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...
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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.
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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.
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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... |
Excerpts
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