Sony Ericsson Marketing Mix
In the corporate world today, marketing is the vital component needed to increase the profitability of a company, increase the rate of longevity and boost the sales of a certain product or service. This certainly applies in the telecommunication industry especially when there are so many mobile phone providers in the market that caused the industry to be extremely competitive. But what is marketing? Marketing is the general term used to describe all the process that lead to final sales, including the planning and executing of price, promotion and distribution to satisfy individual and organizational needs. (Erickson, 1996). From the definition above, it is seen that marketing is not just selling a product and service but an essential part of business to ensure the success of a company.
Sony Ericsson Mobile Communication is a global provider of mobile multimedia devices, and it is a joint venture of Sony Corporation and Ericsson (). It is one of the most successful mobile phone providers that implemented the concepts of marketing and gained competitive advantages within the industry. In this report, I will be explaining on how Sony Ericsson has serviced me as a customer, and how they maintained my loyalty towards their products.
2.0 The Marketing Mix
The marketing mix is a general term used to describe the different kinds of choices organizations have to make in the whole process of bringing a product or service into the market, including the product, place, promotion, and pricing strategies(ANON, The Marketing Mix and 4Ps, 1995-2009). Sony Ericsson has implemented all the four strategies, well enough to ensure that I am a loyal user of their products for the past seven years.
2.1 Product Strategies
Branding is a very important component of a product because it distinguishes one product from another, increases sales of a new product, and increases the rate of repeat sales. Sony Ericsson uses the co-branding strategy, which is the placing of two or more brand names on a product. Co-branding is a useful strategy when a combination of brand names enhances the prestige or perceived value of a product (Summers, Gardiner, Lamb, Hair, & McDaniel, p. 195). The innovation in partnership of Sony Corporation and Ericsson has brought out a better range of mobile phone products since Sony is bringing out the latest entertainment content to mobile phones. I myself was not a fan of Ericsson phone but since Sony had added in good entertainment into Ericsson phone, my confidence towards the brand Sony had became a reason of me purchasing Sony Ericsson phones. This situation is the same to those who fancy Ericsson phone, because they might still purchase Sony Ericsson phones even though they are less interested in Sony products. These two companies have increased their profitability and the company’s presence by combining customers of both companies and share the profits.
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Warranty is also a part of product strategies as product strategies are not just about the physical unit. Warranty is a confirmation of the quality or performance of a good or service. It protects the buyer and gives essential information about the product (Macdaniel, Lamb, & Joseph F. Hair, 2008,2009, p. 317). Sony Ericsson promises a full warranty where they will repair within a reasonable time without any charges if their products are not functioning in within a year. This had increased my confident level towards their products and became the reason of me purchasing their mobile phone.
2.2 Place (Distribution) Strategies
Retailing is defined as all the activities in selling products or services directly for their personal, non-business use ( ). To ensure the profitability of a company, it is important to ensure that their products are easy to be reached for consumers, making products available when and where customers want them. Sony Ericsson uses a few ways of the distribution channel to ensure that their products reach consumers easily. These include agents, retailers and internet. When I bought my current Sony Ericsson mobile phone, it was an urgent situation because I had lost my previous mobile phone. It did not take much effort for me to find a place where I can purchase a new mobile phone since Sony Ericsson uses effective way of distribution channel and I could easily find a retailer around. Since I am a loyal user of Sony Ericsson phones, the effective distribution of Sony Ericsson had avoided the situation whereby I will buy my mobile phone from other provider because of the unavailability of Sony Ericsson.
2.3 Promotion Strategies
Advertising is one of the very important components in promotion strategies. It is any paid form of non-personal presentation and promotion of ideas, goods, or services by an indentified sponsor (Kotler & Armstrong, 2008, p. 396). Sony Ericsson way of competitive advertising had successfully influence high demand for its products since they are seen everywhere. Their advertisements can be found in all sorts of media such as newspapers, magazines, radio, television, outdoor media such as billboards, and internet. The interesting advertisements of Sony Ericsson act as a main source of influencing me to buy their products other than just informing about their products. The first time I bought a Sony Ericsson phone was because I was attracted to one of their advertisement on the television. It explained about the great features and highly fashionable outlook of the mobile phone. The continuous advertising of the company also successfully maintained me as their repeat customer because I was able to know what the new products available are. This shows that advertisements can really change the buying behavior of a person.
