Sonos: The Brand and the Business

This article originally appeared in Sparksheet.


Still hungry after thirteen-years, Sonos focuses on innovation, originality and desirability. But in an increasingly connected world, the brand wants to go beyond background music to become the central nervous system of your house. Talk about subversive.

Earlier this year, Sonos contemporized the look of its brand with a new visual theme representing amplification. This was just another step in a long-term plan. Sonos has long been sought after as a purveyor of wireless speakers, but now the company is aggressively pursuing something much bigger. Sonos not only intends to disrupt the entire music business, it aims to be indispensable in how you run your home.

The Category

The music industry continues to experience deep change. This has been driven by technology and distribution more than musical genres and artist trends. We have rapidly moved from LPs to CDs to digital. Devices and platforms now enable us to transport our favorite tunes, enjoy massive improvements in sound quality, and access extensive libraries of music through a variety of ways.

In this sense, Sonos was always prescient. The founders predicted that WiFi and music streaming would become ubiquitous. And they were right. The company gained a premium reputation and priced accordingly, creating enviable margins.

In many ways, Sonos both invented and defined a consumer category. It now unites digital music collections in one app allowing control from any device. It is an ecosystem of speakers, home theater, and seemingly magic componentry. But it is more than just an intelligent system that can control how you listen to your playlists. A lot more.

The Offer

Sonos is quickly displacing brands like Sony and Bose. Sonos is certainly interested in continuing with their current product offer but the long-term strategic play is to become irreplaceable as the central operating system of your home. This will allow the company to logically extend the brand into heating, security, lighting and more. Think of this as a “share-of-home” strategy. Or as the control system for all of your “internet of things.”

In order to ensure this control, Sonos partners liberally. At present, all of its alliances center around music. If you have a Sonos speaker and an Amazon Prime


account, the two will play very nicely together. Mood Mix is available via the Sonos App. With millions of consumers who use their products at home, Sonos teamed up with Mood Media to bring music to restaurants, retailers and other public spaces. Amazon’s streaming music service is now available in beta on Sonos speakers. Sonos already works with a number of other major streaming services, including Spotify, Pandora, Google Play, and Rdio.

At the core is the Sonos Wireless HiFi System. It allows streaming of all the music on earth wirelessly in every room of your home. This can be controlled by Android smartphone, iPhone, or iPad. The company allows access to millions of songs and thousands of radio stations by partnering with AUPEO, Deezer, iheartradio, JUKE,, MOG, Napster, Pandora, Rdio, Rhapsody, SiriusXM Internet Radio, Slacker Radio, Spotify, Stitcher SmartRadio™, TuneIn, Wolfgang’s Vault, and more.

Given its unique nature, one could argue Sonos has no competitors. By bridging software and hardware and being a market leader they have many brands chasing after them. Sony, Chromecast Audio, Soundbridge, Squeezebox, Apple, Samsung and LG have either entered the market or hold a certain piece of it.

The company made itself more relevant by appealing to technology and home systems installers. In other words, they have leveraged key influencers. I hired a home systems company and they immediately recommended Sonos as my central controller. It works with my Apple TV, a bunch of different speakers, and a mix match of amps and other componentry. It is intuitive and easy to use. When there is a problem, Sonos support connects you quickly with a real human who provides real assistance. All of this has helped build the brand and create more and more advocates.

The Business

The numbers are strong. Sonos is on track to hit $1 billion in sales this year. The growth is due to greater ubiquity and more reasonable pricing. “When we got into this business, an eight-room system cost $20,000,” said Sonos co-founder Tom Cullen. “Now it’s as little as $1,600, $200 a room. Cullen added, “Our mission is to hunt down every silent home and fill it with music.”

Sonos’ growth is attributed to the network effect. This takes place when services and technologies grow in value as more people use them. David Jones, former CEO of Havas and founder of You & Mr Jones, calls the mixing of branding and technology “brandtech.” A recent piece is Harvard Business Review states, “Brandtech companies use technology to create emotional product experiences that customers then want to share with others.”

Sonos has leveraged this effect to the point that one million homes in the United States are now Sonos homes. This penetration begs brand extensions into other aspects of home automation including the control of appliances.


The Brand

Sonos’ growing recognition means bolder communications and increases in marketing spend. The brand ran its first Super Bowl ad in 2014 and supported the last Grammys with an art installation and lavish party. The Sonos Studio in London recently opened and is a public space where people can go and collaborate, listen to music, and attend workshops and masterclasses. The media budget has reached $20 million but Sonos does not use it to beat their chest or make broad claims. Chris Kyle, VP, Global Brand Experience has said, “Our job is to help tell the story, not be the story.”

This may appear a little schizophrenic because it is. Sonos would prefer to let customers be their marketers but the company’s influence has forced them to talk about themselves. For the next few years, the company will experiment with the right balance and that will produce wins and more than a few head scratching marketing investments.

The Last Track

Sonos co-founder and CEO, John MacFarlane sees nothing but sunny days ahead, “I think this is a once in a lifetime moment in music. Streaming music will become a global phenomena just like the Internet was in 1995/96.” And that is what the company is currently banking on. Streaming revenue is set to be the largest part of Sonos’ growth in the next three years.

Yet, I see the bolder play that will influence the brand and the business. Given the company’s interest in partnering to gain more control, market share and “homeshare”, it is reasonable to assume that Sonos and companies like Nest will seek each other out. The goal is to own not just music in a house but anything than can be automated. Whether you call it an ecosystem or a central nervous system, the company’s plan is to hardwire itself into our homes and consciousness.

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