MARKETING MANAGEMENT II (BBPM2203)

FACULTY OF BUSINESS & MANAGEMENT

SEMESTER 5 / 2013

BBPM2203

MARKETING MANAGEMENT II

NAME : AMIR BIN TOMPONG

MATRICULATION NO: 860704495583001

IDENTITY CARD NO. : 860704495583

TELEPHONE NO. : 013-8899761

E-MAIL : mirtoms@yahoo.com

LEARNING CENTRE : Tawau Learning Centre

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TABLE OF CONTENTS

Contents Page

1.0 INTRODUCTION OF SONY CORPORATION 2

2.0 MARKET POSITIONING 3

3.0 BASES OF POSITIONING 5

3.0.1 Product Differentiation 5

3.0.2 Service Differentiation 7

3.0.3 Channel Differentiation 7

3.0.4 Staff of Personnel Differentiation 8

3.0.5 Company Image Differentiation 9

4.0 BASES OF POSITIONING ADOPTED BY SONY CORPORATION 9

5.0 RECOMMENDATION OF THE BASE MARKET POSITIONING 13

6.0 MARKETING MIX 14

6.0.1 Definition of Marketing Mix 14

6.0.2 Relevant Marketing Mix used Positioning (Differentiation) 15

7.0 SUMMARY 18

REFFERENCE 20

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1.0 INTRODUCTION OF SONY CORPORATION

Sony Corporation is a multinational conglomerate corporation headquartered in

Tokyo, Japan and one of the world’s largest media conglomerate with revenue of ¥6.493
trillion (in 2012). Sony is one of the leading manufactures of electronics, video
communications, video game consoles and information technology products for the
consumer and professional markets. Its name is derived from Sonus, the Greek goddess
of sound.

Sony Corporation is the electronics business unit and the parent company of the
Sony Group, which is engaged in business through its five operating segments, which is
electronics, games, entertainment (motion pictures and music), financial services and
other. These make Sony one of the most comprehensive entertainment companies in the
world. Sony’s principal business operations include Sony Corporation (Sony Electronics
in the U.S.), Sony Pictures Entertainment, Sony Computer Entertainment, Sony BMG
Music Entertainment, Sony Ericsson and Sony Financial Holdings. As a semiconductor
maker, Sony is among the Worldwide Top 20 semiconductor Sales Leaders. The
company’s slogan is make believe.

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2.0 MARKET POSITIONING

Market positioning is the act of designing a company offerings and image to

occupy a distinctive place in the mind of the target market. Market positioning also is an
effort to influence consumer perception of a brand or product relative to the perception of
competing brands or products. Its objective is to occupy a clear, unique, and
advantageous position in the consumer's mind. Market positioning is the manipulation of
a brand or family of brands to create a positive perception in the eyes of the public. If a
product is well positioned, it will have strong sales, and it may become the go-to brand
for people who need that particular product. Poor positioning, on the other hand, can lead
to bad sales and a dubious reputation. A number of things are involved in market
positioning, with entire firms specializing in this activity and working with clients to
position their products effectively.

When a product is released, the company needs to think beyond what the product
is for when it comes to positioning. It also thinks about the kinds of people it wants to
buy the product. For example, a luxury car manufacturer might be less interested in
promoting reliability, and more interested in promoting drivability, appealing to people
who are looking for high-end cars which are enjoyable and exciting to drive. Conversely,
a company making mouthwash might want to go for the bottom end of the market with an
appealing low price, accompanied by claims asking consumers to “compare to the
leading brand” so that they can see that the product contains the same active ingredients
as a famous brand, at a much lower price.

Market positioning is a tricky process. Companies need to see how consumers

perceive their product, and how differences in presentation can impact perception.
Periodically, companies may reposition, trying to adjust their perception among the
public. For example, a company might redesign product packaging, start a new ad
campaign, or engage in similar activities to capture a new share of the market.

Companies also engage in the positioning, in which they attempt to alter the
perception of other brands. While outright attacks on rival brands are frowned upon and
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may be illegal unless they are framed very carefully, companies can use language like
“compared to the leading brand” or “we're not like those other brands.” A television ad,
for example, might contrast two paper towels: the brand being advertised, and a “generic”
with a package which looks suspiciously similar to a popular brand of paper towels, but
isn't quite identical.

