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Marketing Strategy Development
Company description:
The following report assumes the case study of Apple Inc. which serves products in the industry of consumer electronics. The organization’s vision statement suggests the emphasis on innovation and contribution to markets. The mission statement of Apple Inc. reflects on the existing accomplishments of the company as well as future initiatives in the diverse product lines (Dudovskiy 2017). The simplicity of the brand is also reflective of the prospects for nurturing innovation that has contributed to the reputation of Apple as a benchmark of design in electronics products.
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These facets of the organization are responsible for obtaining the particular objectives of communicating the purpose of the brand Apple. The market orientation of Apple could be observed in the two types such as market-oriented and product oriented. This market-oriented nature of Apple Inc. can be validated on the grounds of the explicit efforts of the organization to utilize market research to determine the development of products alongside acquiring novel ideas for new products. The product-oriented nature could be observed in the evidence of the company’s focus on innovation and product quality.
The products of Apple Inc. include computers, consumer electronics, and digital music distribution. The notable products of Apple Inc. refer to the Mac series of personal computers, iLife, professional software, iWork, iTunes, iPhone and the iPad. The case of promising revenues earned from the product lines of iSeries of the company including iPhone, iTunes, and iPad could be perceived as the impact of the brand image of Apple in its market strategy (Researchchomatic 2017). The brand image of Apple is cognizably responsible for the engagement of customers and improving the perception of the brand by customers thereby complementing the marketing strategy of the organization.
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5 Cs of Apple Inc:
Company:
The description of the company could be obtained from a comprehensive analysis of the strengths, weaknesses, opportunities, and threats in the context of Apple Inc. The strengths of the organization reflect on the explicit market leadership of the brand through an assorted range of services and products (The discourse of life 2017).
The formidable financial position of Apple alongside the considerable brand value of 154 billion USD also account for prominent strengths of Apple Inc. Furthermore, the higher profit margin, as well as sophistication of the supply chain infrastructure, also serves as major characteristics of the organization.
Weaknesses that are perceived in the context of Apple Inc. reflect on the narrow product range and the depreciation of overall sales due to a decrease in the sale of Mac products, iPhones, and iPads. Apple also faces notable pitfalls in the form of premium pricing of its products and the incompatibility of the services and products facilitated by the brand with other user services and products (Abimbola 2010). The opportunities that can be accessed by Apple include product diversification and improving the dominance of Apple in the business segment of services. The brand could also leverage strategic partnerships and R&D activities to ensure the limitation of weaknesses such as lack of product range.
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Apple could also focus on increasing the compatibility of its products and services that can be impactful on the promotion of the brand among a wider customer base. Threats for Apple Inc. refer to the increasing costs of production and the infringement of intellectual property rights. The lack of innovativeness in the products also accounts as a notable threat for the organization thereby inducing shortage of new products (Rowland 2017).
The involvement of Apple in tax scandal also led to damage for the reputation of the brand that can be considered as a formidable threat for the organization. The increasing competition from brands such as Samsung can be profoundly observed in the form of lower pricing thereby indicating the transition of customers to other brands (Abimbola 2010).
Customers:
The customers in context of Apple Inc. refer to the individuals interested in smart phones. The customers are characterized by the requirements of device features such as checking emails, surfing the web and digital camera. The organization and the volume of customer base involved with Apple have been ambiguous due to the overwhelming passion for products such as iPhone.
The different variety of products facilitated by Apple is also indicative of the company’s commitment to fulfilling diverse customer needs. Therefore a characteristic representation of the behaviour of Apple customers is observed in the dedication of customers to brand Apple. Evidence for the typical behaviour can be noticed in instances when customers slept outside stores for getting the latest iPhone.
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Collaborations:
The sustainability of Apple in the dynamically competitive environment in the industry has been made possible through different collaborations. The strategic collaboration of Apple and Google can be considered as a major opportunity for Apple to access noticeable advantages in case of its online services such as iTunes (Rowland 2017).
The ownership of YouTube by Google allows flexible prospects for transferring video files online thereby supporting the iTV. Another example of Apple’s collaborations could be noticed in the company’s association with BMW in order to ensure that the automobiles manufactured by the latter are able to support the iPhone and its controls.
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Competitors:
Apple is reputed for its profound brand value and market share. However, it faces competition according to the different types of emphasis on the technological domain. With respect to the domain of PC manufacturing, Apple faces competition from Alienware and Dell while in terms of operating system Microsoft poses as a formidable competitor.
The diversification of product lines is also responsible for the proliferation of competition from other brands such as Samsung, Gmail and Blackberry (The discourse of life 2017). The multidimensional focus on the market of technological products as well as cognizable association with distinct sections of technology enables Apple to sustain the competitive rivalry.
