Bang & Olufsen: Strategies for Sustaining Competitive Advantage

This report provides an analysis of Bang & Olufsen's (B&O) business strategies, focusing on its approach to maintaining a competitive edge and long-term survival in the consumer electronics market. Founded in 1925, B&O has historically excelled in designing high-quality, high-priced televisions, speakers, and multimedia systems. The report contrasts B&O's “Pole Position strategy,” which emphasizes core competencies in audio and video products, with Sony's differentiation strategy, characterized by innovation and unique product offerings like the PlayStation. The comparison highlights B&O's focus on sustainable and cost-effective strategies versus Sony's emphasis on novelty and premium pricing. Ultimately, the report concludes that well-defined business strategies are crucial for sustained competitiveness and profitability, enabling companies to improve their offerings and achieve their objectives.

Sustaining the magic
at Bang & Olufsen

TABLE OF CONTENTS
2
▪ INTRODUCTION
▪ STRTATEGU OPTED BY BAND & OLUFSEN
▪ STRATEGY OPTED BY SONY
▪ COMPARISON
▪ CONCLUSION
▪ REFERENCE

INTRODUCTION
▪ Bang and Olufsen is a well recognized and leading brand founded in 1925 in Struer, Denmark,
offering high tech solutions such as television, speakers, music system and multimedia products
with major focus over their designs, quality and price. The company has been struggling since
the time of economic crisis in 2008 to maintain its competitive edge, profitability and long term
survival through launching new products with the best available technology and unique designs
in order to keep up the pace with rapid changing environment. This report highlights the
competitive and sustainable strategy opted by B&O in comparison with its competitor Sony
(Bundgaard and Huulgaard, 2019).
3

STRTATEGU OPTED BY BAND & OLUFSEN
Technological advancements, such as HD protocols for television, has brought up significant
changes into consumer electronics due to which product life cycle of consumer electronics
have been shortened and B&O faced a great deal of challenges with new product launches.
However, B&O maintains a leading position in the market due to their highly expertise and
competencies in designing TVs, loudspeakers and potential to integrate all video and audio
system into one unit. For its business strategy B&O has opted for a “Pole Position strategy”,
on the basis of which company will not produce other products such as mobile phones, DVD2,
MP3 Players etc, and will only focus on audio and video products.
44

STRATEGY OPTED BY SONY
▪ Sony is another leading player in consumer electronics who has been recognized as the
master of innovation due to their novel and unique products since the time of its inception. Discman
and walkmans are still used as a synonymous for the portable music devices. Sony always makes use
of differentiation strategy into its products and services which make it stands different out of the
crowd. Sony has been the front runner in launching products with differentiation which gains attraction
of customer and brings revolution into industry. For instance, play station launched by Sony is one of
the best examples of its differentiation strategy which is based on its core pillars of novelty and
uniqueness with premium pricing policy in order to position itself as a premium brand for high class
customers (Ravasi, 2020).
5

COMPARISON
▪ It is clearly evident, from above information that B&O makes use of sustainable and cost effective
strategy to gain competitive advantage whereas; Sony stands frontrunner in the competition from being
different with its novel products and services. Bang and Olufsen opt for a sustainable and cost effective
strategy which helps in eliminating products that does not add value and focus on its core competent
products, on the other hand, Sony brings innovation to make differentiation to its new and existing
products and services to stay relevant and competitive (Cattani and et. al., 2020).
6

CONCLUSION
From the above stated report it has been studied that business strategies are essential for
keeping business competent and profitable for a longer duration as these strategies suggest the
way businesses can improve their products or services and ways to attain goals and objectives.
7

REFERENCE
▪ Bundgaard, A.M. and Huulgaard, R.D., 2019. Luxury products for the circular economy? A case study of Bang
& Olufsen. Business Strategy and the Environment, 28(5), pp.699-709.
▪ Cattani, G., Ferriani, S., Godart, F. and Sgourev, S.V., 2020. Reflections on Style and Strategy: An interview
with Davide Ravasi. In Aesthetics and Style in Strategy. Emerald Publishing Limited.
▪ Ravasi, D., 2020. Reflections on Style and Strategy: An Interview with Davide Ravasi. In Aesthetics and Style
in Strategy. Emerald Publishing Limited.
8

9
THANK YOU