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An Interview: Ken Ishiwata

Wharfedale Evo 4.2

unleash_me

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Came across an interview with Ken Ishiwata of Marantz; archived in my system. I find it very educational, bring back memories from my management study days. Here are the excerpts.

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ken-ishiwata.jpg


Ken Ishiwata is probably the highest profile personality in this industry. An eloquent talker and stylish dresser, he is courted by the world's press and instantly recognised by the buying public. Nonetheless, few people appreciate the depth of his involvement with the company for which he has worked for more than two decades, Marantz.

Malcolm Steward interviewed him to see what lies behind the public image of a flamboyant audiophile who tweaks CD players.

Malcolm Steward: Let me start by asking you what is your official title at Marantz.

Ken Ishiwata: I don't have one.

MS: Well, what does it say on your business card?

KI: "Marantz . . . Ken Ishiwata."

MS: Nothing more?

KI: That's all.

MS: So what does a man with no title do during a typical working week? I doubt that the public perception of you tweaking hi-fi truly reflects what you do.

KI: I do tweak products but that's a very small part of my work. I exert a lot of influence on the basic vision of the company and that requires me to be involved in many different areas. Product creation is naturally one of them but I'm also heavily involved in the business side of the company, which means always looking to the future. In that role I have to guide the company in a particular direction and that means developing a clear 'story-line' so that everyone within the company understands where it's going and why it's taking that direction. Outside the office I act as a messenger, telling the trade and public what we're doing, talking about our products, and promoting Marantz - explaining to the world who we are. And Marantz is a very interesting company having American origins combined with Japanese industrial strength and European finesse. We have an audiophile heritage and, naturally, we have a selection of products that are focused on the audiophile market. That is another aspect of my job: bringing my love of music and my design approach to the creation of high quality products.

MS: So you're an ambassador, a strategist, a PR person, and you're deeply involved with product development. Does the latter function extend to hands-on work - do you sit and solder capacitors on circuit boards?

KI: No, I don't have to do that. I delegate that to my teams - they're very capable and I simply communicate to them what I want them to do with each product. I know the products intimately so it's easy to tweak them 'by proxy'. The tweaking confounds people who know that I'm involved in so many different things: they wonder how I can know the products so well.

MS: I can understand why: I'm told you have a huge raft of products appearing this year.

KI: Forty six.

MS: That's about one product a week. Will your hands touch all of them?

KI: I'll probably be involved with about thirty.

MS: That's still a product a fortnight. How deep can your involvement be?

KI: With some of them - like the CD players - it will be very deep.

MS: So how much time will you spend on a CD player - weeks, days, a few hours?

KI: I've been working with the same people on CD players for many years, so it's relatively easy. And I tend not to work on individual products: I prefer to work on ranges - three or four products at a time. It makes it easier to appreciate the differences between the models. I can usually finalise three or four products within a week.

MS: Is it also easier when you're working on, say, four CD players because there's a commonality between the components they use - you make a change to one and it's reflected throughout the range?

KI: Unfortunately it doesn't work that way. Every component, including the chassis, influences the sound and imposes its distinct character on the player. If you simply use the same component throughout a range, you don't necessarily achieve the proper musical balance in each model or a coherent graduation in performance as you move through the range. When I started this tweaking thing, many people copied what they thought I was doing: they would say, "Ken Ishiwata used this particular capacitor so it must be good." They would stick it in all their models and come up with a range that had an awful balance.

MS: That suggests that our industry isn't sufficiently self-critical.

KI: No, it isn't. Constant feedback and control are what's needed. You have to listen to criticism. You have to know where you've made mistakes, then avoid making the same mistake again. And you have to be more critical of yourself than others are of you.

MS: How did you come to join Marantz?

