Sonance Case Study

Problem Statement:

Founded by Scott Struthers and Geoff Spencer, Sonance carved a space in the loudspeaker market and had established itself in the industry. By selling exclusively through custom installation dealers, Sonance experienced rapid growth through the early and mid-1990s. However, upon adopting a strategy of diversification in the early new millennium, Sonance fell on hard times and experienced an erosion of brand equity and loss of its core customer base. Sonance’s success was built on its business to business sales ability, while diversifying their offerings Sonance failed to execute adequate business to customer strategy. To this end, Sonance must decide on a strategy for its immediate future to prepare for Custom Electronic Design and Installation Association expo which is quickly approaching. Potential strategies include returning to their original growth concept which had proven lucrative during their inception, introducing a new series of products who’s sales price has yet to be determined, pursuing large scale construction (such as new housing developments) or invest fully in a redesign of the iPort.

Situational Analysis:

Sonance has a long standing reputation for quality and innovation. By capitalizing on their chosen distribution channel, Sonance was able to establish solid relationships and build brand equity. While these two factors have been weakened in recent years, their existence is still notable.

Sonance’s relies predominantly on in wall speakers for its revenue and these product lines have been experiencing a very slow growth in recent years. While other electronic industries boomed, Sonance failed to capitalize on the, instead preferring to stick with its core offerings. In addition, Sonance has damaged its relationship with its traditional distribution channel. By attempting to bypass custom installers, Sonance’s long standing distribution channel, and go straight for large house developers, Sonance alienated some in the...