Sony in United Kingdom

1. Introduction
Sony mobile communications is the third largest mobile phone manufacturer in the
world. It has widespread stores in various countries in Europe with its biggest concentration
being the UK market. Between the years 2004-2007, the Sony brand recorded increased sales
due to the innovative products introduced in the market. However, over the last two years the
company has recorded decreased sales volume and a reduction in the market share in the UK
market. (Ajasafe, & Gillett, 2011). This has been attributed to increased competition from
Samsung, Nokia and Apple brands. The paper aims at looking at the current marketing analysis
of the company with a view of suggesting possible marketing global strategies. In this regard,
the paper evaluates the current business environment using SWOT and PESTLE analytical tools.
The report draws conclusion from the issues addressed and highlights recommendations and
marketing global strategies for the company.
The demand for mobile phones handsets has increased gradually in the UK market. More
than three Quarters of the adults own a mobile phone (Ajasafe & Gillett, 2011). The market is
however becoming competitive as mobile phone brands bring in new products. In comparison to
other European countries, the consumers are getting a fair deal in terms of pricing level although
there are off-net prices which are fairly high. There are changing patterns on mobile phone usage
as more people prefer to use a mobile phone to text rather than to call. This has seen increased
advertising of new phones with more texting and chatting options.
Sony Mobile communications AB has recorded reduced sales as a result of the increasing
competition in the market. In 2011, the company lost considerable market share because of its
inability to successfully launch a Smartphone to compete favorably with Samsung and Apple
brands (Gelder,2012). They launched Sony Xperia Arc and later a more improved version of
Sony Xperia Arch S which had a secondary camera installed. This was however; a little late as
consumers had switched to other brands which had entered the market first .Faced with these
challenges, this report presents the marketing global strategies which are highlighted in the first
part of the essay.

2. Situation analysis
The political situation in a certain country helps to determine the profitability and pricing
strategy of a company. Sony brand has been able to set up successfully because of the stable
prevailing political situation in UK and many of European countries. The concern over ethical
marketing has led to increased boarder regulations and consumer goods. The brand has however
not been affected because of emphasis on quality. The stability has enabled the functioning of
supply chain arrangements which Sony has been able to utilize successfully (Dunn, 2006) The
UK government knows that any unforeseen political situation could immediately affect trade not
only in the UK but also in the region. Consumer laws targeting mobile phone tariffs have
however, affected sales volume of Sony as people have became more conscious to prices.

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 The economic downturn which affected Europe in the year 2009/10 has had a negative
impact on the company sales. Disposable income of most people reduced and hence decreased
consumption on non-essentials such as mobile phones (Sony, Annual Report 2010). The situation
has however improved and the purchasing power has increased. The company has however
increased its strategic promotions methods which have ended up increasing the cost of doing
business. The potentiality of the market is also decreasing but it is still favorable to do business.
The current rates of interest and inflation levels are fairly stable at the moment (Steinbock,
2007). Any investments taken by the company looks promising because of the future prospects
of economic stability.
Increased population growth has led to increased demand for mobile phones in the
country so as to meet the demand. The dependency on mobile phones in many aspects of life has
also led to increased demand. In business, people prefer to use branded mobile phones which can
help them do business on the go. These include word processor, email service and fast internet
connectivity (Curwen & Whalley, 2010). UK is a developed nation and hence people appreciate
technological innovation and its penetration is deep in the economy and this has had a positive
impact on Sony since it relies on constant technology innovation.
The level of technology in the economy has gradually increased in the economy. The new
technologies on mobile phones are increasing and this is fuelling a lot of competition in the
market. This has seen introduction by other brands in the last 2 years. Sony recognizes the fact
that it has to come up with more technological competitive brand to be able to march the new
innovations.
There are no stringent mobile phone regulations in UK. However, there is increased
awareness on the usage of mobile phones by children. Use of mobile phones wile driving has
been banned. This however, has not had any significant decease in mobile phone sales in the
country. Sony brand recognizes the fact that, the company has a safe regulating environment to
operate.
There have been increased campaigns targeting Electronics Company on the issue of
environmental pollution. Environmental activists argue that the mobile phone companies are
among the largest contributors of the carbon gas which leads to global warming. There are also
the recent concerns that continued use of mobile phone can result to increased radiation levels
and hence can result to cancer (Daniels et al, 2007).The increased pressure has caused Sony
brand to incur extra production costs in terms of pollution rights and increased taxation.