KI: Pioneer sent me to Europe in 1968. I left the company for personal reasons in the early 'seventies and went to Germany where I worked for the company that was the military market representative for Sony, Pioneer, Minolta and Canon. It also dealt in software and was trying to create a product range under its own name. I became responsible for creating those own-brand products. My contract made me a lot of money, which I used to start my own business. It was very successful but I lost everything in 1975 when my partner went away. Suddenly I found myself with a huge debt - millions - and I had to sell my house and all my cars (I had ten or eleven) but it still wasn't enough. So, I decided to return to my original career, fashion photography, because it was good money. I had learned photography from my father [who was an award-winning professional photographer] and it was also something special for me. It was creating art. Unfortunately, though, to make lots of money from fashion photography, you have to put up with lots of crazy customers. For example, I would accept a big-budget calendar job - some of which could cost millions - which meant I could take whichever models I wanted, with the clothes I'd selected, to any location I chose and create a beautiful pictorial story. I'd go out with a clear mental image of the series of pictures I wanted to create and come back with exactly what I'd envisaged. Then I'd present them to the client who would say: "This is beautiful. This is wonderful. But you must have taken more than twelve pictures: can we see the others? Oh, these are good. Can we swap this picture for the one you've selected? Can we change this for that?" It felt to me like someone daubing paint over a work of art. So as soon as I had paid off my debts I gave up photography and went back to hi-fi. That was when I joined Marantz.

MS: Can we talk about the market, and marketing? A mutual friend tells me you're regarded as something of a wizard in that area.

KI: The market has changed dramatically over the years I've been involved with hi-fi. Up until the 'eighties it was a typical market with low-end to high-end consumers for whom manufacturers created low-end to high-end products. We created products based upon what the consumers wanted. It was a very two-dimensional situation. We linked both products and consumers to low-end and high-end communication - mass media and specialist press - and low-end and high-end distribution - mass electrical retailers and specialist stores. Positioning your brand was simple. Philips, say, wanted a big chunk of low- to mid-range consumers buying low- to mid-range products. They communicated through the mass media and not the specialist press. Their distribution was the same - through mass electrical retailers, ignoring the specialist stores. Marantz was at the other end of the spectrum. The position, in those days, was very clear: you knew your customers and your products, so the decision regarding communication and distribution channels was taken for you automatically. Today's consumers are becoming increasingly complex as their options and tastes develop. As a result, the market is becoming three-dimensional: depth is entering the equation. The consumer who simply wanted a medium range product in the 'eighties now has more choice: he can choose a mid-range product that is aesthetically pleasing, or he might have a specific need for a mid-range product that is very easy to use. The segmentation of consumers is now much narrower, which means that when we're developing products we have to look into three dimensions. You can no longer just differentiate products according to price and features. Consumers today have become more spiritual: they are driven by desires and products reinforce their individualism.

MS: You're saying that what they buy, in some way, defines what they are - or what they perceive themselves to be.

KI: Yes. A product doesn't just have to perform its particular function; it also has to represent its owner's personality. As a manufacturer we now have to be very careful about how we position ourselves in light of this change in consumer attitude. In Europe now, what we think of as audiophiles represent about five per cent of the total market. Buyers with a primary interest in technology - the early adopters of DVD, for example, some of whom might also be strongly interested in music - represent about fifteen per cent. Together they represent only twenty per cent of the whole market. Thirty-five per cent are price buyers: they only look at the price tag - nothing else matters whatever they're buying. This portion of the market is, of course, of no interest to Marantz. People who buy for ease-of-use represent about twenty-five per cent of the market and people who demand pleasing aesthetics now represent twenty per cent. This diversity makes it harder to target your consumer. We have to look at these much narrower consumer segments and analyse what each of them expects from a hi-fi system. Even with the technology oriented segment you have to do in-depth analysis: owning the latest technology might motivate the buyer but he might also have a clearly defined idea of how he wants it to be presented.

MS: Surely that is not a consideration for all companies: a small outfit targeting the high end, for example, can sell its products purely on the strength of their performance. It can accept the fact that it won't attract mainstream buyers because it is selling into a clearly specified niche.

