Ch 5 Kotler Apple

Value Proposition
A value proposition is a statement summarizing the customer segment, competitor targets and the core differentiation of a company’s product from the offerings of existing competitors. A company's market contribution usually extends further than the core product, to include services, programs and systems essentials. Value Propositions translate those market offerings into a proclamation of the combined benefits a customer will gain.

There are essentially 3 elements to Apple’s value proposition. They are: 1. To own the software and the hardware; controlling the experience from beginning to end 2. To make usage very easy and intuitive 3. To present the the hardware, simply, and elegantly.

How did Apple gain customer satisfaction and maintain customer loyalty?
When customers sleep outside the apple stores just to be one of the first to buy an iPhone, it's very clear that Apple Inc. is a company that enjoys passionate brand loyalty, and this brand success is part of a well-thought-out plan to deliver strong and unique products, and to create an Apple culture. Apple made a revolutionary launch of its tablet, the iPad. In barely 3 months, more than three million iPads were sold. Apple’s marketing strategy has been exclusively unique; the company is constantly gaining competitive advantage in the digital market; translated in terms of customer loyalty.(Thompson, Gamble, & Strickland, 2007)

How Apple gains customer satisfaction
Products That Deliver: Apple carefully considers what consumers are looking for, so its products are a result of research and strong design. This thorough planning is a large contributor to Apple's high customer-satisfaction rates.

Continuous Innovation Apple sells customers what they didn't know they need. A lot of times, people don't know what they want until you show them. Moreover, human preferences are always changing. Introducing new products helps attract new customers and satisfy the already existing loyal ones constantly.

A Store Just for Apple: Apple created a store strictly devoted to Apple products; hence it was able to set its very different products apart from the others, and has made an excellent customer-loyalty move. Apple stores are a friendly place where Mac and PC users are encouraged to explore the technology that the company offers, hence encouraging current and new customers to get excited about what it has to offer.

Attractiveness: From packaging to aesthetic design to user-interface experience, Apple makes its products attractive and accessible. Bright colors, a smiling icon etc. are things that always remind customers every time they use Apple products that this company’s offering is appealing.

Lower entry cost products Much of Apple’s consumers may not be ready to buy Apple computers, but are in fact willing to buy gadgets such as iPods, iPhone and iPads. Thus, Apple’s strategy of offering options that have lower entry costs opens up new opportunities for novel users to be introduced gradually to Apple products

Small and light products Apple keenly focuses on products design and innovation; before developing a product’s packaging it takes into consideration what consumers really want; its products are well researched and carefully designed. This type of careful planning significantly contributes to the company’s high customer-satisfaction rates.(Howe, 2007).

Education Sales: By selling its products to schools and universities, classrooms are turned into showrooms. If students go through school using Apple products, they become comfortable with the interface and the unique performance the brand offers. This early exposure captures customers before they even know they are ones.

Apple retail store customer service the apple retail store is one of the most profitable store present. The soul of apple is its people; how they are hired trained and motivated, and taught to communicate with customers to create magical experiences. All employees know the steps of service as the acronym APPLE:

Approach customers with a personalized, warm welcome.
Probe politely to understand all the customer’s needs.
Present a solution for the customer to take home today.
Listen for and resolve any issues or concerns.

Apple’s effective strategies used in the gaining of customer loyalty

Strong Brand Apple’s strong brand guarantees return customers. It is more costly to attract new customers than it is to keep existing ones. Apple’s positive brand perception has significantly contributed to increased sales. The obvious reason to Apple’s customer loyalty lies in their attention to detail in every feature of the product’s design and development, keeping the customer in perspective at every stage of design, and each particular product is customized to make it as user friendly as possible.
Consumers want something that is well designed and easy-to-use. Apple’s products such as iPods have excellent designs with modern technology such as optical pads and digital surround ear phones making them very attractive to customers. The iPad on the other hand runs on Apple’s iPhone OS and has a built in browser. The tablet is very easy to use with touch screen technology; permitting easy and quick opening and closing of applications. The iPad’s neatness resulted from streamlining and debugging of iPhone OS and the iPod touch technologies; one of the biggest advantages that Apple has over its competitors.

Product integrations Most of Apple’s products connect and/or work with each other. Apple's products complement and complete each other in its “digital hub” strategy. The Company offers various third-party software applications and hardware accessories for Mac® computers, iPods and iPhones through its retail and online stores, as well as software applications for the iPhone platform through its iTunes App Store.. For example, buying an iPod, customers can download music via iTunes. Apple's consumers don't need to look to other competitors for a product they want. iTunes store and App store also help retain Apple's customers, hence strengthening customer loyalty. The Company’s strategy also includes expanding its distribution network to effectively reach more of its targeted customers and provide them with a high-quality sales and post-sales support experience

Apple store The Apple store staff isn’t focused on selling stuff, rather on building relationships and making people’s lives better. Apple’s one to one training was a program built to create a customer for life, because it was designed based on the premise that the more the customer understands the product the more he is going to enjoy it, and the more likely a long term relationship is built with the brand.

Consistency Generally, Apple’s products have a uniform structural design. Hence, customers who already own one of their products have a clear perspective of what they will be expecting in advance. This makes consumers more willing to make repeated purchases.

Innovation Apple offers consumers with a variety of ways to enjoy their products. Thus, by simply giving consumers an opportunity to have Apple in their living rooms, pockets and offices, it is turning them into loyal customers to its brand . When Apple launches a new product, consumers are always excited to discover it. Apple gets a competitive advantage from its innovation and sustains this advantage by constantly producing innovative products such as iPhone, iPhone3G, iPhone3GS and iPad; this constant effective product innovation creates customer's loyalty .

Stylish offerings Apple takes into consideration what consumers really want; strong and easy-to-use gadgets not only satisfy customers, but also increase their loyalty, making them want to purchase more products from the company in the future.

Varied Products: Many consumers may not be ready to buy an Apple computer, but they're willing to give gadgets like the iPod or iPhone a try. If these users enjoy their gadgets, they're more likely to consider buying an Apple computer in the future.

Products That Deliver: It's plain and simple: Robust and easy-to-use products not only make customers happy, but also make them want to buy more products from the same brand in the future.

Club membership programs can be open to everyone who purchases a product or service, or limited to an affinity group or those willing to pay a small fee. These clubs attract and keep those customers who are responsible for the largest portion of business. Apple has a highly successful club.

Apple-user groups Apple encourages owners of its computers to form local Apple-user groups. By 2009, there were over 700, ranging in size from fewer than 30 members to over 1,000. The groups provide Apple owners with opportunities to learn more about their computers, share ideas, and get product discounts. They also sponsor special activities and events and perform community service.

Conclusion
While all other brands are focusing on features and numbers, like GHz, cores number, etc., Apple has always kept its focus on making something that just works and solves the customer’s problems with the least amount of hassle.
As Steve Jobs said, their main mantra is beginning with customer experience and then working back to the technology. He once explained how the essence of the company should be something greater than making boxes that solve people's problems, and how the spirit of the company is honoring great people who think differently.