Marketing

Management

Istanbul Aydin University Apple Inc Marketing Plan and Strategies

Instructor:

Yrd. Do. Dr. AKIM NURDAN TMBEK TEKEOLU

Submitted By: Ab Rahman Nasim B1106.020075

Think Different

Contents
1 Introduction of Apple Inc 1.1 History 2. Situational Analysis 2.1 Position 2.2 Socio-Cultural Situation 2.3 Technological Situation 3. Consumer Analysis 3.1 Target Market 3.2 Potential market 4. Competition Analysis 4.1 SWOT 4.1.1 Strengths 4.1.2 Weaknesses 4.1.3 Opportunities 4.1.4 threats 5.0 Marketing Mix 5.1 Products 5.2 Price 5.3 Place 5.1 Promotion 6. Integration and control 7. Conclusion

1. Introduction Of Apple Inc

Incorporated by Steve Jobs and Steve Wozniak in 1977, Apple Computer, Inc. was incorporated with a net worth of US$250,000. It has since grown leaps and bounds to the Apple Inc. of today, employing close to 50,000 employees worldwide, with a net worth of US$209,379 million in 2010, placing it 56th among the Fortune 500 companies. From the iPod revolution in 2000, to the iPhone in 2007 and most recently, the iPad in 2010, Apple has introduced, amidst much fanfare, ground-breaking products that revolutionized the markets since the start of the 21st century.

1.1 History
The firm started off as Apple Computer, best known for its Macintosh line of computers in the 1980s and 1990s. Despite a strong brand, rapid growth and high profits in the late 1980s, Apple nearly

went bankrupt in 1996. Steve Jobs took over as CEO again in 1997 after being forced out of the firm in 1985. Apple Computer was renamed Apple Inc. to reflect the firms expansion into consumer electronics market with innovative non-PC products starting in the early 2000s. Various revolutionary products such as the iPod, iPhone and iPad were introduced into the market, gaining a cult-like following behind the brand, with exponential growth and share price rising more than 15- fold since 2003. Today, Apple stands as a global technology powerhouse, surpassing its major competitors, including Microsoft, to become one of the worlds most valuable companies.

2. Situational Analysis
Over the past ten years, some refer to as the American lost decade; few companies have been able to grow amide political, economic and financial instability as Apple. Apple, what was once considered a memory of times gone by has transformed itself and is on the verge of becoming the modern day David and Goliath. Today, Apple is a prominent provider of hardware and software, including Macintosh computer, the iPod digital media player, and the iPhone. With the iMac in 1998, iPod in 2001, iPhone in 2007, and iPad in 2010 Apple set itself apart with innovative design and has extended this differentiation throughout its entire product offering. Apple PCs are popular with consumers, students/educators, and creative professionals. Apple is also the largest vendor of portable digital music players globally with 70%+ market share. It is the largest vendor of legal digital music downloads globally. Following its entry

into the smartphone business only 3 years ago, the iPhone already represents the companies innovation. Apple now enjoys a great success in the electronics market.

2.1 Position
Apple entered the market with that slogan; Think Different , and the company became the leader quickly as stated by different design and new technology industry .The quickly rise of Apple cause that the opponents imitate Apples poducts. Apple was the most popular computer brand in the USA at three and four years ago. Today apple is most popular electronic bran in the word. ts leader of the products they produce.

2.2 Socio-Cultural Situation

Brand loyalty is indeed crucial to Apples success. It is for any company, of course, but in Apples case, where it sells its entire product line as a tightly integrated ecosystem of products, it becomes even more critical. It seems highly unlikely that any of Apples competitors will catch up to or surpass Apples success in the near term on their own merits, in which case Apples only real threat to continued prosperity is Apple itself. Population growth leading to expansion of the sector needs for cell phones.

People depend more and more on mobile communication everywhere. There is educational growth in the world. Cultures perception of the technological devices is positive worldwide. Literacy & illiteracy level is not affecting using cell phones but affecting high technological cell phones, this fact needs to be considered.

