Introduction
Apple Inc. is a global company based in California, United States. The company is well-known for designing, manufacturing, and selling state-of-the-art personal computers, consumer electronic products, computer software, and cell phones in different parts of the world. It concentrates on providing its customers with the best user experience through its innovative services, software, and hardware. The company leads in innovation with iPad, iPhone, Apple Watch, and the Mac. Apple is the most valuable brand in the world. Apple Inc.’s marketing has played a considerable part in its success over the years. Consequently, the focus of the present paper is the company’s marketing campaign. In particular, the paper examines the company’s marketing strategies. It also elucidates the strengths and weaknesses of the company’s marketing as well as its marketing opportunities and threats. The paper also provides recommendations on the way the company can improve on its marketing weaknesses.
How Apple Creates Customer Value through Value-based Marketing
The key to attaining the organizational goals by any company is essentially understanding both the needs and wants of the consumers and meeting these needs and wants more efficiently and effectively compared to the business rivals. Ideally, this is what Apple Company does. According to Kerin, Hartley, and Rudelius (11), the strong competition in the contemporary faced-paced international markets has pushed numerous successful American firms to concentrate on customer value. Apple Inc. has essentially not been left behind. As a matter of fact, it endeavors to create and deliver value to its customers. It is essential to mention that this company creates customer value through applying value-based marketing strategies. The company receives high customer satisfaction rates because it cautiously considers what the customers are seeking. In fact, its different products and services are as a result of extensive research as well as robust design.
Apple Inc. designs and manufactures products that are entrenched in the wants and needs of the consumers. Apple is one of the few companies that succeeds in the product launch. Specifically, the company understands well the marketplace as well as the wants and needs of the customers. It also designs marketing strategies that are customer driven and creates an integrated marketing program, which delivers superior value. Kerin, Hartley, and Rudelius (11) maintain that the marketing program of an organization connects it with its clienteles. Indeed, Apple’s integrated marketing program helps it create profitable and robust relationships with the customers. Value-based marketing strategies have essentially helped the company succeed in generating as well as sustaining unique values, which give it a competitive edge over companies such as Microsoft and Google.
Apple Inc.’s Marketing Mix
It is important to understand. Apple Inc.’s marketing program through assessing its marketing mix. Notably, Apple’s marketing mix comprises a range of premium-priced products, which are effectively promoted and vended through various distribution channels. The company utilizes all the four elements of its marketing mix to reach its customers and satisfy their needs. As a result, this helps it succeed in expanding its business operations in the global marketplaces. Below is the analysis of each of the four Ps of Apple’s marketing mix.
Product Strategy
Apple Inc. produces a range of high-quality products. According to Danciu (10), Apple offers high-quality products that meet the real needs of the consumers and have a lasting value. In essence, the company designs all of its products after carrying out extensive research and development. The company produces portable computers such as iMac, Mac Book Pro, Mac Mini, and MacBook Air, among others. The company also produces products such as digital cameras, storage devices, and printers. Additionally, Apple is renowned for producing accessories such as Keyboard and MagicMouse. It is also renowned for Wi-Fi based stations such as Time Capsule and Airport Express. The company’s Macintosh line of laptops is one of the main reasons why it continues to be at the top of the competition. The consumers in different countries especially the United States favor these laptops due to their high-quality. Apple Inc. is also well-known for its IPod, IPhone, and IPad. The company’s IPod revolutionized the way the consumers listen to music. The company’s IPhone and IPad became hit amongst the consumers. The company is also renowned for its Apple TV and Apple Watch. The consumers recognize Apple’s products for their attention to detail as well as quality design. Without a doubt, these products give Apple a competitive advantage since they successfully satisfy the consumer needs.
Place (Distribution) Strategy
The company takes advantage of various channels of distribution in selling its different products in different parts of the world. For one, Apple sells its products through its exclusive stores called Apple Stores. In essence, these are the most visible places in which the company sells its different products. Apple Inc. also distributes its different products through online stores and direct sales force (Nielson, N.p). Specifically, the company utilizes its portal and E-commerce. Additionally, Apple utilizes trade partners in distributing its products. The company also distributes its products through authorized retailers such as Best Buy and Walmart.
Price Strategy
Apple sells its products at higher prices compared to the other companies (Yeung N.p). In essence, the company’s products are superior to the products produced by its business rivals, and this is why it utilizes premium pricing strategy. Apple’s user interface and hardware are designed to offer a great deal of value for the price (Nielson N.p). As a matter of fact, the premium pricing strategy helps Apple maintain its high-end image. In other words, premium pricing strategy helps Apple Inc. promote as well as maintain a positive perception among its loyal customers (Yeung N.p). In fact, Apple’s customers do not mind paying extra for the company’s products.
Promotion Strategy
The company’s marketing mix comprises promotional activities, which give emphasis to the premium quality of its different products. In particular, the company’s marketing mix consists of personal selling, advertising, public relations, and sales promotion. The company advertises through its Apple Stores and websites as well as through traditional media and social media sites. The company’s employees provide the customers with product-specific information to persuade them to purchase different products. The sales promotion take place at the company’s stores. Public relations help the Apple, Inc. optimize its corporate image. The company makes its promotions simple and to the point. In fact, the company’s advertisements talk to the point.
