the Sony store

• Introduced in Canada in 2003

• 70 stores• Targets women• Showcases products

available for purchase online

On-line Operations

• Corporate website http://www.sony.ca

• Links to Sony Style and Sony Store sites

• Product and pricing information

• Financing, delivery and warranty options

• Order tracking

Online Target Market

• Consumers who value convenience

• Geographical and temporal constraints

• Consumers already familiar with products

• Manufacturer

• Warehouse

• Sony Store

• Sonystyle.ca

• End Consumer

Channel Structure

Sonystyle.ca channel flows

• Payment and Financing

• Risk

• Ordering

• Physical Possession

• Ownership

• Promotion

Demand

• Facilitation of Search

• Assortment and Variety

Supply

• Elimination of contact point

Demand and Supply Side Factors

Service Outputs

• Bulk Breaking

• Spatial convenience

• Waiting and delivery time

• Assortment and Variety

Sony Store Gap AnalysisBULK-BREAKING SPATIAL

CONVENIENCEWAITING AND DELIVERY TIME

ASSORTMENT AND VARIETY

LEVEL PROVIDED High Low Low OK

EFFICIENCY High Low OK OK

SOURCE OF PROBLEM Low quantities demanded by consumers

Must travel to major urban center

Shipping time from wholesaler to retailer

Units exceed Capacity of store

ENVIRONMENTAL-MANAGERIAL BOUNDS

Lack of information internally

Taxes differences in each province

Lack of information

Lack of information

OUTCOME DESIRED Increase capacity of store for inventory/frequency of purchase

Reach more consumers

Next day delivery

Offer all lines of products manufactured by Sony

TACTICS TO CLOSE GAP Increase capacity of retail outlets to offer all of Sony’s line of products to consumers.

PREDICTED CHANGE IN CHANNEL PERFORMANCE

Increased efficiency and reduced delivery time. Increasing offerings of products in store will reduce costs of transporting goods from wholesaler to retailer to consumer.

Sonystyle.ca Gap Analysis

BULK-BREAKING SPATIAL CONVENIENCE

WAITING AND DELIVERY TIME

ASSORTMENT AND VARIETY

LEVEL PROVIDED High: customer buys single unit

High: on-line reaches everyone with the internet

Low: anywhere from 1 -7 days

High: can locate all products offered by Sony

EFFICIENCY High: no need for traditional “bricks & mortar” system

High: targets anyone with internet; convenience for time pressed people

Low: multiple points and shipments

High: access to all Sony products

SOURCE OF PROBLEM No demand for bulk purchases in consumer electronics

Certain consumers do not have access to the internet

All products purchased online need to be shipped to end user

No access to other brands

ENVIRONMENTAL-MANAGERIAL BOUNDS

Shipping rates/methods of transporting specific products

Geographical barriers System crashes/viruses could cause problems in the ordering process

Barrier through management to focus attention exclusively on Sony brand

OUTCOME DESIRED To increase frequency of purchase

To increase consumers use of Sony online

Decrease delivery time as much as possible

Continue to offer all Sony products online

TACTICS TO CLOSE GAP Add another distribution center in Western Canada.

PREDICTED CHANGE IN CHANNEL PERFORMANCE

Costs will fall due to a reduction in delivery time and transportation costs of shipping individual products

Delivery will be 4 days or less

• Tutorials and Emulators

• Additional after-sales service

• FAQs

• Timely and consistent information

On-line Support System

Conflict

• Resistance from retailers

• Cannibalization of sales

• Potential loss of retailers

Recommendations

• Establish distribution center in Western Canada

• Increase product offerings at Sony Store

• Implement use of EDI

• Increase capacity of stores

Questions?Questions?