Without differentiation, a product will be viewed as similar to other products. If a

product is not unique, consumers will find no reason to purchase and consume it or
replace the current product that is being consumed. Perodua Myvi and BMW are two
companies which produce cars. The majority of consumers perceive a BMW as having
better quality, performance and safety measures. A Myvi, on the other hand, is perceived
by the consumer as the cheapest car and that its quality is not at par with the BMW. Both
cars are different from the perspectives of quality, pricing, performance level and safety
measures. Myvi uses pricing and the small car concept as the basis of its market
positioning in Malaysia, while BMW uses luxury and status as its main strategy. Other
than that we can look at Sony Corporation product such as, Sony Play Station and Xbox
game console which is made by Microsoft. Sony Corporation make a product (Sony Play
Station) which is same function like Xbox, but Sony Play Station concept are different
than Xbox which is Sony Play Station are maintaining their brand, and quality of Graphic
Interface, different with Xbox which is more cheap and also used an high quality of
Graphic Interface and more small.

There are many methods to differentiate businesses and products. For example,
we can use brand, quality, services offered, sales force, materials used and business
location to differentiate between businesses and products. The market positioning
preferred should be attained by the product being offered. If the company emphasis
differences which cannot be carried by the product, consumers will feel disappointed or
cheated and this will create a negative image of the company and the product. A negative
image can cause losses for the company and the product will not be marketable anymore.

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3.0 BASES OF POSITIONING

Generally, a business or a company can be differentiated based on:-

a) Product Differentiation
b) Services Differentiation
c) Channel Differentiation
d) Staff or Personnel Differentiation
e) Company Image Differentiation

3.0.1 Product Differentiation

Products offered by a company can be used as a basis to differentiate the

company business. The bases used in market positioning are:

(a) Form

Most products can be differentiated based on product design like

size, shape or physical structure. Some are round, cylindrical,
square and other shapes.

(b) Features

Most products can be offered with varying features or accessories

that supplement the product basic functions. For example, the
features of a radio are CD and cassette players and a loud stereo.

(c) Quality

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Most products can be differentiated based on the quality of the

product. Normally, quality is categorized into three levels: high,
average and low or inferior. Product quality can be measured
according to the following features:-

(i) Performance

Performance quality is the level at which the product

primary characteristics operate. For example, a washing
machine that washes efficiently is said to be of good quality
and high performance.

(ii) Durability

A product that can last for many years is perceived as being

of good quality.

(iii) Defect Free

A product which is free from defects is perceived as being

of good quality.

(iv) Features

Products with various attractive features can also be

perceived as being of good quality. For example, a Sony
television set with loud stereo sound, clear picture quality,
remote control and a big screen falls into the category of a
product of good quality.

(v) Brand

Well-known brands also imply good quality. For example,

Rolex watches, Mercedes cars and Nescafe coffee.

(vi) Fit and Finish

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This aspect requires the product to be strong, efficient and

of quality. For example, a dining table is said to be of good
quality if the wood used is hard, steadfast and unshakeable.

(d) Design and Style

Design and style offers a good way to differentiate and position a

company products. A Jaguar car uses attractive design and style as
its basic market positioning strategy. Perfume manufacturers use
various bottle designs and styles which are attractive and unique as
the basis of their product differentiation. Figure 1.1 displays
various designs and shapes of perfume bottles for the purpose of
attracting the consumer attention.

3.0.2 Service Differentiation

The business of one company can be differentiated from another based on

the services offered or the services that are attached to the products sold. Services
that can be used as market positioning are delivery services, fixing, maintenance,
staff training and repair work.

3.0.3 Channel Differentiation

Distribution channels used to distribute the products of a company can be

used as a differentiation factor as well. Some companies use only stores to
distribute products whereas others use intensive distribution, exclusive
distribution or selective distribution strategies.

(a) Intensive Distribution

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In intensive distribution, a company sells its products in as many

shops as possible. The objective of this method is to enable
consumers to purchase the products anywhere and they are needed.