There are different elements/forces in the Apple’s marketing environment that it cannot control. Nonetheless, the company’s high performance is essentially attributed to its effectiveness in addressing these elements/forces. In point of fact, the success of this corporation is attributed to different strategies that it creates to protect its business operations from threats brought about by different external forces as well as its capacity to take advantage of the opportunities brought by the same forces. These external forces include competitive, social, economic, regulatory, and technological forces. They present threats and opportunities, which impact Apple Inc.’s business.
Competitive Forces
The market environment in which Apple operates is highly competitive. The leading competitors of the company include Google, Samsung, Microsoft, and Sony, among others. Interestingly, these competitors do not present intense competition to Apple since its products are unique. Specifically, Apple’s product line is simpler and more user-friendly compared to the competitor’s product lines. In essence, the company has succeeded in differentiating its products through quality. Besides, the company’s robust distribution strategy allows it strategically to position its products in this highly completive marketing environment.
Social Forces
The company’s business is essentially subject to the impacts of social factors. The ever changing tastes and preferences of the consumers have prompted Apple constantly to make changes in the quality and design of its products. As a result, the company has succeeded in meeting the needs of the consumers. Apple has primarily succeeded in keeping pace with the changing consumer buying habits, lifestyles, and educational levels. It is essential to mention that the consumers in different parts of the world have made Apple a status symbol thanks to its high-quality products.
Economic Forces
The economic stability in different industrialized countries as well as the rapid growth of developing counters in which Apple operates have had a positive impact on its business. However, the poor economic performance in some less developed countries has had an adverse impact on the company’s business.
Regulatory Forces
Just like the other companies, Apple has experienced threats to its business from the regulatory factors such as the rising telecommunications and privacy regulations. In essence, these regulations can negatively affect Apple’s business by limiting the usability of its products.
Technological Forces
Technology is the chief factor, which has an impact on the success of a corporation in the computer hardware industry (Johnson et al. 4). The technological factors such as the growing apps market and cloud computing trend have presented significant opportunities to Apple Inc. The company has, for example, taken advantage of the cloud computing trend to offer cloud-friendly apps and devices. Besides, the growth of the apps market has helped Apple grow its App Store. It is vital to mention that Apple continues to invest in R&D to exploit the opportunities brought by technology and sustain its competitive edge.
Apple’s Market Segmentation, Targeting, and Positioning
Apple Inc. segments its market into the demographic, psychographic, geographic, and behavioral segments. The segmentation variables in the company’s demographic market segment include age, occupation, income, and gender. Regarding the age variable, the company targets the consumers aged 20 years to 45 years with its iPod, iPhone, Mac and iPad devices as well as accessories such as Apple watch and Apple TV. It also targets the individuals between 20 to 35 years with the operating system and software such as iLife, iWork, and OSX. What is more, it targets the individuals aged between 18 years and 30 years with the services such as Apple Pay, Mac App Store, and iTunes Store. Regarding the occupation variable, Apple targets the executives, professionals, and managers with its iPod, iPhone, Mac, and iPad. It targets the students, managers, and professionals with the services such as Apple Pay, iTunes, and iCloud. What is more, the company targets both males and females as well as high-income consumers with its different products.
The segmentation variable that Apple further uses to segment its psychographic market segment is social class. Specifically, it targets both the middle and upper class with its various products and services. Additionally, the variables that the company uses to segment its geographic segment further include density and region. In particular, the company targets the urban dwellers as well as the consumers in the United States and international markets with all its products and services. Furthermore, Apple Inc. uses variables such as personality, degree of loyalty, and benefits sought to segment its behavioral market segment. Regarding the personality segmentation variable, the company targets determined and ambitious individuals with all its products and services. Regarding the degree of loyalty segmentation variable, the company targets both the "switchers" and hardcore loyalist with all its services and products. What is more, Apple targets those consumers who seek innovation as a benefit through all its innovative products. Ideally, this explains the reason it continues innovating its different products.
The company positions its products and services so as to appeal to the consumers from the above segments. In other words, the company utilizes a multi-segment positioning strategy. As a matter of fact, this positioning strategy provides the company with high economies of scale. It is imperative to mention that the company implements its positioning through the four elements of its marketing mix.
