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EXECUTIVE SUMMARY

The smartphone has ushered in a new generation of mobile Internet devices. A small smartphone that
is only four inches long enables the sharing of real-time information and knowledge, and it can
transform lifestyles. People use smartphones to obtain, share and exchange information whenever
they desire. The speed of information processing is accelerating, and real-time communication is
becoming universal and is no longer constrained by time and space. Through its ripple effects, the
smartphone makes it possible for people to realize a genuinely ubiquitous life in a variety of areas,
such as business, education, social interaction, and leisure.

OBJECTIVE
To study Apples iPhone as a premium product in smartphone industry in India by analysing its
growth, market share, competitors, customers behaviour, opportunities/threats, status in the
companys brand portfolio and strategies for future growth.

INTRODUCTION
The continuous progress and expansion of applications allow people to obtain the particular
information they want. Users can acquire almost any type of information, such as information on the
weather, locations, food, attraction, transportation, medicine, education, games, fashion, sports, and
scientific research, without constraints of time and place. Users can also create a new form of social
community, influence public opinion, and significantly improve the infrastructure and speed of social
communication. Everything through smartphones which are categorised under the technology
industry. Smartphones are powerful new computing devices offering traditional wireless voice service
as well as native software applications and, perhaps most importantly, the ability to connect to and
run a myriad of Internet-based services including email, geo-location, streaming video, and social
networking, while providing a good user experience. The business opportunities presented by this new
category have attracted many of the major global information and communications technology (ICT)
firms, including firms from the mobile telephony, personal computer, Internet, and personal digital
assistant (PDA) industries, into a complex new landscape of competition.

This industry provides foundation for activities such as, chip production, information and
communication systems, and computer systems. The companies belonging to this industry serves as
developers and manufacturers of the products which increase efficiency and production of cell
phones, computers, televisions, and other communication and information systems. It is a huge
industry with a high growth potential. India remains one of the fastest growing major markets and
continues to offer significant opportunities for growth given its current low smartphone rates. Because
this mobile generation has strong access to information and networking capabilities, the producer-
driven consumption pattern is rapidly being replaced by a consumer-based consumption pattern.
Smartphones are powerful new computing devices offering traditional wireless voice service as well
as native software applications and, perhaps most importantly, the ability to connect to and run a
myriad of Internet-based services including email, geo-location, streaming video, and social
networking, while providing a good user experience. The business opportunities presented by this new
category have attracted many of the major global information and communications technology (ICT)
firms, including firms from the mobile telephony, personal computer, Internet, and personal digital
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assistant (PDA) industries, into a complex new landscape of competition. For many of these firms,
capturing a portion of the total value created by the smartphone industry is believed to be a key to
future growth and profits. (Kenney, 2011)

6. SMARTPHONE INDUSTRY

6.1GLOBAL SMARTPHONE INDUSTRY

The global smartphone market has been experiencing explosive growth for the last several years.
Competition has remained fierce all throughout, but the numbers don't lie.The major smartphone
platform war continues to play out between Apple and Google, while Microsoft still aims to grow its
small slice of total shipments. On the vendor side, Samsung has tried to fend off pressure from low-
cost vendors out of China while also succumbing to pressure from Apple on the high-end of the
market. Low-cost smartphones are proliferating across emerging markets, driving the feature phone
closer to obsolescence.

Key Highlights
The smartphone market in the second quarter of 2015 has grown at its slowest rate since 2013
up just 13.5% over the same period in 2014.
China, seen as one of the most crucial markets for companies like Apple, saw sales fall by 4%
according to the latest figures from research company Gartner. Its phone market is essentially
driven by replacement, with fewer first-time buyers. Beyond the lower-end phone segment,
the appeal of premium smartphones will be a key for vendors to attract upgrades and to
maintain or grow their market share in China.
Feature phones now account for just 25% of total mobile phone shipments
worldwide. Shipments in the Indian market will grow roughly 31% per year on average
through 2020, compared to 8% average annual growth in China.
The global platform wars are still playing out, with Apple able to push back against Android
dominance on the backs of new device launches. After the release of the iPhone 6 line, Apple
was able to grow market share in the fourth quarter 8 percentage points from a year earlier.
The smartphone companies of China are well represented among the biggest manufacturers in
the world with Huawei, Lenovo and Xiaomi listed in the top five vendors.
Huawei was the most impressive performer, seeing sales increase 46% year-on-year, helping
it increase market share from 6.1% to 7.8% and establish it as one of major players in the
global smartphone industry. Huawei's growth was based on strong overseas sales and
increased sales of 4G-enabled phones in China.
Lenovo, which last year bought the Motorola smartphone business from Google, remains in
the fourth position despite seeing sales drop over 14% and its market share tumble from 6.6%
in 2014 to 5% as of the end of June 2015.
Xiaomi, the internet company which sells its smartphones in only a handful of countries
compared to the likes of Apple and Samsung, continues to impress, growing sales by over
28% to see it nipping at Lenovo's heels with 4.9% of the global smartphone market.
Samsung remains the world's biggest smartphone maker with a 21.9% market share, however
the company's recent poor sales continue, as it has lost almost 5% of its market share since the
same period in 2014 with unit sales down over 4 million year-on-year.
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Key trends in global in the smartphone market


Bigger screenss, and have continued to drive growth in the first quarter of 2015. Share of such
devices grew from 32% or one third of the global smartphone market in the first quarter of
2014, to 47% almost half in the first quarter of 2015. So it is no surprise that supersize
screens are expected to be the largest sales segment worldwide in 2015, surpassing the 4 to
4.5 segment for the first time.
The rise of 4G : 4G-enabled devices surpassed 50% share of the global smartphone market
for the first time in the first quarter of 2015, buoyed by continued price erosion of 4G
smartphones. Our forecasts point to 4G device share increasing further in 2015, reaching 59%
in the fourth quarter of 2015
Smartphone growth in India and Indonesia is expected to be helped by an expanding 4G
network. In Q1 2015, 4G share in both countries was well below the global average, at 4%
and 7%, respectively. We estimate 4G share will increase to 7% in India and 10% in Indonesia
by the end of 2015.
Cheaper handsets: In the first quarter of 2015, low-end smartphones those priced below
$250 saw their share increase to 56%, up from 52% in Q4 2014, at the expense of high-end
models ($500+), while the market share of mid-range devices ($250-$500) remained stable.
Low-end smartphones those priced $150 and below are expected to gain further share in
2015, helped by continued price erosion in emerging markets.
The fast growth of emerging markets: The rapid growth of the smartphone market has been
shown to slow at country level when saturation point is approaching. For this reason, Spain
and France are expected to see a slowdown in smartphone unit growth in 2015 compared to
2014. As such, emerging markets are key to global growth. The fastest growing regions in
2015 forecast to grow by +29% and +33% respectively are the Middle East and Africa
(MEA) and Emerging APAC. Both regions still have significant room for growth as
consumers migrate from feature phones to smartphones and existing smartphone users trade
up to a device with a bigger screen. Focusing on Emerging APAC, the Indian and Indonesian
markets are expected to drive growth, where low smartphone penetration leaves good room
for growth. The Latin America smartphone market enjoyed the highest growth of all regions
in 2014, both in terms of units and value, driven by smartphone price erosion, 4G promotions
and a boost from the World Cup.

While the growth of the global smartphone market continues to be driven by these four key trends, in
some local markets growth is not so strong. For example, in Central Europe where the
macroeconomic situation in Russia has had a negative impact on sales, both units and value are
forecast to decline. However, globally, the news remains positive for smartphone manufacturers and
retailers.

