Sony VIAO - Dilemma of Richard Lopez

Group 6

Group 6

Ankit Uttam

Anjali

Jerin

Ayush

Lizzi

Divya

Jaskaran

Dilemma of Richard Lopez

SEGMENT GLOBAL OR

LOCAL

• Established as Tokyo Telecommunication in 1946.

• Manufacturer of telecommunication and

measurement equipment.

• Rechristened as Sony in 1958.

• Sony in 2010

– 171000 employees

– $89 bn in sales

– Past Leaders: Walkman

– Current Leaders: Handycam camcorder

• Introduced in mid 1996.

• Debut with desktops

• Laptops launch one year hence

• Differentiation strategy for Vaio

– High end

– Stylish

– Designer

– Colour options

– Statement

– Iconic

– Sleek

– Software

• Aversion for mass market

• Premium offering

• High ASP

• Sony’s unusual focus on Laptop

manufacturing, marketing and sales that reaped

return in 2000

Limitations

• Mass Market

• Statement computer

• Good for individual use

• Enterprise use is limited

• Standard software in office laptops

Vaio in China

• Premium positioning

• Moderate success

• Aesthetics

• Customers with high intangible focus

• Japanese Brand Image

• High resistance against knockoff products

Comparison between CLUES report and Consumer interview

• Consumer Interviews : Around 40 people were

interviewed between the age group of 21 to 35.

• Asked about how they researched, shopped for

,set up and used their laptops. The interviews

revealed three key themes related to purchase.

• Brands are an extension of who I am.

• Asking for product advice is one way I connect

with others

• Just give me what I want

• CLUES Report :Chinese Laptop Users Survey

• Conducted 760 surveys of Chinese consumersbetween 18 - 55 years. The respondents were asked torate the laptops on specific characteristics such ascoolness, simplicity and productivity. A statisticalanalysis if the report yielded six user segments. Thesewere :

• Entertainment Lover

• Business Focused

• Family User

• Tech Enthusiast

• Fashion Oriented

• Heavy User

• Fashion Oriented falls in first category

• Business Focused and Family Users fall relate

to the second identity.

• Heavy Users and tech enthusiasts fall in the

latter.

• The four key consumer goals that relate to CLUES segments

Some consumers depended on their laptop to connect with

others vi e-mail, social networking sites etc. Eg. Family User,

Fashion Oriented

Others viewed it as a productivity tool. Eg . Business oriented

Some others were light users and relied on their computers for

everyday tasks .

A segment of consumers who use their laptops as central hubs

for accessing and experiencing multimedia. Eg Heavy User ,

Tech Enthusiast

• The combined results of these two studies

helped in Lopez’s decision.

Comparison b/w Customer Interview result &

Compass Report Data

Customer Interview

• Purchases as a strong means of self-expression

• Tendency to follow trends

• Consumers more receptive to new technologies and

product

Compass Report

• Technosocializers (16%)

• Performance Seekers (17%)

• Status Focused (12%)

• Unfussy Basics (24%)

• Functional Socializers (9%)

• Quality of Lifers (22%)

COMPARING –CLUES REPORT AND

COMPASS REPORT

• In CLUES Interview-

The respondents were asked to rate the laptops on specific

characteristics such as coolness, simplicity and productivity.

Consumers were between 18 and 55 years of age.

• The Project Compass

It was indented to provide the comprehensive view of

consumers across variety of markets and product categories.

Participants were between 16 and 65 years of age.

Customer segmentation

CLUES

Entertainment Lover

Business Focussed

Family User

Tech Enthusiast

Fashion Oriented

Heavy User

Compass

Technosocializers

Performance Seekers

Status Focussed

Unfussy Basics

Functional Socializers

Quality of Lifers

• Lopez and team re-conducted the Project

Compass research with the consumers who

responded to the CLUES Study.

• This Combined data helped to compare the two

approaches in segmenting the Chinese market.

• Helped to understand the consumer preferences

about products and their perception of SONY

VAIO.

• It could not help to develop a successful plan.

Enterta

inment

Lover

Busine

ss

Focuss

ed

Family

User

Tech

Enthus

iast

Fashio

n

Oriente

d

Heavy

User

Total

Techno

Socialize

r

13 19 14 8 25 21 100

Perform

ance

Seekers

8 22 3 40 8 19 100

Status

Focusse

d

1 15 22 15 17 10 100

Unfussy

Basics

23 17 41 2 13 4 100

Function

al

Socialize

r

19 2 55 6 16 2 100

Quality 21 15 8 23 15 19 100

Relationship between CLUES and COMPASS

Chinese Laptop User Survey

Clues Segment Laptop purchase in next

12months(%)

Sony Buyers

(%)

Entertainment lovers 88 7

Business Focus 54 12

Family User 38 12

Tech enthusiast 50 13

Fashion Oriented 92 7

Heavy User 65 11

Here, It’s observed that Entertainment Lovers are

more interested in purchasing a Sony than the other

segments present in the market over the next one year.

