Marketing strategies of Apple Inc Essay

A study on the marketing strategies of Apple Inc (Dissertation)Document 1. †A study on marketing strategy of Apple† December 2012 I †Critical Analysis of using marketing strategies of branding Apple Inc† Maha H 2. †A study on marketing strategy of Apple† December 2012 II Declaration I hereby declare that this dissertation is my own original work and is the result of my own investigations. This dissertation research was conducted to fulfill the requirements of BA (Hons) in Business Administration (Marketing) associated with University of Wales. XYZ December, 2012 3. †A study on marketing strategy of Apple† December 2012 III Acknowledgement I would like to thank a bunch of people who helped me in completion of my dissertation like: My facilitator for guidance and support throughout the dissertation. All respondents and friends for filling in the questionnaires. My family for constant support and motivation. 4. †A study on marketing strategy of Apple† December 2012 IV Abstract , computernicsconsumer electroApple Incorporation is a multinational company that creates and sells The.billionabout US$16363 stores worldwide, with global sales of, insoftware, and personal computers are mainlyiPadand theiPhone,iPodline of computers,Macintoshlikeknown products-company’s well e due to high brand awareness related to these products. Applerecognized as a source of competitive edg ,Final Cut Studio,Aperture,iWork,iLife,iTunes,Mac OS Xalso sells other branded products like, .iOSbrowser andSafari,Logic Studio The main objective of this study is to analyze the importance of using marketing strategies of branding in Apple Inc. The study will help to find out about the related benefits of branding mainly. The details of the study will help us to learn about the consumer’s awareness about the brand and how their loyalty can be increased in order to gain a competitive edge. Also, analyzing the importance of branding can help us to find out about the Apple brand’s strengths, weaknesses, opportunities and threats, by using SWOT analysis tool and by using STP process, we can know how to segment the market, target the customers and position the products/services. Whereas, by using 4 Ps of marketing mix, we can find out about the branded product, its price, promotion and placement. Therefore, since the competition in the technology industry is increasing, ‘A study on using marketing strategy of branding in Apple’ will help the company in staying at the top of consumer’s mind, to cope up with the changes, to gain competitive edge, to attain goals  set by the company, to make improvements for the future related to products, its pricing strategy, communications used to promote and the placement of the product. Therefore, it will help us to evaluate whether branding will affect Apple Inc’s success rate or not. 5. †A study on marketing strategy of Apple† December 2012   Introduction 1.1 Technology Industry Wiki invest (2012) Technology states, the technology industry provides foundation for activities such as, chip production, information and communication systems, and computer systems. The companies belon ging to this industry serves as developers and manufacturers of the products which increase efficiency and production of cell phones, computers, televisions, and other communication and information systems. It is a huge industry with a high growth potential, but it is sometimes go through volatile cycles, like the semiconductor industry. As chips are getting smaller and globalization is increasing, demand for faster and efficient technology, demand for technological industry in increasing. 1.2 Introduction to Apple Incorporation Apple Incorporation is a multinational company that createst,tha,statesApple store(2012)Wikipedia 363 stores, computer software, and personal computers, selling inconsumer electronicsand sells oncompany was first foundedThe.billion in merchandiseabout US$16ide, with global sales ofworldw and thenRonald Wayne, andSteve Wozniak,Steve Jobsby, CaliforniaCupertinoApril 1, 1976 in he company was named as Apple Computer, Inc before for the first 30Ted on January 3, 1977.incorporat The company’syears. The word â€Å"Computer† was then removed from its name on January 9, 2007. Now the company’s.consumer electronicson personal computers shifted towardswastraditional focus , along with theiriPadand theiPhone,iPodline of computers,Macintoshknown products are the-best suite ofiLifemed ia browser,iTunes,)operating system(Mac OS Xother line of products including, (professionalAperture(suite of productivity software),iWorkmultimedia/creativity software, , aLogic Studioindustry),-(suite of professional audio and filmFinal Cut Studiophotography package), (mobile operating system).iOSweb browser andSafarisuite of music production tools; 1.2.1 Mission statement of Apple Inc According to Apple Inc (2012), †Apple designs Macs, the best personal computers in the world, along with OS X, iLife, iWork, and professional software. Apple leads the digital music revolution with its iPods and iTunes online store. Apple reinvented the mobile phone with its revolutionary iPhone and App Store, and has recently introduced its magical iPad which is  defining the future of mobile media and computing devices.† Another mission statement is:†Apple is committed to bringing the best personal computing experience to students, educators, creative professionals and consumers around the world through its innovative hardware, software and internet offerings.† 8. To find out about the branded product and its related price, promotion and placement and to find out the strengths, weaknesses, opportunities and threats the company may be facing.