Ch. 2 - Strategic Planning for Competitive Advantage

Sony Computer Entertainments star strategic business unit is Sony PlayStation. A Strategic business unit is a subgroup of a single business or collection of related businesses within the larger organization. Each strategic business unit has its own rate of return on investment, growth potential and associated risks, and requires its own strategies and funding, When properly created, an SBU has the following characteristics: A distinct mission and specific target market, control over its resources, its own competitors, a single business or a collection of related businesses, plans independent of the other SBUs in the total organization.

Sony PlayStation has become a semi-permanent fissure in the gaming market, there is always an audience ready and willing to receive anything "PlayStation" however, and Sony still has to plan strategically to remain one of the top three in the game market. PlayStation's biggest competitors are Microsoft's Xbox and Nintendo's Wii and DS. 

This year has been one of the biggest for the PlayStation brand, with the announcement of PlayStation 4 the brand new system. During the annual E3 (Electronic Entertainment Expo) the three big game companies announce their latest development, and the competition essentially begins, of course PlayStation has its share of loyal customers that will continue to be faithful to the brand, but Sony's job is to grab new customers and Microsoft’s and Nintendo's customers in the process. This is done through strategic planning: the managerial process of creating and maintaining a fit between the organization’s objective and the evolving market opportunities.

The PlayStation target market is gamers (which is all ages and both sexes) its main goal right now is to get gamers to fall in love with its system all over again. Its new tagline “greatness awaits” lures people in, but also with its strategic planning at gaming expos like, E3 and Gamescon, PlayStation appeals to gamers with exciting new games from every genre and creating a gaming powerhouse with advanced technologies. Another way to maintain a competitive edge to have games exclusive to the console, forcing players to purchase the system if they want to play the hottest games.

Sony is reportedly spending $100 Million dollars on a marketing campaign involving billboards, commercials, magazine, spreads, and other ads. Sony’s marketing strategy is Product Development, a strategy that entails the creation of new products for present markets. Sony knows trying to appeal to everyone will not rein in as much profits as aiming at target consumers: gamers. Microsoft received much criticism for its Marketing strategy with the Xbox one, aiming at anyone who sits in the living room by adding television, apps, and other things plus a plethora of fees for sharing games and buying pre-owned games, something that is critical to gamers who may not be able to afford new games or want to try games before committing to it. Microsoft was critically panned for apparently punishing gamers, for being gamers.

Microsoft eventually recanted its fees and tried to show incentives for gamers, but not without pushing PlayStation in the lead of sales, having 1 million units pre-ordered within the first month of its availability. PlayStation has a niche competitive advantage: it seeks, targets and effectively serves a single segment of the market. However its marketing is effective across the globe.