resolution screen etc – all these features are available in Sony phones. The main aim for company is to keep following and implementing new technologies into their mobile phones.

SWOT Analysis for Sony Mobile

• Strengths. There’s always a demand for Sony products as the company is operating in different markets for a long time. Sony engineers learned from past mistakes made and now work better. Due to their brand, the company is very competitive towards their competitors.
• Weaknesses. The company loses the Android based smartphone battle to Samsung; despite that same technologies and parts are used in both brands’ phones, Samsung phones are made of cheap materials, that make their phones less durable, but more cheaper. Sony Mobile is the newbie on the smartphone market since they renamed from SonyEricsson.
• Opportunities. If the company will produce phones using cheaper materials, then they can beat Samsung’s pricing policy and increase their sales on mobile phone market among Android phones. The mobile phone market is still rising in developing countries; Sony can make use of it and create ventures in Africa or other developing regions. Sony is known for non-copying policy on their products, so every smartphone has a unique design.
• Threats. Threats. There’s a very tough competition on smartphones market. New aggressive players on the market could also take some part of company’s market share.

SWOT Analysis for Xperia

• Strengths. Always offering a customer the latest and high technology smartphones with latest applications installed. High quality parts used in phones along with modern design. Some of Xperia phones are enhanced with waterproof and dustproof cases. Most of Xperia phones are enhanced with branded Sony photo camera along with branded Walkman music player. Xperia phones could be connected wirelessly to other Sony devices at home/work, for example TV, DVD or speakers. As all the Xperia phones are running under Android system, all parts in the phone are easy replaceable and cheap. Xperia phones differ by 3 categories to cover 3 types of consumers’ demand: hi-end, middle, economic.
• Weaknesses. There are always identical products on market with same specifications but with lower price. Not such strong brand name as SonyEricsson was before; the production of Xperia phones with name “Sony” started only since 2012. Prices for some high-end models are overvalued.
• Opportunities. Xperia brand is operating as a sponsor of USA tennis tournaments. If the company creates new phones with more durable case, like iPhones have, it would probably increase the demand. While the Xperia brand is not the most popular among smartphone users, hence there are much less duplicate or fake phones.
• Threats. People who are interested in Xperia phones sometimes change their mind and buy Samsung phones because their prices are cheaper. The company may lose the technology battle to Samsung; the latest Samsung Galaxy S4 is about to be announced; this model’s characteristics are expected to be higher than any Xperia phone.

Let’s review now the SWOT Analysis for Samsung Galaxy. The leader on the mobile phone market:

• Strengths. Cheaper price because of the cheaper materials used in the phone case. Freshly announced Galaxy S4 is the most efficient smartphone for this day. Galaxy smartphones line-up is very wide and varies from low-budget models to high-end phones like Galaxy S4 or S3. The most repairable phone in the world, as Samsung has more service centers comparing to its opponents. Parts for Galaxy phones are cheap and easy accessible; the phones also could be repaired by any mobile technician.
• Weaknesses. All Galaxy phones are fragile and easy do break. New published top smartphones are always starting with big price. Simple design without any visible unique design like iPhone or Sony Xperia. Samsung smartphones are the number one category of phones, which are copied and produced “fake” models; mostly in China.
• Opportunities. If the company enhances Galaxy phones with a durable case, the demand for the phones will increase. Another idea to increase sales is to add a unique design to their smartphones.
• Threats. The uprising popularity of Xperia phones could be a possible threat. If the company remains purchasing phones without any design idea, it could downsize its sales.

Company Sales Forecast

Sony targets to sell 50 million smartphones in 2013. This statement was made due to the increased efficiency work in Taiwanese factory. Sony plans to produce 20 million mobile phones only in Taiwanese Foxconn factory. The rest would be produced from other countries’ factories like China.

The forecast for the 2012 year was 35 million; the company finally sold 32 million of phones. It is almost a 50% increase comparing to 2011. As we can see on the chart the smartphone business of Sony increases from year to year:

 

The mobile business is the only segment of Sony which didn’t downgrade its shipments during 2012. Most of other businesses like PlayStation did a heavy downgrade. (2012, SONY REPORTEDLY TARGETING 50 MILLION XPERIA SMARTPHONE SALES IN '13)

Distribution

Available channels. Most of Sony Mobile’s products are sold in Sony online store or in Online Sony dealers’ stores. The other part of goods is sold in Sony retail stores or in authorized dealers’ stores. The other channel is worldwide mobile operators. Nowadays mobile operators offer Xperia phones along with mobile operators’ services. This is a very suitable option for those, who wants to purchase a phone, but don’t have full amount of total phone’s cost. In such cases mobile operators offer special deals, when the customer pays for the phone partly during 1 or 2 years. Primary distribution channels depend on country. For example in USA most of the smartphone sales are made by mobile operators. In this particular case phone producers have to concentrate more on this channel as it brings most part of revenue. So the companies in this country aspire to have as much as possible models of phones in mobile operators’ offices or stores. (SONY, 2013, SONY AUTHORIZED DEALER)

Outlet. Besides retail stores Sony has a network of outlet stores with limited varieties of phones under a low price.

