Sony India grows 47% on retail strategy

Sony India claims to have grown at a compounded annual growth rate of 47 per cent over the past three years. In comparison, the industry growth rate has been in the range of 10-12 per cent.

The Japanese company's turnover from its Indian operations, which was Rs 800 crore in 2002-03 touched Rs 1,200 crore in 2003-04, Rs 1,700 crore in 2004-05 and ended the last financial year at Rs 2,500 crore.

Sony executives claim that it has a differentiated retail strategy that worked for the company and helped them leverage the brand's premium perception. "Our strategy for the Indian market has always been different from the rest of the players. While they concentrate on discounts, large volumes and market share we merely look at the wallet share," said Mohit Parasher, GM (sales and marketing - Audio, Video and IT Division), Sony India.

"We concentrate on exclusive outlets (Sony World) to drive our sales as we feel that consumers can truly appreciate the value of our products in tailor-made retail environment," he added. With 37 per cent of the company's sales value coming from Sony World outlets, the brand has steadily grown from 28 outlets in 2001-02 to 375 exclusive outlets by the end of 2005-06. Sony expects to have 400 outlets by March 2007.

"We like to locate our stores in residential areas or in places where other electronic retail outlets don't exist. We take the retail environment that we want to the consumers rather than expecting them to chase us," Parasher said.

But, Sony has not completely ignored the multi-brand outlet format. From being available in 1,417 multi-brand outlets in 365 towns in 2001-02, its products will now be available in 7,715 multi-brand outlets in 784 towns by the end of 2006-07.

Analysts point out that other factors like growth on a comparatively smaller base, contributions from the multi-brand outlets segment and the aggressive marketing strategy as reasons for Sony's success.