Context:
The different contextual factors affecting Apple’s marketing strategy include political, technological, legal, economic and social entities in the business environment. Furthermore, Apple has been able to acquire growth in its context through measures such as cost cutting and innovativeness for addressing the competitive environment (Abimbola 2010). The resolution of cost cutting measures through outsourcing of production leads to ambiguities in terms of social and legal impacts especially in context of intellectual property infringement.
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Collection of market information:
The marketing strategy of Apple Inc. is supported by the use of market research to obtain insights into customer requirements. The surveys of customers of Apple iPhone on a monthly basis prove to be credible tools for assessment of the marketing opportunities and pitfalls especially in terms of 5 Cs of the organization.
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The surveys indicate a country-wise representation of customer’s perception of the brand and the reasons for which they prefer brand Apple over other competitors in the industry. The surveys allow Apple to obtain an impression of the customer needs especially in terms of the features favoured by customers in iPhones as well as their satisfaction levels in context of various aspects of the product. Analysis of customer demographics also serves as a promising contributor to the collection of data pertaining to the needs of customers (Dudovskiy 2017).
The most noticeable competitor for Apple presently includes Samsung which uses Android OS in its smart phone designs. The organization poses a threat in terms of lower pricing of products and the compatibility of the devices with wide assortment of user products and services. Furthermore, the legal and ethical dilemma pertaining to the outcomes of the survey and access to market intelligence enables the competitors to obtain comprehensive insights into the factors that motivate customers for purchasing Apple products.
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For example tracking studies could provide essential details of the product features of iPhones that are favoured by customers such as Siri, the battery life or the FaceTime. Price disparity proves to be a notable pitfall for Apple that can be posed by competitors since the average cost of Apple iPhone is considerably higher than that of android mobile devices (Researchchomatic 2017). The price disparity could be assumed as a profound reason for transitioning of customers from the premium priced Apple iPhone.
The context of the consumer electronics industry is consistently changing with specific characteristics such as extreme competition and the increasing pace of growth. The consistently increasing growth of the domain of smart phones and the newly developed technologies of smart wearables is also supported by the increasing penetration in the market. The substantial growth of the smart phone industry in recent years has been a major contextual change.
The estimation of growth rate of 27.6% in the year 2014 as well as the substantial increase in the industry shipments as well as revenues indicates the dynamics of the smart phone industry. Furthermore, the growth that is predicted for 2019 is observed in the global shipments despite slower rate of growth thereby implying an estimate of 1.9 billion (Abimbola 2010). The political factors that impact the strategic direction of Apple refer to political instability while the economic factors refer to impact of global recession and the increasing labour costs. Social contextual factors are helpful in context of the organization since the perception of Apple as an indicator of a high end lifestyle is suitable for the marketing approach of the organization. The imitation of Apple’s distinct technological features by competitors also poses considerable threat with respect to the dimension of technology in the context of Apple.
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Collaborators have the significant contribution to resolving the issues faced by Apple due to dynamic changes in the context of the organization. The volatility perceived in the political aspects, industrial trends and natural disasters leads to profound concerns for unpredictability in procurement strategies. Research studies have emphasized on the role of suppliers in acquisition of market intelligence that can contribute to the processes for incremental innovation in predesign activities as well as marketing initiatives (Kerr 2015).
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On the other hand, involvement of collaborators is not associated with the outcome of improvement in market share. The role of collaborators in the predesign process could help in integrating the collected data in the design process thereby ensuring compliance of the product designs with the customer requisites (Kerr 2015).
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Development of marketing strategy:
The segmentation targeting positioning (STP) in case of Apple Inc. is facilitated by the support from strategic planning, acquisition of market information and the implementation of a marketing strategy through moderation of marketing mix. The initial target market identified for Apple was vested in young people that had interest in surfing the web, use digital camera and entertainment services. The selection of this target market can be validated on the grounds of their affiliation towards technology as well as limited sensitivity for price among the young people.
The target market also reflects feasibility due to the prospects for adaptability to novel emerging technologies such as the smart wearables and online services such as iTunes and Apple Music. Customers of Apple iPhone could acquire value proposition that is a significant input for the marketing strategy of the organization. The value proposition facilitated by the organization refers to innovative design of the products, aesthetic excellence and technological precision. The positioning of Apple’s market strategy also reflects on the representation of the organization as a high end brand with the capability to deliver simplistic design in its products alongside emphasizing on innovation. The positioning of Apple as a market leader especially with respect to the use of inbuilt iOS in the devices as well as superior customer support services provided through Apple Care (The discourse of life 2017). Positioning statement for an organization is designed from the distinct elements such as frame of reference, points of difference and the target segment. Apple’s positioning implies emphasis on efficiency of product design as the frame of reference and its innovativeness in products as the point of difference.
