Delivering Value through the Marketing Mix (4Ps)
In January 2010, Apple Inc. introduced the iPad, a multi-purpose portable gadget for reading and sending email, viewing photos, browsing the web, watching videos, playing games, listen to music, reading e-books, and among other functionalities (Apple, 2011). This product was developed using Apple’s Multi-Touch technology that uses a simple interactive interface to enable customers to connect with their applications and content. With the iPad, customers are capable of accessing the iTunes Store whereby they can download video and audio files, in addition to thousands of other varieties of digital content and applications. Other than the accessories available to Apple from the Apple Application stores, there are hundreds of thousands of other third party compatible applications that can be used on the iPad. These applications are available from Apple stores, online retail stores, and other third party sources. Currently, the iPad Brand is doing well in the market and it is arguably the leading tablet now. There are two products in the iPad family-iPad 1 and iPad 2. Mostly likely, the iPad 3 will soon hit the market by the end of this year or beginning early next year. Undoubtedly, customers can easily replace their laptops and personal computers with the iPad given that it performs similar functionalities with equal if not more speed and capabilities.
Company overview
Apple Inc. and its wholly-owned subsidiaries engages in the design, manufacture, and marketing of a range of personal computers, consumer electronic products such as mobile communication and media devices, and portable digital music players (Apple,. 2011). Apple Inc. also sells a range of networking solutions, peripherals, and third party digital content and applications. Other than distributing products through the iTunes store, Apple distributes products worldwide through its retail stores, direct sales force, value-added resellers, wholesalers, and third-party network carriers. Apple’s business strategy entails commitment aimed at delivering the best user experience to customers through the delivery of innovative software, hardware, peripherals, and internet offerings (Apple 2011). This business strategy is unique in the sense that it leverages the company’s unique ability to develop and design the company’s own operating system, application software, hardware, and other services that are designed to deliver new products and solutions to customers.
Most of products and solutions from the company are easy to use, offer seamless integration, and come with innovative designs. Continuous research and development has been critical in enabling the company to develop itself and enhance its capacity of innovating and delivering leading products and technologies. Delivering customer value has been a leading priority for the company and therefore, the company’s business strategy has largely revolved around the expansion and distribution of services to cater for the needs of more customers and supply them with high-quality sales and post-sales support experience. As such, Apple has managed to position itself uniquely in the market by offering superior, high quality, and well-integrated digital lifestyle and productivity solutions.
Marketing Mix (4Ps) and Customer Value
The process of delivering a product into the market calls for the need to understand the concept of product management. Product management entails understanding the factors that creates point of difference for the product, how the product will be differentiated, and as the entire life cycle of the product. For this reason, it becomes possible to focus on the process of creating value to the customer and sustaining the value of the product through the entire product life cycle. For Apple, the management of the product begun from the time the idea of developing a tablet was conceived. The development of the iPad 2 was fueled by the need to satisfy the ever-changing needs and preferences of customers with respect to gadget for reading and sending emails, viewing photos, browsing the web, watching videos, playing games, listen to music, reading e-books, and among other functionalities (Apple,. 2011). The product development stage ended with the development of a comprehensive marketing approach and revelation of the detailed marketing mix elements of the product.
Value was the most essential factor throughout the development process of the iPad because all development processes were implemented and executed while having in mind the range of value and extent of uniqueness that the product was going to deliver to the market. Simply put the process of differentiating the iPad and equipping fitting it all innovative features and the process of creating value largely contributed to the realization of success for the iPad.
How the iPad 2 has Delivered Value through the Marketing Mix (4ps)
In order to examine the extent to which the iPad has delivered value to customers, the influence of the iPad in the four areas of the marketing mix will be examined. This entails the product strategy, the pricing strategy, promotion strategy, and the place strategy.
