Growth opportunities for the brand using product/market expansion grid to increase sales
For the new Sony Watch for monitoring blood pressure and sugar for diabetes in individuals, the best product/market expansion grid is diversification. When the company develops and launches a new product in a new market, it will find good opportunities that are not available in its current business. Thus, Sony Watch could be a game changer for revenue growth and profitability for the company. In this case, the company will be launching a new product in a new market of the UAE. To grow, the company will focus on conglomerate diversification strategy. It is noted that Sony Watch, which is a wearable technology for individuals with diabetes, is a vibrant product for new markets not explored before (Armstrong et al. 45).
Potential new market segments
Although the company already has existing clients, Sony Watch is meant to target new market segments to create more opportunities for growth and profitability. The wearable technology perhaps has not penetrated the market as expected. In the UAE market, Sony Watch is a product that will specifically appeal to new group of consumers who are considered to be living with diabetes. By focusing on this market segment, the company will go beyond its traditional market segments.
Although there are smart wrist technologies for diabetics, they have not gained grounds in the UAE markets. Given the number of rising middle class in the target, individuals with chronic diabetes and other lifestyle conditions is most likely to rise. This situation presents an opportunity for the company target new markets. For instance, in the UK, the wearable device has gained attention from many diabetics who initially had problems monitoring their glucose levels and blood pressure (Kirsch 1). While these products can be found in the UAE, they are not common in the mainstream target market. In fact, only well travelled, wealthy individuals possess them.
Application of the marketing mix
Sony Watch is specified as consumer product. In this regard, the company will market the Watch to mass market, just as it markets and promotes smartphones, tablets and others. Thus, the company must ensure that Sony Watch meets the needs of the new target market segment in the UAE.
Proposed Product
Sony Watch will present major benefits to potential customers. The Watch is designed to measure glucose levels and change the way in which about 20 percent of the UAE diabetics manage their conditions. It is estimated that the number is most likely to rise because of growing cases of obesity and lack of physical activities (Chaudhary 1). New cases of diabetes in the UAE will present even more opportunities for Sony Watch.
The product is worn on the arm to gauge the level of glucose in the wearers’ blood via the skin after specified period. As a result, diabetics can obtain vital real time information about their glucose levels and adopt best practices to keep the levels management or stable. Patients will therefore be able to avoid chronic challenges that arise from elevated blood sugar using Sony Watch.
Sony Watch is most likely to rely on minimal electric current to draw blood sugar via the skin. Through complicated processes based on positive and negative ions, the Watch would be able to collect glucose for analysis.
Sony Watch will be designed for convenience as the major product specification and benefit. It has been observed that several people with diabetes often fail to test their blood sugar levels due to inconvenience and pain associated with the process. While diabetics recognised that it is imperative to gauge their levels of blood sugar based on physicians’ recommendation, they usually fail to do so because of poor management of daily activities related to sustained levels.
In fact, diabetics understand that chronic complications may result in loss of kidney, heart diseases, stroke and even blindness. By portraying Sony Watch as a simple gadget that could prevent these adverse outcomes due to lack of measurement of blood glucose levels, consumers are most likely to realise these benefits and purchase it. That is, frequent measure of blood sugar levels would ensure that patients understand their conditions and take appropriate interventions to control the levels. Thus, they can avoid long-term advance outcomes.
It is expected that Sony Watch will have a chip to store all data collected regarding blood sugar and pressure for analysis and reference. In addition, it will be possible to warn diabetics when their blood sugar levels and blood pressure are too high, too low, rising steadily or dropping faster.
Proposed Price
Many analysts have associated diabetics with changes in lifestyles supported by increased earnings. That is, the disease affects mainly the middle class and other affluent people. In this regard, Sony Watch should be a premium product, but the company should also develop other models for mass markets.
It is expected that the pricing strategy would accounts for product costs, costs associated with shipment, distribution, advertisement and promotion among others. It is however recommended that the premium pricing strategy should be considered once the market research has been done in the UAE to determine the most suitable price for the local market.
It is also imperative to recognise that Sony Watch will not be retailed at prices that reflect that it is a luxury brand. This implies that the pricing strategy would tout the product as convenient for consumers rather than a luxurious brand for the few.
Price skimming would be the best approach for Sony Watch. Through this approach, Sony Watch will maximise the profit for the company by retailing at a premium price for early adopters. Later on, the price of the product will gradually drop to attract a large number of middle class consumers. The innovative technology and wearable device fad will drive sales among target consumers who will be willing to pay high prices for the gadget. Once the sales drop or a new competitor enters the UAE market, the company will gradually reduce the price, skimming every segment until all segments of the target market are exploited.
By adopting price skimming strategy to launch Sony Watch, the company is most likely to derive four main advantages. The company will learn about what its target market segment is ready to pay for the Watch. Sony Watch will also enjoy prestige status associated with the product classification and pricing strategy. In addition, if the company learns that the entry pricing is far beyond many target consumers, it will be willing to lower it gradually.