OS Bifurcation
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Overall Phone Shipments (Millions units)

Competitor 2014 2013


Samsung 405 452
Microsoft(Nokia) 200 252
Apple 193 153
Lenovo-Motorola 94 64
Others 919 764
Total 1810 1685
Source: IDC, Above Avalon
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Source: IDC, Above Avalon

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Source: (Chapman & Haskisson)

6.2SMARTPHONE MARKET GROWTH IN INDIA

Smartphone adoption in India is the fastest in Asia-Pacific region. With the number of vendors offering wide
variety of smartphone devices, consumers are spoilt for choices with diverse features at different price.
Consumers in India backed by comfortable disposable income at hand are quickly swapping their feature phones
with the latest smartphones. The falling prices of smartphones are further accelerating the adoption trend. While
foreign companies have realized the opportunity in India for Smartphone devices and have brought it a number
of India specific devices, domestic handset companies are targeting to capture larger market in the country with
budget smartphones. New age consumers with improved disposable income and varied needs are quick to adopt
smartphone, creating substantial opportunities for smartphone manufacturers.The growth in smartphone
popularity in India reflects the overall digitization of the country.

Growth Drivers for Industry

Smartphone Growth Trends in India

India will cross 100 million mark as the sales of smartphone devices in the country is
estimated to reach 118 million, accounting for about 8% of global smartphone market 2015.
Unlike US and China India will see a constant growth in the upcoming years. The year-over-
year growth will slow down tough; the country will still remain the most favorite market for
all smartphone manufacturers for a very long time. By 2017, the contribution of India to
global smartphone sales will also reach in double-digit, estimates analysts at Strategy
Analytics.
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The growth and sales forecast figures dont surprise much as stagnation smartphone market in
the US will hit the wall soon. Consequently, almost every major smartphone manufacturer has
either ventured or is gearing up to make India debut. By 2017, the contribution of India to
global smartphone sales will also reach in double-digit, estimates analysts at Strategy
Analytics.
The smartphone sales growth in India is driven by the low smartphone penetration, growing
demand of entry-level smartphones, increasing buying power of middle-class and aggressive
promotions rom local smartphone brands like Micromax, lava, etc.
The Indian government is committed to setting up a robust digital infrastructure and to
promote adoption of mobile Internet and related products and services. In 2014-15, the
Government budgeted INR 500 crore for building infrastructure as per the National Rural
Internet and Technology Mission with an additional INR 100 crore budgeted for improving e-
governance.
India has the third largest Internet user base in the world out of which more than 50 per cent
are mobile-only internet users. However, the Internet penetration in India at 19 per cent is
quite low compared to other developed and developing economies.
Expansion of 3G network and rollout of 4G networks is expected to boost the sales in the
country.
Increased internet enabled device penetration, decreasing handset prices and data plans tariffs
are helping create a suitable environment for a rapid growth of mobile internet in India, with
rural India set to take the lead.
The smartphone market also received a huge fillip from the huge uptake of the ecommerce
platform. Since then, many other handset makers have followed that model, launching
handsets exclusively through online marketplaces like Snapdeal and Amazon and later
introducing the device in the offline market.
India has become the market with the most potential upside. India offers both a growing
customer base and favorable conditions for manufacturing thanks to financial benefits derived
from localized manufacturing.

6.3SWOT ANALYSIS OF SMARTPHONE INDUSTRY IN INDIA

STRENGTH WEAKNESS

High technological advancement Highly Competitive


Large customer base Intensive Research and Development required
Increasing disposable income of the people Low end products yields very less margin
Greater number of Telecom service providers
thus high demand of mobile phones
Government policies to support the industry

OPPORTUNITY THREATS

Rural market is very less penetrated so great The telecom service providers have to incur a
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opportunity ahead huge initial fixed cost to enter rural service


4G and 3G auction has paved the way for areas. This can directly affect the smartphone
highly advanced smartphones penetration in India
Smartphones are highly demanded Unorganized sector
Government policies for mobile banking Net neutrality
provides great opportunity ahead Need to keep abreast with the technology

6.4COMPETITOR ANALYSIS

With the saturation of European markets, smartphone manufacturers are turning their attention to
India, which has a population of over 1.2 billion. Presently, India is the fastest growing smartphone
market; hence, it isn't surprising that smartphone manufacturers are racing to get a piece of the pie.

Competitor Landscape in India

Samsung manages to acquire the largest market share in smartphones largely because it offers
phones in different segments i.e. from high to low price segment, with different product line
that attracts many consumers. Low pricing and good features make it affordable by many and
therefore it has gained such popularity.
In the Indian smartphone market, Apple maintained its position as the number two-
smartphone brand by value in the first quarter this year, after Samsung. By volume, Apple is a
much smaller player compared with market leader Samsung. Its market share is relatively
growing in India as it has been able to penetrate largely the youth which looks out for a good
international brand name, features, design, quality. Since the time apple iPhones have been
offered on EMIs there has been a relative increase in the sales of iPhones as now many can
afford it.
Intex took the third position, capturing slightly fewer than 10 percent of the smartphone
market, riding on the demand of sub-$100 smartphones.
Lenovo and Lava grabbed the fourth and fifth spots, respectively. Lenovo was also the second
largest LTE smartphone vendor during the quarter.
While Xiaomi smartphone shipments increased sequentially during the quarter, Apple's
iPhone shipments remained strong during the quarter as vendor expanded its distribution
reach through both online and offline channel by adding more partners.
Microsoft also found its place among top five overall mobile phone brands during the quarter
but Lumia shipments declined sequentially.
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INDIAN COMPETITOR Share

16; 16%

27; 27%

2; 2%

5; 5%
Samsung Micromax Intex Nokia Motorola Lava Karbonn Xiaomi Apple O

8; 8%

6; 6%
17; 17%

5; 5%
5; 5%
9; 9%

Rise in smartphone popularity with the advent of local Indian smartphone companies like
Micromax, which have created affordable mobile devices that have all the bells and whistles
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of their more expensive, foreign counterparts, but a much less intimidating and more
attractive price tag.

Source: Consultancy reports & News


articles

Competitor Segmentation

BRAND SHARE PRICE MAJOR USP


OFFERRINGS
APPLE 2% High iPhone 6, iPhone 5S iOS, Appstore
SAMSUNG 27% Moderate S6,S6 edge, Note 5 Gestures and display
quality
MICROMAX 16% Low Canvas Silver, Canvas Moderate quality
A1 functions at low Price

NOKIA 5% Moderate Lumia 930, Lumia Camera and OS response


630 and functionality
KARBONN 8% Low Karbonn Titanium, Moderate functions at low
Karbonn A1+ Price
MOTOROLA 5% Moderate Motorola G3, Moto X One of the best
play, Moto X Style, implementation of Android
Moto Droid turbo OS
XIAOMI 5% Low RedMi Note 2, Mi 4i Promising user experience
and low price Tag
INTEX 9% Low Intex Aqua Y2, Intex Beautifully designed with
Aqua turbo, Intex High-quality camera
Cloud M6.
LAVA 6% Low Lava Iris X1,Lava Moderate functions at low
Pixel V2, Lava Iris X8 price with long lasting
battery life.
*notes to the table
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High- above 40,000, Moderate- above 15,000; below 40,000,Low- below 15,000

7. APPLE IPHONE MARKET STUDY

Apple is a well-known company for all of its technological advances. It leads the industry with new technology
that consumers are looking for. In order to continue to provide cutting edge technology there are
things that every company needs to be successful. Apple has been capable of staying ahead of the
competition due to its ability to produce cutting edge designs by using a creative design process.

