Marketing Framework Apple

Marketing Framework:
Apple Inc.
Shashank Jadhav
M.Pharm + MBA (Pharmaceutics)
Mumbai Batch
Roll No. A016
Marketing Strategy ( Minor Assignment)

MARKETING FRAMEWORK: APPLE INC.

Few days back there was buzz all around the world because of Apple’s announcement of its new smartphone. It’s the usual way of Apple to launch a new product in market. Creating hype of the product in market as soon as idea is generated and make people wait , make them discuss about product and always surprise customers with innovative features along with great quality and after sales service . This is allowing Apple Inc. to charge premium for its products. This is what Apple is doing so far and they have managed to be one of the most valuable company of world. With immense global presence and unique manufacturing strategy i.e. manufacturing in china at very cheaper rate and selling at premium resulted them to gain great revenues every year as well as to beat the competition. People all around the world are very fond of Apple’s products and they are crazy too as a result, people start queuing up in front of apple store just after announcement of new product to have it first before anyone could get it.
Through this document I have tried to understand the Marketing framework of Apple Inc. and portrayed it in few pages.
Marketing Framework includes

5 C's
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Customers
Company
Context
Collaborations
Competition

STP
• Segmentation
• Targeting
• Positioning

4P's
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Product
Price
Place
Promotion

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MARKETING FRAMEWORK: APPLE INC.

Apple Inc. is an American multinational corporation headquartered in Cupertino, California, that designs, develops, and sells consumer electronics, computer software, online services, and personal computers. Its best-known hardware products are the Mac line of computers, the iPod media player, the iPhone smartphone, and the iPad tablet computer. Its online services include iCloud, iTunes Store, and App Store. Apple's consumer software includes the OS X and iOS operating systems, the iTunes media browser, the Safari web browser, and the iLife and iWork creativity and productivity suites.
Apple was founded by Steve Jobs, Steve Wozniak, and Ronald Wayne on April 1, 1976, to develop and sell personal computers. It was incorporated as Apple Computer, Inc. on January 3, 1977, and was renamed as Apple Inc. on January 9, 2007, to reflect its shifted focus towards consumer electronics. Apple surpassed Coca-Cola to become the world's most valuable brand in the
Omnicom Group's "Best Global Brands" report.

Marketing Framework of Apple Inc.
A. 5 C’s of Marketing:
I. Customers:
It includes who are the customers and what are their likings. Apple’s customer base consists of vast demographic group, customers of apple are college going youth or working young man who likes to click pictures, listen music and play games so all kind of leisure activities, on other hand apple also has a customer group which consist of business people on higher post who always like keep up with news, make presentations, as well as reports and all other business related activities.
So apple has product range of portable as well as no portable product range which will cater this customer needs or likings. In portable devices apple has iPod, iPad, iPhone, MacBook as well as in non-portable category apple has Personal computer, and iTV .

II. Company:
It includes what are our companies strengths and weaknesses & what customer benefits we can provide. Strengths: Strengths relates to the resources and capabilities that can be used in developing a competitive advantage.
 Apple has positioned itself to be a pioneer of producing high tech and innovative products in the computer (MAC), mobile (iPhone) and electronics (iPad, iPod) industry.
 Apple has a set of standards for high quality products in order to meet customer satisfaction.  It has a strong Research and Development department which helps in creating of new efficient, innovative, compact, user friendly and feasible to use products.
 A company known for having the most brand loyal customers who buy their products for quality, regardless of the high price. Such powerful loyalty of customers means that Apple has a strong positioning of their brand and that they not only creates new customers but retains them, as they keep coming back to avail the company's products and services.
 They have a strong presence in the corporate and education segment, with a strong brand name.  Eye catching retail stores with high tech products and providing experiences of Apple's software. 2

MARKETING FRAMEWORK: APPLE INC.