ï‚ · To find out about the benefits of branding for the company and to find o ut how branding helps to gain a competitive edge by differentiating themselves and how it increases customer loyalty and increases brand awareness. To analyze the importance of using a marketing strategies of branding for Apple Inc and to find out how STP strategies helps Apple’s brand. Toinnovateonaregularbasis. 1.2.4 Major competitors of Apple Inc Samsung, Microsoft, Dell, HP, Blackberry, Nokia 1.3 Motivations of research: As the competition in the technology industry has increased, it has become mandatory to make a study on the importance of using a marketing strategies of branding for Apple, to stay at the top of consumer’s mind, to cope up with the changing environment, to gain competitive edge, to make improvements in future and to attain goals set by the company. 1.4 Research Objectives: Toopenmorestoresevenoninternationallocationsto increase sales and dominate world market. ï‚ · Tokeepcreatingandreleasingcomputersandconsumerelectronics those are user-friendly. ï‚ · To obtain products and services within tight timeframe, at a cost providing the best value to the customers and shareholders. ï‚ ·Ã¢â‚¬ A study on marketing strategy of Apple† December 2012 2 1.2.2 Vision Statement of Apple Inc â€Å"We believe that we are on the face of the earth to make great productsAccording to Apple Inc (2012), and that’s not changing. We are constantly focusing on innovating. We believe in the simple not the t we need to own and control the primary technologies behind the products thatcomplex. We believe tha we make, and participate only in markets where we can make a significant contribution. We believe in hat are truly important andsaying no to thousands of projects, so that we can really focus on the few t pollination of our groups , which allow us to-meaningful to us. We believe in deep collaboration and cross innovate in a way that others cannot. And frankly, we don’t settle for anything less than excellence in honesty to admit when we’re wrong and the courage to-company,  and we have the selfevery group in the change. And I think regardless of who is in what job those values are so embedded in this company that Apple will do extremely well.† 1.2.3 Objectives of Apple Inc As stated on the website Apple Inc (2012) are: 9. †A study on marketing strategy of Apple† December Does branding really contribute in making a difference in Apple Inc’s success? 1.6 Organization of Study: Chapter 1: Introduction Chapter 2: Literature Review Chapter 3: Methodology Chapter 4: Research findings, data presentation and data analysis Chapter 5: Conclusion and Recommendationsï‚ · How will using STP strategies, 4 Ps of marketing mix and SWOT Analysis help to enhance Apple’s brand? ï‚ · Does branding allow Apple Inc to charge premium for its products and yet maintain customer loyalty? ï‚ · Does branding allow Apple’s customer to easily recognize and recall the company and its products? ï‚ · Does branding helps Apple to differentiate its products from its competitors, by gaining competitive edge? ï‚ · Does branding allow Apple Inc to communicate company’s objectives, mission and vision clearl y to their customers? 2012 3 1.5 Research question: 1.5.1 Leading question: What benefits will Apple and its customers benefit from after using branding marketing strategy? 1.5.2 Subsidiary questions: 10. Brand recognition- is when the consumers have good knowledge of brand when they are asked questions related to a specific brand and they are able to differentiate a brand on the basis of having noticed or heard about earlier. E.g. Is I-phone related to Apple or Samsung?ï‚ ·Ã¢â‚¬ A study on marketing strategy of Apple† December 2012 4 CHAPTER 2: Literature Review 2.1 Introduction This section will provide the details about the qualitative data, providing a foundation for all the details to follow. 2.2 What is branding? According to Kotler (1999), branding is a †name, term, sign, symbol or design, or a combination of all these that identifies the goods and services of one seller or group of sellers and to differentiate them from those of competitors.† Branding does not only allow your targ et market to choose your company over the competitor’s, but it helps in getting your prospects to see you as the only company that provides a solution to the consumer’s problems. It provides a company’s with a recognizable and trustworthy badge of originality, an intangible guarantee, i.e. a promise of performance that the product will meet with desired consumers’ expectations. 2.2.1 Apple’s Branding Strategy According to Marketing minds (2012), Apple Inc. uses the Apple brand to  compete across several highly competitive markets, including the personal computer industry with its Macintosh line of computers/laptops and related software, the consumer electronics industry with products such as the iPod, digital music distribution through iTunes Music Store, the smart phone market with the Apple iPhone, magazine, book, games and applications publishing via the AppsStore for iPhone and the iPad tablet computing device, and movie and TV content distribution with Apple TV. The company is also establishing a very strong marketing presence relative to the rival (Google) in the advertising market, via its business Apps and iAd network. Steve Job s, the co-Founder of Apple, described the company as being a â€Å"mobile devices company†, largest in the world as their revenues are bigger than Nokia, Samsung, or Sony’s mobile devices business. 2 .2.2 Brand Awareness It is when the consumers are familiar about the life or availability of the product. It is the degree to which consumers associate your brand with a specific product/service. As indicated by Management study guide (2012) in their article † What is brand awareness?