They are followed by business focused and tech

enthusiasts.

CLUESAdvantages:

• Targets entertainment buffs

• Technology Integration

• Use technology to manage other products

• Fast and powerful computer product

Disadvantages:

• Unable to target the “Fashion Oriented” despite of being

stylish

• “Heavy Users” still prefer focusing on functions and

capabilities rather than new features

• Targets a small segment of market

• Fails to do an in depth analysis of the segments

Compass Segment

Compass Segment

(China)

Laptop purchase in next

12months (%)

Sony Buyers

(%)

Techno socializers 78 13

Performance Seekers 70 10

Status Focused 92 15

Unfussy Basics 47 3

Functional Socializers 41 4

Quality of lifers 55 9

Here, It is observed that Techno socializers and

status focused are more interested in purchasing a

Sony than the other segments present in the market

Compass Segment

Advantages:

• Brand oriented customers

• Tech Savvy consumers

• Highly social with strong social media connection

Disadvantages:

• Fails to target the “Functional Socializers” as they still prefer face to

face interaction

• Targets too larger segment of market

• Unreliable and confusing data analyzed, errors maybe present

MAIN GOAL TO STEAL

SHARE FROM OTHER

BRANDS

WHICH MARKETING

STRATEGY???

CLUES STRATEGY

• What were the key similarities and differences

among consumers in China?

• Were there different groups of consumers in

China with different product preferences?

• How big or small were these groups?

• What market opportunities did they present

STATISTICAL ANALYSIS OF

CLUES

• ENTERTAINMENT LOVER

• BUSINESS FOCUSSED

• FAMILY USER

• TECH ENTHUSIAST

• FASHION ORIENTED

• HEAVY USER

WHY CLUES REPORT

• SONY VAIO STRENGTH

– Stylish, trendy, high end and designer

• CUSTOMER SEGMENTATION

– Entertainment Lover

– Fashion oriented

• Sony’s rank in both these segments is 7

• Both these segments have high percentage of

users in near future

WHY CLUES REPORT

• HEAVY USERS

– Where 65% ready customers

– They rank Sony at 11

– For heavy users connecting with others

– Sony’s strength is its own software bundle

TABLE EXHIBIT 5

CLUES SEGMENT

Integrates all of my technology

Helps me to connect with others

Helps me being more productive

A simple tool for daily task

Entertainment lover

1 2.9 .9 4.7

Business focussed

3 .9 5.2 3.3

Family user 4 3.7 1.7 5.0

Tech enthusiast 5 3.0 5.2 1.2

Fashion oriented

5 5.1 2.0 3.1

Heavy user 4 5.3 4.8 2.1

TABLE EXHIBIT 8CLUES SEGMENTS

Segment Size Plan to purchase laptop in coming 12 months

Rank Sony as their top brand

Agree that laptop knockoffs are good

Entertainment lover

18 88 7 36

Business focussed

16 54 12 35

Family user 22 38 12 37

Tech enthusiast 16 50 13 38

Fashion oriented

15 92 7 30

Heavy user 13 65 11 36

If Lopez main goal is to capitalize on existing loyalty and

interest in Sony, which study will provide the most useful

foundation for his marketing strategy?

The aim of this study was to find out how people shopped for

laptops, what they looked for in them etc.

Three key themes were revealed in so far as laptop purchase was

concerned.

Brands are an extension of customer’s identity: in China

customers saw laptops simply as a means to express themselves, to

show a ‘good” face to society or simply to show off. When

surveyors researched deeper into how a brand might be an extension

of a customers identity , three main identities emerged

• Multimedia person

• Tech person

• Cool person

Asking for product advice s one way I connectwith others: Respondents in China were glued tothe internet much more than in other countries likeUSA or UK. As a result word of mouth was anessential part of the buying process. Consumerssought knowledge and advice specially fromfriends, family and others. Specially before makingdecisions.

Just give me what I want: customers did notwant extra information and too many modelsthat were insignificantly different:

The rapid growth in Chinese market had madecustomers more receptive to new technologies anddifferent features were more important to differentinterviewees, depending on how they used theirlaptops.

For example ,some wanted to connect with loved ones

on social networking sites . Some looked at laptops as

merely a productive tool for school or office work, some

who did not want too many features and simply wanted a

laptop for daily use. And finally a new set of consumers

who looked at their computers simply as a multimedia

gadget to connect with people online as well as

accessing television shows and games.