The launch of the iPhone was, by industry consensus, a disruptive innovation. Eager consumers lined
up to buy the high-priced device. It took just 74 days for Apple to sell one million iPhones and less
than two years to sell 21 million worldwide. The iPhone was introduced on a proprietary platform,
controlled by Apple. In 2008, Apple opened an App Store, creating a platform for independent
applications, each approved by Apple and subject to a fee equal to 30% of revenues.
Apples wireless foray yields benefits directly related to the structure of its platform. By using its
proprietary mobile operating system, a modified version of its desktop OS, it offers a desirable
product for iPhone users. It also enables this wireless applications entrant (i.e., Apple) to appropriate
the gains from competitive superiority in product design. By filtering applications through the Apple
App Store, it both protects its brand and delivers a customer experience that increases demand. And
by coordinating the interface both technically and financially, it helps independent developers market
and bill for their products while extracting its share of value. Despite or perhaps because of the
vertical control imposed by the platform owners, software firms reacted enthusiastically.Apple Inc.
still has plenty of challenges ahead. Some of those stem simply from the nature of the fast-paced,
hyper-competitive consumer technology business the company currently competes in

Company profile
Apple Inc. (Apple), incorporated on January 3, 1977, designs, manufactures and markets mobile
communication and media devices, personal computers and portable digital music players and sells a
variety of related software, services, peripherals, networking solutions and third-party digital content
and applications. The Company's products and services include iPhone, iPad, Mac, iPod, Apple TV, a
portfolio of consumer and professional software applications, the iOS and OS X operating systems,
iCloud and a variety of accessory, service and support offerings. The Company offers a range of
mobile communication and media devices, personal computing products and portable digital music
players, as well as a variety of related software, services, peripherals, networking solutions and third-
party hardware and software products. In addition, the Company offers its own software products,
including iOS, the Company's mobile operating system; OS X, the Company's Mac operating system;
and server and application software. The Company's primary products include iPhone, iPad, Mac,
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iPod, iTunes, Mac App Store, iCloud, Operating System Software, Application Software and Other
Application Software.The company also has a chain of retail stores known as Apple Stores.
Apple Inc. was founded on April 1, 1976 in a garage by Steve Jobs and Steve Wozniak. The young
entrepreneurs brought different strength to their fledgling company: Jobs had a flair for
conceptualizing products, while Wozniak had the technical know-how to make them happen
(Washington Post Economy, 2012).

Apple vision
Apple is committed to bringing the best personal computing experience to students, educators,
creative professionals and consumers around the world through its innovative hardware, software and
Internet offerings.

Timeline
Apple I was the first product that Apple Inc. produced. It was a personal computer (PC). In
1977, Apple introduced Apple II which became a very successful device. After that the
company began to produce Apple II series. The Apple II was followed by Apple II plus, Apple
IIe, Apple IIc, Apple IIGS, Apple IIc Plus and Apple IIe Card.
Apple introduced Macintosh in 1984 that became a very successful computer. It was a first
computer featuring a graphical interface and a mouse for navigation. The new computer sold
very well, pushing apple's fiscal 1984 sales to an unprecedented 1.5$ billion. (Chapman &
Haskisson)
By 1985, however Jobs and Scully began to disagree over the direction they wanted the
company to take. After Jobs' attempt to remove Scully failed, Jobs left Apple in May to start
his own new business, NeXT Computers. (Chapman & Haskisson)
In December 1996, Apple acquired NeXT, with the plan of using its technology as the basis
for a new operating system. After being gone for more than a decade, Jobs returned to the
company he had originally cofounded with Wozniak. (Chapman & Haskisson).
In 1998 Apple introduced the new generation of PowerMacs, PowerBooks, and the highly
anticipated iMac and iBook, which were less expensive computers aimed at the how-end
computer market. After an entire year without showing a profit, the first quarter of 1998
began three years of profitable quarters for Apple. (Chapman & Haskisson)
Apple ventured into the market of legal downloads with the introduction of its iTunes Music
Store in 2001. iTunes offers downloads at a specified price without requiring subscription or
monthly fees. iTunes offers its users a selection of more than 6 million songs, with new songs
continually added. (Chapman & Haskisson).
With the introduction of the successful iPod music player in 2001 and iTunes Music Store in
2003, Apple established itself as a leader in the consumer electronics and media sales
industries, leading it to drop "Computer" from the company's name in 2007
As of 2012, Apple is the largest publicly traded corporation in the world by market
capitalization, with an estimated value of US$626 billion as of September 2012. Apple Inc.s
market cap is larger than that of Google and Microsoft combined. Apple's worldwide annual
revenue in 2010 totaled US$65 billion, growing to US$127.8 billion in 2011 and $156 billion
in 2012.

7.1 iPhone Growth Perspective

Global Growth Perspective


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The iPhone is a unstoppable with unit sales up 25% in 2014, representing close to 70% of
Apple's operating income. Many market observers are wondering if Apple is approaching a
limit to iPhone sales growth.

With the iPhone 6 and 6 Plus representing possible inflection points in the phone market, the
ingredients are in place for Apple to sell 300 million iPhone units annually within three years,
which would represent 50% growth from the 193 million iPhones sold in 2014.

The significant increase in iPhone upgrading in 2014 was driven by the iPhone 6 and 6 Plus
and that trend will continue in 2015. As the iPhone user base expands, it is not hard to fathom
that close to 250 million iPhone users will be upgrading their iPhones on any given year by
2017. Apple would likely position the screen, battery, and camera as some of the more
marketable upgrades each year, as well as upgraded components including the fingerprint
sensor, speakers, headphone jack (or lack thereof). In addition, Apple will continue to update
the iPhone's form factor, including cosmetic chances, as well as altering width and weight.

iPhone Growth in India


India is one of the fastest-growing smartphone markets in the world, but it's been a tough one for Apple
Inc. Only one in five Indians owns a smartphone, and since wireless carriers don't typically subsidize
phones, Apple products are too costly for any but the most affluent early adopters.
The iPhone has a market share of around 2% based on smartphone shipments, far below market leaders
Samsung, Micromax and Karbonn that share among them 55% of the fast growing smartphone market
in India as of June-end 2015.
For the period between April to June, 2015, iPhones recorded a growth of 93% in India, which is more
than growth in Italy, Spain, the Netherlands, Turkey and China.
If we take into account the annual sales of Apple products, then India has become their billion dollar
market now. However, compared with 13.2 million units (27% of overall iPhone sales) sold in China,
only 0.5 million units were sold in India. But the growth trajectory witnessed in India has surprise even
Apple, as they are now formulating some aggressive campaigns in India.
But by value, Apple is the sixth largest smartphone player in India with an about 5.5% share as of end-
June 2015. It had climbed to the third spot in the January to March period with a 9.2% share.
Apple has made some inroads, however, by selling a wide range of phones from the iPhone 6 to the
iPhone 4S and dropping prices through deals with banks and wireless carriers. The reception to the
iPhone 6 models has been tremendous. It has given (Apple) huge momentum in India.
In addition to slowly expanding the reach of its distribution in the country, through pan-India deals with
major distributors, Apple has lifted its volume with sales of older models at much lower prices,
increased its marketing budget, buyback and exchange schemes and monthly installment offers via
various banks and retailers.
The tech giant now plans to deepen its reach into the Indian market and targets smaller cities with small
format, neighborhood retail stores, which will sell all of Apple's products aided by distributors
Redington and Ingram Micro besides existing trade partners.
Apple has struck a deal with Brightstar Corp. to distribute its phones in India. Bright star, controlled by
Japanese telecom giant Softbank Corp., already distributes Apple products in other markets.
Apple is adding other distribution partnerships in India with Rashi Peripherals Pvt. Ltd., which
coincided with the launch of the iPhone 6. This deal expanded Apples reach in India by some 1,200
stores.
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Apple also stepped up its efforts by offering its latest model, the iPhone 6, on an installment plan in a
partnership with Vodafone Group PLC. The plan locks customers in for two years, but they get a brand
new iPhone 6 and full-fledged plan for 3,599 rupees a month with no down payment.
Foxconn manufacturers smartphones and tablets for mobile device players like Apple, (Samsung and
Xiaomi. Recently, it announced its intention to invest $5 billion over the next five years in India to set
up factories and R&D (research and development) centers. The main reason why it has gone ahead
with the decision is Indias rapidly growing smartphone market. India has the fastest growing
smartphone market. It could overtake the US smartphone market by 2017, according to a report from
Strategy Analytics. Another possible reason why its keen to invest in India is that it wants to lessen its
dependency on China. It faces higher costs due to rising labor wages.