Competitors’  distribution methods. All producers on smartphone market are using same types of channels: company and dealers’ online stores, retail stores and mobile operators.

Mission/Objectives

The company’s main objective is to increase sales and popularity of Sony’s Xperia brand; to take a bigger part in a market share, attract new customers and follow the implementations of new technologies into their phones.

The company’s final mission is to become the biggest producer in smartphone market and make brand Sony Xperia the most recognizable, attractive and innovative in mobile industry. The other continuing mission is to keep producing unique phones that wouldn’t have any analogues from Sony’s competitors.

The smartphone market is continuously expanding. New players appear time by time as well as new technologies are invented every year. Smartphones have gone from very simple - instant messaging and e-mail to high-end devices for streaming video and web pages with incredible speed. It is hard to predict how the smartphones will look like and what options will they have after 5-10 years. One thing we can suppose for sure is that a smartphone will gain more and more options. It is expected the mass production of hand-bracelet phones and elastic phones which form can be transformed. Another most possible option that will be realized on phones of future is virtual reality.

 

 

 

Corporate Objectives

Profitability, growth

As the company started operating under the name Sony just since 2012, it plans to receive their first NET profit in this fiscal year starting from April 1^st. Plus Sony plans to take 3^rd place in 2013 overall market share. (2013, SONY MOBILE CEO TARGETS PROFITABILITY IN 2013 FISCAL YEAR, EXPECTS OVER 34 MILLION UNITS SOLD)

After the consolidation of Sony Mobile with Sony; the heads of the company expect a rapid growth. New Sony Xperia Z is the result of fast and productive work after two companies united. Xperia Z has all needed modern features like Sony Exmor RS 13MP camera, latest versions of Android, Bluetooth. High resolution screen using branded Sony Bravia technology. HD Video recording ability, water and dust resistance, integrated Sony PlayStation client, wireless connectivity between the phone and other devices like TV, Speakers, Laptop and other phones – all these functions defer Sony Xperia Z from other models on the market.

Marketing Objectives

Market Share, Growth, Sales

Sony plans to take over mobile phone market after its consolidation with Sony Mobile and the release of Xperia Z and Xperia Tablet. The company plans to produce more phones this year and sell more after increasing efficiency on Taiwanese factory. In addition Sony plans to start producing low-cost smartphones for the developing countries.

The main marketing objective for Sony Mobile is to increase their sales and take a bigger part on a smartphone market after Sony realized a single platform operating structure for its mobile business. (Sony, 2013, STRENGTHENING CORE AREAS)

 

 

 

 

 

 

 

 

Strategies

Brand Strategy

After the consolidation with Sony Mobile, the company plans and already started the “One Sony” strategy to produce phones that would gain functions from other Sony devices like cameras, TV’s, laptops, pads etc. As a result of these forecasts, Sony plans to achieve target sales of 1.8 trillion yen in FY14 from mobile business and significantly increase their profit. (2012, SONY OUTLINES DETAILS OF “ONE SONY” STRATEGY; CONFIRMS FOCUS ON MOBILE)

 

Company Strategy

After a bad financial year, the company has launched a number of initiatives aimed at revitalizing its business. The strategic plan called «One Sony» is intended to draw attention to the markets of games, mobile technology and digital image processing. As planned by the management of the company, the new plan will allow to profit from these three lines of business in the amount of 70% of the total sales of all goods and services Sony.

In the gaming sector, Sony plans to release new games for PC and PS3 consoles, as well as improve service subscription to PlayStation Network. In addition, Sony is also preparing its best games for the line of tablets and devices Vaio. If all goes well, the gaming segment of the market the Japanese electronics giant hopes to get to the 2014 fiscal year, a profit of $ 12.4 billion.

As for the digital imaging technology, Sony hopes to strengthen its position through the development of new types of image sensors, advanced signal processing technologies, lenses and other key technologies of digital image processing. It is expected that digital cameras and camcorders, created on the basis of new components and technologies will be released to the markets of consumer electronics and professional equipment. (2012, "ONE SONY" INITIATIVE TO FOCUS ON THREE KEY MARKETS TO REVITALIZE BUSINESS)

Segmentation

Bases, Characteristics & measurement

In recent years the mobile phone market rapidly increased. And every year mobile phones get more intelligent. In previous times a cell phone was a device to make calls and SMS; but nowadays phones are mini computers that can store and process information. Moreover modern smartphones can provide the customer with all needed components like email, internet, entertainment and communication. The external design of phones nowadays is also different. They vary from large touch screened to old-style buttoned phones. New types of phones are published every year. It’s happening because of technological progress and customers’ constantly changing demand. Market segmentation is necessary for the producers to make a clear vision on the situation and find needed segment to act.