Product Strategy
Under the product strategy, the features, specifications, functionalities, and other factors that are responsible for giving the iPad multi-purpose capabilities will be examined. As earlier mentioned, the iPad is used for gadget for reading and sending email, viewing photos, browsing the web, watching videos, playing games, listen to music, reading e-books, and among other functionalities. Therefore, the features and specifications responsible for facilitating the will be examined as follows;
Value Proposition
Apple’s iPad is positioned as the best gadget that enables customers to experience web surfing, taking, and viewing photos, email functionalities, listening to music, reading and editing documents, authoring functionalities, and watching videos. The value proposition for the iPad is categorized into different market segments. For students, the iPad is ideal for reading e-textbooks, it is portable, affordable, and connects easily to the internet thereby offering easier access to documents. Additionally, students love to be entertained and hence, the iPad is equipped with all the essential entertainment functionalities to satisfy their needs. For businesses and businesspersons, the iPad is an essential communication and business gadget that enables them to access vital business information at the touch of a button. With its massive storage capacity, a wide range of information and documents can be stored. Its portability also acts as a convenience to these individuals because they travel a lot and hence, they can easily replace their laptops, which are quite bulky when compared to the iPad. Presentations and other conferencing functionalities can be done using the iPad. Lastly, the iPad is ideal for book lovers and kindle lovers due to its enhanced features such as e-book readers. The iPad will also add value to iPhone lovers and iPod lovers because it represents a developmental product that follows similar generation and product life cycles.
Design
The iPad is developed with the sleekest, thinnest, and well-finished design. It is amazingly thin that enhances its portability making it more convenient to customers. Additionally, the iPad is furnished with scratchproof materials thereby making its design to become durable. The reflective and shiny finish on the iPad increases its value proposition. In its marketing slogan for the design, Apple argues that the iPad is “Sleek, Light, and Fully Loaded.”
Functionalities
The Apple iPad is a multipurpose gadget that is equipped with the best functionalities. Arguably, the most important feature that drives customers to purchase the iPad is the plethora Customers in the primary market would love to own a gadget that supports the best of functionalities that the iPad is capable of delivering. It offers exceptional web and email functionalities, outstanding video coverage, document editing, and formatting abilities, e-book reading, two cameras for taking photos and conferencing, and communication functionalities. Equally important is its outstanding capabilities to support thousands of applications. With the capability to support more than 350,000 applications, Apple Inc. was not wrong when it argue that, “It’s got everything and it’s unlike anything.”
Level of Technology
Being an innovative company, Apple Inc. equipped the iPad with leading technologies that enables the iPad to stand years ahead of its generation. Undoubtedly, Apple iPad will most likely rule the tablet industry for some time given that Apple Inc. moves fast with the changing technology. Speaking of the operating system, the iPad is built with the exclusive iOS5 operating system that is developed purposely for Apple products. The iOS5 operating system is very advanced and holds more than 200 software features, provides best user interface, in addition to its rock-solid stabilities.
Brand
The Apple Brand is recognized and respected brand in the industry and majority of customers find value in purchasing Apple products. Apple has also positioned itself as the leading brand and hence, customers find Brand value by purchasing the iPad. The Brand Slogan for the iPad is ‘Revolutionary and Magical Device at an Unbelievable Price.” Brand loyalty among many customers is another essential feature that promotes value because past products such as the iPhone and iPod have generated significant success to the company. In order to capitalize on the value associated with the Apple brand, Apple creates buzz regarding products that are yet to be launched to take advantage of the time strategy. For instance, customers are already anticipating for the iPad 3 way before Apple makes any formal announcements.
Features and Specifications
According to apple.com, the iPad is “Amazingly thin and light’ making it hard to believe it is packed with so many features’. Some of the outstanding features of the iPad are iOS5 operating system with over 200 software features and future mobile technologies, iCloud feature to enable customers to synchronize their contents with other devices automatically, iTunes Store for storing music and storing other applications. Additionally, the iPad is built with two front and back cameras for FaceTime uses and HD video recording coupled with the Dual-Core A5 Chip processor for faster speed. Other outstanding features and specifications of the iPad include a10 hour battery, automatic orientation screen adjustment, fully capacitive Multi-Touch Capabilities to ease user interface capabilities, and an amazing 9.7’ inch LED screen that is suited for watching videos and music clips, enhancing web and internet browsing experience, and reading. The iPad comes in two formats Wi-Fi, and Wi-Fi and 3G-enabled gadgets.