†, Brand awareness may include of: 11. It strengthens user loyalty Apple has a branding strategy that focuses on the emotions. Apple brand’s personality is about lifestyle, imagination, liberty regained, innovation, passion, hopes, dreams and aspirations, and power-to-the-people through technology. The Apple brand personality is also about simplicity, making life easier for people as they have people-driven product design, and is a humanistic company with a heartfelt connection with its customers. 2.2.4 Apple’s Brand equity According to Investopedia, it is the premium value that the company realizes from a product with a recognizable name as compared to its generic equivalent fi rm. Companies can create brand equity for their products by making them memorable, easily recognizable and superior in quality and reliability. Also, mass marketing campaigns may help to create brand equity. Brand equity is said to be positive if the consumers are willing to pay more for a branded product than for a generic one. Brand awareness plays a key role in building brand equity. Create reliable brand image, slogans and taglines, helps to strengthen brand awareness which therefore improves brand equity. Marketing minds (2012) also states, Since Apple has strong brand awareness, it has high sales and high market share, and the consumers are well acquainted and familiar with the brand and its products. They are also  willing to pay premium price for their products, relative to the competitor’s brand due to Apple’s positive brand equity. Apple is not just intimate with their consumers but there is a real sense of community among users of its main product lines. Therefore, this also helps to create consumer’s brand loyalty (where brand loyalty is when the consumers become committed to your brand, ch oosing it over competitors and making repeat purchases over time.)ï‚ · It motivates the buyer ï‚ · It connects your target prospects emotionally ï‚ · It confirms your company’s credibility ï‚ · Helps to deliver the message clearly ï‚ · Brand recall- It allows a customer to recover a brand from his memory when given the product class/category, needs satisfied by that category or buying scenario as a signal, i.e. if they are able to recall the brand from their memory. E.g. Showing a logo of Apple’s brand, and asking which brand does this logo belongs to. 2.2.3 Apple’s brand personality As stated by About.com (2012), †What is branding and how important is it to your marketing strategy?†, a good brand helps a company to achieve these objectives: ï‚ ·Ã¢â‚¬ A study on marketing strategy of Apple† December 2012 5 12. †A study on marketing strategy of Apple† December 2012 6 2.3 Benefits of branding a company (Apple) 2.3.1 Emotional Appeal – As stated by Clarity marketing LTD (2005), emotional appeal helps a great deal in targeting customer’s emotions with product names. A strong, recognizable brand will acts like a ‘short cut’ in decision making process, as the customers don’t dither over alternatives or compare options where there is no clear point of difference, and instantly chooses your brand as they know what it stands for. For instance, as Apple manufactures technological items, the name of each product clearly reflects technological aspects like iPod touch, which indicates that it is a product that allows you to play and choose music through touch properties. It therefore, helps in creating an integrated appeal to specific emotions promoting the product recognition and sales. 2.3.2 Memorability and Familiarity – According to Marcia Yudkin (2012), brand helps to create a reputation and good will for a company. It is very hard for customers to refer to a company as â€Å"that whatsitsname store† or to refer business as â€Å"the shop from the Yellow Pages.† In addition to the company name, it gives people to give constant reminders reinforcing the identity of companies they will want to buy from. Memorability can come from the logo, its design, color, style etc which  helps to nail your company’s name in the minds of the public. Similarly, after your brand is nailed in the minds of your customers, that’s when your customers have become familiar and aware of your company’s existence in the market. Branding allows having huge effects on non-customers too. Psychologists’ studies have proved that familiarity develops liking for it. Also, the customers who have never bought from your company, may many tomes be willing to recommend your company to others even without having any personal knowledge of your products or services. Therefore, the half bitten Apple logo and the brand name ‘Apple’ help a great deal to help customers remember, be familiar and recommend the brand to others. 2.3.3 Premium image and Premium price – Branding allows a company to differentiate themselves from competitors existing in the market, because of which instead of dealing with price-shoppers the customers become eager to pay a higher price for your company’s goods and services. A strong brand let the customers associate themselves as being a company that offers premium quality, trendy products and is offering unique products that other companies are not offering. 2.3.4 Extensions – When your company’s brand is well-established, you can spread the respect you’ve earned to a related new product, service or location and win acceptance easily of the newcomer. For instance, when Apple introduced a new product extension line of Ipad, the customers trusted the brand so they didn’t feel reluctant and bought Ipads anyway, making these tablets quite popular of its kind in the market. 2.3.5 Loyalty – When customers have a positive experience with your company’s brand, they are more likely to buy your products and services again in future rather than the competitors. Customers that are closely bonded with your brand’s identity may not only repurchase what they bought earlier, but may also buy related items of the same brand, and recommend your brand to others and resist the lure of a competitor’s price cut. The brand identity helps to create and anchor such loyalty.