Marketing Management Case Study

Sony Ericsson’s Alliance: The Synergies

OR

Abstract:
Sony’s electronics division which accounted for the major share of Sony’s overall revenue was making losses during the last three years (from 2004). This was due to a decrease in revenues in the audio, video and the semiconductor products of the company. Sony faced challenges from companies across different product categories like Apple’s iPod and also from Sharp and Samsung in the LCD TV segment. Moreover, in August 2006, Dell announced a massive recall of Sony’s batteries fitted in its laptop computers. In a turnaround strategy, Sir Howard Stringer, the CEO of the company, closed the money-losing divisions and undertook diversification strategies through technological innovations. The case gives an insight into Sony’s history and the challenges that it faced from its major competitors. It also discusses the strategic initiatives taken by Sir Howard Stringer in order to turn the company around.

Pedagogical Objective:

• To discuss the expected synergies that prompted Sony and Ericsson to strike a 50-50 joint venture in 2001
• To analyse the reasons behind the alliance’s troubled beginning and how it bounced back to profitability
• To analyse the reasons that compelled the company to target low-end high-volume market form high-end segment.

Keywords : Sony; Ericsson; Sony Ericsson; Mergers, Acquisitions, Alliances Case Study ;History of Sony; History of Ericsson; Sony Ericsson joint venture; Sony Ericsson's losses; Global mobile market; Sony Ericsson T68I; 3G technology; Low priced handsets; Sony Ericsson's restructuring; Profits of Sony Ericsson; Business performance of Sony Ericsson; Global imaging phone market; Target marketing; High-end low volume market; Low-end high volume market; Dynamics of selecting a target market, Marketing Management; Marketing Mix; Market Segmentation; Product Life Cycle; New Product Development; Consumer Behavior; Marketing Case Studies; MBA; Marketing Course for MBA Marketing Course Case Map; Course Case Map; Case Map