Sony says premium strategy is achieving results

Concentrating on high-end products is returning profits, the company says

Sony is winning customers and seeing clear results from a strategy to focus on premium products in the U.S. and improve interaction with consumers, a top executive said Tuesday.

The company, which for years tried to battle lower-priced competitors, decided more than a year ago to concentrate on high-end products that showed off the best of Sony technology and allowed it to make money. And, so far, so good, said Mike Fasulo, president of Sony Electronics, at a briefing with reporters in San Francisco.

"In November, we recorded record profits and that's not by accident, that's by clear strategy," he said.

Part of that strategy called for Sony to focus on a small number of product areas: home entertainment, audio, digital imaging and smartphones. Products outside of those core areas were discontinued and Sony reduced the complexity of its business, cutting the number of individual products it sells in the U.S. from around 2,000 to around 800. Next year, Fasulo plans to get that down to 500.

As a result of the new focus, Sony says its best-selling TV is a model with a $1,499 price tag.

Leaving the low end to other brands means Sony won't have the largest market share in TVs, but Fasulo said he's much more interested in making Sony the leader in higher-priced sets or in new technologies like 4K. Such sets offer consumers four times the resolution of high-definition and are attracting consumers.

Over the Black Friday sales period, when stores typically cut prices to attract customers, Sony managed to sell 11,000 4K televisions without deep discounting, he said.

In fact, Fasulo criticized some of Sony's competitors for the prices at which they sold 4K TVs over the period, calling them "irresponsible."

"It tells me they have inventory problems and are not selling through at the rate they thought they would," he said.

Sony's flagship products for 2015 will be unveiled in Las Vegas on January 5 at the International Consumer Electronics Show.

Ahead of that event, Fasulo had a parting message.

"Stay confident of Sony in America, we're back."

Martyn Williams covers mobile telecoms, Silicon Valley and general technology breaking news for The IDG News Service. Follow Martyn on Twitter at @martyn_williams. Martyn's e-mail address is martyn_williams@idg.com

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