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BRAND EXTENSION OF SONY ERICSSON AND MOTOROLA

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Arindam Hait
Arindam Hait

This document analyzes potential brand extensions for Sony Ericsson and Motorola mobile phone brands based on customer research. It finds that Sony Ericsson is viewed most positively for sound quality, so extending to sound systems could be successful. Motorola is seen as having strong battery life, so battery products like inverters could leverage its brand equity. The research surveyed customers on preferences for the mobile brands and opinions on potential new product categories for each to enter. It concludes category extensions may differ for the brands based on their varying brand images and customer perceptions.

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<br /> RESEARCH ON CATEGORY EXTENSION OF SONY ERICSSON & MOTOROLA<br />Post-Graduate Diploma in Management <br /> <br />By<br />Name <br />ARINDAM HAIT 20<br />ABHIJIT DEY 01<br />ARIJIT DATTA 18<br />AVIK MONDAL 25<br />Under the guidance of<br />Dr. Anubha Vasisht<br />INMANTEC, Ghaziabad<br />INMANTEC <br />Integrated Academy of Management and Technology <br />Ghaziabad<br />CONTENT <br />Acknowledgement<br />Introduction <br />Research objective<br />Research methodology<br />Analysis <br />Conclusion <br />Recommendation<br />ACKNOWLEDGEMENT<br />This project report bears the imprint of those who had rendered their whole hearted support and encouragement without whose help this effort of us would be in vain.<br />We are thankful to our respected executive director, Prof. Pankaj Gupta, INMANTEC for giving us the exposure of the corporate environment by providing us with the opportunity to do live project. <br />We also thankful to our respected faculty guide Dr. Anubha Vashisht who guided us throughout my project, and left no stone unturned in helping us throughout our project. Under his guidance we were able to complete our project.<br />INTRODUCTION<br />What is brand extension?<br />Brand extension or brand stretching is a marketing strategy in which a firm marketing a product with a well-developed image uses the same brand name in a different product category. The new product is called a spin-off. Organizations use this strategy to increase and leverage brand equity (definition: the net worth and long-term sustainability just from the renowned name). An example of a brand extension is Jello-gelatin creating Jello pudding pops. It increases awareness of the brand name and increases profitability from offerings in more than one product category.<br />Risk of category extension<br />While there can be significant benefits in brand extension strategies, there can also be significant risks, resulting in a diluted or severely damaged brand image. Poor choices for brand extension may dilute and deteriorate the core brand and damage the brand equity. Most of the literature focuses on the consumer evaluation and positive impact on parent brand. In practical cases, the failures of brand extension are at higher rate than the successes. Some studies show that negative impact may dilute brand image and equity. In spite of the positive impact of brand extension, negative association and wrong communication strategy do harm to the parent brand even brand family.<br />Why firms opt for Brand Extension?<br />Helps the new brand to acquire instant brand recognition<br />Saves costHelps leverage the strengths of the existing brandIt also helps build the brand into a ‘Super brand’<br />Mobile phone satisfaction study – Usage patterns• The average replacement cycle for a typical handset is 16.6 months-a notable decrease from 18 months in 2005.• Handset features that are used most frequently include: <br />THE SPEAKERPHONE (32%)<br /> CAMERA CAPABILITIES (27%)<br />SERVICES TO SEND/RECEIVE SHORT MESSAGES (25%)<br /> AND GAMING (16%)• More than one-half of all current wireless users compared other handset brands before selecting their current wireless phone. Those customers who compare phones during the selection process are more likely to be satisfied overall with their current handset than those who do not.<br />Mobile phone customer satisfaction study: The Reported Handset Purchase Price Has Increased, as Recently Introduced Models Generate Higher Price Points. Sony Ericsson ranks highest in satisfying customers who have owned their current mobile phone for less than two years, according to the J.D. Power and Associates 2006 U.S. The study measures customers’ satisfaction with their wireless handsets based on five key performance factors. In order of importance, these are:<br /> Physical design (24%); <br />Operation (22%); <br />Features (20%); <br />Handset durability (19%); <br />And battery function (15%). <br />Sony Ericsson receives the highest ratings from customers in handset durability, and also performs particularly well in features and battery functionality<br />RESEARCH OBJECTIVE<br />To study customers perception about the brands SONY ERRICSION & MOTOROLA