Weaknesses:
 Increasing competition in the market, many similar producers of tablets, smart phones and computers, therefore it may be a difficult task of ensuring consistency and quality for its products.  Failure of notability and lack of promotion of two of their products Apple TV and Mac mini.  Decision to restrict iPhone to a single mobile operator (non jail break phones) was an issue in many countries.
 Premium pricing for all products lose a potential customer base that are price conscious.
 Very proprietary and controlling as they have their own operating system (MAC and ios), this keeps design control inside and up to standards, but it does not have a wide adaptation of its hardware, especially computers, where it has a relatively small market share.
Opportunities in terms of offering more customer benefits:
 Growing market of green and energy saving products.
 To introduce new line of products related to the same mobile, computers and electronic market but aimed at the price conscious customers.
 The use of Intel chip will allow new machines of Apple to be compatible with Windows
Operation System which can be used to develop iTunes and music player technology to be applied to a mobile phone. Apple should continue to create such opportunities through new and innovative software markets in order to strive to introduce its groundbreaking hardware into these markets.

III. Context:
This includes what are the activities that may reshape future business.
Following are some factors that will change or reshape Apple’s business
 More international expansion like Asian countries.
 Constant growth in technological products
 Good relationship through joint venture with other big brands.
 Competition in technology with other Pc industry giants like HP, Dell, Lenovo and other mobile industry like Samsung, HTC, Blackberry.
 Till today Apple is very much low in promotional activities from advertisements as well as by other means such as sponsorships but in future they might have to go for it for increasing customer base, Apple can be sponsor in sports events, Like: Cricket, Football, Olympics etc. through which they communicate the huge population of different countries, it’s a great platform to keep in touch with the customers.

IV. Collaborators:
Collaborators in marketing frameworks context includes the strengthening B2B partnerships to address customer needs. Apple has collaborated with IBM for cloud computing and iCloud. They also did co-branding with Nike, in which a person wearing Nike products and using iPod and listing music and enjoy his walk. They also collaborated to social websites and get the feedback and suggestion from customers through different blogs, it’s kind of customer relationship management through which they make relation with customer and design the product according to the customer expectation.

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MARKETING FRAMEWORK: APPLE INC.

V. Competitors:
Samsung: Samsung has managed to maintain its position among the elite in mobile technology.
Samsung products are loaded with features that are generally sought out by technology lovers;
Samsung places heavy focus on the features and specifications of their products in their commercials. Currently it is the biggest competitor of Apple in smart phones and iPad (Tablet) category. Dell: Dell has positioned itself in the market as a competitor to Apple with high affordability and is also user friendly. Dell’s marketing campaign has always been catered to families and everyone in it. Using the fact that their computers are more affordable than more expensive brands such as
Apple, Dell focuses their advertisement campaign with an economical approach. So dell is the direct competitor of apple in laptop category.
Blackberry: Blackberry marketed their brand as sophisticated and the latest and savviest technology for networking. Blackberry has the reputation of being elite and positioned high within the industry; it is only fitting that they cater to and consistently revolve their advertisements around elite business types.
Android: Samsung’s success and large market share is in fact due to the latest craze for the
Android operating system. The Android operating system is used in various different models with a few different vendors such as LG, Sony Ericsson, HTC, and Motorola. The advertisements for these models are all essentially sending out the same message as they are all trying to state their models are very advanced and on the cutting edge of technology. So it also the competitor of apple, because the other mobile companies offering handsets with android software installed.
Microsoft: Another Direct Competitor to Apple would be Microsoft and their latest operating system, Windows Phone, Tab, or PCs the Windows operating system prides itself on being quick.
The Windows phone advertisement campaign revolves around social life and activities.

B. STP Model:
I. Segmentation:
The market segmentation concept is crucial to market strategy. Apple has targeted and marketed their products to consumers with a few certain characteristics. Apple doesn’t target markets in the same way many of their competitors do, because it targets people and focuses on users, more so then the target markets alone, who then decide how and where they will use Apple's products. The segmentation strategy followed is psychographic segmentation to appealing to all consumers no matter the age, race, income level, and/or demographic.
Although Apple try to be appealing to all consumers, this is never the case for any company even
Apple. Instead, Apple typically appeal to those who are middle to high class who do not mind spending a little extra cash for the best quality in the product being purchase and those who are in the profession of media and design. Generations X and Y have been heavily expose to the internet using computers for a wide variety of reasons. Apple offers unique and innovating computer device with great quality at and reasonably affordable price. Top of the line and innovating products is what most appeal to the youth and middle age people.

II. Targeting:
It is the second stage of the STP process. 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.

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MARKETING FRAMEWORK: APPLE INC.