3. Micro and Macro analysis

The introduction of the innovative Sony Xperia with resistive touch screen has boosted
the Smartphone sales for the brand. This has been in line with the demand by UK market which
has increased sales in Smart phones (Curwen & Whalley, 2010). The pricing policy of the
company is also acceptable to many of the buyers. The brand name of Sony in the UK market is
also strong. In the previous years, the company has shown capability of producing quality phones
and this has boosted its fortunes as a reliable brand in the market (Brown, 2008). Their phone
types are also easily compatible with other brands. This has enabled the brand to have a
competitive edge over the others in the market.

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 The Sony brand is not targeted towards business people hence being seen as incompatible
with the corporate world. Furthermore, the cost conscious consumers may still not be able to buy
the new Sony Xperia introduced in the market because it is still relatively high to low class
consumers. The late launch of Xperia Smartphone in the market has seen considerable reduction
in sales for the company (Gelder,2012).
More technology advancements means that more consumers will be attracted to its new
brand which is favorably cheap than the rest in the market. The new Xperia phone is also
upgradable hence giving customers limitless opportunities. Various partnerships with other
marketing companies will see the marketing costs decrease significantly for the company. Smart
phones are expected to be the main attraction in the UK market in the short run. The company
therefore, has an opportunity to introduce more innovative products to be able to meet the
increasing demand.
Increased competition for Smartphone sale in the UK market has been the greatest threat
to Sony. This is attributed to the fact that Smart phones are easier to make than before. With the
fast changing environment, companies are coming up with new brand on a regular basis. This
has forced Sony to introduce Xperia which could not even match the innovations by Samsung
and Apple Inc (Franchini, 2008). More companies may enter the market in the long run which
will lead to even grater competition.
Introduction of cheap phones in the market is also a great thereat to the brand sales.
These new brands pose a great threat especially to cost conscious consumers. In the long run, the
company may be forced to reduce the price level of Sony Xperia to be able to compete favorably
with new entrants into the market. It is also difficult to switch brands for the older generation
who prefer to continue using the brand he/she has been accustomed with. Lumia Nokia series has
largely been embraced in the market because of the integration of Windows mobile OS in 2012
(Dunn, 2006). Sony brand will therefore need to introduce other innovative product to be able to
match the ever changing customer needs.
Sony released its first product in the market in the year 2002. With 10 years experience in
the telecommunications industry, the firm has been able to cut down its production costs over
time to give a differential advantage of others in the market (Evans & Berman, 2007). To start
with, the joint venture partnership between Sony and Ericsson gave the firm the right pushes
towards establishing itself as a global company. The partnership was a huge boost as it gave the
company major access to the European market. The partnership also helped the firm to establish
strong distributional channels. Sonys technology has hugely helped the firm in market design,
core competencies as well as adequate management skills. Sony brought it the marketing skills
while Ericsson brought the needed technology. This is the reason why immediately after
establishment, the company was able to give others worthwhile competition in the UK market.
The company can therefore regain considerable market advantage by pricing it cost
effectively and resolving its stability problems. The company has managed to improve its
efficiency levels. This is possible through its ability to minimize production costs while
maximizing outputs and profits. The company can also be credited for its innovation. It was the
first company to come up with GSM/GPRS enabled color screen handset. It later introduced the
Bluetooth technology and high mega pixel mobile camera. These innovations helped the
company establish itself as a strong brand capable of controlling the market.

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4. Segmentation, targeting and positioning strategy

The firm uses mainly lifestyle and demographic variables in segmenting their market
(Harris, 2007). The firm should however lay more emphasis on the changing lifestyles of the
young generation and cater for their ever changing needs. In order to regain market share, the
company can segment the market into rural and urban people. The rural targets will help increase
the market share. The urban should comprise mainly the people aged 15-30. This ought to be
their main segment in order to compete favorably with brands in the same market segment. This
target group of people focuses mainly on music, leisure, sports and has the flair for hip gadgets
in the market.
The firm targets the upper middle class professionals. These usually have busy
schedules and hence need to communicate with their colleagues and families. The secondary
targets are the high school, college and graduate students who need devoices which are
multifunctional and portable. The secondary targets also include medium sized corporations and
they aim to help managers and employees have crucial data access on the go. Thus the company
has two main segments and this is called multi segments targeting. The company should
however, enhance its target group to incorporate more teen activities that are the main targets of
main competitors. With the over emphasize on online chatting, social networking and sharing,
the company could be loosing out on this target group.

High value
Sony
Nokia

Samsung, apple

old Young
Siemens Sagem

Low value

The positioning strategy that the company uses to market its new products is the positioning of
the new product as a convenient, value-added device which can be used for personal and
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professional use by young professionals (Steinbock, 2007). There is also the focus on
convenience as it incorporates other features such as music, photo sharing and internet access.
This positioning strategy enhances Sony products as professional and hip.
The firm however needs to enhance its positioning towards a more relaxed and younger
generation who want more apps on the go. The younger generation would therefore make a
better positioning strategy. In this case, the company can establish a link between them and the
users through more enhanced features which include video conferencing and social networking.

