Stan Glasgow, president/COO of Sony Electronics, is hopeful that the reorganization of his company's sales and marketing operation will help it react quicker to the market, and he sees some hopeful signs in overall market conditions.
Glasgow sat down with TWICE at the Consumer Electronics Association's Washington Forum, held here last month, to discuss his company, CE retail sales and the industry in general.
Glasgow said the “ultimate hope” for the new consumer sales and marketing format is “that we become a stronger organization ... and are more responsive to consumer demands. Bringing marketing and sales closer flattens our organization and makes us react quicker to the demands of the marketplace.”
Sony's consumer sales and marketing changes were announced last month, with long-time consumer sales president Jay Vandenbree among those employees accepting an early-retirement offer (see TWICE, April 20, p. 4).
Glasgow said, “Things are tough,” but added that Sony consumer sales “are not as bad as we thought they would be. Every month we are exceeding our [monthly] sales projections.”
He noted, “Business has been up a week or two, then down for a week, but it is better than five or six months ago. Last year was a good one, until the fall when the economy went down.”
As for individual categories, Glasgow said due to “conservative sales estimates” set last fall, “it's been tough to keep up with Blu-ray demand,” but inventories will be corrected in May. Glasgow said, “Some TVs are in short supply,” especially 26-inch and 32-inch LCD TVs.
PC sales “are moving, especially netbook models ... PC sales only slowed slightly” as the recession deepened, Glasgow said.
At retail, in Glasgow's opinion, “Wal-Mart is doing well, and so is Costco. Best Buy has been slightly affected [by the recession] but is OK. The facts are that consumers are looking for the value equation and price. And we serve plenty of smaller dealers, and a lot of them are doing OK.”
The reason for small dealer success it that “they continue to serve their customers. They provide value and are respected in their communities.”
The demise of Circuit City has helped those retailers — large and small — who remain, Glasgow said. “All retailers are sharing that volume. Circuit City at the end was a TV/video house. So no one really knows, but the perception is that Best Buy and Wal-Mart are benefiting the most. But we know that many [Circuit City] sales are now going to regional retailers.”
The challenge of serving smaller retailers is that “it is tough to keep them stocked because they don't forecast” as effectively as larger retailers, “so when they run out of product, they need it immediately.”
Glasgow noted, “We have been trying to anticipate their needs. We are working with distributors on this, to provide fulfillment, but we will still manage the business. We don't want to lose touch” with smaller retailers.
Regarding new technologies in the works, Glasgow said OLED “is going to be a key area, which will provide larger screens and more features,” but he added the format won't challenge the popularity of LCD TVs “anytime soon.”
About IPTV, he noted the market “is growing steadily, but someone has to come up with the right model for consumers to make it easy and simple to use. I ultimately think you have to have a system that uses one remote.”
Glasgow sees the “next breakthrough for the industry” involving “home networking, making it easier for the consumer to move content from device to device.”
Glasgow pointed out how the camcorder's popularity over the years is an early indicator of economic conditions. “Camcorders are the 'canary in the mine.' In past downturns, when camcorder sales are off, they are an early indicator of families not going on vacation or not buying in time for a big family occasion. Soon after that, you hear of a downturn.”
Glasgow quickly added, “We now see camcorder sales slowly coming back, which is good news for everyone.”