(b) Exclusive Distribution

Through exclusive distribution, the company distributes its

products in exclusive stores only. The company gives special rights
to certain stores to distribute its products. For example,
manufacturers of Cartier accessories distribute their accessories
only in one store in Malaysia, which is situated in Suria KLCC.

(c) Selective Distribution

Selective distribution strategy incorporates aspects of intensive

distribution and exclusive distribution. Through this strategy, the
manufacturer will select a few stores to carry its products. The
objective of this strategy is to build good relationships with a few
stores in order to provide excellent service to consumers.

3.0.4 Staff or Personnel Differentiation

Personnel can also be a differentiating factor for a company. Trained,

dedicated, friendly, self-confident, capable and honest are a few basic attributes of
personnel that can differentiate a company from its competitors engaged to create
word of mouth momentum. Sales staff often plays an important role in word of
mouth and public relations.

3.0.5 Company Image Differentiation

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Today, there are many types of images that are used to differentiate
products and companies in the market. McDonald portrays itself as a clean and
cheerful restaurant. Nestle positions its Nescafe coffee as an international
beverage. Marlboro portrays its cigarettes as cigarettes that embody a rugged
lifestyle. Pepsi, on the other hand, portrays its carbonated cola as a drink for the
new generation. Generally, images are created through advertisements that are
passed on to consumers. Global companies are willing to spend billions of ringgit
in advertisement program to create a desirable image for their products or
company name. Image and brands are differentiating factors that competitors find
most difficult to copy. On the other hand, other market positioning differentiating
factors like features, design and style, and services offered are easily imitated and
followed by competitors.

4.0 BASES OF POSITIONING ADOPTED BY SONY CORPORATION

There are few bases of positioning strategy which is adopted by Sony

Corporation. The bases of positioning strategy which is used by Sony Corporation is
product differentiation. Sony Corporation differentiates its product in many ways.

First it is the only gaming console to adapt to blu-ray technology, something that
no other gaming console can say. Its sleek style and looks make it the most visually
stunning system to date as well as the graphics are better than any other system. Its ability
to reach the entire world and provide so many different uses in such a convenient and
easy way is head over heels better than any other gaming console in the world.

Second is 5 Forces Mode. Buyer Power for the consumers in the video game
market is fairly low. Since only a few companies make video games and game systems
there aren’t many choices to choose from. Consumers just have to pay the given price and
don’t have any say if it’s too high. Supplier Power is the opposite of buyer power which
makes the supplier power of the industry on the high side. Sony and its PlayStation have
this power because there are not a lot of alternatives to choose from in the industry. They
can set a price for their product and people will just have to pay if they want a
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PlayStation. The threat of substitute products for the PlayStation is quite low because
there are only three main gaming systems on the market right now. There is also a
switching cost in getting a new system because the games you purchase only work for
one particular system. Also, the controllers and other accessories you invest in buying
only work for that particular system. The threat of new entrants for the video game
industry is quite low. It usually takes a large company and good financing to be
successful which can be an entry barrier. If a small company attempted to get into the
industry it would just get pushed aside by the three large companies currently in the
market. Another setback is that it is difficult to get software designers and third party
companies to make the software for the games themselves. Most game designers won’t
work with a certain system if they don’t feel that their game will sell for that system.
There is a strong rivalry among Sony’s PlayStation, Nintendo’s Wii, and Microsoft’s
Xbox. These three companies have to make their products stand out over its competition.
All three have been in the industry for a good amount of time and show no signs of
leaving. Price cuts are one way these companies are currently trying to reach out to more
consumers. Each system has their own product differentiation to make their system stand
out.

Other than that is Initiatives and Philosophy. The four different business
initiatives are Supply Chain Management, Customer Relationship Management, E-
Collaboration, and Enterprise Resource Planning. Sony Play Station uses a mix of E–
Collaboration and Enterprise Resource Planning system. The company uses technology to
support work activities with integrated collaboration environments with virtual teams
who are located all over the world. It uses a system with a collection of software for
business management, accounting, finance, human resources management, project
management, inventory management, service and maintenance, transportation, e business
and also Supply Chain Management and Customer Relationship Management all
together. Sony Play Station uses top line initiatives because their strategy is to increase
revenues, and different ways to increase revenues used by them are reaching out new
customers, offering new products, cross selling related products like accessories and
offering complementary products. At the same time it the use some bottom line initiatives
to keep the expenses at a minimum. Sony is considered to be one of the top leading