5. Marketing objectives and goals

The company should aim at becoming the leading communication and entertainment
brand which is preferred by many people. The firm should therefore aim at increasing the
market share by more than 18% by the 2014 through introduction of new innovative products
(Sony, Annual Report 2010). The company should set its short term goal of ensuring that it
competes favorably with Samsung and Apple. It plans to be the third leading mobile phone
provider by the end of 2013. They have launched their flagship mobile phone for the year, Song
Ericsson Xperia Z (Krishna, 2012). The organization should aim at achieving a 10% share based
on sales within the end of the year 2013. In addition, the firm is aiming is aiming for a 2% share
of the UK PDA/Phone market through unit sales of 500,000 within the next two months
(Krishna, 2012).

6. Marketing global strategies and programs

The firm should strive to ensure that it maintains product quality and differentiation while
trying to venture into other world markets not ventured before. When their band was introduced
into the UK market, it was uniquely famous for its uniqueness and quality. It has however
received a lot of criticism due to lack of stability in the telecommunications market (Harris,
2007). Customers were feeling that they did not get the value that they paid for. The new
product strategy which has been adopted by the firm is to produce phones for a certain market
only. The problem with this strategy is that this kind of market is changeable and hence
consumers can easily shift to other brands when they realize a better deal. The firm should
therefore develop new technologies to help them come up a robust long term product strategy.
With the ever changing technological advancement, providing high-end phones is not a
sustainable way of ensuring stability in the long term.
The firm should ensure it follows up on its pricing policy. The distributors should be
monitored so as to ensure that there is strict monitoring. Top level management should also
follow up to ensure that the brand is not diluted by selling at price which is different from the
company pricing policy. After the economic recession in 2009, many consumers are not willing
to risk and buy many high end products which do not guarantee value. The market penetration
pricing strategy can also help increase the economies of scale for the firm. Some of the bulk can
also be passed to the consumers. The current target which is young professional has higher
disposable income hence their ability to use more money on buying accessories such as mobile
phones. The target group is however not sustainable in the long term and the firm will have to

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target the more youthful group. The firm can therefore diversify its target market in order to
reduce prices. One such policy would be to target low income buyers especially the aged and
those living in rural areas. This may not generate enough sales but would be a solution in the
long term.
The joint partnership of Sony and Ericsson groups ensured that the company had a strong
set up base. With the setting up, the firm established many robust distributional channels across
Europe (Sony, Annual Report 2010). This is what has largely contributed to the initial success of
the brand in UK market. The marketing strategy employed however, should ensure that they set
up in places where they are able to meet the customer needs. In the rural areas, the organization
should intensify their retail stores so as to ensure that they are able to cover more people in order
to record increased sales (Harris, 2007). The distributional channels should however, be
intensified to ensure that they meet the customer needs and cover majority of the people in the
country. The organization should also intensify online advertisement methods since it has a huge
customer base. The method can be linked with other supply chain partners to ensure efficiency
and transparency. Online customers have also be found to have more appeal.
Initial promotional events of Sony brand targeted the vast majority of the population. The
older folk are also more associated with the product because of its stay in the UK market
(Applegate, 2007). Increased competition however recognizes that the products should be
branded in such a way that they make a place in the memory of the people. Introduction of Smart
phones has introduced anew era of mobile phone usage with major time on the phone being spent
online chatting and other social media sites (Helles, 2007). Digital media should therefore be
used to promote the product through advertisements. The firm should also intensify mass media
marketing and vigorous promotional methods. Other youth oriented events can also be used to
promote the product with the target group being 15-30 years. The target group is easier to
convince especially when it includes mobile phone gadgets.
As much as many upcoming products target the young people, the changing market needs
may not sustain this idea in the long term. Sony should therefore seek to target many people in
the rural areas to increase its market concentration (Gay & Charlesworth, 2007). The advantage
of the rural areas is that there requirements are not many and as demanding as the urban
consumers. There are not many means of communication hence less requirement for internet and
other phone apps. The brand can therefore produce more phones which are less expensive
targeting these people. This will increase the market concentration of the company in the
country.
Sonys products have managed to maintain their unique hardware and software for a long
period of time (Hill, 2007). The applications, hardware and innovativeness of their products
bring about easiness in use and therefore attract customers. The organization should therefore
maintain their unique product process.In the past, the physical outlook of a business premise was
not a major consideration. In the current competitive age, the location and the physical outlook
of a business premise have a huge contribution on the view of a business by the customers
(Gelder,2012). The firm should therefore introduce a focus other market segments especially in
the rural areas which are less demanding and less covered.

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