According to Kotler, there are four main segmentation dimensions that are mostly used:

(KOTLER, 2003, MARKETING MANAGEMENT)

Nowadays smartphones have their own operating system. Most of them work under Android OS. But some of mobile phone producers merged is past with operating system developers. Such companies are Apple with their iOS, Blackberry with their own OS and Nokia with Symbian OS in past and Windows Mobile now. That is why Sony is not segmenting the current smartphone market, because it is already segmented for Android/iPhone/Windows/Blackberry phones. But Sony is not aiming to reach 1^st place on only Android phones segment, the company plans to aim the whole smartphone market, and their current mission is to reach top 3.

Of course some can say that we could segment the mobile smartphone market by their key abilities. We could divide the existing market on subcategories depending on the phones’ primary merit. This kind of segmentation was actual 3 years ago and earlier. At these times marketers could segment the phone market at following sections:

• Camera Phones. The mobile phones that can take high quality pictures and videos.
• Music Phones. Phones that can produce high quality sound. A branded headset is usually an addition to these phones.
• E-mail Phones. Devices that have best encryption system and compatibility to popular mailing systems like Outlook and Lotus.
• Entertainment phones. These phones allow user full access to entertainment like games and internet browsing.
• Fashion phones. The phones with unique design or jewelry incrusted.
• Low-budget Phones. The type of smartphones that have a low price, of course they have worse characteristics than the expensive ones.

All these categories were actual for SonyEricsson at that time. Before 2010 the company targeted different segments using different phone models. For example Walkman phones were their major in Music phones category; Cybershot phones were the major in Camera phones segment.

But these days Sony aims the whole market using one brand – Xperia. There is a wide phone lineup in this brand from low-budget phones to the top model Xperia Z, which can be reviewed as a phone to all categories as it contains a superb camera, branded sound, e-mail encryption support, has all the entertainment features and look stylish as well. So there is no any reason to segment the market as the brand meets all the requirement of possible segmentation by category.

Regarding the Kotler’s model of segmentation there is no need to segment the market by geographic location, as the mobile phones are sold everywhere. And there is no need to segment it by demographic, psychographic, behavioral as the lineup fits all the constituent parameters.

 

 

Positioning

Sony Xperia smartphones are positioned as a modern, innovative and high-tech brand. Consumers choose Sony because of their unique design in addition to already acknowledged new technologies implemented in their phones. The most important differences of for example Xperia Z in comparison with top competitors are:

• Waterproof and dustproof case;
• HDR Video camera with 13MP photo camera;
• Durable case and screen.

As it can be seen Sony made a serious attempt to capture more part on the market after creating a phone which is more durable than iPhone, has stylish look, can compete in technical characteristics with Samsung.

In January, Sony presented the new Xperia Z for the first time. Because of the internet, PR, YouTube and social networks, Sony started the domino effect of promoting the product to the public. Different tech sites published their reviews; 2 million people watched the advertisement and discussed it on YouTube. Sony kept promoting their new product via internet during 2 months. Finally after everybody got introduced to the new phone, it was published in the beginning of March. The company launched the process of advertising in internet, now their followers and different tech-sites follow the trend and continue the chain of promotion. Below is describe an example of Xperia positioning on a smartphone market.

Marketing Mix

Product Decisions

In this section we will review the Xperia phones lineup key attributes:

• Xperia L. HDR photo camera with 8MP quality. 4.3 inch display with high resolution. The one touch NFC connection function. The long lasting battery with the “stamina” function.
• Xperia SP. The LED line indicator that is on whenever user missed something. 4.6 inch HD display with Mobile Bravia Engine 2 technology. Ability to connect to any Sony device via WiFi, DLNA or MHL.
• Xperia ZL. 5inch display with full HD resolution. The optimized “Opticontrast” display glass. 13MP Exmor RS camera. The perfectly shaped OmniBalance phone case made of high-quality materials. Quadcore processor with 2GB of RAM memory. Adreno 320 video card for the perfect entertainment. 4G internal modem for a faster internet connection. HD Voice technology decreases the excess noise and increases the sound quality.
• Xperia Z. Same characteristics as Xperia ZL, but this phone has the water/dust proof case. Phone’s width is 7.0mm; that makes him light and stylish. Durable case made of materials that will prevent physical damage.
• Xperia E. Walkman music player with xLoud function.
• Xperia E dual. 2 SIM cards function. Characteristics are same as Xperia E.
• Xperia V. 50Gb cloud storage for private files. PlayStation games certified.
• Xperia J. The unique 4 inch screen and curved phone’s shape. NFC tags function to easily connect phone to any device.
• Xperia miro. 4 different colors available. 3.5 inch display with 5MP camera. Easy connection to a TV-set using DLNA interface.
• Xperia tipo dual. Same specifications as “J” model but the phone can operate with 2 SIM cards.
• Xperia i-on. 12MP ion HSPA camera along with 4.6 inch HD display.
• Xperia SL. Face detection screen locker. Walkman music player with manual equalizer.
• Xperia acro S. Waterproof phone with HD screen and 12MP camera.
• Xperia tipo. Compact sized phone for users that prefer the small sized, but efficient phones.
• Xperia Go. 3.5 inch waterproof and durable phone.
• Xperia U. 4 Colored 3.5 inch display smartphone with easy-replaceable bottom panels. The LED notification indicator flashes depending on the picture color.
• Xperia P. 4 inch display with 8 MP photo camera. Phone’s cover is made of durable aluminum.
• Xperia Sola. “Floating Touch” touchscreen technology that lets user to operate the phone without touching the screen.
• Xperia S. 4.3 inch display with 12MP photo camera. PlayStation games certified.