Acceptance of imported products in some countries are less if there is local provider

2.3 Technological Situation

Level of technology in the world is increasing. Internet level of awareness & usage for individuals & industrial aspect are increasing worldwide New technologies in the electronics are increasing. Future plans for technological linkage between cities, universities, colleges, hospitals and other institutes are increasing and can be connected using electronics Level of usage of the E- Technology (online bidding, billing, complaints, blogging etc) are high and trendy.

3. Consumer Analysis
Apple aimed to people who had some characteristics: Middle/Upper income folks who were willing to pay a bit more for a better user experience.

People who liked to have fun with technology. Music enthusiasts aged 12-35. Professionals in media and design.

After doing a research, Apple realised that the first two groups was a huge market. These people were ready to pay at a higher price to show up their social status. Apple has a branding strategy that focuses on the emotions. The Apple brand personality is about lifestyle; imagination; liberty regained; innovation; passion; hopes, dreams and aspirations; and power-to-the-people through technology. The Apple brand personality is also about simplicity and the removal of complexity from peoples lives; people-driven product design; and about being a really humanistic company with a heartfelt connection with its customers. The Apple brand is not just intimate with its customers, its loved, and there is a real sense of community among users of its main product lines.

3.1 Target Market:

Primary customer targets is the middle-upper income professional to coordinate their busy schedules and communicate with colleagues, friends and family. Secondary consumer targets are high school, college and graduate students who need one portable multifunction device.

3.2 Potential market

In 2006, 26 million game consoles were sold worldwide. People consumed 94 million digital cameras. 135 million MP3 players and about 209 millions PCs were sold out. This provides a huge market in every segment for Apple.

4. Competition Analysis 4.1 SWOT

Here is a look at a company's strengths, weaknesses, opportunities, and threats.

4.1.1 Strengths
Strong Marketing Efforts One of the greatest strength of Apple is its impactful marketing efforts which produced a potent concoction of a strong global brand and celebrated products. Brand Marketing Apple is one of the most established and reputable IT brands globally. Its popular multi-million dollar marketing campaigns included successful Think Different ads and catchy slogans such as It just

works, which positioned the firm as a chic alternative to its competitors. As a result of its massive marketing efforts, Apple has built a very loyal customer base that advocates the brand, enabling it to not only recruit customers, but also retain them. This provides a platform for Apple to introduce new products, such as the iPod and iPhone. Retail Strategy Apple launched its retail strategy in 2001 to increase customer exposure to its products. Its stores carry its full range of products exclusively with well-trained sales personnel promoting product advantages to potential buyers alongside in-store presentations. Apple specialists are also present to provide technical support. The enhanced consumer experiences helped to further differentiate Apple from its competitors. Research and Development Apples R&D encompasses the product development process where it relies on its proprietary designs and keeps key design decisions in- housed. Jobs is also a vital part of this design process with his hands- on involvement.56 As a result, Apple is able to produce best-sellers, from the iPod scroll wheel design to the ultra-thin MacBook Air, which sets Apple apart from its competitors.

4.1.2 Weaknesses
Business Strategy Apples premium price differentiation strategy has its pitfalls given the intense rivalry of the industry. Without constant innovation to set itself apart from its competitors, Apples products may appear overpriced in comparison to its rivals. Reliance on Steve Jobs Apple greatly depended on Steve Job, The news of his liver transplant and also his cancer treatment effected the stocks. After his passing away the stocks fell and he was attributed with the innovation and success of Apple and its innovative products. Apples Product and Expectations With short product life cycles of the consumer electronics industry, Apple may find it increasingly difficult to keep up with the overly- hyped expectations with some product launches being merely a rehash of the last. Corporate Social Responsibility As a large firm under the media spotlight and public scrutiny, it is imperative that Apple extends its responsibilities to its stakeholders and demonstrates commitment to its triple bottom line: people, planet, profit. However, Apple has been known to receive widespread criticism for its labour and business practices.

