E-Marketing: Sony Corporation in USA - Term Paper Example

SONY CORPORATION USA (www.sony.com) Overview of the company: Sony Corporation is a leading and well-recognized manufacturer of audio, video, communications and information technology products for the consumer as well professional market. It has its headquarters in Tokyo and was originally named as Tokyo Telecommunications Engineering Corporation or more commonly Totsuko. In January 1958 it was renamed as Sony which is derived from the word ‘sonic’ which means sound. Sony has not only been recreating products but it has opened a new dimension of inventing new technology. Its products are a symbol of innovation and style. It has developed a wide range of products such as television systems, videocassettes recorders, cellular and cordless telephones, compact disc equipment, cameras, videogames, telecommunication equipments, computer peripherals, etc. People at Sony are encouraged to experiment and come up with innovative ideas which have resulted in great inventions. It has its operation all over the world especially USA. Situation Analysis: (SWOT) SWOT analysis is a first stage of planning and understanding the company’s overall position in the market. It helps the marketers to focus on the key issues. SWOT stands for Strengths, Weaknesses, Opportunities and Threats. Strengths: Ability to create innovative and high quality products for its customers. The company holds a good reputation in the electronic consumer market. People at Sony learn from their failure and try to come up with better ideas in future. Expansion of operation in several markets with a wide range of products. Weaknesses: Not able to coup up with the failure of products in the past few years. Facing loss and the overall market share as well. Lack of direction and management issues. Lack of coordination and communication within the organization. Opportunities: Increase in the size of the engineering department to improve the product quality and functions. The competitive advantage of being the product innovator in the market. Marketing department focusing on the advertising techniques to capture the customer’s attention. Decrease in the price range to attract more customers. Threats: Microsoft, Nintendo are the top competitors in the gaming industry which can be a great threat as Sony is losing its share in the market. Similarly, Samsung, Panasonic are major competitors in the television market which are improving day by day. No strategy to maintain its position. Disappointment of the customers which can result in a major downfall. Segmentation, Targeting and Differentiation positioning strategies: Sony Corporation has segmented its market into many parts and offers a wide range of products and services. Its product line is divided into many categories and its subsidiaries include Sony Electronics, Entertainment, Sony Computer, Sony Ericsson (50%), Sony Pictures Entertainment, Sony BMG, Sony Marketing, Sony Life, Sony Assurance, Sony Bank. This means that Sony is not just targeting the electronics consumers but it has provided several options to cater different segments of the market. The target market of Sony Corporation (USA) is from mid to high income people. To be more specific, the Sony Corporation (USA) primarily deals with Sony Electronics Inc., Sony Pictures Entertainment Inc., Sony Computer Entertainment America Inc., and a 50% interest in Sony BMG Music Entertainment. In this way Sony has differentiated itself from other competitors by providing products in a variety of areas. Positive customer experience: The strategy of Sony Corporation is to offer interconnected products from pocket sized radios to wall sized plasma televisions to enrich the experience of a customer. The vision to provide a positive customer experience and integrate the customer relationship management system in this regard was a worth mentioning and difficult task for the company. If we closely look at the Website of Sony Corporation of USA we can find several options related to the customer help and support. There is a repair section, product support, drivers and software related to the product etc. Sony Corporation uses EDOORWAY’s service for their customers. The customer service component of Sony is linked with the EDOORWAY’s technology. When a customer types any problem in the search option, it directs the website to pop up different windows for the assistance. It also provides opportunities to teach the customers related to the products parts and their accessories. The website also provides manuals and guidelines related to their products for their valuable customers. The repair and service network has been setup to ensure prompt responses to the customer needs. Benefit, Cost and Value creation: Sony has created many ways to provide value to its customers and partners. The innovative attitude, high quality products and the use of advanced technology has always benefited the customers for quite a long time. The cost charged in relation to the benefits is justifiable. Sony implemented. However the value of the products in the eyes of the customers is decreasing due to the absence of the state of art in the Sony’s products. Sony needs to implement a more customer driven strategy to better satisfy the customer with a value added incentive. Internet marketing mix: Product: As already mentioned Sony has a wide range of products in different areas from videogames to television systems to telecommunication equipments to the entertainment industry. It can be divided into following main