The failing strategies of Sony

Term Paper, 2013

8 Pages, Grade: A


The failing strategies of Sony: Case study


It has become critical in the dynamic marketing environment for any company to understand the parameters which are key and that affect its market. This will help understand the trends in the market and shifting demands of the customers, technological changes and most important the ability to make a profitable timing and secure a competitive advantage in the market. Creation and implementation of marketing strategies should ensure that they bring a positive impact to the success of the business in the market comparing the operational levels and chances of success to its competitors. Understanding the market trends remains a vital key in remaining a market leader and sustaining achieved competitive strategies. Sony, being a market leader failed to address these major issues in marketing hence resulting to the downfall experienced with the up-rise of the IPods. Failure to understand the opportunities presented at a particular time in the market results to creation and adoption of poor marketing strategies and giving an advantage to the competitors to position themselves well in the market as it has been the case of Apple in embracing IPods technology.

Overview of Sony Corporation

It is a Japanese multinational conglomerate corporation with its headquarters in Tokyo, Japan operating as a public company. It is traded as TYO (6758) and NYSE (SNE). The company was founded in 1948 as Tokyo Tsushin Kogyo but in 1955 changed to Sony. It operates on a global scale and it focuses on electronics, entertainment, games and also deals in financial service sector. These are its major segments of the market it seeks to satisfy (Chang, 2011). Ranked as 87th among Fortune Global 500, it remains one of the leading electronic manufacturers for professional markets and consumers. In general, it deals with computer hardware, video games, consumer electronics, semiconductors, media/entertainment, telecommunication and motion pictures. The services offered include financial services, credit finance, insurance, banking and advertising agency. It recorded revenue of US$ 72.349 billion with an operating income of US$ 2.448 billion and total equity of US$ 28.523 billion in fiscal year 2013. Its current employees under its branches are 146,300.

Overview of Apple Company

As one of the major competitors of Sony, it was founded in 1976 as a public company and incorporated in 1977. It is headquartered in California, US and has over 406 retail stores around the world. It has over 80000 employees as per 2013. It deals in digital distributions, consumer electronics, computer software and hardware. It is best known of IPod music, Mac line of computers, IPod tablet computer and IPhone smartphone. In October, 2001, apple was able to launch the IPod (Apple Inc, 2013).

Sony decisions

The launching of IPod by apple was a major success in its operation and securing of the music industry because it made an instant success with over 220 million units of sale for over 8 years. This was in the segment of entertainment category which was amongst the segments that Sony was capitalizing in. over the centuries, Apple remained a leader in brands of portable music with much of its creation being much superior and demanded by individuals. The introduction of the portable radios and the Walkman was the creation of Sony making a huge success in its segment market and establishing itself as a company focused on growth (Millard, 2005, p. 325). Its strategies were successful and the level of innovation and creation of new products in this line was high. It remained the largest innovator and hence IPod was to be a classic Sony. A great strategy can only be great in context. Sony during this period of 70s and much late, Sony was great both in implementing strategies, selecting the best that suit its market segments, maintaining customer loyalty and expectations and much more making more profits. Its name in fact became synonymous with all the cutting-edge technology hence it remained unrivaled master in consumer electronics. Even all the creations of Sony were of great quality including the Trinitron and were satisfy to hold. They were intricately detailed and designed to its functionality. This came with sound decision making with full knowledge of the market. Even though the market for electronics is larger than before with customers having a better purchasing power, the strategies developed by Sony have continually failed it resulting to major losses as its competitors achieve a better position in the market and excel in the same segments that Sony is fighting to sustain. Sony focused majorly in offering the customers with a wide range of products and managed to remain successful with this strategy for a long period of time. The decisions made by Sony to keep on this line of products and not pay attention to the IPod caused a great change in its market with the hit of IPod and its success by its competitors who embraced it (Pham-Gia, 2009, p. 22). Sony can be considered as one that lacked timing of its market hence failing to understand the current demands of its customers. IPod is believed not to have been created for customers but created by the customers themselves. The decision by Sony to implement strategies that did not embrace the current needs of its entertainment segment resulted to its entire downfall because it stimulated the growth of other competitors like Apple both in brand name and products. Sony and its strategies focused on the products which it was offering yet the customers in this market segment had moved to another preference. They preferred experience rather than the product hence resulting to a turn in the marketing activities. Sony became trapped in its own success hence did not wish to embrace the change believing that as a market leader it could still influence its market segment by controlling the products offered. The company was highly involved in innovation and was always the first to develop a new machine, television, and integrated camcorder and much more of the products but in its astonishing ability failed to address the most important turn of the customer preferences.


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The failing strategies of Sony
University of Houston
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Klope Mark (Author), 2013, The failing strategies of Sony, Munich, GRIN Verlag,


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