To find out the possible brand extensions of SONY ERRICSION & MOTOROLA
Evaluate the difference in brand extension possibilities.RESEARCH METHODOLOGY<br />We have done both primary and secondary research.<br />It was done in two methods<br />Quantitative research
Qualitative researchData collection method<br />Secondary data is collected from the net<br />Primary data is collected through filling up the questionnaire and telephonic interview is taken from convenient sampling.<br />Area of research:<br />Sastrinagar D block.<br />INMANTEC BUSINESS SCHOOL<br />Sample size: 30+ 10 TELEPHONIC INTERVIEW.<br />Duration: 1 month.<br />DATA REPRESENTATION<br />Present market share of Motorola and Sony Ericsson<br />COMPARISON BETWEEN THE TWO<br />COMPARISON BETWEEN THE TWO<br />Customer’s perception about Sony Ericsson and Motorola<br />OPINION ABOUT PRINTER<br />OPEINION ABOUT PEN DRIVE<br />OPINION ABOUT PHOTO STAT MACHINE<br />OPINION ABOUT SOUND SYSTEM<br />OPINION ABOUT INVERTER AND BATTERY<br />OPINION ABOUT TV<br />OPINION ABOUT CAMERA<br />OPINION ABOUT WEB CAM<br />OPINION ABOUT LAP TOP<br />QUESTIONIRE<br />RESEARCH ON BRAND EXTENSION <br />Have you ever used Sony Ericsson mobile phone?
Yes
No
Have you ever used Motorola mobile phone?
Yes
No
What do you like of Sony Ericsson and Motorola? (grade 1-5 for each parameter. 5 is the best and 1 is worst)
Sony EricssonMotorolaSoundPicture qualityBattery back upVoice clarityInnovative featuresHandyTechnologically soundCamera
Your perception about Sony Ericsson and Motorola?
Sony EricssonMotorolaReliabilityBrand ratingPrice
According to you Sony Ericsson and Motorola can launch these products which will be successful in the market.
Sony EricssonMotorolaPrinter Pen drivePhoto stat machineSound systemInverter and batteryTVCamera Web camLaptop
Any other suggestion of you……………………………
With whom Sony Ericsson and Motorola can compete in their existing market?
Sony EricssonMotorolaHPTranscendXerox IntexMicrotec or LuminusSamsungDel FINDINGS<br />Market share: <br />Sony Ericsson 20%
Motorola 13%
Sony EricssonMotorolaSoundVery goodAveragePicture qualityVery goodAverageBattery back upAverageVery GoodVoice clarityGood Very goodInnovative featuresVery goodVery goodHandyyesSo soTechnologically soundyesyesCamera Very goodGood
Sony EricssonMotorolaPrinter Pen drivePhoto stat machineSound systemInverter and batteryTVCamera Web camLaptop ANALYSIS<br />According to our research customers like Sony Ericsson mainly for its sound quality.

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BRAND EXTENSION OF SONY ERICSSON AND MOTOROLA

  • 1. <br /> RESEARCH ON CATEGORY EXTENSION OF SONY ERICSSON & MOTOROLA<br />Post-Graduate Diploma in Management <br /> <br />By<br />Name <br />ARINDAM HAIT 20<br />ABHIJIT DEY 01<br />ARIJIT DATTA 18<br />AVIK MONDAL 25<br />Under the guidance of<br />Dr. Anubha Vasisht<br />INMANTEC, Ghaziabad<br />INMANTEC <br />Integrated Academy of Management and Technology <br />Ghaziabad<br />CONTENT <br />Acknowledgement<br />Introduction <br />Research objective<br />Research methodology<br />Analysis <br />Conclusion <br />Recommendation<br />ACKNOWLEDGEMENT<br />This project report bears the imprint of those who had rendered their whole hearted support and encouragement without whose help this effort of us would be in vain.<br />We are thankful to our respected executive director, Prof. Pankaj Gupta, INMANTEC for giving us the exposure of the corporate environment by providing us with the opportunity to do live project. <br />We also thankful to our respected faculty guide Dr. Anubha Vashisht who guided us throughout my project, and left no stone unturned in helping us throughout our project. Under his guidance we were able to complete our project.<br />INTRODUCTION<br />What is brand extension?