Apple is aiming for the sales of two million iPhones in India in this (October-September) fiscal year
after notching up one million last year. In the seven months ended April 30, the company sold a
million iPhones in India. Another executive said Apple India had been under pressure since Samsung
has become more aggressive and wants to ensure that volume sales grow at twice the existing pace.
Apple's distributors are now reaching out to even local consumer electronic dealers and mobile phone
stores for stocking iPhones and setting up dedicated space in such stores.
By value, Apple is the number two brand in the overall Indian smart phone market after Samsung.

7.2 CONTEMPORARY MARKETING PRACTICES OF APPLE IPHONE

MarketingProcess
Apple really stands out in its marketing. The company simply seems to understand what will get
people excited about its products and services, then only it executes on its vision. They dont talk
about features or technology, but about how the computers will make your life better.
Apple Inc. Company uses all forms of advertising strategies, marketing knowledge, market
commitment, commitment decision and current activities to call the attention of customers through
Television, Newspapers, Billboard, Internet and Movies. The best advancement and ways in all Apple
Inc. stores customers are freely to touch and see the products. The sales teams are well trained in a
good and responsible ways to give awareness, rather than giving a sales pitch.

iPhone Marketing Mix


Apple has used marketing mix to create specific inroads in the technology market. Its tendencies to
manipulate and develop specific company approaches to the "4 P's" of marketing have helped to
establish its place in the marketplace. At the same time, it has demonstrated a particular flexibility to
the marketing reality of price, product, promotion, and place to ensure that its approach is replicated
in other companies while firmly establishing itself in the marketplace.

Price
Skimming price
Apple uses a skimming pricing strategy. Selling the iPhone 6 at a high price attracts premium
customers where they seek to be unique by purchasing products with the highest price and
therefore gaining a status symbol. Apple selling their iPhone 6 at a high initial price attracts
first those who are willing to pay at a high price (innovators group). Once the first set of
customers are satisfied, the price is gradually lowered in order to making it more affordable
and thus catering to a larger consumer base. The disadvantages of the skimming pricing
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strategy, that if price were lowered abruptly, the innovators group will feel ripped off and
therefore generate negative publicity hovering around Apples skimming pricing strategy; it
may spark a pricing discrimination. The objective of lowering prices of their iPhones after
the first round purchases usually from the innovator groups may be seen as price
discriminating.
With a premium target, and with the product and promotions to support the targeting.
However, Apple customers are not budging and they are very much loyal to the Apple brand
and to Iphone.
No discounts
Another interesting thing to observe in IPhone pricing policy is that it does not offer any
discounts. However, discounts might be given in the form of sales promotions or by exchange
offers. But otherwise there is no discount given in IPhone. A standard price is maintained
across the market.
Place
Present across the globe with a fantastic service backup Iphone is present across many
countries and nations and is known to provide an excellent service backup in all these
countries. The target of Apple Iphone is premium customers, hence it is found in A grade
cities only.

I-stores are found in premium places and malls Iphone has named its retail counter as
Istore keeping in line with the complete product line of Apple which starts with I resulting in
an immediate personal connect with the customer. These I stores of Apple are found in malls
and premium areas in premium cities across the complete country wide network.
Distribution happens through CNF >> Modern retail or Distributor >> Retails All
modern retail outlets are distributed the Iphone through a carrying and forwarding agent. On
the other hand, individual retailers are given the product through distributors. Finally, I stores
which are the exclusive showrooms, are given the product directly from the company at best
discounts.
Corporate tie up Apple also has a corporate sales department for the Iphone which does
corporate tie ups for the company. When Blackberry announced its exit from the handset
market, Apple Iphone soon came into the picture and did many corporate tie ups to replace
itself as the handset with all top CEOs and managers who were previously using Blackberry.
Thus, it could take over a major market share left over by Blackberry.

Promotions
Promotions and advertisement for the majority of Apples products, including each generation of the
iPhone tend to follow a similar pattern that focuses on endorsing the latest Apple product as being
ahead of the game, at the fore front of any brand new technology and the most streamlined, efficient
and modern product on the current market place. Apples leading objective in regards to promotion
and advertising of the latest Apple product, such as the iPhone 6 and 6 Plus, is set it apart from
other Smartphones, tablets or personal computers on the market by suggesting its superiority over
competitive brands and products.
Above the line (ATL) Promotions of IPhone are known to be fantastic and might range
from a full front page ad on the launch of the product, promotions in the radio, the television
and what not. Whenever a new phone is being launched, be sure to see IPhone everywhere, on
each and every ATL platform. Because they are targeting a premium segment, the presence of
Apple IPhone is higher in the ATL segment than in the BTL segment. The interesting thing
here is the taglines in newspaper ads because many of the IPhone ads are known to come up
with the most interesting taglines for the new phone.
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Below the line (BTL) For BTL marketing, IPhone uses out of home advertising with
hoardings and point of sale advertising in major retail outlets. It also uses various forms of
sales promotions and exchange offers to lure in the customer via BTL marketing.

Product
The Iphone marketing mix is one of the strongest marketing mix because the key factor
Product, is very strong
The iPhone offers consistency and innovation in its features which focuses on entertainment
and accessibility, but what makes it differ from other smart phones is its exclusive IOS
operating system and apps only accessible on the iPhone (iTunes and apple store). The high
quality processing speed also lend a hand towards the popularity of the product.
The iPhone 6 basically would be classified as a consumer specialty product, it also provides
simplicity and customization used to reflect the particular individual which makes it cater to
all ages, ethnicities and occupations. The quality has improved tremendously, from previous
iPhones being created from plastics and infusing metal and glass, apple has deviated from
that and shifted to a design that is pure of metal, (anodised aluminum and stainless steel),
providing that smooth and premium feel.
Currently the iPhone life cycle has fallen between the growth stage and maturity stage. In
terms of its growth stage, the demand of the iPhone series is growing significantly therefore
producing greater profits

7.3 APPLES SEGMENTATION STRATEGIES


Geographic Segmentation: Apples retail stores are located in highly populated cites around
the world. Global presence, with online presence/ official websites in 88 countries.
Demographic Segmentation: Age 14-55, students and business professionals, etc. Plus most
Apple stores in are concentrated in all major cities. In cities, the stores are located in shopping
centers and market places where business professionals and high income families meet their
shopping needsshowing that apple caters to high income and posh lifestyle segments.
Psychographic Segmentation: Most used type of segmentation by Apple. Segment users
according to their lifestyle.
Product related segmentation: Another major marketing strategy used extensively by the
company. Every Apple device is targeted specifically to different group of consumers and
business and features in the product are built around their needs. Apple has segmented
products vertically, creating on product for one particular use.
Apple also targets according to brand loyalty, considering that Apple has quite a cult-like
following just due to its image/brand name.
Benefit Segmentation: Apple brings newness and innovation with each of its products.