KI: Exactly. But a company such as Marantz cannot confine itself to operating solely in a small sector of the market. That's why we need to perform the type of analysis I'm talking about.

MS: Are the figures you've quoted global or European?

KI: They're European.

MS: Do they alter dramatically in the Far East and America?

KI: Yes. In parts of the Far East consumers are way behind. They still buy on features and functions: the spiritual values aren't there yet. Once their lifestyle catches up and becomes more cosmopolitan, the three-dimensional element will enter their market place as it has done here, in Japan and in America.

MS: It sounds like a frightening prospect for many traditional manufacturers.

KI: No, I think it's an opportunity for them. The small hi-fi specialist who knows his market coverage and isn't greedy can stay where he is and do a fine job. He can build a few hundred amplifiers a year and sell them at the price he chooses, and make himself a very nice business.

MS: But the small to medium sized business that wants to grow its market needs to be aware of so much more nowadays. Building products that sound good is no longer enough. I wonder how many will cope with, say, aesthetics and staying in touch with what this diversity of buyers is looking for. Will they adapt to ideas that younger people take for granted, such as that having the wrong label on your clothes means you won't be allowed into a particular club? Branding and image are even becoming important to pre-teens.

KI: That's what I'm talking about with 'spiritual values' and it's why this industry needs professional marketing people to create a framework of how businesses should be run.

MS: Younger people don't seem to have a problem with marketing but I think our generation probably regards it with greater cynicism and suspicion. The word smacks of hype and dressing up mutton as lamb. Some people view marketing as being on a par with second-hand car dealing.

KI: That's one kind of marketing, but not the sort I'm talking about. I'm talking about creating products that are attractive to specific groups of buyers. If you can create products whose look, feel and performance satisfy those particular customers then your marketing has worked successfully. Marketing is vital when you are targeting narrow segments.

MS: Have you always taken this approach to products or has is developed as consumers have become more spiritually aware?

KI: I've thought this way for about fifteen years and I've been trying to influence the way people around me think. As you've said, though, many people in this industry don't look at fashion or the spiritual aspects of products, so it has been hard work. It's nonetheless necessary: as consumers change we sooner or later have to adapt. If you look at the music scene you see that all its vitality comes from young people. That's one of the reasons we have been focusing recently on affordable products. Coming up with super esoteric products is no use whatsoever: the challenge for me is to produce the best products we can given a strictly limited budget. Of course, that doesn't mean just sound quality: good products also offer reliability, good looks, build quality and so on. Sadly, there are too many products out there that seem designed to have a short life-span.

MS: That seems to be so with much of the CE business. I have computer software that's two-years' old that the producer is no longer supporting. If it's broken, you don't fix it, you replace it. Computer hardware is going that way as well. I worry that the next generation of buyers will expect hi-fi to be the same: buy it, use it for a year or so, then junk it.

KI: If our industry does the same as the computer industry - selling products that are obsolete as soon as they're unwrapped - we're going to have a hell of a problem, even if the computer manufacturers seem able to get away with it.

MS: It's our fault. We - at least at consumer level - have bought into that mentality. We've accepted that this week's cutting edge technology is next week's door-stop . . . and we do nothing about it.

KI: Many portable audio systems are disposable: when your 60.00 Walkman breaks you buy another one. The labour and parts to repair it would cost you more. Up to a certain price, people are prepared to accept that. Now it's possible to buy separate hi-fi components for under 100.00 each. I'm sure the people who buy them aren't thinking about repairing them when they break.

MS: What do you think about cheap hi-fi in general? Is it a good idea that you can buy a CD, amplifier and speakers for 300.00 or do cheap systems lower people's estimation of the entire concept of 'proper' hi-fi? Isn't there a danger that someone seeing such a system will think "Why should I spend 3,000.00 or 30,000.00 on a hi-fi when I can get essentially the same bits and pieces for 300.00?"