<br />Brand extension or brand stretching is a marketing strategy in which a firm marketing a product with a well-developed image uses the same brand name in a different product category. The new product is called a spin-off. Organizations use this strategy to increase and leverage brand equity (definition: the net worth and long-term sustainability just from the renowned name). An example of a brand extension is Jello-gelatin creating Jello pudding pops. It increases awareness of the brand name and increases profitability from offerings in more than one product category.<br />Risk of category extension<br />While there can be significant benefits in brand extension strategies, there can also be significant risks, resulting in a diluted or severely damaged brand image. Poor choices for brand extension may dilute and deteriorate the core brand and damage the brand equity. Most of the literature focuses on the consumer evaluation and positive impact on parent brand. In practical cases, the failures of brand extension are at higher rate than the successes. Some studies show that negative impact may dilute brand image and equity. In spite of the positive impact of brand extension, negative association and wrong communication strategy do harm to the parent brand even brand family.<br />Why firms opt for Brand Extension?<br />Helps the new brand to acquire instant brand recognition<br />Saves costHelps leverage the strengths of the existing brandIt also helps build the brand into a ‘Super brand’<br />Mobile phone satisfaction study – Usage patterns• The average replacement cycle for a typical handset is 16.6 months-a notable decrease from 18 months in 2005.• Handset features that are used most frequently include: <br />THE SPEAKERPHONE (32%)<br /> CAMERA CAPABILITIES (27%)<br />SERVICES TO SEND/RECEIVE SHORT MESSAGES (25%)<br /> AND GAMING (16%)• More than one-half of all current wireless users compared other handset brands before selecting their current wireless phone. Those customers who compare phones during the selection process are more likely to be satisfied overall with their current handset than those who do not.<br />Mobile phone customer satisfaction study: The Reported Handset Purchase Price Has Increased, as Recently Introduced Models Generate Higher Price Points. Sony Ericsson ranks highest in satisfying customers who have owned their current mobile phone for less than two years, according to the J.D. Power and Associates 2006 U.S. The study measures customers’ satisfaction with their wireless handsets based on five key performance factors. In order of importance, these are:<br /> Physical design (24%); <br />Operation (22%); <br />Features (20%); <br />Handset durability (19%); <br />And battery function (15%). <br />Sony Ericsson receives the highest ratings from customers in handset durability, and also performs particularly well in features and battery functionality<br />RESEARCH OBJECTIVE<br />To study customers perception about the brands SONY ERRICSION & MOTOROLA
  • 2. To find out the possible brand extensions of SONY ERRICSION & MOTOROLA
  • 3. Evaluate the difference in brand extension possibilities.RESEARCH METHODOLOGY<br />We have done both primary and secondary research.<br />It was done in two methods<br />Quantitative research
  • 4. Qualitative researchData collection method<br />Secondary data is collected from the net<br />Primary data is collected through filling up the questionnaire and telephonic interview is taken from convenient sampling.<br />Area of research:<br />Sastrinagar D block.<br />INMANTEC BUSINESS SCHOOL<br />Sample size: 30+ 10 TELEPHONIC INTERVIEW.<br />Duration: 1 month.<br />DATA REPRESENTATION<br />Present market share of Motorola and Sony Ericsson<br />COMPARISON BETWEEN THE TWO<br />COMPARISON BETWEEN THE TWO<br />Customer’s perception about Sony Ericsson and Motorola<br />OPINION ABOUT PRINTER<br />OPEINION ABOUT PEN DRIVE<br />OPINION ABOUT PHOTO STAT MACHINE<br />OPINION ABOUT SOUND SYSTEM<br />OPINION ABOUT INVERTER AND BATTERY<br />OPINION ABOUT TV<br />OPINION ABOUT CAMERA<br />OPINION ABOUT WEB CAM<br />OPINION ABOUT LAP TOP<br />QUESTIONIRE<br />RESEARCH ON BRAND EXTENSION <br />Have you ever used Sony Ericsson mobile phone?
  • 5. Yes
  • 6. No
  • 7. Have you ever used Motorola mobile phone?
  • 8. Yes
  • 9. No
  • 10. What do you like of Sony Ericsson and Motorola? (grade 1-5 for each parameter. 5 is the best and 1 is worst)
  • 11. Sony EricssonMotorolaSoundPicture qualityBattery back upVoice clarityInnovative featuresHandyTechnologically soundCamera
  • 12. Your perception about Sony Ericsson and Motorola?
