Researching The Underlying Cause in The Decline of Sony's Sales

Our research results suggest that the decline in Sony’s sales was not driven by the economic chaos seen this past year. The economic issues just made Sony’s underlying issues more prominent. These include a lack of desired innovation, and increased competition. The interviews conducted provided a lot of information regarding potential consumers buying motives and strategies for purchasing a TV. However; more research is needed to get a clear idea of the issues, and their specific effects on the sales of Sony.

Secondary Research

Stacked heading. -Christopher Thacker 3/20/10 5:15 PM

Literature Review

While researching Sony Corp, our company noticed there had been a significant decrease in their net sales for the fiscal year ending March 2009. According to Sony’s Annual Report (2009), their sales and operating revenue dropped 12.9 percent from the previous year. This is shown in Datamonitor (2009) as a 956.2 million dollar net loss – certainly a considerable amount of money even for a corporation as large as Sony. In his Letter to Shareholders, Howard Stringer says “The global economic crises combined with the pronounced strength of the Yen, significantly impaired our operating results…” (Sony’s Annual Report, 2009, p. 9). But, was it really just the poor economy that was the foundation of their loss? An analyst for Standard and Poor’s (2010) says the outlook for the consumer electronics industry is not as strong as it had been in the past, driven by weak consumer spending and lack of innovative products. He also went on to say, that the demand for flat panel TVs appears to be close to saturation levels, driving demand and sales even further down. If the market is truly moving towards saturation, it is even more c...

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...or preferring one TV to another. Predictably the answers varied; however, interestingly, the few consumers that owned more than two TV’s both owned Sony’s and they were their most recent purchases.

Are you happy with you current TV brand performance? Once they own the product and have lived with it for awhile, do they have a different view then when they purchased the product. Surprisingly, regardless of current brand, everyone said yes. Perhaps, because they all researched their products first, and knew the pros and cons beforehand, there were no surprises to make them unhappy with their purchase afterward.

The interviews conducted provided a lot of information regarding potential consumers buying motives and strategies for purchasing a TV. However; more research is needed to get a clear idea of the issues, and their specific effects on the sales of Sony.