Lastly, other potential customers will be enthralled to acquire Sony Watch at relatively lower price and, therefore, the company will be able to establish goodwill in the local market. One major drawback is that Sony Watch is most likely to attract multiple competitors because of its premium pricing strategy and large profits. On this note, the company must continuously introduce advanced watch through innovation to create competitive advantage.
Overall, the pricing strategy would be guided by specific factors in the UAE market, the company’s image, brand feature such as “competitive intensity, market pioneering, brand reputation, and experience effects” (Spann, Fischer and Tellis 235).
Proposed Place
Given the premium classification of Sony Watch, the company will adopt selective distribution strategy. Through this approach, the company will be able to select specific dealers in the UAE market to resell the Watch. It will assist the company to ensure that all selected dealers comply with the strict criteria that reflect its brand and premium classification of Sony Watch. Thus, the company’s strategies will influence resellers’ strategies.
The company will use the Internet as a means of distributing its Watch to target online shoppers. At the same time, it will encourage the channel members to share distribution activities to ensure that practices are consistent. The company must coordinate the supply chain to position the brand as premium. This strategy would create premium value to support the product classification and the intended brand image, as well as justify the premium pricing strategy for Sony Watch (Parment 250). The company should be careful to ensure anchorage in the UAE market because it is significant for encouraging resellers and creating competitive edge. When the company identifies its distribution places, which will be high-end locations in the UAE market, it will be able to design appropriate strategies for distribution.
It is imperative for the company to recognise that a premium Sony Watch may not appeal to the local UAE market because of loose relations. On this note, the company must create competitive advantage through its supply chain, which will ensure strong brand recognition, identification and appeal to consumers. According to Parment, “consumer is likely to be attracted by the image of the premium brand than by the local dealer and thus creating a consistent brand experience is decisive for premium brands whose content to a great extent is global and goes beyond the influence of local dealers and cultures” (250).
The company should adopt a pull strategy to create demands and encourage consumers to buy premium Sony Watch. The pull strategy would ensure that the company appeals to the end user of its product. In this regard, the distribution strategy must create a strong, visible brand for the successful strategy. The company will adopt various ways in its pull strategy to promote Sony Watch. First, the advertisement would involve traditional media and the Internet to promote Sony Watch. Second, the company will focus on developing customer relationships to ensure that customers will always come back and create awareness about Sony Watch to meet specific needs of diabetics. Finally, sales promotion would drive the pull strategy.
Through the pull strategy, the company will create new demands for Sony Watch. The increased demands will ensure that distributors are active to serve the target market segment. For example, the company will adopt strategies used by premium smartphone firms to launch their products. The Internet and social media would also be instrumental in enhancing the pull strategy of the company.
Proposed Promotion
A mix of promotional elements would be used for Sony Watch. On this note, the company would only focus on the most popular promotional strategies. Sales promotion would involve the use of incentives such as gifts to encourage the customer to purchase Sony Watch. For instance, customers will get gift voucher of specific amount to purchase any other products of their choice after purchasing Sony Watch. Through sales promotion, the company would realise immediate, short effects on sales volumes. It will allow the company to clear available stock. The sales promotion methods used such as stock clearance would motivate the distribution channels and consumers to purchase Sony Watch. At the same time, they would give the company a competitive edge against competitors.
The company will also use advertisement. Both traditional and modern media will be used to communicate merits of Sony Watch, its price and retail outlets in the UAE market. Through advertisement, the company aims to advance its pull strategy and create an impact by directly targeting and appealing to the target market of Sony Watch.
Personal selling will also be used as a promotional strategy to appeal directly to people with diabetics and explain how the product can assist them to manage their conditions. The face-to-face interaction with consumers will create a strong bond between sellers and consumers (Perner 1). The company will however not use this strategy to entice consumers and create unnecessary demands among consumers. Instead, it will act as an opportunity to establish good customer relations and enhance customer experience.
In addition, to the abovementioned marketing mix, the company will also use public relations by visiting some individuals with the condition and providing free Sony Watches to create goodwill in the local market.
Works Cited
Armstrong, Gary, Stewart Adam, Sara Denize and Philip Kotler. Principles of Marketing. 6th ed. Australia: Pearson Australia, 2014. Print.
Chaudhary, Suchitra Bajpai. “National diabetes registry by end of 2015 in UAE.” Gulf News. 2015. Web.
Kirsch, Michele. “A wristwatch to ease diabetes.” Daily Mail. n.d. Web.
Parment, Anders. “Distribution strategies for volume and premium brands in highly competitive consumer markets.” Journal of Retailing and Consumer Services 15 (2008): 250–265. Print.
Perner, Lars. Promotion: Integrated Marketing Communication. 2008. Web.
Spann, Martin, Marc Fischer and Gerard J. Tellis. “Skimming or Penetration? Strategic Dynamic Pricing for New Products.” Marketing Science 34.2 (2015): 235 – 249. Print.