Apple’s Branding Strategy and Market Entry Strategies
The company’s branding strategy primarily concentrates on sensations. In particular, the consumers feel the Apple brand in their hearts. It is imperative to mention that this brand is reflected through the company’s fundamental beliefs regarding imagination, innovation, and design. Apple is an example of brand strategy, which supports the company’s products in the international market as well as its unique position (Danciu 9). The company makes use of its brand to compete across various competitive markets. The company’s brand personality is about aspirations, liberty regained, simplicity, innovation, and imagination, among others. The company promotes its brand through customer experience, advertisements, and high-quality products. The consumers have a robust brand awareness. In fact, they are well familiar with Apple’s brand. It is vital to note that Apple has a positive brand equity. In essence, this is the reason the consumers agree to pay premium prices for the company’s products. Apple Inc.’s robust brand helps it differentiate itself from its business rivals. In fact, consumers associate themselves with Apple due to its strong brand. The consumers recognize Apple as a company that provides exceptional products and premium quality. Apple’s robust brand also helps in creating and maintaining customer loyalty. As a matter of fact, customers are more likely to buy the products produced by Apple Inc. instead of those produced by its competitors due to their positive experience with its strong brand. Apple Inc.’s robust brand also helps it spend less in promotion. Consequently, the company’s strong brand significantly lowers its marketing expenditures. What is more, the robust brand helps create Apple Inc.’s goodwill as well as reputation.
Apple Inc. has succeeded in expanding into different global markets. In particular, the company utilizes different global market entry strategies. The examples of these strategies include exporting, licensing, and foreign direct investment. The company makes use of these market entry strategies due to the associated benefits. Specifically, the company markets the products it manufactures in a particular country to the others in which it does not operate. The exporting strategy helps the company minimize risks and increase its speed of entry in a particular international market. Besides, this market entry strategy decreases the possible risks of operating in some global markets. Apple has succeeded in expanding into some global markets through foreign licensing. In essence, this market entry strategy lower regulations compared to other strategies such as strategic alliance and direct investment. Besides, both the exporting and foreign licensing market entry strategies have higher returns for the company compared to the other market entry strategies. The corporation also expands into various global markets through acquiring business assets or establishing business operations there.
Strengths of Apple’s Marketing
There are some strengths that are associated with Apple Inc.’s marketing. The company is extremely successful with its marketing techniques (Johnson et al. 16). The company’s advertising as well as marketing capabilities help it raise brand awareness among the customers. Besides, these capabilities help the company generate a robust demand for its various products and services. The company owns retail stores and, as a consequence, it can have direct conversations with its potential and current customers (Johnson et al. 16). The other strength of the company’s marketing is that it does not confuse the consumers with excessive information. In particular, the company keeps it marketing simple and to the point. As a result, this helps in eradicating consumer confusion. The company’s marketing is also efficient. Notably, Apple’s utilizes a marketing system that fully concentrates on only the most relevant opportunities and incorporates empathy for the needs of the clients. Ideally, this makes the company’s marketing a strength. Moreover, the company’s distribution channels in the industrialized countries such as the United States are mature. Consequently, this facilitates the distribution of the company’s products to the final consumers.
Weaknesses of Apple’s Marketing
Nonetheless, Apple Inc.’s marketing has some weaknesses. One of these weaknesses is limited distribution network. Apple’s exclusivity policy makes its have a limited distribution network. In fact, the company’s selection of authorized retailers of its products brings about the problem of limited distribution network. The other weakness is that its sales are mainly limited to the high-end market. As a result, this has an adverse impact on the company’s revenues and profitability.
Opportunities for Apple Inc.
There are some significant opportunities, which Apple Inc. can exploit. One of these opportunities is expanding its distribution network. The corporation has the opportunity to broaden its distribution channels. Ideally, this offers an excellent opportunity for Apple to increase its brand awareness further as well as customer base and eventually raise its revenue and profit. The company also has the opportunity to further expand its tablet and personal computer market share. What is more, the company has the opportunity to increase its sales of different products as an increasing number of individuals continue buying into Apple ecosystem.
Threats Facing Apple Inc.
Nevertheless, Apple Inc. faces some threats. First of all, the cheaper products from competitors will continue to increase pricing pressure on Apple’s products. Besides, Apple’s competitiveness in the global market might start dwindling in the event that it slows down in its technology improvements. Additionally, the company faces the threat of product substitution from its business rivals.
Improvements/Recommendations
The company ought to expand its distribution network through doing away with its exclusivity policy. It should distribute its different products to various retailers to further improve on its revenue and profitability. The company should also consider producing products for the low-end markets. In other words, the company should start targeting the middle-income consumers by manufacturing products that are not expensive. As a result, this will help it increase its market share and eventually facilitate its growth.
Works Cited
Danciu, Victor. "The brand identity: a strategic shift for success." Romanian Economic Journal 13.36 (2010): 3-13.
Johnson, Katherine; Li, Yang; Phan, Hang; Jason, Singer; and Trinh, Hoang. "The Innovative Success that is Apple, Inc." (2012). Theses, Dissertations and Capstones. Paper 418.
Kerin, Roger A, Steven W. Hartley, and William Rudelius. Marketing. McGraw-Hill Education, 2015.
Nielson, Samantha. "Apple’s premium pricing strategy and product differentiation." Market Realist 6 (2014).
Yeung, Natalie. "The marketing strategy of Apple: A concise analysis." Version Daily. N.p., 26 Jan. 2016. Web. <http://www.versiondaily.com/the-marketing-strategy-of-apple-a-concise-analysis/>.
