Sony Broadcast and Professional Co. (BPC) is leaping into uncharted waters with an initiative to sell its products directly through the Internet.
Sony's e-commerce effort, due to begin this fall, is perhaps the first attempt by a major broadcast supplier to offer the majority of its new broadcast products online. A few broadcast suppliers sell demo equipment or overstocked or discontinued items on the Internet, some through auction sites. But no one has made a serious push into offering first-inventory gear online.
"We are launching an e-commerce capability," says President Ed Grebow. "There's going to be a soft launch in September, and certainly by this fall, all of our significant product will be available on the Internet."
Grebow is quick to point out that Sony BPC's Internet sales channel isn't intended to replace the company's extensive direct sales force or dealer network but instead to complement it.
"We are committed to making both information and products available to our customers however they want to buy them," he says. "So most of our customers are going to want the training and the support they get from a dealer or a direct salesperson, but there are other products that are just as well bought over the Internet. For example, you don't need a Sony salesman or a Sony dealer to sell you a spare part or an accessory."
Sony BPC's Internet effort is being supported by Sony's "e-solutions" division, which numbers more than 100 staffers and is also in charge of creating the online retail infrastructure for Sony's consumer products, such as the "Sony Style" Web site. Directing its sales and marketing is Steve Jacobs, a former news producer at CBS and deputy general manager of CBS.com. He joined Sony in March as senior VP, networked systems businesses.
Jacobs notes that CBS is already accustomed to buying professional gear online with its "Eye on the Buy" extranet site, a Web site designed for use by CBS staffers that lists products from several major suppliers. Sony maintains a product page on the CBS site, featuring some of CBS' favorite Sony professional products at the network's preferred pricing. Sony, which already dedicates salespeople to major accounts, plans to create extranet sites for other major customers.
"It's a trend not of the future but of the present," says Jacobs, who says one of Sony BPC's main goals in using the Internet is to help salespeople and dealers communicate more easily with customers. "We want to give a customer the address of a particular page and push that page directly to the customer by triggering their browser to go [there]."
Sony began selling some "B-stock" and slow-moving gear on the Internet last year. Although the sites drew a lot of hits, research indicated that customers checked out the gear on the Internet but still went to a dealer to make the purchase. That may hold true for Sony BPC's formal Internet effort as well, Grebow acknowledges. But he predicts that Sony BPC will do 10% of its sales through the Internet in three to five years.
Grebow may have reason to be optimistic. Since May, Philips Broadcast has been selling some of its professional products through Digibid, an auction site whose main business is professional audio gear. Philips allows Digibid to handle transactions with customers and drop-ships items from its Salt Lake City warehouse facility. A customer has three days from receiving an item to return it.
Most of the Philips Broadcast equipment offered through Digibid, a subsidiary of Primedia-owned IndustryClick, is overstock or demonstration product. But it isn't all low-end.
According to Mike D'Amore, Philips Broadcast vice president of business and technical development, some of the items recently sold through Digibid include Venus routing switchers, which list for $60,000 (the auction price was lower, because Philips gives a minimum-sell price and incremental-bid prices for items). The site has also sold Philips-brand DVCPRO VTRs and laptop editors. "We're finding it to be surprising," says D'Amore. "A lot is being purchased by new customers, such as religious organizations."
Philips plans to more aggressively advertise its Digibid page (www.bid4philips.com). "It's an excellent opportunity for people looking for a good bargain," says D'Amore. "And it serves a purpose for us, by freeing our sales people to concentrate on new product."
Digibid is interested in doing more broadcast business, according to General Manager Ray Maxwell. "Part of our focus is to really be more aggressive in the high-end area."
Panasonic Broadcast & Digital Systems Co. has also gotten into the Internet act with its Valuedays Web site, which sells overstocked and discontinued items. Although the products are promoted on the Internet, the actual orders go through dealers, says spokesman Jim Wickizer, adding that it's a little early to gauge the impact of the site, which started up in late March.
Grebow says as much about Sony's Internet effort. "It's too soon to tell how important the Internet will be. But it's clear to us we need to be there."