COMMENT:Why Sharp Is A Massive Basket Case
Sharp Australia hasn’t got much left in the consumer appliance market, they got out of the TV market last year, not because their TV’s were inferior but because of poor marketing resulting in a lack of uptake by consumers.
Now their appliances business is on life support as their parent Company is set to be flogged to Taiwanese Company Foxconn, in a multibillion dollar deal that could well see the Companies consumer products disappear from Australian shelves.
Sharp make extremely good products but they don’t know how to price them or market them because of a combination of poor Japanese management and local management, who don’t have a clue when it comes to delivering cut through marketing.
Sharp management have failed dismally resulting in lost jobs, and a once great brand relegated to the back end of stores.
The Sharp Australia web site which is a low cost way for the Company to market their products.
But the problem is that this site is shocking and local management, don’t have a clue when it comes to social media marketing, which in the USA is seriously driving sales for Sharp.
Click to enlarge
|Sharp Australia Intro Page
In the USA Sharp appliances are top of mind and growing, but when it comes to online the difference between the Sharp Australia web site and the US site, the difference is like chalk and cheese.
While the Australian web site looks like something from the early days of online the US web site is engaging and designed to deliver information for consumers.
Deloitte Australia Research shows that 65% of consumers are going online to search for information prior to shopping, they either visit a retailer’s web site or go direct to a vendors site who redirects them back to a retailer to buy or like Sharp in the USA sell the product direct.
According to a recent study by e-commerce analytics company Clavis Insight, Sharp trumps its top five online competitors in the big US market, including Panasonic who are the #1 microwave supplier in Australia in five key metrics: availability, image presence, content, keyword search and customer ratings.
With 17 percent of market share by volume in 2015, according to Euromonitor, Sharp leads the pack with strong breadth and depth of distribution among online appliance retailers analysed in the study.
Specifically, at least 15 Sharp models were offered by the trio Amazon, Target.com and Walmart.com – while Target’s e-tail site carried 33.
What’s more, the brand outperformed its peers on both search performance and image presence, offering multiple product views on a large majority of its product pages.
This must be embarrassing for Sharp Australia staff who believe marketing is still about giving retailers a bundle of cash and expecting them to build the brand and market the product using catalogues, store visits and online.
Along the way they slap together some external marketing to demonstrate to retailers that they are actually conducting some form of external marketing.
Today a strong web site that promotes a brand as well as products is a critical part of any marketing mix.
Also critical is video as 63% of all transactions at web sites like Harvey Norman and JB Hi Fi are coming from portable devices such as a smartphone or tablet. Consumer today want to simply press a button, watch a video and then make a decision as to their next move.
Sharp’s problem is not about money, it’s all about deadwood.
What Sharp Australia needs is a Young aggressive digitally savvy marketing team that can ID the right products for Australia and then aggressively market them.
They need to give the brand CPR so that when it comes back to life consumers actually want to engage with the brand.
At one stage Sharp branded products were an object of pride for both Australian and Japanese consumers.
Sharp started to come unstuck in 2005 when Japanese management started to believe that the brand was invincible.
They believed that their new LCD/LED TV production plant at Kameyama was the be all of TV production plants.
The only problem was that the Japanese management was only watching the Japanese markets and not overseas markets like Australia or the UK and the USA, while at the same time they failed to capture orders from third party TV Companies to manufacture display components.
This resulted in the Company racking up massive losses.
Even while the plant was pumping out product, it was seriously in debt due to competition from other TV manufacturers, including Chinese and Korean manufacturers.
The blinkered world view that still exists at Sharp Australia today has destroyed a once great brand.
Now the Japanese are fretting at the loss of the iconic brand to a Taiwanese Company Foxconn who has made a name for themselves making goods for Apple.
at the heart of Japan’s reluctance to let Sharp be sold to Foxconn is the bile building up in the throats of Sharp management and Japanese Government official’s that the know how once owned by a great Japanese Company is set to fall into the hands of a competitor.
The anxiety comes from a deep feeling that denies the ascendance of Taiwan, China and South Korea in realms where Japan once reigned.
Japanese media never seriously discuss the fact that companies such as LG, Samsung and Haier now dominate the global home electronics field.
A few pundits and journalists have made the case that not only does Sharp’s likely sale to Hon Hai not signal the end of the world, but that it could turn out to be a good thing for Japan.
During a recent Japanese TBS Radio discussion, listeners sent in questions betraying their nervousness over the deal.
One listener remarked that if Hon Hai buys the ailing company, Sharp will merely become a “maker of goods.” Atushi Osanai a Japanese academic told the listener that, in fact, Hon Hai was buying Sharp because it admires the company’s knack for new ideas.
What he failed to communicate was the fact that Japanese Companies are making great products but they are failing dismally when it comes to marketing the products.
Sharp who does not have much of a profile outside Japan due to its lack of initiatives is doomed to becoming a supplier of components.
Japanese electronics makers “have never had an overseas strategy,” according to Osanai, unlike Japanese car makers. He claims Hon Hai will give Sharp that chance, something the Innovation Network Corporation of Japan who also been bid for the Company would not have been able to do.
Foxconn says it will not sell off any part of Sharp, though that could change once the financing dust has settled.
Japanese media say that Hon Hai wants Sharp for its display technology, but there is nothing special about Sharp’s LCDs, which have become a commodity because Sharp management were unable to sell the superiority of their panels.
In truth, it wants to get into the IOT (Internet of things) business, by producing home appliances that can connect to the Web, and for that it needs Sharp’s know-how. Hon Hai’s rival, Haier, bought General Electric’s appliance business for the same reason.
Softbank another big Japanese Companies popular robot, Pepper, is manufactured by Foxconn another fact the media rarely mentions but one that is central to the issue of Sharp’s worth to the company. “Hon Hai is just like Pepper,” said Osanai. “You can tell it what to do, but it won’t come up with ideas on its own.”