 4.1.3 Opportunities
The Shift from the PC to Mobile Era Since the mid-1990s, demand for phones with increased functionalities and enhanced aesthetics has increased tremendously, with smartphones rising to prominence in the following decade. Emerging Markets Despite the shift towards the mobile era, the PC industry is still considerably viable especially in emerging markets, as it is propelled by growing Internet demand. As of 2010, more than one billion PCs were used worldwide and it is forecasted that this trend will continue for the next 3 years, with exponential increases in the Asia Pacific and Middle East/Africa regions. Smartphone Sector Strong growth in Smartphone and tablet markets to boost Apple's revenues

4.1.4 Threats
Intense Competition Global markets for consumer electronics are considered fast-cycle markets23 that are highly competitive and subjected to rapid technological changes. Apple huge success in major product lines

attracts strong competitive responses, emphasizing the need to innovate and differentiate to out maneuver its competitors. Risk of International Operations A large and growing portion of Apples revenue is derived from international operations. Over the last three years, international sales have been increasing and accounted for 56%, 47% and 44% for FYs 2010, 2009 and 2008 respectively.31 Therefore Apple risks violating the complex foreign laws and regulations, including foreign exchange controls, labour laws and anti-competition regulations the latest being that Apple is accused of creating a music-download monopoly. Risk of Imitations, Unauthorised Modifications and Piracy Given the high success of Apples product launches, Apples products are highly prone and susceptible to imitation. In the past, when Macintosh licensed their ROM and softwares, almost 99% of customers who bought such clones were existing Mac users, cannibalizing Apples profits. Although the Macintosh licensing program has been halted, iPhone imitations in countries such as China have been rampant Andriod/Blackberry Rising popularity of Google Android and Blackberry may affect its market share.

5.0 Marketing Mix


Extend on the Apple brand name and link to the established meaningful positioning. Extend on Apples image of innovation, quality, and value. Measure the awareness and response in order to make adjustments to the marketing campaigns as necessary The following is the marketing mix of Apple.

5.1 Products
A convergence of technologies e.g. An iPhone has a mobile phone, an mp3 player and internet surfing capabilities. iPhone3G/iPhone 3GS iPod shuffle (available in a range of colours) iPod nano (available in a range of colours) iPod classic iPod touch Apple TV MacBook Pro/Air/mini iMac Mac Pro

5.2 Price

Apple is a premium brand computer that does not attempt to compete on price. The company has reduced prices after some

initial product launches. It uses skimming and preimuim pricing strategies.

The AppleiPad is priced at a minimum of $499. The Apple iPhone costs begin at $99. The Apple iPod Classic is priced starting at $249. The Apple iPod Nano costs $149. The Apple Mac Book costs $999. The Apple MacBook Pro is priced at $1199. The Apple Quicktime Pro for Windows costs $29.99

5.3 Place
Since the inception of the retail initiative in 2001, Apple has opened 65 retail stores in the United States through 2003 and during the first quarter of 2004 opened 9 additional stores, including its first international store in the Ginza in Tokyo, Japan. 98 Stores are installed at high traffic locations in quality shopping malls and urban shopping districts. Products are available from various sources through the channel there are various distributors, and many retailers and e-tailers. Alternatively the products can be purchased from apple directly.

5.4 Promotion
1. Through Apple shops, supermarkets, and electronics shops. 2. Internet sales 3. TV adverts 4. Billboard advertising 5. Internet adverts 6. Print adverts in magazines

Always a distinct and consistent style. Well known logo. Celebrities have in some of the advertising. Apple, Inc offers special discounts on refurbished I phones. In each case a 1 year warranty is included on the all products. The Apple Consultants Network website provides a search tool allowing visitors to locate nearby certified Mac product consultants in the U.S, Canada, and a number of international locations. The online Apple Store offers free shipping for orders over $50. The online Apple store offers iTunes gift cards. Apple provides a $100 rebate when you purchase an i phone or specific products from the online store. Apple has packaged back-to-school offers, including some aimed at college students.

6. Integration and control

In order to avoid coordination problems between people, functions, and divisions, Apple has to use integration mechanisms and control systems. Actually, integration mechanisms aim at increasing intra-functional coordination and communication. As Apples culture can be described as relatively open and casual, direct contact constitutes an appropriate integration mechanism. In fact, direct contact among Apples managers enables them to work closely together in terms of problem-solving a n d o th e r (stra te g ic ) issu e s.

8. Conclusion
Apple converts new customers and secures their loyalty through a corporate emphasis on customer service. Apple seeks to attract its target market through bold public relations events such as the MacWorld Expo etc., as well as advertising widely.