Segmentation Targeting Positing

Apple STP
Segment The market is divided into sub groups, known as market segments, in order to create
product differentiation strategies and to exploit these segments to the firm's own use. There
are several segmentation techniques that can be used, like:
Demographic segmentation: It is when the market is segmented on the basis of age,
gender, education, income, occupation, etc.
Geographic segmentation: It is when the market is segmented on the basis of city,
P a g e | 18

state, region or country.


Psychographic segmentation: It is when the market is segmented on tha basis of
life style, Social class (Upper class, middle class, lower class, blue collar, and
white collar), behavior, opinions (liberal/conservative), values or ethics.
Apple has the ability to be judicious in its implementation of differentiating hardware
components at the display, phone, camera and video capture level. Focus is purely on
providing stylish and smart touch phones.
Target Group After the market has been separated into its segments, the marketer will select a segment or
series of segments to target at, and then resources and efforts will be targeted at the segment.
Apple uses the second approach of being one supplier that is targeting many segments.
Apple mainly targets people, as it focuses on users and lets them decide how and where
theyll use their products. Example: Urban young from middle and upper class
Positioning Positioning is the third and final part of the STP process. Positioning is one of the simplest
and one of the most useful tools for marketers. After segmenting a market and then targeting
a consumer, you would proceed to position a product within that market. Positioning is all
about the 'perception', and it may differ from one person to another. E.g. What you perceive
as quality, value for money, etc, maybe different to another person's perception about it.
Apple is positioned as a premium brand in the mind of the customers that demands and
earns a price premium. Apple's has positioned them to target a less price sensitive customer,
thus which has created a culture and a set of activities through which Apple differentiates
itself from competitors to meet the needs of their targeted customers.

7.4 APPLE BRAND AWARENESS


Brand awareness plays a huge role in the consumer decision making process. Having friends or family
that can give a positive review of a certain product, or a true awareness of the product through
advertising and other social cues, might tip the scales in favor of one brand over another.
If you have a new product, brand awareness is the main goal of any type of marketing or advertising
in the beginning stages of your product or business. It is ESSENTIAL that your brand stands out from
all of the other similar products in a competitive market.
A successful brand awareness campaign will also:
Ramp up brand loyalty
Lower the per/customer acquisition costs
Encourage repeat purchases and solidify success for your business
Apple is a master of brand awareness. Apple has strong brand awareness, it has high sales and high
market share, and the consumers are well acquainted and familiar with the brand and its products.
They are also willing to pay premium price for their products, relative to the competitor's brand due to
Apple's positive brand equity
Apple has a branding strategy that focuses on the emotions. Apple brand's 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, making
life easier for people as they have people-driven product design, and is a humanistic company with a
heartfelt connection with its customers.
Essentially a consumer of Apple products sincerely believes that Apple products are the very best on
the market. These people are the ones that wait in line for days in order to purchase the next
generation iPhone. Most of these fans are so loyal to Apple that they will not consider buying
anything else.
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Competitive responses are triggered by Apples profitability. In any event, rival platforms using
diverse models are providing alternative content choices. Rivals are adopting filtering policies of their
own, guiding usage towards approved content and imposing certain restrictions, default software
applications, and fees. The presence of competitive rivals, the relative success of Apple, and the
widespread adoption of their basic business model by entrants suggest that iPhone innovation is pro-
competitive.

7.5 SWOT ANALYSIS


OF APPLE
It is a method of is a method of analysing a business, its resources, and its environment.
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7.6 CONSUMER BEHAVIOUR

Understanding consumer behaviour is directly involved in obtaining, consuming and disposing of


products & services, including the decision process that precede & follow these actions.
Consumer behaviour is becoming more relevant than technology when it comes to understanding
future evolution in the mobile phone market. Apple makes consumers believe that their products are
what the individual needs as a necessity rather than a luxury item. It seems that they tell their target
market what they need/want rather than making them find.
Factors affecting smartphone purchase decision
Cost-Value resale potential
With budget phones being launched with high spec, consumers seek high value-low cost deals
which have good resale propositions as well.

Screen size and Performance


Consumer want smartphones that have high performance but somehow they are intrigued by
large screen sizes.

User opinions and reviews


Consumer pay a lot of attention to user reviews and opinions. The average user does a lot of
online and offline research before investing in phone.

Brand Value
Sometimes a person may buy a smartphone just to satiate his desire to be brand conscious. So
it is important for brands to strengthen their image.

Comparative Benefits
Consumers often compare the relative benefits provided by mobile devices that lie in the
same price segment. The winner is always the one with highest featurecost score.

Adoption of iPhone among Consumers

Early adopters: tech-savvy shoppers


These consumers tend to be the ones who are standing outside Best Buy in the freezing cold anxiously
awaiting the new iPhone arrival. Based on a survey I sent out randomly to various demographics,
members of this group are the first to purchase and analyze new iPhone models. Once the phone has
reached its maturity, early adopters then serve as thought leaders and enjoy expressing their new
found knowledge on social sites and blogs.
Late adopters: the trend-followers
Late adopters can most aptly be characterized by their willingness to keep up with the current social
trend. While some of these stragglers have simply waited for the phone to mature, others just want to
fit in with their friends. This group also does not use the phone to its full capacity. Most late adopters
claim they know little about the phones technological capabilities. But may look at a smartphone as a
laptop/desktop replacement and be willing to spend more money on a smartphone.
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Factors influencing consumer buying behaviour with relation to Apple

CULTURAL FACTORS

Cultural trends:
Cultural trends are defined as trends widely followed by people and which are amplified by their mere
popularity and by conformity or compliance with social pressure. The more people follow a trend, the
more others will want to follow it. They affect behaviour and shopping habits of consumers and may
be related to the release of new products or become a source of innovation for brands. By social
pressure, desire to conformity or belonging to a group, desire to follow fashion trends or simply due
to the high visibility provided by media, consumers will be influenced, consciously or unconsciously,
by these trends.
Apple has created a culture trend of its products because of its huge fan following and also because of
the brand loyalty base which it has created among its customers.

SOCIAL FACTORS

Social factors are among the factors influencing consumer behaviour significantly. They fall into three
categories: reference groups, family and social roles and status.

Reference groups and membership groups:


The membership groups of an individual are social groups to which he belongs and which will
influence him. The membership groups are usually related to its social origin, age, place of residence,
work, hobbies, leisure, etc. The influence level may vary depending on individuals and groups. But is
generally observed common consumption trends among the members of a same group.
Apple has understood this very well and communicate, implicitly or not, on the social benefit
provided by their products.
Social roles and status:
The position of an individual within his family, his work, his country club, his group of friends, etc.
All this can be defined in terms of role and social status. The social role and status profoundly
influences the consumer behaviour and his purchasing decisions. Especially for all the visible
products from other people.
Apple had understood it by creating an image associated with their products reflecting an important
social role or status.

PERSONAL FACTORS

Age and way of life:


The family life cycle of the individual will also have an influence on his values, lifestyles and buying
behaviour depending whether hes single, in a relationship, in a relationship with kids, etc.
Our study shows that most of the people who buy iPhone belong to the age group of 12 to 25. The
college going crowd is more inclined to buy an iPhone who are mostly single.
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Purchasing power and revenue:


The purchasing power has a decisive influence on his behaviour. This affects what he can afford, his
perspective on money and the level of importance of price in his purchasing decisions. But it also
plays a role in the kind of retailers where he goes or the kind of brands he buys.
iPhone has a higher premium price as compared to its competitors. Hence, people with a relatively
higher income will buy an iPhone. This purchasing power also goes in consent with the sample
conclusion that most of them buy from an apple store.