categories: Home video (Blue ray disc player, DVD player) Television and Projectors (Bra via LCD TV) Home theatre systems (Accessories) Digital Photography (cyber shot digital camera) Computer and Peripherals (VAIO and laptops) Game (PS,PS2,PS3) Portable audio (Walkman mp3 series) Storage and Recording media (Memory stick) In car entertainment Batteries and chargers Price: The price is a very critical element of the marketing mix which determines the product positioning strategies. It also affects other area such as the promotion department, channels of distribution etc. The pricing strategy must be used according to the type of customers the company is targeting. Sony uses the price skimming strategy to target its customers that lie in the range of middle to high level income. Example: The VAIO series of Sony was divided into different categories to cater different segments of people according to the style, purpose and performance required by the user. Similarly, the range of television systems vary from 100$ to 1000$. This shows that a wide range of people can use Sony products depending upon their budget. Place: Decisions related to the distribution channels of any product are made keeping in mind the locations where people usually go for shopping. As e-commerce has been introduced, customers now prefer website or online shopping as it saves time and makes it more convenient for the buyers to look at the product specifications more closely and then make a rational decision related to it. The online marketing through the Sony website and other internet based sources has helped the company as well as the customers to find their dream product by sitting at home and enjoying the benefits by online order and delivery. Promotion: Sony website is a great means to promote its product line worldwide. It refers to the direct responsive online advertising strategy which helps in getting the feedback from the customers experience and by placing the order online via email, website etc. It also provides the materials and guidelines to guide the users. Customer relationship management features: A CRM information system aims to find ways to attract new customers and retain the old customers in the long run. The features of the Sony customer relationship management include the FAQs, support center, the order status department to check the orders, etc. A customer based center and a CRM environment which is based on Cisco Systems has also been developed. It helps in forming a better relationship with the customers as well as the other stakeholders of the company. The customers can also send a request through the internet to dispatch help locations close to their areas. The feedback of the customers is always considered to make their journey a successful one. For example: Sony recently added a webpage of online guides on the demand of the customers about how to connect different devices. Consumer characteristics and branding strategy: The brand name of any company can play a major role in its success. This can be noticed as people usually buy those brands to which they are loyal and feel a sense of loyalty and belongingness. It is a promise to the customers that a specific brand name delivers quality which is attached to its brand name. Undoubtedly, Sony is an iconoclastic brand which introduces products one after the other that its competitors never get time to rest for a while. It has been considered as an innovator and elegant brand. It applies premium brand strategy i.e. giving pride to the customers in knowing the brand ‘Sony’. Thus, it can be implied that Sony is a brand empire which has invented great products since its inception. The consumer characteristics for the Sony products differ from one segment to another. People who refer style and elegance can also refer the Sony products. On the other hand Sony is a Japanese company which makes it obvious that it has made great advancements in the field of technology and is improving with time. People who value technology more than the style can also buy the products. Factors affecting the users STDP strategies: There are many factors that can affect the STDP strategies of the electronic product users. Let’s look at some of the factors: The mindset of the consumers towards the products can greatly affect its decisions and strategies towards the consumption of any product. The economic factors such as the level of income, pattern of consumption, the rate of inflation and the exchange rates can highly affect the user’s frame of mind. The social factors such as demographic and behavioral aspects can also influence the decision related to the product. People get influence by their surroundings and this also affects their lifestyle. Finally the most important of all is the technological factor which can pose major differences. Like in 2006 Sony introduced the first blue ray equipment in the form of notebooks. This means that in order to keep up with the improved era Sony has to develop and rebuild its strategies and must make use of its good reputation in a positive manner. Online versus Offline customers: Online customers are the those customers that use the web for online shopping whereas offline customers are the regular customers that buy products through a retail outlet close to your location. In order to compare the two types of customers the decision depends on the lifestyle and what fits best for the user. For instance a disabled person must have to depend on online shopping if the person is alone and wants to buy a new camera or iPod etc. The