Apple iPod

Agenda
Company Overview
History of Product
Strategic Issue
Situation Analysis
Strategic Response
Key Reasons for Success
Lessons Learned
 Company Overview
1976-1980 : The Early Years

 Established on
“April Fool’s”
day in 1976 by
Steve Jobs & Wozinak,
both college drop outs
 1976-1980 : The Early Years

 The Apple I went on sale in July,

1976 for $666.66.
 Apple was incorporated
on January 3, 1977.
 The Apple II hits
the market in 1977.
 Apple soars to
$1 million in 1980 and went public.
1981-1985 : Lisa & Mactintosh

 Apple faced saturated market after the

launch of IBM’s PC.
 Apple introduced Lisa
with hefty price of
$ 10,000.
 Jobs resigned from
Apple in 1985 and
founded NeXT Inc.
 Apple seeking to make big splash,
introduces the Macintosh commercial
during the Super Bowl XVIII on January
22, 1984.
 1986 – 1993 : Rise & Fall
 The period between 1989-1991 was the
“Golden Age” of Macintosh.
 Apple introduces Mac II & Apple was again
in spotlight.
 1986 – 1993 : Rise & Fall
 Apple introduce Power
Book & system 7.
 1993, Sculley was
ousted after his
pet project (Digital cameras,
Speakers & TV appliances)
 Micheal Spindler takes over the Apple’s operations.
  1994-1997 : Attempts of
Reinvention
 1994, Apple aligned with IBM, Motorola
in AIM alliance and introduced Power
Macintosh
 1995, Gilbert pushes out Splinder after
sales suffered due to parts shortage.
 Apple acquired NeXT Inc., which
reunites Apple with Steve Jobs.
  1998 : New Beginning
 Apple introduces iMAC, featured
current technology & ground breaking
design.

 Apple stunned Wall Street by earning $

45 million in first quarter of 1998.
History of Digital Audio Player
 The first mass produced DAP
was “MP Man” in 1997.
 It was branded as
“Eiger Labs
MP Man F-10” to
North American
market in 1998.
History of Digital Audio Player
 “Rio PMP300” from Diamond
Multimedia was introduced
in 1998.
History of Digital Audio Player
 In 1998 Compaq developed the first
hard drive based DAP called “PJB-100”.
 2.5” laptop HD.
 4.8 GB.
 1200 songs.
 History of iPod
First Generation

 October 2001, Apple unveiled

first generation iPod.

1.8” Hard drive

5 GB

 March 2002, Apple intoduced

10 GB model of first generation
iPod.
Second Generation

 Second Generation ipod was

introduced on
July 17, 2002.

 Touch sensitive wheel

 10 GB & 20 GB
Third Generation

 Third Generation iPod was

introduced on
April 18, 2003.

 Thinner

 10 GB,15 GB & 30GB

Timeline of iPod
 Situation
• In 2000, Steve Jobs Candy colored iMac was
leading the change for Apple’s come back, but
to further spur sales, company started
asking :

“What can we do to make people more

macintoshes ????????”
 Fork in the Road
Line Extension of iMac

Launch a new Product

 Situation Analysis
 Industry Overview

 Strides of Window platform was narrowing the

edge of Apple’s products.
 Hard disk based Music Player are too big to carry &
weighs ½ KG.
 New Music Players Let You Cram CDs With MP3
Favorite.
 Situation Analysis
 Enviroment Overview

 Companies were planning to extend the

use of its personal storage solutions
into MP3 players.
 consumer-electronics companies are
rushing out their own digital-audio
products.
 SWOT Analysis
 Strenghts
 High quality product which makes Apple
different than its competition
 Apple niche audience provides the company
with insulation from direct price competition.
Weakness
 Weak presence in business arena
 Dependency of new product launches
 SWOT Analysis
 Opportunity
 Large population Gen(X&Y) which are
extremely indivisualistic & brand
consious
 Booming MP3 player market
 Threats
 Intense Competition
 Changing technology
 SWOT Analysis
 Leverage

Apple leveraged the fact that high

quality product which is different than
its competition and targeted to Gen
(X&Y) which were extremely
individualistic and brand conscious.
 Marketing Mix
Product Price

“Apple iPod – First US $ 399.00

Generation”
Small & User friendly
Black and white
screen
5 GB Hard Drive stores
1000 songs Promotion

Place
TV Commercials
Print ads (music, sports &
Apple opened its stores in
men Magazine)
 Strategic Response
 The first commercial for iPod aired in 2001.
 Strategic Response

From 2003 to 2005, Apple ferociously

promoted iPod.

Silhouette Campaign was the most

popular
 Strategic Response
 Target Market
 Targeted at young, style conscious, &
music enthusiasts.

 Brand Position
 iPod positioned itself as the best MP3
player.
Ability to Build Brand Equity
 Identity
 iPod changed the game in the brand identity.
 iPod differentiated itself from MP3 player
 Integrity
 iPod perceived to meet customers’ expectations.
 Resonance
 iPod got connected to customer lifestyles & aspirations.
Is it a success or a failure
???

Great success for Apple

 Reasons for Success

Apple shifted the brand identity from

company context to context of
customer.

High Quality products and design make

it different from competitors.
 Lessons Learned
 Create brand equity in context of
customer.

 Focus on your core competency.

 Differentiate yourself.
Questions?