KI: In this country, the amount of money people are prepared to spend on hi-fi is much lower than elsewhere. The highest is in Japan followed by America. The UK has always been a price-driven market. The judgement given on products centres on their performance while the materials used and the build quality, for example, are deemed less important. A product that is badly engineered and has lousy build quality can still be popular provided it sounds good. That's very rare when you look at the world market: it's specific to this country.

MS: I could at this juncture ask you whether the hi-fi press has helped or hindered the industry.

KI: I think it has done both. Consumers in the UK are interested primarily in price and certain magazines have responded to that.

MS: I don't condone that. I think it dumbs down the market place; that the "this item costs 2,000.00 and it's excellent, but here's one that costs 200.00 and it's perfectly respectable so you might as well save yourself 1800.00" approach is specious and misleading. We ought to be telling people that they buy hi-fi to achieve emotional satisfaction not to 'get a great deal'. It should be judged in terms of value rather than cost.

KI: At the same time, British magazines have generated a tremendous amount of loose component sales compared to the rest of Europe. The magazines have steered people away from buying mini and midi systems towards separates. They've made the mid-price hi-fi market very strong and you don't see that in many other countries. So, from the high-end manufacturers' perspective, the magazines are dragging the market down. From the other end of the scale, they are bringing the market up and widening it, making hi-fi more accessible. This country is very special: you don't see companies such as Arcam, say, in other countries.

MS: If that is the case, how do British companies manage to sell components in the 300.00 to 800.00 per item bracket overseas?

KI: Fortunately for the British industry, the British magazines influence the Asian market in a big way. Many Asian countries buy products purely on the strength of reviews in British magazines. So, in effect, those magazines create markets and companies that base their marketing on reviews can achieve a certain level of business.

MS: That places a heavy burden of responsibility on our press - rather than kill a product with a bad review, you're saying it can kill an entire product category world-wide.

KI: Yes. That can happen. Hi-fi started in two continents - America and Europe, but it was led by Britain, which gave this country a strong starting point. British hi-fi always had a certain flair: people recognised its refinement. That position has been maintained and hopefully you can continue to maintain it. The proof of that is the influence of the British press, particularly in Asian countries.

MS: It's interesting, though, that in recent years Haymarket dropped from three hi-fi titles to one, while other magazines have simply ceased publishing or have pitiful circulation figures: the amount of hi-fi publications going out to the world has turned from a tidal wave into a trickle.

KI: Look at the way those magazines lived the past twenty years. Look at the music the reviewers talk about. Today's younger audience will never listen to it. To find common ground, reviewers need to understand today's music. It's the same for manufacturers.

MS: Ricardo Franassovici and I had much the same conversation recently. Do you feel that the 'serious' hi-fi brigade tends to live on a little island and adopts the attitude that to gain entry you need to conform to its outmoded rules and regulations?

KI: Creating a wall - that's one of the biggest problems in this industry. It has caused younger people to walk away. To knock down that wall we need to listen to their music and understand what they want. Then they'll stop walking away. I listen to almost every new single that's released . . . and you would be surprised how good some of that music can sound on a good system: some All Saints' tracks would amaze you. If you can demonstrate that, then the young people who love All Saints will also be shocked. We can't change the music they love. You know that if you love something then nothing will change your mind about it. We should exploit that by showing people how good their music can sound through our systems. It's all part of the framework we need to impose on this industry. Manufacturers must have clear objectives: not just for today but for the next twenty years. It's what I call super-ordinated objectives.

MS: Super-ordinated objectives? You'll have to explain that to me.

KI: You start by clearly defining your company's primary and financial objectives. Then you need to analyse your environment - in its entirety - consumers, politics, finances; everything that can and might affect your business. Then you need to analyse your competitors: what they're doing today and what they're planning for the next decade or so.

MS: Short of industrial espionage, how do you do that?

KI: You know what technological development is going on and you can feel the general direction your competitors are taking. You can easily guess what they'll be doing over the next five or six years quite precisely.