2.3.2 Personal Selling
Personal selling is a direct communication between a sales representative and a prospective buyer in an attempt to influence each other in a purchase situation (Jobber, 2007, p. 545). Personal selling is an effective way of obtaining a sale and gaining a satisfied customer because it provides a detailed explanation and demonstration of a product. The last time I bought a Sony Ericsson mobile phone, the sales person at the retail shop had demonstrated a good sales skill, going through the steps in the selling process. He approached me and probing my needs. When I reach the shop, the first thing he asked was what type of mobile phones I like, since there are a few different types of phone targeting on different consumer according to the function of the mobile phone. Once he knew that I prefer C series phones, which consist of the Cyber Shots function, he started proposing solutions by introducing me to a few different phones with good camera features. He also demonstrated a good objection handling skills, understanding that I am concerned about the price of the mobile phone since I am a student. Knowing that I am looking for something more affordable, he quickly introduced me to another phone with camera functions that is cheaper in terms of the price. Due to his persuasive ways of selling, he was finally able to close the sale when I exhibited that I was ready to purchase the item. According to the situation above, it is shown that personal selling is vital in order to increase the sales amount of a certain product. If there were no sales person that approached me, I would have walked away and bought another phone from other providers.
2.4 Pricing Strategies
2.4.1 Price Lining
Price lining is the practice of offering product line with several items at specific price points (Macdaniel, Lamb, & Joseph F. Hair, 2008,2009, p. 611). Sony Ericsson uses this strategy and offers a range of products at different prices so consumers can choose among the different prices with a different product. Since Sony Ericsson produce both cheap and expensive phones, it became very easy for me to choose a phone that I can afford. Since I am a student, and my monthly allowances are limited, I could choose the mobile phone that is cheap. This pricing strategy is actually very good because Sony Ericsson is able to target on all consumers with different income. If they only sell products that are expensive, only higher income people would be able to purchase their products and it might decrease the profitability.
2.4.2 Flexible Pricing
Flexible pricing is a price tactic in which different customers pay different prices for essentially the same merchandise bought in equal quantities (Macdaniel, Lamb, & Joseph F. Hair, 2008,2009, p. 611). Sony Ericsson uses the flexible pricing several times when I purchased their products. The most recent time when I purchased a Sony Ericsson phone a few months back, the display price of the model was RM850, but after a negotiation, the sales representative was able to adjust the price to RM800. I would not purchase the phone if it was RM850, but since they adjusted it to RM800; I felt it is valuable and decided to purchase that mobile phone. This shows that by using flexible pricing, one company could ensure more sales for their products.
3.0 Segmenting and Targeting
Market segmentation is an adaptive strategy which consists of the partition of the market with the purpose of selecting one or more market segments and adapt to particular market needs; while targeting (Restrepo, 1999, p. 1). Market Segmentation plays a key role in Sony Ericsson’s marketing strategy to ensure its success. The segmentation strategy that is used by Sony Ericsson is psychographic segmentation, where they segment their products according to the personality. Sony Ericsson released a few different series of products to target on people with different personality. This can be seen because they came out with 4 series of mobile phones. These are Walkman series, Cyber-shot Series, UIQ Smart Phones, and Xperia Windows Mobile Phones. It is obvious that each of the series are targeting on different personalities. As for me, I have always wanted a mobile phone with good camera functions because when it is so, I can use the camera phone when and where I wanted and would not need to buy another camera. This had made it easy for me to choose a Sony Ericsson mobile phone because I don’t need to look into other series of mobile phones and can just choose among all the mobile phones from the Cyber-shot Series which provide good camera features.
4.0 Customer Relationship Management
Customer Relationship Management is a strategy designed to optimize the profitability, revenue, and customer satisfaction by focusing on highly defined and precise customer groups (Macdaniel, Lamb, & Joseph F. Hair, 2008,2009). To maintain the relationship between customer and the company is important to increase their profitability.
4.1 Customer Service
Sony Ericsson has their own customer relationship management system, and the good customer service is one of the reasons that they retained me as a repeated customer. Sony Ericsson has their hotline where customers can call them in case there are any problems with their products. I personally used to call their customer service because my mobile phone was not functioning well. The staff was very polite and was able to solve my problems. By having a good customer service, I have more confidence in their products and that is one of the most important reasons of me being a loyal user of Sony Ericsson mobile phone.
Having a corporate website is one of the ways Sony Ericsson interacts with their customer. I have personally browsed through their website a few times when I need to find out what are their new products, to check the price, or to compare among a few mobile phones. This is a good way to maintain my relationship with the company so that I am always up to date.
From the report above, it is shown that marketing strategies are very important in order to maximize the profitability. If Sony Ericsson had not implemented any of the above marketing strategies, they might not be able to have me as their regular customer, even though they produce good products. This means they would also have lost a lot of other customers and hence become unprofitable. In the world today where most of the industries are very competitive, companies need to be good in their marketing strategies, from the planning to the implementation in order to earn the competitive advantage among the industry.
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