  • 14. According to you Sony Ericsson and Motorola can launch these products which will be successful in the market.
  • 15. Sony EricssonMotorolaPrinter Pen drivePhoto stat machineSound systemInverter and batteryTVCamera Web camLaptop
  • 16. Any other suggestion of you……………………………
  • 17. With whom Sony Ericsson and Motorola can compete in their existing market?
  • 18. Sony EricssonMotorolaHPTranscendXerox IntexMicrotec or LuminusSamsungDel FINDINGS<br />Market share: <br />Sony Ericsson 20%
  • 20. Sony EricssonMotorolaSoundVery goodAveragePicture qualityVery goodAverageBattery back upAverageVery GoodVoice clarityGood Very goodInnovative featuresVery goodVery goodHandyyesSo soTechnologically soundyesyesCamera Very goodGood
  • 21. Sony EricssonMotorolaPrinter Pen drivePhoto stat machineSound systemInverter and batteryTVCamera Web camLaptop ANALYSIS<br />According to our research customers like Sony Ericsson mainly for its sound quality.
  • 22. Motorola is famous for its battery back up
  • 23. Thus Sony Ericsson can launch sound system and Motorola can launch inverter and battery.SONY ERICSSON ANALYSIS<br />In case of Sony Ericsson the main problem is Sony is taking acquiring the most market share in the electronics market. Thus probability of creating a different brand identity is very tough for Sony Ericsson.<br />In sound system market the average market leader is Intex. If Sony Ericsson launch its sound system in the market it can easily go on.<br />Here the strategy will be launching high price sound system. As Sony Ericsson already have an brand image that it serves better quality and charge high price. Thus it can be segmented in a high brand value than Sony.<br />If the strategy becomes successful then they can move on different market of electronics goods.<br />As people have faith on this brand name and its durability it can run its laptop business also. <br />They can also run CD parlour like planate M. <br />MOTOROLA ANALYSIS<br />Motorola is good but the main problem is its brand value. Now a day it is not performing well in the mobile market.<br />Thus it can shift or start a business of inverter and battery.<br />Its brand image will be carried forward through this type of category extension.<br />The market leaders are LUMINUS AND MICROTECH<br />But Motorola can compete with them.<br />CONCLUSION<br />In case of category extension the customers view is more over different for the two mobile companies.<br />This is because of their different brand identity, brand image, and perception of the customers.<br />The brand value of Sony Ericsson is good because it’s the joint venture of sony.<br />But Motorola is in the back position.<br /> <br />RECOMMENDATION<br />Sony Ericsson should launch sound system , laptop, pen drive, headphone, printer
  • 24. Motorola should introduce Inverter & battery, pen drive
  • 25. Motorola should try to improve its image by improving quality of the nproducts
  • 26. While sony will introduce new products in the name of Sony Ericsson it must differentiate between the two brands Sony and Sony Ericsson and should target the high profile customersQUESTIONIRE<br />RESEARCH ON BRAND EXTENSION <br />Have you ever used Sony Ericsson mobile phone?
  • 27. Yes
  • 28. No
  • 29. Have you ever used Motorola mobile phone?
  • 30. Yes
  • 31. No
  • 32. What do you like of Sony Ericsson and Motorola? (grade 1-5 for each parameter. 5 is the best and 1 is worst)
  • 33. Sony EricssonMotorolaSoundPicture qualityBattery back upVoice clarityInnovative featuresHandyTechnologically soundCamera
  • 34. Your perception about Sony Ericsson and Motorola?
  • 36. According to you Sony Ericsson and Motorola can launch these products which will be successful in the market.
  • 37. Sony EricssonMotorolaPrinter Pen drivePhoto stat machineSound systemInverter and batteryTVCamera Web camLaptop
  • 38. Any other suggestion of you……………………………
  • 39. With whom Sony Ericsson and Motorola can compete in their existing market?
  • 40. Sony EricssonMotorolaHPTranscendXerox IntexMicrotec or LuminusSamsungDel BIBLIOGRAPHY<br />http://www.highbeam.com/doc/1O18-productcategoryextension.html<br />http://www.sonyericsson.com/cws/cws/home?cc=in&lc=en<br />http://www.motorola.com/Consumers/US-EN/GLP<br />THANK YOU<br />