MS: So you could tell me exactly what, say, Sony, Pioneer, Denon - and certainly Philips - will be doing for the next six years?

KI: I can tell you what they're planning and probably what type of products they'll deliver with up to eighty per cent accuracy.

MS: How do you manage that with a company as diverse as Sony, which is producing audio, hi-fi, home theatre, camcorder, television and computing products, not to mention robot dogs? Do you just concentrate on the product ranges that compete in your arena?

KI: As far as Sony is concerned, it wants to be the leader in any high technology electronics arena. It's as simple as that: Sony is a technology-driven company. So, it has to be ahead of everyone in every segment.

MS: So would you concentrate on particular relevant divisions or look at the whole company?

KI: The whole company.

MS: So the fact that Sony has brought out the Vaio computer range affects your plans for Marantz' products?

KI: Of course. Why did Sony come up with Vaio?

MS: Because it could?

KI: Yes, but also because over the next twenty years there's going to be an integration of the computer into every aspect of the household although most people will not realise it has happened. They'll just have their TV . . . and it will look like a TV . . . and they'll sit and push the remote handset . . . but inside the TV will be a computer and an operating system. People won't think they're using a computer but that TV might have a hard disk hidden inside with software that enables it to store movies, music, family photographs . . . but it won't be intimidating to Mr Average.

MS: So he just thinks he simply has a TV that automatically records the football while he's down the pub: he doesn't realise he's programming a computer.

KI: Exactly. So you see now what I'm talking about when I speak of analysing your environment and your competitors. Then, last but not least, you need to analyse your own resources and capabilities. This will show you your strengths, weaknesses and you'll also see your opportunities and threats. Based on those analyses you can then identify your strategic options. Once you have decided which options to reject and which to adopt you can begin thinking about marketing.

MS: You haven't yet mentioned products?

KI: No, because you haven't yet analysed your marketing opportunities, buyer behaviour, market segments or done any market research. You can't make any decisions about products, prices, promotion or distribution until you've completed all the analyses I've mentioned.

MS: I'd guess that with most companies, the specific decision about which products to make comes much earlier on: probably around five minutes after deciding upon the company's objectives.

KI: That's what happens with most Japanese companies. They come up with a product and they do test marketing in Japan. Fortunately for them, there are 120 million people in Japan so they have a sizeable market to use. But you know that Japanese are not really marketing driven people.

MS: They're also not typical consumers.

KI: The idea of marketing only really took off about twenty years ago but Japanese industry started by copying: copying other countries' cars, copying electronics. We were very cheap and quality didn't matter that much, but because we were cheap we could sell. So Japan's success was based upon products that were cheap: cheap and nasty, even. One strength, however, was that Japan was determined to improve quality. And once they start the Japanese never stop. We always say that the Americans will win a sprint but they'll never beat us in a marathon. Look at Japanese cars today: they've reached a remarkable quality level and after forty years they're still continuing to improve. The Japanese keep going deeper and deeper into the technology.

MS: But while Japanese cars are superbly reliable and technologically advanced, they're still dreadfully bland. With few recent exceptions, they don't offer much in terms of a driving experience: they don't have distinctive characters. Driving a Toyota is much like driving a Nissan, while driving a Lotus is dramatically different to driving a Jaguar, which is different to driving a BMW. If you're buying a Japanese saloon you could virtually ignore the make and model and just pick the one that's finished in the colour you prefer.

KI: I agree but with one exception. Honda has tried to retain its identity. Honda and Sony are two exceptions among Japanese companies. They have very strong images associated with their identities and that's the way they want to keep it.

MS: Will we see other Japanese companies following their example? If you look at, say, AV receivers, they all look the same. As you said, if you take the badges off the products you have no clue as to who made them.

KI: Exactly. But consumer changes won't allow them to continue that way. They may not do much to establish their identities but they might move from black boxes to prettier boxes. That, though, reflects the way those companies want to run their businesses. They know their position in the same way that Toyota knows it will never be Mercedes: Toyota is quite happy competing with General Motors and Ford. It comes back to what I was saying about defining your company objectives.

