Sonos is splashing out on advertising as connectivity becomes a standard feature for home hi-fis, rather than a differentiator. “Sonos spent $19.3 million on measured media in 2013. Two years prior, it spent less than $1 million. Since then, its marketing budget has expanded more than twenty-fold,” explains AdAge in a profile of Sonos’ marketing strategy.
It’s paying off, mind: the article claims that Sonos expects to record $1bn in sales for 2015, nearly double its turnover in 2013. That equates to a 16% share of sales (in terms of dollars) in the wireless speaker market, behind only Bose’s 22%. The article is a good primer on that market too: research company Futuresource is quoted estimating that 5m wireless speakers shipped in 2012, but that this rose to 30m in 2014.
Sonos certainly has the financial muscle to boost its marketing budget: the company raised $130m of new funding in late 2014. That’s the company’s war-chest to fend off competition from all angles, from direct rivals like Denon – who Sonos sued for patent infringement last October – to set-top streaming boxes from the likes of Apple, Google and Amazon which include audio support, and startups like Gramofon with its ‘modern cloud jukebox’.