Apple has following targeting strategy:
Segment 1
One product for all segments

Supplier

Segment 2
Segment 3

Segment 4
Segment 5

Apple Inc. has been using the 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 they’ll use their products.

III. 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.
Apple is positioned as a premium brand in the mind of the customers that demands and earns a price premium. This price premium spans the entire Apple product lineup encompassing the
Macintosh, iPod, iPhone, software, and accessories. Therefore, 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.
By analyzing the mental map of apple it shows that what thing comes in the mind of the customer when he thinks about the Brand.

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C. 4 P’s of Marketing Mix:
I. Product:
Products are the goods and services that a business provides for sale to target the market. Apple includes different technological brands, with premium pricing strategy. All the brands are very successful in the market, especially the IPod, I phone, I pad, Mac book. Apple always focuses on innovation and new design and with the little time they launch new model in their brands to keep their brand on the top.
Following are the products of Apple:
• iphone3 G
• iphone 3GS
• iphone 4
• iphone 4S
• iphone 5
• iphone 6

• Mac air book
• Mac book pro
• Mac mini

• ipad
• ipod
• ipod nano
• iPod Shuffle
• itouch

Laptop/Pc

smartphones

ipod/ipad

others

• Mac OS
• iMac
• Apple Tv

II. Price:
Price concerns with the amount of money that customers should pay in order to purchase the company's products. Pricing strategy followed by Apple is skimming pricing strategy. Apple has never considered pricing as one of the competitive advantages. They only use their best resources to make a great final product first, and then only worry about the costs. The only buck to this trend we have seen now is with iPad. Apple’s competitors release their own tablet devices, but none of them are coming any closer to iPad’s entry price of $499 even when everything is equal in regards of the hardware and component quality. It is clearly seen that Apple is leveraging some of the supply chain advantages earned from the iPhone and iPod with regards to materials like touch screens and flash memory in order to keep iPad’s pricing down, which will prove very difficult for the major competitors to approach in the near term. The high price charged for its products also portrays the high quality of its products, for which customers are willing to pay for.

III. Promotion:
Promotion refers to the act of communicating the benefits and value of your company's product to their consumers. Apple’s commercial spots are instantly recognizable by everyone whether you are a fan of their products or not. It is easy to identify their commercials immediately because of the use of the simplistic approach of the layout of their product featured on a white background, with catchy music playing in the background. Everything in their advertisements are visual, and
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visually plentiful, but not overpowering as some ads can be. When a new product gets launched, along with the press conference, several major tech blogs and websites also take part in covering the event.. However, given the memorability of Apple’s advertisements, it seems to be more pervasive than it actually is. In addition, if there was a poster child for the powers of word-ofmouth marketing and brand loyalty, it would be Apple.

IV. Place:
Place is related to the distribution, location and methods of getting the product to the customers.
Apple has adopted a hybrid distribution channel involving an online store, physical outlets and the retail points of the exclusive mobile service provider and its online store. Apple recognized that by getting their products used by students, could influence brand preferences more in the development years of a new generation of computer users. The most dramatic 'Jobs-led' initiative involved the 4th element of marketing mix “place”, which was the opening of its now iconic Apple retail stores. Apple expanded its consumer reach by building numerous new retail outlets, owing and operating around the world in the last ten years. It has also placed their products from iPods, iPads, and iPhones in about every store that sells electronics these days. Also, from numerous retail outlets to a great e-commerce website, like Amazon, Apple's website, making their products as easy to buy for consumers as anything out there today.

References:
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http://blog.kissmetrics.com/7-strategies-apple-marketing/ http://www.saleschase.com/blog/2012/03/13/the-best-of-apples-marketing-strategies/ http://www.stephansorger.com/pdf/BrandManagement_Ch2_Equity_v1.pdf http://www.casestudy.co.in/wp-content/uploads/2009/11/Apple-Inc-CBBE-Leonard-K1.Amanna004.pdf 5. http://www.scribd.com/doc/76409727/Brand-Portfolio-Apple-Sec-2
6. http://www.marksherrington.com/downloads/Brand%20Planning%20eArticle.pdf
7. http://www.scribd.com/doc/3996140/Brand-Audit-Elements

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