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THE SONY AIBO

THE SONY AIBO. Marguerite Chaignot, Wai Ting Chung, Adrian Corsin, Samer Fahmy, & Johnny Leon. FAMOUS DOGS IN HISTORY. AIBO WEBSITES. AIBO TOWN MAGAZINE. AIBO SOCKS. The Problem. American market less responsive in purchasing AIBO when compared to Japanese market Problems:

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THE SONY AIBO

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  1. THE SONY AIBO Marguerite Chaignot, Wai Ting Chung, Adrian Corsin, Samer Fahmy, & Johnny Leon

  2. FAMOUS DOGS IN HISTORY

  3. AIBO WEBSITES

  4. AIBO TOWN MAGAZINE

  5. AIBO SOCKS

  6. The Problem • American market less responsive in purchasing AIBO when compared to Japanese market • Problems: • The product remains unprofitable for Sony at current production levels • Possible Causes: • High price tag • American consumer sees robots as “dangerous or threatening” and see little value in a robotic pet that performs no functional tasks

  7. AGENDA • The Problem • Situational Analysis • Methodology and Criteria • The Alternatives • Alternative Selection • Implementation

  8. Situational Analysis • Strengths: • Association of Sony brand name • Sony is market leader AIBO is the first commercially available robot • Weaknesses: • Not part of Sony’s core competencies • “electronic, games, and entertainment” • Price tag of US$1500-$2500 • Sony often fails to meet demand

  9. Situational Analysis • Opportunities: • Social: Baby boomers in the US market • Technological: The research holds the potential of being extremely valuable to external high tech companies • Political: Government agencies have a keen interest in how new technology can improve its operations • Turn the robotic pet into a learning tool at schools or an automated caretaker at aging homes

  10. Situational Analysis • Threats: • Competitors: Honda's Asimo uses a platform recognition and network integration technologies similar to the AIBO • Technological: A high-tech company such as Sony and its competitors are always threatened by a high rate of technological obsolescence • Economic: By the nature of the product categories in which they compete, Sony and its industry offers many high-end, luxury products

  11. Methodology and Criteria • Four criteria were used to compare the alternatives • 1) Short term to medium-term profitability (30%) • 2) Alliance with Sony’s core competencies (30%) • 3) Long term growth potential (20%) • 4) Ease of implementation (20%)

  12. Alternatives • Stop Production • Reasons: • Sony AIBO is unprofitable • Does not fit with core product strategy • American market has a history of associating robots with enemies

  13. Alternatives • Market Penetration • The Innovator market has not be saturated • Same product, same price • Same Distribution channels • The promotional strategy would eschew mass advertising and focus on building ‘word of mouth’ buzz • Technology trade fairs

  14. Alternatives • Market Development • Attract the early adaptors and lead towards a mass marketFunctional AND emotional positioning • Build primary demand • Market is large and will offer long-term growth • Short-term profitability because low R&D

  15. Alternatives • Product Development • Exploit the tech-savvy, innovator market that it currently targeted • Develop the AIBO to the point of being less of a continuous innovation and more like a discontinuous one • Purchase because of the novelty

  16. Alternatives • Diversification • Two diversification strategies • a) diversification towards a highly functional AIBO which performs duties and is targeted towards adults • Development of a highly functional product that answers the question, “But what does it do?” • American consumer is pragmatic • Low short-term profits • Most aligned with Sony’s core competencies of producing high-tech electronics

  17. Alternatives • b) a primitive-version AIBO that is geared towards children • Dropping both the price and the functionality • Mass advertising campaign, • Integrated components • Element of luck when attempting to create “mass infatuation”

  18. Alternative Selection

  19. Implementation • Spend around $3M on national advertising campaign • The advertising budget will be split into a 40-60, respectively. • Fifteen percent of the 40% will be spent towards TV commercial • 10% will be spent on movie ads in high-tech movies • 15% will be put towards advertisements in different newspapers, magazines, and other publications • The remaining 60% of the budget will be spent on direct selling through booths in high-traffic, public areas, such as shopping centers and in-store displays/personnel at Sony and The Sharper Image Stores across the country

  20. Implementation

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