Philips: Making Sense of Simplicity

            
 
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Case Details:

Case Code : MKTG163
Case Length : 19 Pages
Period : 2004-2007
Pub Date : 2007
Teaching Note :Not Available
Organization : Royal Philips Electronics, Inc.
Industry : Electricals and Electronics
Countries : Worldwide

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Introduction Contd...

The 'Sense and Simplicity' brand positioning was based on Philips' traditional strengths of design and technology. As per the new brand promise, the company was to launch high-tech products that met customers' needs but had simple designs and easy-to-use interfaces. Philips set up a Simplicity Advisory Board consisting of experts from diverse fields to bring in fresh perspectives to its quest for simplicity. The emphasis on simplicity was applied not only to new products and concepts, but was also used to make Philips a nimbler and a more effective company. Though Philips was still behind in the numbers game, especially in consumer electronics (Philips was the leader in lighting and medical equipment products in several markets), it was generally agreed that the company was moving in the right direction.

Marketing Management Case Studies | Case Study in Management, Operations, Strategies, Marketing Management, Case Studies

However, there were also skeptics who felt that the company's new strategy would do little to strengthen Philips' competitiveness.

Background Note

Philips was established in Eindhoven, a small town in The Netherlands, in 1891 as a manufacturer of carbon-filament lamps and electrical products. By the end of the nineteenth century, it had become the largest producer of these lamps. In 1914, it set up a research center for the development of new products. In 1918, it began manufacturing medical x-ray tubes.

Even before the start of the First World War, Philips had established marketing companies in the US and France. In the 1920s, the company expanded to new territories.

In the mid-1920s, Philips' research labs were involved in the development of radio and television technology. In 1927, the company introduced its first radio. Within a span of five years, it was able to sell a million radios. In 1930, the company started using the star and waves logo6 on radios and gramophones. In 1933, it started manufacturing x-ray equipment in the US. In 1939, it launched electric shavers. By this time, Philips employed as many as 45,000 people worldwide...

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6] In 1938, the Philips logo was altered in that the circular emblem of three waves and four stars was placed in a shield and the Philips word-mark placed on top. This was done to differentiate the Philips logo from other circular emblems. The Philips shield was prominently used in all ads as well as on products till 2002, when its use was discontinued.

 

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