How Sony Competes Without Lowering Prices

Last Updated Aug 22, 2007 12:53 PM EDT

sonybravia.jpgIn one of our feature packages, we highlighted how some companies generate profits without competing on the basis of price. It looks like Sony may have paid attention. With HDTV equipment prices above the competition, the company needed to do something to keep customers loyal. (Although the 2007 Brand Keys Customer Loyalty Index found the company number one for brand loyalty when it comes to LCD HDTVs and DVD players, Panasonic won for plasma HDTVs, and Samsung for CRT HDTVs).

Sony's pulling out all the stops to own the number one spot in every product category without cutting into its share of the holiday-spending pie -- a prospect it belabored last holiday season. It's new $100 million-plus advertising campaign (HDNA: High Definition. It's in our DNA.) kicks off in September. The integrated campaign extends across multiple product categories -- including cameras, Bravia televisions, Blu-ray players, and camcorders -- and will reach the public via television, radio, print, and interactive web spots. Peyton Manning and Dale Earnhardt Jr. will serve as spokesmen.

Sony's CMO Mike Fasulo said:

"HDNA is the core, the essence of all Sony HD products. HDNA ensures an HD experience that you cannot have with any other brand.If a consumer is considering the purchase of an HD product, we believe that given our lineage and expertise in the category, Sony should be the only consideration. With this comprehensive campaign we will also demystify all of the fears associated with purchasing a high-definition product."
In that one statement, Sony stakes its claim as a brand synonymous with high definition, undermines the competition, and addresses one of the top concerns consumers have with purchasing HDTV: confusion about the product.

William Gelner, executive creative director for 180LA, the advertising company Sony's working with, shed further light on the company's motivation:

"The HDNA concept will help Sony own the concept of high definition in the minds of people looking for the ultimate entertainment experience. It provides a meaningful platform that ties all of Sony's products together under one theme, across every medium, in order to create excitement around the best HD products available."
So there you have it -- banking on the brand to convey superior quality. It seems like a smart move, but we won't know until after December if customers agree.

(Sony Bravia Image by LiveU4)