Pricing Strategy
Pricing is among the most influential factors that determine the quantity of the product that can be sold at any point in the market, the targeted market, the types of services that must accompany the product, and the level of profits that must be generated from the sale of the product. During the development of the iPad, a number of factors were put into consideration to ensure that that the product is accepted in the market. For this reason, Apple developed positioning strategies to ensure that the necessary adjustments can be without altering the intended intentions for the iPad. This process entailed approaching the pricing issue with a lot of sensitivity. Different models of the iPad were developed with similar qualities, features, and specifications but with different storage capacities. This factor contributed to the different prices of the iPad. On the other hand, gadgets with different points of connectivity were developed to ensure that customers afforded a product of their choice. This included developed a Wi-Fi only and Wi-Fi+3G models with different prices.
The cheapest model of the iPad retailed at $499 while more advanced models will retailed for $829. The price variations can be attributed to the different memory capabilities and added functionalities such as different connectivity features. iPhone and iPod owners were also giving incentives to enable them afford the iPad due to their brand loyalties. Equally, the strategic sweet spot of the iPad was included as part of the pricing strategy because it offered customers by satisfying their needs beyond the capabilities of the competitors. The iPad was developed with more than one strategic sweet spot.
The first point of difference was the iOS5 operating system that unmatched by tablet manufacturer and the OS is exclusively used in Apple products unlike the Android platform that is open for any other company. One of the most profitable and strategic spot for the iPad model is the 32GB iPad 2. The product retails at $729 and added manufacturing costs are accumulates to $287 thereby leaving Apple with a 62 % profit margin. The value of the pricing strategy can be evidenced by the desire to provide equal opportunities to customers in all market segments to own an iPad irrespective of their income levels. Individuals in the lower income bracket can afford the cheaper models of the iPad while those in the high-income bracket can also opt to purchase the highly priced versions.
Promotion Strategy
The iPad is promoted as a device or gadget performs cell phone functionalities and as well, the functionalities that are performed by personal computers. The only difference is that the iPad performs better smartphones such as the iPhone due to its increased utilities while also having added advantages when compared to personal computers due to its portability. Additionally, the iPad is marketed as an intuitive, convenient, and versatile gadget for multitasking e.g. browsing, watching videos, taking and sharing photos, reading, and entertainment among others. In most instances, the iPad is promoted as alternative to other leading gadgets in the market such as Amazon’s Kindle and e-Book Readers such as Barnes and Noble ‘Nook’. It is also a superior and portable ‘netbook’.
Integrated communications strategy and promotion mix tools are used in promoting the iPad. Integrated Marketing Communications involves the process of combining a range of communication forms to promote the product. On the other hand, utilization of items in the promotional mix includes sales promotion, personal selling, advertising, and public relations. The company’s websites carries much of the adverts while other adverts are carried through the print media, TV commercials, emails, and billboards. These promotional aspects add value by promoting the product to the customers. Messages are clearly designed to inform the clients of the iPad, persuade them to purchase, and as well, remind those who were informed the availability of the product. Social networking sites and marketing blogs forms other places for making the product.
Place Strategy
Apple Inc. has international presence and majority of its operational activities are categorized into different geographical segments. Therefore, there is region place for accessing the product but specific places have been identified from where customers can access the product. These places include the Apple Apps stores, network carriers, Online stores and Brick and Mortar stores, and Indirect Channels. In terms of distribution, the iPad was is mainly distributed through channels such as direct sales channels that include Apple App Stores, Online stores and Brick and Mortar stores, Indirect Channels mostly in stores within stores such as Best Buy and Apple premium resellers, over time sales representatives and selected network carriers such AT&T and Verizon Wireless. The distribution strategy is managed from Apple Inc. logistic center and regional logistic centers in participating regions. By delivering the iPad to the customer, value is added.
References
Apple Inc. 2011. The Ipad. Retrieved on 27 November 2011 from www.apple.com