time period available by the customer all affects the medium of shopping. For instance if a Sony customer wants to buy an LCD television within a day or two, then the best option would be to buy through a retail outlet. As the online order and delivery takes time, if a person who plans according to the schedule and carry out an online transaction it would save time as well as energy to go for shopping. If we talk about the Sony Corporation of USA then it can be notice that as media companies are using internet as means to promote and sell their products by providing a great experience of virtual products online in the same manner Sony has also capitalized its resources towards the online medium of promotion to attract the customers worldwide. Evaluation of the Website: The customers’ expectations of a website of such a giant company are really high and may lead to disappointment most of the time. The sony.com website of Sony Corporation USA leads to many opinions depending upon the customer’s perception of looking at it. The appearance of the website creates a big difference as it is a source to communicate the messages to the target audience. Design and Layout: The overall look of the website is very professional and classy which attracts the sight of many customers. The homepage of USA website requires a flash player which runs smoothly with a cable connection. On the other hand it also offers an option of non-flash mode for people having slow internet connections. These minor details add value to the customer experience. Features: As Sony is a huge company it covers a wide range of products details, pictures, specifications in the online shop. The way they present the information is so stylish and elegant that it adds a sense of taste and builds the image of Sony in the eyes of the customer. The option known as product registration allows the Sony user to earn points and use it for the purchase of further items in the future. The Sony shop is the best place for the customers to visit as it claims big savings on many products. However, the prices seem to be higher on the website as compare to a local store such as Wal-Mart, Target etc. Apart from the product information it also provides the opportunity to buy music and read the related reviews, watch movie and video games trailers etc. The credibility of the online shopping of Sony products is higher as it is a world class leader and enjoys a strong position in the electronic market. The text font size and type used by the developer is appropriate which complements the overall combination and color scheme of the website i.e. Black theme. The download time is quick and FAQs are also very helpful from a customer’s point of view. E-business Model: When a business uses information technology to sustain itself in the long run, then this method is termed as E-business model. Sony Corporation also recognized the need to discover ways to use internet as a means of distribution and to target the customers worldwide. On the activity level, Sony uses online advertising and public relations (PR) to promote its products and services. This is done by advertising on other’s website through content sponsorship. Online purchase includes Sony’s own website as well as the other online press releases. On the business process level, the information systems such as Customer Relationship Management, Supply Chain Management, and Knowledge management are all used by the giant company. Customer Relationship Management (CRM): The main idea of the customer relationship management is to find new customers and retain the old loyal customers by providing value and satisfaction in the fullest manner. The customer centric approach of Sony related this model with customer value. Knowledge Management: This model is also used by the Sony Corporation in order to make better decisions related to the promotional activities, product features, channel divisions etc. Supply Chain Management: It involves the coordination of the distribution channels to deliver the products. Like every other organization, Sony Corporation also uses this model to process the orders and to keep track of the inventory supplied and left. On the enterprise level, E-commerce model is used to carry out the online transactions through the website. Sony not only sells products but also offers digital products such as software, music, videos via the internet. The Sony website has earned high marks among the other websites in this regard. E-marketing metrics: In order to evaluate the effectiveness and efficiency of a company’s operation, a term known as E-marketing metrics is used. It is an analysis to determine the extent to which the organization has achieved its stated goals and objectives. Sony Corporation also use e-marketing metrics model to analyze the current position of the company in different sectors and to figure out ways to improve the output. Site Objective: The main objective of the Sony website is to provide ease and convenience to the customer by their online facility. It contains all the information that a customer might need at the time of browsing the Sony products and services. This customer centric approach of Sony is valuable but at the same time Sony must improve its strategic position as compare to its competitors. The metrics likely used by the Sony Corporation includes: Web Analytics: It refers to the online behavior of the user while browsing the web pages. Sony also collects information as the user clicks on its web page in order to optimize it in their strategic decisions. Similarly, the