MS: So, are you saying that Toyota has to accept that it's too late now to change its objectives: they were fixed years ago and it has to stay doing what it knows best, address the market places in which it's established, and can never break out?

KI: That's the reason they came up with Lexus. In America it was an immediate success; in Europe they know it's going to take twenty years. They don't mind: they have a healthy business with the Toyota brand. They will wait. That's a perfect example of super-ordinated objectives at work.

MS: The more I try to apply this thinking to pure hi-fi the more uncomfortable I become. I can't help thinking of our industry as something that was - and should - remain distinct from consumer electronics; yet we seem to be talking about it in terms of something that's close approaching commodity status.

KI: But just suppose one company comes up with a range of hi-fi that's like the BMW range of cars: the Compact, the 3 Series, the 5 Series, the 7 Series . . .

MS: In the way that TAG McLaren wants to generate different levels of products for different types of buyers?

KI: Yes, but to do that successfully you need to have a very clear direction as a company. You have to see the product ranges you're going to have in ten years' time first: then you need to work backwards. That tells you what you need to be doing today, next year, five years from now . . . but you also have to remember that you'll still need to eat today, next year, five years from now . . . Having a clear state of mind and working within this framework puts you on the track. And it is necessary.

MS: But is it? We are both aware of passionate, determined individuals who run hi-fi businesses very differently and very successfully.

KI: If you are satisfied with the size of your company and you're not greedy, you can adopt less formalised approaches, and you might well end up the happiest man in the world. Those people are doing what they want to do the way they want to do it and I respect them but their products will never reach tens of thousands of people.

MS: But you're doing a similar thing with the Signature models. Okay, you're operating under the umbrella of Marantz but those products are esoteric, characterful . . . products of your individual way of thinking.

KI: But how many people can afford that sort of esoteric product? Most people want quality products at affordable prices. And for me, creating products with no cost constraints is not a challenge. It's far more exciting building the best CD player it's possible to make for 300.

MS: Do you find that people buy in at the lowest level and then move up to your expensive products because they've developed brand loyalty to Marantz for helping them get started in hi-fi?

KI: It does happen. I know one guy who has had seven CD players from us. That's where reliability enters the equation. He has tried others and they've failed, so he sticks with us. He likes our sound, he finds our products reliable and he's experienced bad service from other companies. Too many manufacturers don't give enough thought to reliability and service. I constantly see products that shock me by the way they have been designed and built: some manufacturers clearly don't have the faintest idea what reliability means.

MS: Are we talking about major league companies here?

KI: No, they usually take care. It's usually the esoteric products. And, unfortunately, you do see it more in this industry than in others.

MS: Ken, I'm sorry but we must stop now. Another five minutes and I'll have enough to write the definitive guidebook to marketing . . . and more.

KI: Well, it was you who wanted to talk about this aspect of my work. I haven't done an interview like this before: everybody else wants to ask me about engineering. But I'm not just an engineer. I'm always thinking about and involved in far more.

MS: Your tweaking side is well documented. I'm far more interested in what we've discussed this evening and I'm sure that anyone reading this will finding something in what you've said that will make them think about the way they run their business: whatever that business happens to be.

KI: Everybody needs to look at the way they run their business. It's changing and we need to adapt to stay in touch with our consumers.

MS: So what do you do to stay in touch?

KI: A lot of reading and talking to many different people. For instance, I was really shocked when I went to China recently. I had to do a lot of presentations to music lovers. Some were only young teenagers while others were in their sixties. They were all in the room together and they all wanted to listen to classical music. I wondered why but, of course, it was because when Mao was in power China was completely isolated. The only music they heard was classical: they didn't know about rock music. That shocked me. There's about 1.2 billion people in China and it's going to be a huge market but their cultural background gives them totally different perceptions about music. For me, it's a tremendously exciting challenge. I travel a lot and wherever I go I try to meet different people and talk to them: that in itself is a tremendous education.