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The identification of the target market alongside the proposal of value proposition and the positioning allow the access to feasible marketing approaches. First of all it is essential to understand the concerns for identifying diverse customer segments and prepare marketing strategies that could cater the needs of those segments. The necessity of including educators, students and creative professionals could be identified as a prolific contribution to expand the target markets for Apple.
Positioning is a crucial aspect of the STP process alongside implications of notable impact on consumer perception of the brand. The effectiveness of the positioning can be realized through communication, channels of distribution, pricing and brand design rather than specifying customers to read it in a statement. This allows the customers to perceive Apple’s positioning in a tangible manner wherein they could be able to associate with the products of Apple and the benefits obtained from the products (Dudovskiy 2017).
Marketing mix:
Apple has to recognize the significance of the marketing mix in determining the marketing strategy. The observation of the marketing mix comprising of four Ps such as product, place, price and promotion could be helpful for the organization especially in terms of leveraging on the unique aspects of STP approach as well as unique differentiation of value proposition for customers (Kerr 2015).
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Apple has considerable competences in terms of differentiating itself from competitors especially through the use of superior customer service, user-centric products, and explicitly superior technological innovation. The detailed marketing mix for Apple could be essayed as follows.
Product:
Product dimension of the marketing mix of Apple is inclusive of iMac, iPhone, iPad, iPod, online marketing services, Macbooks, iTunes, Apple TV and Apple Music. The characterization of these products is based on the provision of a unique operating system in the applications and software.
Furthermore, the use of a distinct iOS allows the organization to obtain feasible outcomes in terms of improvement in efficiency and quality of software and hardware. The uniqueness of Apple’s products is also supported by the features provided in the products to connect with other Apple products (Abimbola 2010). This specialization of products allows motivation of customers to purchase other Apple products.
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Price:
Pricing of Apple products is a reflection of the status earned by the organization as a provider of high end technological products. The capability of the organization to introduce innovative products in the market is indicative of the company’s ability to decide the pricing. The cult following for Apple’s products is accountable for the higher loyalty of customers (Dudovskiy 2017).
Furthermore, customers of Apple products are generally observed to be price insensitive thereby forming a significant characteristic of personal identity of customers. The high end pricing of Apple products is also subject to the impact of skimming that implies the reduction of initial price of a product after a certain period of time.
Promotion:
Apple utilizes promotion channels such as television advertisements, online advertisements and billboards. The foremost entity in the facet of promotion of Apple’s marketing mix reflects on the Halo effect created by the organization through use of tailored marketing tactics. The ability of the organization to create a buzz around the products through news media, blogs and websites is supported by the media campaigns that are designed for specific target markets (Kerr 2015).
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The emphasis of the promotional efforts of Apple on customer service rather than sales also forms a characteristic feature of the promotion mix of Apple Inc. The examples of retail stores of Apple known as Genius Bar and the provision of user training at the same induce plausible changes in the perception of the brand by customers.
Place:
Apple is known for the direct channel of distribution in the form of retail stores that were opened in 2001 which is indicative of the unique experience that customers can access while purchasing Apple products.
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The expansion of Apple’s distribution channels could be observed in the inclusion of indirect channels such as Costco and Wal-Mart which led to the concerns for differentiation of products from other products in the stores. Online purchasing facilities could also be observed through the website of Apple that allows customers to obtain access to the complete product line of the organization. The brand reputation of Apple also plays a considerable role in the sophistication of purchasing experience of customers.
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References
Abimbola, T., 2010. Brand strategy as a paradigm for marketing competitiveness. Journal of Brand Management. 18, 177 – 179. doi: 10.1057/bm.2010.48
Dudovskiy, J. 2017. Apple SWOT Analysis – Research Methodology. [online] Research Methodology. Available at: https://research-methodology.net/apple-swot-analysis/ Accessed: 12-May 2017].
Kerr J. 2015. The Henry Fund – Apple Inc. (AAPL). Henry B. Tripple School of Management. [Online] Available at: http://tippie.biz.uiowa.edu/henry/reports15/AAPL_fa15.pdf [Accessed: 12-May 2017]
Researchomatic.com. 2017. Apple’s Marketing Orientation | Researchomatic. [online] Available at: http://www.researchomatic.com/Apples-Marketing-Orientation-150758.html [Accessed: 12-May 2017].
Rowland, C. 2017. Apple’s Vision Statement & Mission Statement – Panmore Institute. [online] Panmore Institute. Available at: http://panmore.com/apple-mission-statement-vision-statement [Accessed: 12-May 2017].
The Discourse of Life. 2017. A Long-standing Discourse on Apple’s Orientation: Product or Market Oriented?. [online] Available at: https://stringsofdiscourse.wordpress.com/2014/10/11/a-long-standing-discourse-on-apples-orientation-product-or-market-oriented/ [Accessed: 12-May 2017].