Lifestyle:
The lifestyle of an individual includes all of its activities, interests, values and opinions. The lifestyle
of a consumer will influence on his behaviour and purchasing decisions.
Apple delivers exceptional customer experience through superb user interfaces. With its touch screen
"gestures", iCloud, iTunes, and the Apps, Apple matches the modern lifestyle of the people which
largely affects the consumer buying behaviour.

Personality and self-concept:


Personality is the set of traits and specific characteristics of each individual. It is the product of the
interaction of psychological and physiological characteristics of the individual and results in constant
behaviours. It materializes into some traits such as confidence, sociability, autonomy, charisma,
ambition, openness to others, shyness, curiosity and adaptability. While the self-concept is the image
that the individual has or would like to have of him and he conveys to his entourage. These two
concepts greatly influence the individual in his choices and his way of being in everyday life. And
therefore also his shopping behaviour and purchasing habits as consumer.

Apple cultivates an image of innovation, creativity, boldness and singularity which is able to attract
consumers who identify to these values and who feel valued in their self-concept by buying a
product from Apple. Because consumers do not just buy products based on their needs or for their
intrinsic features but they are also looking for products that are consistent and reinforce the image
they have of themselves or they would like to have. Apple conveys a positive and favourable self-
image to the consumer, hence it is appreciated and regularly purchased.

Apple has a branding strategy that focuses on the emotions. The starting point is how an Apple
product experience makes you feel. The Apple brand personality is about lifestyle, imagination,
liberty regained, innovation, passion and power-to-the-people through technology. The Apple brand
personality is also about simplicity and the removal of complexity from people's lives, people-driven
product design and about being a really humanistic company with a heartfelt connection with its
customers.

PSYCHOLOGICAL FACTORS

Among the factors influencing consumer behaviour, psychological factors can be divided into 4
categories: motivation, perception, learning as well as beliefs and attitudes.

Motivation:
Motivation is what will drive consumers to develop a purchasing behaviour. It is the expression of a
need is which became pressing enough to lead the consumer to want to satisfy it. It is usually working
at a subconscious level and is often difficult to measure. Motivation is directly related to the need and
P a g e | 25

is expressed in the same type of classification as defined in the stages of the consumer buying
decision process.
Smartphones in todays world are not only a luxury but they have become more of a need. Apple not
only differentiated itself but also it became the need of Customers which is evident from the count of
model of phone people own. This need is reinforced in the consumers mind which then becomes a
purchase motivation.

Perception:
Perception is the process through which an individual selects, organizes and interprets the information
he receives in order to do something that makes sense. The perception of a situation at a given time
may decide if and how the person will act. Depending to his experiences, beliefs and personal
characteristics, an individual will have a different perception from another.

Consumers remember the benefits of a brand and forget the drawbacks or competing products
advantages. Sample analysis show that most of the people are satisfied with the product quality,
service and usage. Due to Selective Attention, Selective Retention and Selective distortion people tend
to perceive Apple products of premium quality due to the above mentioned advantages.
If its not an iPhone, its not an iPhone campaign makes consumers perceive iPhone as an exclusive
product as they have differentiated their product from rest of the market in terms of superiority.

Learning:
Learning is through action. When we act, we learn. It implies a change in the behaviour resulting from
the experience. The learning changes the behaviour of an individual as he acquires information and
experience. If one had a good experience with the product, he will have much more desire to buy it
again next time.

Because of product quality, brand reputation and being user friendly, Apples iPhone provides the user
with a good experience which in turn motivates the user to buy a newer version again next time.
Hence, by learning from a good past experience, the customer will have a much more desire to buy
the product again. As Apple has an expertise in providing good experience to most of its customers,
learning very well plays an important role in buying behaviour of consumers for iPhone.

Beliefs and attitudes:


A belief is a conviction that an individual has on something. Through the experience he acquires, his
learning and his external influences, he will develop beliefs that will influence his buying behaviour.
While an attitude can be defined as a feeling, an assessment of an object or idea and the predisposition
to act in a certain way toward that object. Attitudes allow the individual to develop a coherent
behaviour against a class of similar objects or ideas. Beliefs as well as attitudes are generally well-
anchored in the individuals mind and are difficult to change. For many people, their beliefs and
attitudes are part of their personality and of who they are. The influence of advertising can directly
affect consumer brand attitudes and beliefs.

Apple fans see the company's products in much the same way as religious people perceive their sacred
icons. Apple fandom has become like a religious belief. Apple has found out a way to harness, or
exploit, the brain areas that have evolved to process religion.
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8. METHODOLOGY

8.1 RESEARCH METHOD

The research methods used for the research is Survey Method


This approach is best suited for gathering detailed information. Survey research is very flexible by
obtaining many different kinds of information in many different situations. A survey questionnaire is
used to collect data due to its flexible property of providing different kinds of data

8.2 TYPES OF DATA

Primary data
The first hand obtained data for any issues or specific information collected directly through thorough
observation and research (Kotler, Armstrong, Ang, Leong, Tan, Tse, (2005)
Survey research is the most widely used method to collect primary data; this approach is best
suited for gathering detailed information.
We select target groups for asking questions about their knowledge, attitudes, preferences and
behaviour In order to gather information regarding the marketing strategy of branding in
Apple. Survey questionnaire will be used to collect data due to its flexible property of
providing different kinds of data and uses this data in order to draw conclusions.

Secondary data
The second hand data obtained by the use of secondary sources such as articles, books, journals,
internet, etc. (Kotler, Armstrong, Ang, Leong, Tan, Tse, (2005)

The secondary data is collected via the use of internet (websites, articles and journals) and
books mainly online websites, published articles or journals the data was collected from.
The secondary data is readily available nature and it helps to support primary data, making it
more specific as it helps a great deal to get a clearer view of Apple's segmentation, targeting,
positioning and marketing strategies, along with SWOT analysis model

8.3 TARGET POPULATION


We have aimed at population that consists of working people and students belonging of both sex.

8.4 SAMPLE SIZE


The sample size chosen for this research consist of 150 people

8.5 DATA COLLECTION METHOD


The data collection method used for gathering data for the research is a questionnaire form. A
questionnaire in a web based form is being used, containing of all close ended questions is also being
used.
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9. FINDINGS AND RESPONSE ANALYSIS

Pricing analysis:

The above graphs depict that Apples iPhone has a higher premium price as compared to the
competitors. This is evident from the findings as 81.7% of sample size, responded in favour of higher
premium price. Approximately half of the sample size is moderately satisfied with its premium price
and the other half is not. Even according to the Likert scale, iPhone is rated moderately in terms of its
pricing. This price shows that Apple have made their entire product range exclusive. Apples vision
was always to create a premier product and charge a premium price. Apples cheapest products are
usually priced in the mid-range but they ensure a high-quality user experience with their features. The
hardware and user interface are designed to provide a lot of value for the price.
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The above graph tells us that the customers pay for the higher premium price of the product majorly
because of its high-quality, product feature, corporate reputation and design innovation.

Mode of purchase and payment:

The above graph depicts that most preferred mode of payment is cash. This is evident from the
findings as 36.9% of sample size responded, stating that they prefer paying in cash. For about 23.3%
of people prefer payment through debit cards whereas 16.5% pay using credit cards. Similarly, 21.4%
of the people use EMI mode of payment as it lets them to pay in instalments. Only 1.9% of people pay
through loans while purchasing an iPhone.
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The graph depicts that iPhones are largely


purchased from Apple stores. There are
for about 1/4th of the sample size that
prefers to buy iPhones from an authorized
dealer store whereas only a few people
opt for buying iPhones from retail stores.
With increase in ecommerce people have
started purchasing smartphones online.
Therefore one can see a decent amount of
people purchasing iPhones online.