MS: Other things you've said indicate that your interests extend way beyond the hi-fi industry.

KI: I have a great love for anything beautiful: music, fashion, art, ladies, whatever . . . Also, I have done other things in my life, such as photography. My father was an incredible photographer: in the sixties he won international awards five years running. He was unbelievable and I was lucky to have had such a father. He was always my inspiration and his appreciation of a wide range of subjects opened my eyes.

MS: What's your take on how the home theatre scene is developing?

KI: DVD is certainly today's 'thing', and notice what's making its development unique. You normally come up with a new format at a certain price point and watch it gradually achieve the desired level of market penetration - five per cent of households - until it's established and then booms. With a push from the computer industry they're bringing the DVD starting price down - even if it means losing money - to reach five per cent in a much shorter time. Normally you would aim for five years: with DVD they want to do it in three.

MS: Surely that's hitting the manufacturers' pockets hard?

KI: That's the calculation you have to make with a venture of this sort. How much money are you going to make in those early years? What's the investment required? What is the best option in the long-term? This time they're decided they can't afford to wait those extra two years. In this industry you need one new format every ten years. The last new format we had was CD in 1982.

MS: We had DCC and . . .

KI: Sorry, I meant formats that reached five per cent penetration. What's more, it's important for the big companies to push DVD. They know that the smaller companies can't follow because they don't have the same financial power. As a result, their long-term market share is going to be much bigger: you kick all the small companies out.

MS: Do you kick them out or just push them back down the road a couple of years until they can afford to compete?

KI: Many of the smaller companies will just rebadge product from a larger manufacturer. And why should the bigger company care whose name is on the box? It's still his product; it's just more market share for him. The big companies can afford to push DVD. They're taking a similar approach to that of the computer industry: bring the cost down very rapidly and if people can't follow . . . they leave. Companies such as Panasonic, Philips and Sony, they're going to go for it and by the time DVD has reached five per cent penetration and it starts peaking they'll have about seventy per cent market share. That's my guess.

MS: If that's the case, one might ask why Sony is being so aggressive with SACD. Why not simply say, "hang it, we'll go with DVD?"

KI: SACD is Sony's technology carrier: DSD was developed by Sony. Sony has never had its own worldwide format other than Betamax, which is finished. Apart from that, what format have they come up with? They co-developed CD with Philips but Philips was much bigger.

MS: Who cares? If you and I had invented CD, I'd be perfectly happy sharing the limelight with you.

KI: Sony's image is 'Number One in Technology'. For them things like MiniDisc and the new Memory Stick are their 'face'. Sony wants its own standards.

MS: You make Sony sound like Microsoft: nothing less than world-domination will do.

KI: Well, Microsoft is very successful today but you know what its drawback is - it started with DOS, so even when it developed Windows it had to think about backwards-compatibility. That's going to hamper its future development. Do you remember when I was talking about that TV with its integral computer? Imagine that Sony produces one and the computer arrives with a totally different OS. It doesn't have to run Windows. In fact it comes with a much better graphical interface, which you can operate with a remote handset. Now imagine that this TV/computer can be connected to a universal bus system that Sony might also have developed. Suddenly that TV/computer can be linked to everything in the house. Suppose that happened: what's the value of Microsoft to home users then?

MS: Sony versus Microsoft: that'll be one hell of an interesting fight to watch.

KI: The next decade is going to be full of interesting developments. And it brings us back to the three-dimensionality of the market. We can make products to satisfy a three-dimensional consumer base; communication is three-dimensional - it's easy to let those specific target groups know that such products exist through men's magazines, women's magazines and so on.

MS: That's fine for companies with the resources of Sony, Philips or Marantz. It's not so easy for a five-million pound company that's struggling to find the money to advertise in What Hi-Fi? They'll always face the problem of breaking out and talking to new people.