product registration option helps in knowing the number of customers that are using the website. The Balanced Scorecard: A balanced Scorecard model is a useful way to measure the achievements of a firm from many aspects. It consists of four perspectives namely the customer perspective, the internal perspective, the learning and growth perspective and the financial perspective. Metrics for Customer Perspective: Sony will use this perspective to measure the customer loyalty and the value that it gives to its products and services. Customer engagement online is an important tool to determine the behavior of the customer towards the Sony products. As social networking website such as face book allows the company to create their fan pages and profiles and upload pictures, videos and other information related to the company. This helps in knowing the likes and dislikes of the users related to a particular product or service. Metrics for the Internal Perspective: To analyze the entire supply chain management of Sony it can provide an in depth insight and information as to how improve the process of online transactions from the point of order to the point of delivery. Metrics for the learning and growth perspective: Sony website allows the management to identify the areas that are not hitting the target market and to make improvements where necessary. This leads to the concept of product innovation which is a key element of Sony products. Metrics for the financial perspective: The number of online customers which is determined in the customer perspective also helps in knowing the financial benefits that are coming from the online marketing. Sony Corporation will use the information to know the market value as compare to its major competitors in the different areas. Conclusion and Outlook: From the above analysis of the Sony Corporation (USA) website it can be concluded that the e-marketing strategies of Sony are considerably good but with the entry of strong competitors the company must re-build its strategies in order to retain its customers which are falling apart. The level of expectation of a Sony customer is higher than the actual products that are being offered. This has not only resulted in the decline of the overall sales of the company but it has also affected the image of Sony in a negative manner. The competitive advantage of being the pioneer in the electronic market must be capitalized in the proper ways to channelize the resources of the company. The online marketing of Sony is not very effective as compare to the other related companies. This implies that a shift in the strategy and outlook is required. Recommendations: The products prices must be lowered in the website which is comparatively higher as compare to the market prices. The layout of the website must be changed to give a touch of style and freshness. The products must be categorized by segments relative to their prices. Promotional strategies must be improved through the efficient use of the website. Tools such as customized products must be introduced. Improved Website: Sony Corporation must re-launch its website by developing a fresh and dynamic appearance of its website. A suitable theme must be followed to change the outlook and trend of the electronic market. In today’s competitive word, people are less price-sensitive and seeking for a change all the time. This means that apart from focusing on technology, Sony must discover new ways to revolutionize the product line by using the customization tools on the website to better understand the needs of its users. Social networking sites must be used to enhance the promotion of the Sony products. Sony is considered as a world-class company in the electronic industry and this goodwill can create wonders for the company. Sony must focus on repositioning their strategies not just at the strategic level but also at the operational level to design better products. The company has been on the way of losing its share in the market which is due to the disappointed behavior of its customers in the recent years. As we all know customer is the king and in order to satisfy the customers to the fullest, internet can play a dynamic role. Bibliography (2007) Game industry: Electronic video games http://www.gamesindustry.biz/content_page.php?aid=25104 Page 4 (2007) Books editor: Reviews of the Sony products http://reviews.cnet.com/4511-5_7-4.html?qt=delldhsnotebookseditorsratingtab&do=1&ds=1 Sony Corporation : Style and innovative technology http://www.sonystyle.com/webapp/wcs/stores/servlet/CategoryDisplay?catalogId=10551&storeId=10151&langId=-1&categoryId=16154&parentCategoryId=16154&XID=O:sony%20vaio:dg_vinb_gglsrch (2006) 4-5 : Sony ethical and legal dilemmas http://au.christiantoday.com/article/sony-apologizes-for-games-bloody-church-shootout-refuses-demands/2929.htm (2007) 8-10:Forbes website: Leaders of the electronic market http://www.forbes.com/leadership/2007/08/01/sony-games-innovation-lead-cz_cc_0802christensen.html (2008) 10, 5,6 : Corporate world insight: Sony Brand http://news.sel.sony.com/en/corporate_information/sony_brand (2007)Page 6: Sony article to reposition strategies http://www.pcworld.com/article/id,128176-page,6-c,electronics/article.htmlhttp://www.sony.com/SCA/index.shtml Sony Corporation (2010): Sony features http://www.sony.com/SCA/index.shtml Sony USA (2008): The Global innovative leader http://www.sony.net/Fun/SH/1-37/h2.html (2010) Sony Corporation: Customer Experiences http://www.sony.net/SonyInfo/csr/quality/customer/index.html Read More