Communication:

It shows that information about the iPhone travels to audiences through various transmission methods.
Out of all the methods used, Internet proves to be the most dominant transmission method which
comprises 41.7% of the sample size. Word of Mouth has been recognised as one of the effective forms
of promotion for Apple iPhone because of its honesty and this is evident from the sample size as 33%
heard about the product from their relatives and friends .
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Demographic variables:

The graph depicts that:

66% of the respondent are males


34% of the respondents are female

The graph depicts that maximum


respondents are graduates i.e. 47.6%.
38.8% of the respondents are post
graduates. Respondents that are
professionals are only 8.7%. Whereas only
4.9% of the respondents are pass outs
from high school.

This graph depicts that majority of the


respondents belong to the age group of
12-25 years i.e. 68% whereas 20.4% of
the respondents belong to the age group
of 26-39 years. Only 8.7% of respondents
are from the age group of 40-55 years
and only 2.9% of the respondents belong
to the age group of 56 years and above.
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This graph depicts that:

Maximum respondents are students


There are almost equal respondents who are professionals and those in services
There are relatively lesser respondents who have businesses
Only a mere proportion of respondents are homemakers

Ownership and preference:

The graph depicts that maximum respondents have iPhone 5S. There are almost same number of
respondents who own an iPhone 5 or iPhone 5C or iPhone 4S. There are relatively higher number of
respondents who own iPhone 6 than those who own iPhone 4S or iPhone 5C or iPhone 5. There are
the least number of respondents who own an iPhone 6 plus.
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The graph depicts that:

56.3% of the respondents prefer iPhone

43.7% of the respondents prefer android phone

This shows that people prefer iPhone more than android phones though the margin is not very huge.

This graph depicts that:

53.4% of the respondents have purchased iPhones

46.6% have not purchased an iPhone


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Consumer buying factors:

The graphs depict that:

61.2% of sample size desire to purchase an iPhone


93.2% of sample size think that brand name affects the consumer buying behaviour
Factors which attract people to buy an iPhone are being User-Friendly, product
quality and brand reputation. Corporate reputation also provides Apple an edge over
its competitors
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The responses show that the Apple products are more popular than competitors mainly because of the
quality and design of the product and corporate reputation. Hence, these factors motivate the
customers to buy Apple products rather than the products of their competitors. The brand name of
Apple is an important attraction for its customers.

10. CONCLUSION AND RECOMMENDATIONS


10.1 CONCLUSION
The main aim of the study was to conduct a study onApples iPhone as a premium product in
smartphone industry in India by analysing its growth, market share, competitors, customers
perception, opportunities/threats, status in the companys brand portfolio and strategies for future
growth. The study helped us to find out more about the segmentation, targeting, positioning, branding
strategies, consumer behaviour and marketing mix strategies. Furthermore, a SWOT analysis was
done to recognize the strengths and weaknesses of Apple iPhone along with the opportunities and
threats that the company may be facing. The analysis helped us in identifying the success factors that
will help the company in gaining a competitive edge; allowing it to increase profit, brand power and
customer loyalty proving it to be a well-known, leading and a successful company in the saturated
smartphone industry. Survey findings were made to find if the marketing strategies of branding are
proving to be effective or if any changes are needed to be made in the future. The literature review
and the descriptive survey research consisting of primary data both helped in fulfilling the objectives
of the study by recognizing the problems that Apple iPhone maybe facing in order to improve or
eliminate those problems. The study shows that Apple's strength lies in its experience and expertise in
integrating hardware, software, services and third-party applications into differentiated devices that
allow Apple to capture a premium on hardware sales. Apple is the world's most trusted consumer
technology firm in terms of delivering flawlessly working products in existing, and even new, product
categories. Although Apple has a sterling brand, strong product pipeline, and ample opportunity to
gain share in its various end markets, short product life cycles and intense competition prevents the
firm from resting on its laurels. Technological inferiority can supersede years of brand equity at any
given time. Smartphone competition stems from software and services, as were seeing less and less
meaningful hardware differentiation (screen size and quality, etc.). Apple is well positioned to develop
and expand enough services to enhance the user experience that will help the firm retain customers
and generate significant repeat purchases which will be critical for future iPhone growth in the years
ahead.
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10.2 RECOMMENTATIONS

In order to succeed in the mission Apple just as others has resources that they must rely on. To
continue to be creative. Following recommendations has been put forward by the group.

Provide value for the products offered


If a perception is created that Apple iPhone is offering its customers with fine products with
premium quality in the industry, which is not being offered by others; than Apple IPhone
should be able to differentiate themselves from their competitors in order to still keep
premium pricing for their products. Apple should continue positioning iPhone into critical
aspects of our lives (home, health, car, finance) using HomeKit, HealthKit, CarPlay, and
Apple Pay. Such efforts are not only to prevent Android from establishing major positions in
key parts of our daily lives, but also to increase the iPhone's value proposition.
Conduct more aggressive promotion
Increasing promotional programs never proves to be damaging for any firm, but only proves
to be beneficial, it not only helps to attract potential customers, but also new customers
boosting customer traffic and sales. Apple should also start creating 'TV commercials', in such
a way that educate the customers about the latest technological product, making it seem more
appealing. Also, they should start focusing on advertising all products not only new products
in order to meet the sales target for all products.
Make maximum innovations
Technology market is a highly competitive market, its very easy for competitors to clone
your products and sell as new products by making small innovations. Therefore, it has
become very important to keep making constant innovations in design, features and
specifications in order to differentiate your product from competitive brands and to be able to
dominate the market.
Offer price reduction offers from time to time
Instead of not charging premium, price reductions, free gifts, vouchers, VIP cards, etc. can be
made for a limited period of time, to allow customers to buy from Apple iPhone more often.
Thus, this may help Apple to attract new target group customers increasing its fan base, along
with sky rocketing its brand loyalty and sales.
Open more Apple outlets in different areas
Since Apple relies on online, direct and retail distribution methods, its important for Apple to
expand its direct reach through its own stores and retail stores by locating stores in a more
reachable district, like residential areas so that people can have an easy access to the stores.
Selling older model at lower price
Apple should continue bringing down the entry-level price of older iPhone models. Such a
pricing strategy will help maintain iPhone momentum as Apple focuses on grabbing as much
profit share as possible at each price level before moving further down market.
Loyalty Strategy
Apple's has a big opportunity to reach more customer by expanding distribution thereby focus
on gaining new customers and maintaining prevailing customer loyalty. If proportion of Apple
loyal customers increases then this could convert existing android users to use iPhone through
word of mouth.
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10.3 LIMITATIONS

A sample of 150 respondents was used due to time restrictions a large sample should have been taken
in order to minimize response errors.

In the web based form of questionnaire, there may be a chance error due to lack of
understanding of few respondents thereby resulting in few guessed answers may have
resulted due to lack of personal contact with the respondents.
Forms were distributed but fewer responses were generated due to many not filling it.
Some respondents may not have used Apple's products/services but may have filled up the
survey just for the sake of filling it.
Due to time constraints, simple random, convenience and judgment sampling methods were
used for the survey.
Uneven gender distribution due to more convenience of men available and willing to answer
the questionnaire.

11. REFERENCES
Chapman, R., & Haskisson, R. e. (n.d.). Case 14: Apple computer Inc.

Kenney, M. (2011). Structuring the Smartphone Industry: Is the Mobile Internet OS Platform the Key ?

Washington Post Economy. (2012). Retrieved from Washington Post:


http://www.washingtonpost.com/business/economy/apple-a-history-of-one-of-the-worlds-most-
valuable-companies/2012/02/29/gIQA1VFVmR_gallery.html

Shupel Tsai, (2008) "Corporate marketing management and corporateidentity building", Marketing
Intelligence & Planning, Vol. 26 Iss: 6, pp.621 - 633

Investor Relation: Apple.com. (n.d.). Retrieved from http://investor.apple.com/faq.cfm?