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manufacturers of audio-visual electronics and information technology products

worldwide. Such success can be link with the type of IT organization and philosophical
approach that Sony uses. The philosophical approach that is used by Sony is
decentralized, also known as the early IT adopter’s philosophical approach. This
approach has been used since the foundation of this corporation in the earlier 1940’s.
Adopting this approach can be risky but it can also provide significant competitive
advantage and a higher return if it proves to be successful. This fact can be proven by the
success of PSP 3, which use advance technology like a High-Performance Processor and
a Semiconductor Laser that gives them the advantage among their competitors and the
preference of their customers. This success is achieved by the fully integrated approach
within SCEA. This means that even if every function has its own department. The IT
personal is placed within the other functional units. The approach gives the corporation a
tremendous empowerment.

The other strategy is, new design after price cut. Sony Corporationused e-
commerce in a number of different ways. You can buy the PS3 console online at a
number of different retailers including Amazon, PlayStation.com as well as number of
different retailers like Best Buy etc. Another way that PlayStation uses e-commerce is
through what’s called the PlayStation store. This store that is accessed through the bar
when you turn your PlayStation on it sells a number of different items that correspond to
PlayStation as well as other things. At this store you can download free demos of games
coming out, you can buy old PlayStation 1 and 2 games and download and play them on
your ps3, you can buy add-on's for games that you currently have and you can also rent
movies and buy movies to download to your ps3 as well. So as you can see PlayStation
does a lot to have e-commerce integrated into its lineup. For the most part Sony uses the
B2B and B2C models. When Sony sells its games, systems, and accessories to retail
stores this is selling to another business or company. Then from these other stores and
businesses the consumers buy their products. Sony also sells its products directly to its
consumers which would be B2C. Another way Sony products are sold are from people
buying and selling products on eBay. This method does not involve Sony so it would be
an example for C2C e-commerce. Sony registers with search engines to try to direct
traffic to its website. When you do a Google search for "Sony" its homepage comes up as

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the second link. Anyone that searches the company will see it in the first few Google
results. I have also seen online ads for Sony's video games when I have been on video
game related websites. When Sony releases newer games or games that are expected to
sell more you may see advertisements on other websites that are not video game related.
Sony also has TV commercials for the Play Station and its games. Viral marketing is
another way the word is spread about the PlayStation because its users always talk about
it. The best thing about viral marketing is that it is free for the company because the
consumers do the work. Sony does not really use the payments methods in the B2C e-
commerce model. Depending on where the consumer orders its Sony products from, a
financial cybermediary may be needed. For the most part Sony sells its gaming products
through other electronic retail stores. The most common way games are sold using e-
commerce is by online shopping from retail stores. Some of these stores have their own
payment system, but others may need the financial cybermediary. PayPal is the best
known financial cybermediary and is very user friendly.

5.0 RECOMENNDATION ON THE BASE OF MARKET POSITIONING

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To determine the positioning strategy, first, it is necessary to identify the

properties and the images of each of the major rivals completely and correctly. Then, the
business will determine its position for its products, at this point, it must put forward the
combination of the benefits of customers that are not offered by competitors but are
desired by the target market. So, customers will be affected by emphasizing the
advantage of buying their company’s products, not the opponents’. of them the that why
opponents of the customers, not products, to buy their products that are highlighted for
their benefit, they will be affected. In other words, in the beginning, for the goods or
services to be presented to the market, it must be determined by the management that
‘what kind of differences and superiorities they would have’, 'why they should be
preferred’ against competitors, systematically and as a strategy planning.