KI: There's always a way. If you can't afford to advertise in those magazines you might, for example, consider offering them products as a competition prize.

MS: Those products still have to be sufficiently interesting to appeal to the editor of the magazine.

KI: Exactly: if you target the product properly - to appeal to that magazine's readers - it's naturally going to be the kind of product those readers want.

MS: Which takes us neatly back to your marketing framework and company objectives.

KI: There's just one more problem - distribution. We don't have the sort of boutique-style shops where those people will probably want to go to buy things. So - and I want to say this in a positive, non-critical way - our dealers have to start thinking more; start understanding the consumers; start understanding what's happening in the communication area; start changing. Consider this: twenty years ago there were no shops specialising in selling lamps. People bought lamps solely because they needed the function of light. Today lighting is not just functional: it's also about creating atmosphere. The light you buy says something about you to people who come into your home: it represents your personality and taste. Our [industry's] products can do that. If we start understanding those types of consumer needs our industry will change. Sony, for example, has done a wonderful thing with the Vaio computer because they understood exactly what sort of consumer wanted a product like that.

MS: They also seem to have timed its introduction perfectly: now is just the right time for sexy products with outstanding multimedia performance.

KI: That's because it came from properly planned marketing steps.

MS: But Ken, you're talking about planning ten or twenty years ahead: we've only had personal computers for around fifteen years. There must have been some element of reaction to the market involved in the Viao.

KI: You forget that Sony was working with Apple many years ago. In a way they failed to achieve their aims. But with the present CEO, Nobuyuki Idei, who is a very sharp person, they're making the Viao a huge success - just as they did with the Playstation in the games sector. Sony has tried and failed before: do you remember Elcassette? But when they have a success, it's usually a huge success. They introduced ATRAC and everybody hated it because of its terrible sound quality. Now they have third generation ATRAC and it's wonderful.

MS: I have to admit that I admire the company's marketing. I remember the obscure but persuasive adverts they ran before introducing the Playstation. Everybody was talking about it, even people who hadn't seen it or didn't know what it was.

KI: It was brilliant branding; very well calculated.

MS: So is there a better way to brand hi-fi? "Put your records in it and they'll sound nice" doesn't seem to generate the 'you cannot live without this' excitement that surrounded the Playstation.

KI: That isn't enough anymore. You have to sell it differently and the first step is understanding younger people's music. Making products is easy. Changing their shape and design - you can do that all the time. But if you don't understand what younger people want, then, quite simply, you are lost.
============
The interview is property of the British-Audio-Journal.
Source: Marantz 7001: Ken Ishiwata - Zen Odyssey: beta~release/work~in~progress =)


Happy reading! :)
 

iaudio

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Unleash, thanks a lot for the article. Nice to read about a person whose name you have been hearing for the longest time in audio.
And in Kerala, Marantz and its KI version cdps have been in great demand always!
 

unleash_me

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You are all welcome! Glad to know that you guys enjoyed it, even though its a rather long interview.
 

gobble

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Consumers today have become more spiritual: they are driven by desires and products reinforce their individualism.
or
Yes. In parts of the Far East consumers are way behind. They still buy on features and functions: the spiritual values aren't there yet. Once their lifestyle catches up and becomes more cosmopolitan, the three-dimensional element will enter their market place as it has done here, in Japan and in America.
It sometimes amazes me how men of supposed learning can speak such crap and B***S*** !! :lol:
 

unleash_me

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1. This is a 13 year old interview.
2. Seems like the contextual meaning of the word 'spiritual' is misunderstood.
3. Ken Ishiwata is not a native English speaker.

Peace :)
 

gobble

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1. This is a 13 year old interview.
2. Seems like the contextual meaning of the word 'spiritual' is misunderstood.
3. Ken Ishiwata is not a native English speaker.

Peace :)

Yeah I too thought exactly the same after posting :)

Cheers
 

suri

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that man (Ken Ishiwata) is an innocent and honest man!:)
 
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