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Sharp Kicks Off $30 Million Ad Campaign

New York — Sharp is kicking off one of its largest summer and fall advertising campaigns in its history, in an effort to reclaim lost market share in LCD TV, company executives told reporters at a roundtable press conference here Tuesday.

Bob Scaglione, Sharp Electronics Marketing Company of America (SEMCA) product marketing group, senior VP and group manager, said Sharp is deploying a $30 million advertising and promotional campaign running through September. The effort will employ network and cable TV spots, magazines, newspapers, online and billboard ads to generate an estimated 1 billion impressions, he said.

Ads will also appear during nationally televised Major League Baseball games including the 2007 MLB All Star Game, Fox’s “Saturday Game of the Week,” ESPN’s Sunday and Monday Night Baseball and ESPN’s “Baseball Tonight.”

The media plan includes a targeted cable effort on 20 cable networks including USA, CNBC, TBS, TNT, CNN and FOX News.

It will also feature MLB-themed creative focusing on fans’ appreciation of the “details of the game” as shown on a Sharp Aquos. Boston Red Sox’s David Ortiz, Minnesota Twins’ Joe Maurer and homerun legend Hank Aaron will be featured selectively.

The effort will tie in with Sharp’s recently announced MLB sponsorship. That effort will include electronics video insertions on every ESPN game Sunday and Monday nights as well as FOX’s “Saturday Game of the Week” and at MLB Jewel event viewing parties for outside ballparks.

Other brand enhancement efforts include a Sharp and 3M co-branding effort in a NASCAR sponsorship, and the placement of 10 Aquos Entertainment Lounges in upscale malls owned by Taubman Shopping Centers.

The company is also conducting a nationwide Sharp Aquos Experience Tour using a 53-foot interactive technology display trailer designed to educate consumers and experience products. Tour stops include baseball stadiums, retailer store-level events and other sporting events.

Meanwhile, Sharp’s U.S. executives extended a belated welcome to the April 1 arrival of Sharp’s new world wide president and chief operating officer Mikio Katayama, who replaced Katsuhiko Machida after Machida advanced to the role of chairman of the board and CEO.

Mike Troetti, SEMCA president, said Katayama’s ongoing goal for Sharp is “to be a company that creates value, and the No. 1 priority is to help strengthen Sharp’s brand power in the U.S. market.”

To help in that mission, Sharp appointed Judah Zeigler, SEMCA retail and consumer marketing group associate VP, while Bruce Tripido was promoted to SEMCA marketing, entertainment products division associate VP.

Zeigler said he recently expanded Sharp’s sales training force by 28 people, who are going out into the market to educate retail sales personnel and to ensure that Sharp’s promotions are properly positioned and deliver the company’s product message accurately.

The focus will be on “closing the last 3 feet of the retail floor, and that’s what our whole organization will be focusing on to help both the retailers and us improve our sales,” Troetti said.

Troetti said Sharp had “a record high profit” for the fiscal year that ended March 31. He said Sharp slightly exceeded its goal of selling 6 million LCD TV units world wide in the year, up about 80 percent from the previous year. In 2007, the company expects to sell more than 9 million units worldwide. In the United States, the company expects to see unit sales growth this year growing more than 70 percent over last year, Troetti said.

“That sounds like a big number, but last year at this time we were struggling a little bit,” Troetti said. “We didn’t’ have our large screen TVs out yet. We missed that whole 42- through 52 series. So when you look at the numbers we actually have about nine different units in our line that we didn’t have last year.”

Sharp is aiming to achieve a 17 percent market share position, and a No. 2 rank in U.S. LCD TV sales this year, Troetti said.

As for price erosion, Scaglione said Sharp’s average selling price and retail margin have actually risen in the last year as the line has been expanded with larger and larger screen sizes.

Tony Favia, SEMCA flat-panel senior product manager, said Sharp will significantly reduce the time it takes to bring products to market this year through the addition and expansion of manufacturing facilities.

Starting in July, the company will add a second LCD assembly plant in Mexico starting with a production capacity of 200,000 units per month. More significantly, he said, Sharp for the first time will begin producing LCD modules in Mexico.

“This new plant, basically, allows us to assemble all the pieces of the television there in Mexico, and then assemble them and get them off to our retail partners,” Favia said. “So the only piece that will come from Japan is the panel itself. This will save use about four weeks in production lead time, reducing our lead time from about nine weeks to five weeks total.”

Favia said Sharp is also entering phase three of its production ramp-up at its Gen 8 LCD plant in Kameyama, Japan, which will increase the number of substrates that can be produced to 60,000 a month, as of July. The company plans to be at full capacity in the first quarter of 2008, producing 90,000 substrates a month.

“We think by far we have the best production capacity for LCD TV in the business, and that is one of the key cogs in our plan to reclaim market share over the next year or so,” Favia said.