Because product or market positioning is dependent on the attitudes of the target

market, marketing management, either tries to change product specifications according to
that attitudes, or tries to change the attitudes of the market. In general, changing goods is
easier and cheaper than changing consumers. But sometimes the attitude of the market is
so negative that the product may be required to re-position. For example, for Czech
"Skoda" brand cars, it was hard to break the impression that they have former Eastern
European origin, the company did not want the “bad workmanship” and “unreliable”
perception of 'Yugo', 'Lada', and 'Poliski Fiat' cars. Skoda makes so much effort for its
customers to realize that Volkswagen bought its company and its cars are very much like
of Volkswagen's

Positioning, especially with the market segment of products, can be defined as

placing the product into the consumers’ reference frame of product category. Ideally, it is

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accepted that all marketing / communication plans should include a positioning strategy.
This strategy includes,

(a) Positioning objectives

(b) The product's positioning statement

(c) The positioning of any featured benefit on the target consumers,

(d) An understanding of this position in the market.

6.0 MARKETING MIX

6.0.1 Definition of Marketing Mix

Marketing mix is a major concept in modern marketing and involves practically

everything that a marketing company can use to influence consumer perception favorably
towards its product or services so that consumer and organizational objectives are
attained. Marketing mix is a model of crafting and implementing marketing strategy. To
effectively market a product or service there are four things we need to know which is:

a) Product
b) Price
c) Place (Distribution)
d) Promotion

These four elements are known as the marketing mix or the 4Ps. The four
elements should be viewed as one unit and structured to support each other; Otherwise a
firm's marketing strategy will be confusing and uncoordinated. This article provides you
with a quick introduction to each element and links if you would like more information.

6.0.2 Relevant Marketing Mix used positioning (Differentiation)

A company’s offer has to be distinct from those of its competitors and should
fulfill the requirements of the customers of its target markets. A company’s positioning is

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the result of whatever the company does. Marketing mix is the most tangible and the
most flexible tool to create the desired positioning. Companies use their marketing mix to
create something specific and special for the customer.

a) Product Differentiation

Product differentiation results from added features which give customers

benefits that rivals cannot match. Before adding features, a company should
thoroughly research the need for the particular feature among customers in the
intended target market. Companies keep on adding new features just because
their competitors are offering them. Sometimes deletion of features and
benefits from a product may be a very effective differentiation because
customers never really wanted these benefits. Adding the same features as
competitors may make the products of a company more acceptable among
customers, though it may end up introducing similar products that does not
result in any differential advantage. Such a strategy of matching features and
benefits will result in product parity, with no company providing any
compelling reasons to the customer for buying its product. In such industries
customers will buy on the basis of price, and competitors will be forced to cut
prices to grab customers from each other. The profit of every company will go
down. Companies will not have the ability to differentiate their product as
they will not have enough resources due to their dwindling profit margins. The
only way out of this mess is that companies should pick up courage, arrange
resources and start differentiating their products from each other. Price based
competition should be avoided.

Most of the time, in most categories of goods, consumers get products

with features that they could do without and are needlessly paying for them.
Most products can be made more suitable for their target markets by deletion
of certain features. Nokia has introduced a stripped down version of the
cellular phone for the entry level customer in Japan. The phone is a contrast to
the ones that offer internet usage, m-commerce, camera etc. It serves the basic
purpose of mobile connectivity. Many customers are realizing that they do not

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need what they have bought and are switching over to these simpler phones.
This phenomenon is likely to be repeated in many categories of goods once
simpler options ore available at lesser prices.

b) Promotional Differentiation

Promotional differentiation arises from unique, valued images created by

advertising or superior services provided by salespeople. People in different
target markets are likely to react differently to certain stimuli like emotions,
images, storylines, celebrities etc. It is important to identify the stimuli which
will evoke the desired response in members of the target market. It may be an
extremely intricate task but it is imperative to find out whether the members
prefer emotional or rational messages, whether they like humor or sedate
messages, whether they like narratives or musicals .Unless the company has
determined the choice of the consumers on all the variables that affect an
advertisement it cannot create an advertisement which is suitable for members
of the target market but is unsuitable for any other target market. Sadly most
advertisements look and sound similar and are not suitable for any particular
target market and do not elicit the desired response. Similarly, different target
markets will require different types of sales presentations, persuasions and
relationships with the seller

c) Price Differentiation

Price differentiation involves estimating the price sensitivity of the target

market, and offering relevant values on the basis of such an estimation. A
target market can be totally price insensitive and desire value of the highest
order. These values can be exclusivity/ sheer luxury/ symbol of status or
royalty. They essentially signify belongingness to an exclusive club and are
often accompanied with the owner’s passionate attachment to the product. A
target market can be highly price sensitive and will go for mere functionality
of the product if it finds the price of available products high. Customers of this
target market yearn for better products/ but will not be willing to pay a price
for it. If a company offers a better product at the existing price level such

