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JEALOUS of her
Transistor Radio
Christian Sandström holds a PhD from Chalmers
University of Technology, Sweden. He writes and speaks
 about disruptive innovation and technological change.
Radios
 used to be
FURNITURE
They were big and beautiful…
… And stood in the living room…
”At the
dearest
place in
Your
Home….”
And the radios were sold in special stores…
In 1955, a company called Tokyo Tsushin
  Kogyo introduced a Transistor Radio
It was named SONY
The ’furniture radios’ used Vacuum
tubes, and therefore they were big
  and demanded a lot of energy.
In order to sell transistor radios, Sony
   had to create a new channel. The
     Radio stores made money on
  repairing furniture radios and were
   therefore not interested in selling
 small, cheap transistor radios which
  did not generate service revenues.
Sony dealt with
discount stores
like Woolworth
 which did not
    have any
     service
 departments.
The Transistor Radios were smaller,
cheaper and demanded less energy…
The ’SONY’ became a great success
and therefore Tokyo Tsushin Kogyo
     changed its name to SONY
Initially Transistor Radios
did not threat the big radios,
simply because it prospered
       in a new market.
It was a New Market
  Disruptive Innovation, a
product that would prosper
 in a new market and then
     later on invade the
    established market.
Let’s take a look at the marketing
       of transistor radios…
Home transistor




An ideal, portable, ’second radio’
  and for your summer house
A Beach Radio!
Look at the names!
It’s a lifestyle product!
Auto Radio – it’s a
new application!
LUXOR
Travel Radio
None of them focus on Good Sound!
The reason is
very simple…
Compared to the
old, big radios, the
sound wasn’t good.
But the sound was GOOD
   ENOUGH to enjoy.
Now let’s
look at the
marketing
   of big
 radios…
’If You want good sound -




     Ask for Radiola’
So, the established Radio companies
focused on sound, sound and sound…
… While transistor radios
prospered in new markets.
… In 1957 they were small
enough to fit into the pocket.
In the 50’s and 60’s
    the market for
  transistor radios
      exploded!
Virtually everyone had a transistor
radio and it became a cult product.
The Beach Boys released a song
called ’Magic Transistor Radio’.
Benny Hill, the famous
 English entertainer
 wrote a song called
 Transistor Radio in
 1961 (Listen here):
“My baby’s got a
  transistor radio
  She takes it
  everywhere we
  go
  She takes it
  when we go out
  a-walking
  Even to a
  movie show”
“Well now
just last night,
in the pale
  moonlight
  I asked her for a
  kiss
  But instead of
  hearing her
  whisper sweet
  words of love
  All that I could
  hear was this…”
“I’d like to take her
transistor radio
And throw it in
the deep blue sea
I’m so jealous of her
transistor radio
Cause it takes her
mind off me“
The Transistor Radios
were so popular that by
1959 there were about
  12 million in use…
Soon, there were
more of them than
   there were
households in the
 United States!
And well, as the sound quality improved
gradually there was no reason any longer to
           buy a furniture radio…
… All of a sudden, it was impossible to sell
big radios on sound, sound and sound…
Transistor Radios were now
 cheaper, portable, consumed less
energy, and had a sound which was
  as good and soon even better!
The furniture radios now left the
     market rapidly and the
disruption was accomplished…
And with these radios, many special
Radio Stores also left the market, because
    there were no radios to repair…
Sony was initially not regarded as a
threat, since they satisfied a market that
     had not existed previously.
Sony targeted Non-consumers
 and created a huge market!
And who would regard Non-
  consumers as a threat?
Some estimates suggest that there are 7 billion
        transistor radios in use today.
What a huge New Market Disruptive Innovation!
So, this story tells us that:
By targeting Non-consumers, huge
    markets can be created and
 disruptions may occur later on.
And it reminds us of the crucial question...
… What is GOOD ENOUGH?
Image Attributions




http://www.flickr.com/photos/96979971@N00/110830957/
http://www.flickr.com/photos/danailaadrian/1311477408/
http://www.flickr.com/photos/simplylafra/2387899450/
http://www.flickr.com/photos/44124324682@N01/2166509550/
http://www.flickr.com/photos/roadsidepictures/315468558/
http://www.flickr.com/photos/roadsidepictures/2221686905/
Photos taken at:


  Radiomuseet i Jönköping:
http://www.radiomuseet.com/



      Thank You!
Find out more:

www.christiansandstrom.org

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The Disruptive Transistor Radio