FaqSetID=6

http://seekingalpha.com/article/1140311-global-smartphone-trends-leave-little-room-for-
rim

Gallagher, D. (2012, Oct 5). http://stream.marketwatch.com/story/markets. Retrieved


from www.marketwatch.com: http://stream.marketwatch.com/story/markets/SS-4-
4/SS-4-13545/

Apple Support. (n.d.). Retrieved from Apple.com: http://support.apple.com/kb/he44

Apple Inc.2015.About (online)Available at [http://www.apple.com/about

The Innovative Success that is Apple, Inc. Katherine Johnson, Yang Li Hang, Phan Jason
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Automatic Effects of Brand Exposure on Motivated Behavior: How Apple Makes You Think
Different grainne m. Fitzsimons Tanya l. Chartrand Gavan j. Fitzsimons
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Apple's iPhone Launch: A Case Study in Effective Marketing Kyle Mickalowski, Augustana
College Mark Mickelson, Augustana College Jaciel Keltgen, Augustana College

https://www.scribd.com/doc/56666238/Consumer-Behaviour-towards-Apple

http://www.slideshare.net/ShivamShah3/apple-company-market-research-project-mkt305

http://www.ibtimes.com/once-tough-market-apple-inc-indians-show-growing-taste-
iphones-1796326

http://www.idc.com/prodserv/smartphone-os-market-share.jsp

http://www.aboveavalon.com/notes/2015/2/11/apples-strategy-for-growing-iphone-sales-
by-50-in-three-years

http://marketrealist.com/2014/02/apples-premium-pricing-strategy-product-
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http://www.business2community.com/marketing/apples-iphone-marketing-strategy-
exposed-0661613

http://marketingmixx.com/marketing-plan-2/203-marketing-plan-of-apple.html

http://www.forbes.com/sites/gordonkelly/2014/07/25/iphone-6-sapphire-display-
everything-you-need-to-know/

http://www.forbes.com/sites/jaysondemers/2014/07/08/heres-the-simple-secret-to-apples-
marketing-success/

Marketing Management 14 th edition, Philip Kotler, Keller, Koshy, Jha Published by


Pearson Education (Singapore) Pte. Ltd.
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12. ANNEXURE

12.1 QUESTIONNAIRE

Design

The questionnaire mainly consisted of all close ended questions to find the responses suiting the
respondents from the given choices in order to find the exact information required and to minimize
the time required to fill in the survey, with two rating scale question with rating ranging from (1 to
5), in order to collect quantitative data associated with the research along with qualitative, also
rating scales helps to find the respondents perceptions related to the questions asked.

What is your Gender?

o Male

o Female

o Others

What is your Age Group?

o 12 -25

o 25-39

o 40-55

o 56 and Above

What is your Occupation?

o Student

o Business

o Home maker

o Service
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o Professional

What is your Educational Qualification?

o High school

o Graduate

o Post graduate

o Professional
Which of the following brands do you own?

o Apple

o Samsung

o Nokia

o Micromax

o HTC

o Lenovo

o Xiaomi

o Sony

o LG

o Motorola

o Other

Do you prefer an Android or an iPhone?

o Android

o iPhone

How often do you change your phone?

o Once in 6 months

o Once in a 1 year

o Between 1 -2 years
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o After 2 years

Does the Brand name affect the consumer buying behavior?

o Yes
o No

What are the factors that motivates you to purchase a smartphone ( Choose multiple options)?

o Brand
o Price
o Performance
o Quality
o Design
o Operating Platform/ System
o Value
o Reputation
o Services

Have you purchased the iPhone from Apple Inc?

o Yes

o No

Which model of iPhone do you have?

o iphone 4
o iphone 4S
o iphone 5
o iphone 5S
o iphone6
o iphone 6Plus
o iphone 5c
o iphone 3gs
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o None

How would you rate the iphone in terms of product quality? (1 being the lowest, 5 being the
highest)

o 1

o 2

o 3

o 4

o 5

How would you rate the iphone in terms of satisfaction?

o Very Dissatisfied Dissatisfied Fair Satisfied Very Satisfied

Are you satisfied with the pricing of iPhone? (1 being the lowest, 5 being the highest)

o 1
o 2
o 3
o 4
o 5

Why you pay for the iPhones premium price?

o Product feature

o Design innovation

o Availability of software and peripherals

o Corporate reputation

o High-quality
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o After-sales support

What is the mode of payment?

o EMI
o Credit card
o Debit card
o Cash
o Loan

What is your preferred mode of purchase?


o Online
o Apple store
o Authorized dealer
o Retail stores

How does the price of Apples products compare with others in the industry?

o Higher premium price

o Similar premium price

o Lower premium price

Do you think that the pricing of the Apple iPhone is justified?

o Yes
o No

Where did you hear about Apples product?


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o Internet

o Magazine or Newspaper

o Advertisement on TV

o Apple store

o From relatives or friends

Which part of the product attracts you?

o Fashionable appearance design

o User-friendly

o Product quality

o Product integration

o After-sales service

o Cost-performance ratio high

o Brand reputation

Why do you think Apple's products are more popular than competitors?

o High security

o After-sales service

o Marketing and sales

o Corporate reputation

o Quality and design of product

Will you purchase an iPhone in the future?

o Yes

o No

o Maybe

Which sentence would you see describes Apples products?


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o Stand for corporate culture

o Innovative brand leader in fashion

o The king of the touch technology

o Aspirational and luxurious brand

Are you satisfied with the availability of the product (iPhone)?

o Yes
o No

12.2 APPLES ANNUAL REPORT 2014 KEY HIGHLIGHTS

Apple's annual report, which is mostly targeted at investors and regulators, contains a number of other
details about the company's operations. The report also provides an analysis of current product lines
and addresses topics like executive compensation, investments, taxes, and more.

The iTunes Store generated a total of $10.2 billion in net sales during 2014, up from $9.3
billion in 2013. Apple credits the growth to an increase in revenue from app sales, but
acknowledged that digital music sales were in decline and partially offset the growth.

Apple noted that it now has 92,600 full-time equivalent employees, up from 80,300 at the end
of fiscal 2013. The majority of that growth was outside of the company's retail division,
which grew by 3,400 to 46,200 full-time equivalent employees.
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Apple's store count increased by 21 during fiscal 2014, with average revenue per store
increasing slightly to $50.6 million from $50.2 million in 2013. As noted during its earnings
conference call last week, Apple expects to open 25 new retail stores in fiscal 2015 with most
of those stores being outside of the United States. Apple is also planning to remodel five of its
existing stores.

Apple spent a total of $6.0 billion on research and development in fiscal 2014, up
significantly from the $4.5 billion spent last year. That amount contributed towards the
company's efforts to develop new technologies to enhance existing products and to expand the
range of its product offerings. Apple's $6.0 billion investment is the highest level relative to
revenues since 2007, which is the year that the iPhone was released.

Real estate holdings increased slightly, with Apple now owning or leasing 19.7 million square
feet of building space, up from 19.1 million square feet at the end of 2013. Apple says that
most of the building space is in the United States, and is expanding its existing office space
and customer support call center in Austin, Texas. Work also continues on the company's new
campus in Cupertino, which is once again said to contain an estimated 3.6 million square feet
of space.

Apple is expecting its capital expenditures to rise to $13.0 billion in 2015, up from the $11.0
billion spent in 2014. $600 million of that amount will be allocated towards retail store
facilities, while $12.4 billion will be used for other expenditures including manufacturing
process equipment,data,centers.

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