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customers would buy it. A third type of target market is emerging. This
market’s price sensitivity is moderate and is willing to pay higher price for
more features and benefits. This would be a big market in the future because
income and aspiration levels of customers are rising throughout the world.

d) Distribution Differentiation

Distribution differentiation arises by making the buy situation more

convenient for customers. Different target markets will require different
activities to make the buying situation more convenient for them. Customers
hard pressed for time have welcomed introduction of automated teller
machines. But some customers would still prefer to visit the bank to conduct
transactions which can easily be carried out through the ATMs. Cans of
carbonated soft drinks from vending machines are finding favor with
youngsters from the upper strata in India who believe that this is the original
Coke or Pepsi. Different distribution channels like telemarketing, direct mails,
internet marketing, personal selling are being used to lure customers of the
same target market resulting in irritability among customers, duplication of
efforts and high costs. This is particularly true of credit card markets, internet
service providers etc. The adequate strategy would be to identify the most
suitable distribution channel for each target market and pursue it.

7.0 SUMMARY

Product positioning is an important element of a marketing plan. Product

positioning is the process marketers use to determine how to best communicate their
products' attributes to their target customers based on customer needs, competitive
pressures, available communication channels and carefully crafted key messages.
Effective product positioning ensures that marketing messages resonate with target
consumers and compel them to take action.

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Today, many companies offer the same products and services. It may seem
pointless to try to compete in an environment in which numerous other companies are
already offering the same product or service you wish to sell. However, new companies
often do come into the market place and successfully sell products and services that
already existed in that market place. They are able to compete because they use product
differentiation. Product differentiation is a specific kind of business and marketing
strategy. It focuses on a target market in which competitors already offer similar products
or services. A company that uses product differentiation tries to create the perception
among certain target customers that the company’s version of this product or service is
some how different and thus has added value that is not available from competitors.
Product differentiation is extremely important to running any kind of business. This is
due to economic principals that have been demonstrated time and time again in nearly
every market place. If the public perceives no difference between two competing
products, then the only possible means of competition is through pricing. In a situation
such as this, products are viewed by customers as very easy substitutes for one another. If
one product is more expensive than the other, the customer will simply purchase the
cheaper product. She does this because she views no difference between them. To
compete, the company with the higher price will lower its price to the same level as the
competition. Eventually, another company may ignore the standard price in the market
and offer the same product at an even lower price. The other competitors have no choice
but to lower their prices as well. They have to or they will lose their business. Eventually,
this leads to a situation in which the prices are lowered to the point where no business in
the market can make a profit off of that product.

Situations such as these present themselves in markets where products are

relatively similar. For example, people generally don’t consider one brand of peas
inherently superior to another. Due to this fact, they are likely to just purchase the
cheapest brand. Entering into a business such of this doesn’t seem like a lucrative
proposition. Gaining market share and producing a sizable profit will be very difficult.
The answer to this problem based on economic principals is to make your product seem

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different from the competition. If the customers do perceive a difference, one product is
less likely to be a perfect substitute for another.

REFERENCES

Borden, Neil. "The Concept of the Marketing Mix” Neil Borden. Retrieved 24 April 2013

Banting, Peter; Ross, Randolph E. Journal of the Academy of Marketing Science (Springer Link)
http://www.springerlink.com/content/mn58860185200184/

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Sony Corporation
http://www.sony.com/SCA/

Sony Pictures Television

http://en.wikipedia.org/wiki/Sony_Pictures_Television

Ries, A. and Trout,J. (1981) Positioning, The battle for your mind, Warner Books - McGraw-Hill
Inc., New York, 1981, ISBN 0-446-34794-9

Levi, K. (2007) "Differentiate or Diminish: The Art and Necessity of Business Positioning",
(March 2007), p. 9

Trout, J., (1969) ""Positioning" is a game people play in today’s me-too market place",
Industrial Marketing, Vol.54, No.6, (June 1969), pp. 51–55.

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