 

Pricing Decisions

Because of Xperia wide model lineup; the prices for Xperia phones vary from 500RM for Xperia E to 2200RM for Xperia Z. In order to increase the market shares, Sony can adapt and use different appropriate pricing strategies to different target audiences.

Psychological pricing strategy is currently in use by Sony. According to the company’s official stores the prices for their phones are always with 89 or 99 in the end. For example price for Xperia Z is 1999RM. This trick is used by many companies as it visually decreases unit’s price in the consumers’ minds.  

The next strategy which can be used by Sony is bundling price strategy. For example, when customer buys an expensive phone, they will get free gift, such as NFC tags or additional case. Additionally, it can be another example; “Buy Xperia phone and Xperia Speaker” for price lower than these two items combined.

Prices for top models of Sony Xperia are quite high. But in comparison with top phones from Apple, Samsung and HTC, Xperia prices are competitive and usually are less.

Distribution Decisions

The company is currently operating by Manufacturer-Retailer-Consumer channel or straight Manufacturer-Consumer. Sony has their own online store where all their products can be ordered. Plus the company has a list of their certified retailers, who are allowed to sell Sony products in their stores. Usually the retail partners are well prepared, trained and have required knowledge of the products. The last option of company’s distribution is mobile operators that sell Sony phones with mobile operator service contracts.

Promotion Decisions

The Promotional activities are mainly done through advertising. Sony Ericsson has been sponsoring WTA tours. The Brand Ambassadors of the company include many tennis stars such as Maria Sharapova, pop stars and actors in different countries. The company has also adopted the method of Sales Promotion by giving free gifts or use of “Scratch Card”.

As described earlier, Sony started to promote their new Xperia Z 2 months before the official release date. The company made 1 presentation and published a video promotion on youtube and social networks. The rest of the work did chain reaction of observers, specialists and possible customers.

Another promotional activity is the deals with local mobile providers. For example DiGi offer Sony Xperia Z for 1029RM; but you have to sign a two year contract and use one of the offered DiGi mobile plans.

Below is displayed the Gantt chart which shows company’s main activities on Xperia brand during 2013:

Subject

Quarter 1

Quarter 2

Quarter 3

Quarter 4

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Advert

Retailers' training

Mobile operators' training

New phone development

New sponsorship

Budgets

Below is shown an income statement table for the past 5 years of Sony Corporation (in USD):

As we can see on table the company’s total revenue bounced every year and there was no any constant growth in sales as it were always ups and downs. Let’s try to calculate the average growth in sales for the last 5 years = ⁴√(Sales 2012/Sales 2008)-1

Sales in 2008 = $ 88 700 000 000

Sales in 2012 = $ 78 400 000 000

Average annual growth in sales = ⁴√(78 400 000 000/88 700 000 000)-1 = -3.03%

As we can see the average annual growth in sales is negative. So there’s no possibility to forecast the sales for the next years using this method. (2013, SONY INCOME STATEMENT)

Sales Forecasts and Budgets

As it was mentioned earlier, Sony plans to significantly increase their revenue and net profit for the financial year 2014; especially after publishing Xperia Z. Below is the table for the possible net profit for the next 3 years for Sony. Also the company is in process of selling several of their buildings in USA and Japan that will add a huge value into their annual profit for 2014. Sony plans to reach $400 million of net income by the end of 2013 fiscal year. (2013, SONY DOUBLES FULL-YEAR PROFIT FORECAST TO $400 MILLION)

The official earnings announcement will be made on May 9.

 

- Periods 1-5 Years, Costs

http://finance.yahoo.com/q/is?s=SNE+Income+Statement&annual

 

 

 

 

 

 

 

 

[GROSS,1989, P43]