This document focuses on Sony's use of a "Global Localization" strategy during the launch of the MiniDisc in 1992.
Sony is a leading Japanese consumer electronics brand (Case study, graph, p. 2), known through its universal and language-free brand name "Sony". Its global reputation is also reflected by the fact that it is ranked number two in the global brand power league, just after Coca-Cola.
A key to Sony's success is its "global" status, a status achieved in the 1970s when Sony became the first Japanese company to be listed on the New York Stock Exchange. Just two years later, Sony opened its first American factory, with European production starting in 1974. By 1985, the concept of "Global Localization" was well established, with 70% of sales coming from outside of Japan. (Case study, p.1)
Sony's uses a concept of "Global Localization" (coined by its chairman and cofounder, Akio Morita). In other words, Sony tries to "think globally and act locally". As much of Sony's business as possible is conducted locally, by local people, without sacrificing the strengths and advantages of a truly global enterprise; this shows that Sony attempts to combine poly- and geocentric orientation for its international and global marketing approaches (G. Hankinson, (2007); W.J. Keegan, (2003)).
[...] elements) across boundaries, whereas localization refers to the adaptation of launch elements in different countries. This outward facing approach is still unusual for a major Japanese corporation, which tends to have centralized structures, preferring multi- domestic approaches over global ones (Case study, p.1; G. Hankinson, (2007); W.J. Keegan, (2003)). Sony's use of a “Global Localization” strategy was illustrated during the global launch of the MD in 1992. Global and local factors were part of the overall launch strategy and both are analyzed in the following section How did Sony's strategy of “global localization” influence its launch of the MiniDisc? [...]
[...] The case indicates that Sony used more flexible pricing controls after the launch in order to adapt to local conditions. Thus, global pricing appears to be a feasible solution. Place, Production: Advantages: The global simultaneous launch was successful. Disadvantages: Making hardware and software available globally from Day One proved to be a major challenge. ( A solution might have been to produce hardware in the USA and Europe from the start rather than wait until the Japanese plant had reached capacity. [...]
[...] All Marketing mix element controls (product, price, place, people, promotion) will be relaxed once MD becomes established to adapt further to local conditions Difficult decisions However, there appear to be some elements of the launch process that were difficult and could have been handled differently: Price: Advantages: Sony used a centralized pricing strategy for the MD launch. Initially offering MD at a premium price (skimming strategy, in F.Brassing, S.Pettitt, (2003)) reflects Sony's market leader position (Case study, graph, p.2). Sony could sell MD at a premium due to the emotional brand value the Sony name offers to customers. [...]
[...] (Editorial British Food Journal, 2001; Editorial: Harvard Business Review, 1985) Reference List CASE Study: The global localization concept and the launch of the MiniDisc”; by Sony and Graham Hankinson Textbooks Frances Brassington and Stephen Pettitt, (2003), Principles of Marketing, 3rd edition, Prentice Hall: London Sven Hollensen (2004): Global Marketing, a decision-oriented approach, 3rd edition, Prentice Hall: London Keegan, W.J. (2003), Global Marketing Management, Prentice Hall: New Jersey Journals Editorial Harvard Business Review: you really have a global strategy?”, by Gary Hamel and C.K. [...]
[...] Once MD production was established, Sony again employed region-specific teams (freelancers) to promote the product to influential industry figures and record companies. Sony sent teams to the major hubs of the music business: Los Angeles, New York, Nashville, London, Cannes and Vienna. There, local teams promoted the product in record stores, studios and record company offices. This method of localized sales promotion allowed Sony to adapt quickly to the changing demands of local music tastes and created a around MD. In the future, as MD becomes more established, the case indicates that further localization processes are to be undertaken. [...]
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